After-sales in manufacturing has witnessed an accelerated transformation post the pandemic. The necessity of ensuring services and rectifying breakdowns has made the hitherto slow-moving manufacturing sector embrace technology to develop resilience and agility in dealing with future crises.
After conducting a study across 50 capital equipment manufacturers, we have seen that ‘After-Sales Service’ is impacted by factors such as technology adoption, changing customer orientation and machine life ownership.
The new look of the customer service journey
Both technological adoption and customer involvement play crucial roles throughout various touch points in the ‘Service Journey.’
A typical service journey consists of the following phases:
- Pre-Installation: The first stage includes closing the ordering process and preparing for installation and commissioning.
- Installation and Commissioning: After pre-installation, the next step is dealing with activities pertaining to the actual installation and commissioning of the machine. This stage includes checks, dry runs, training and subsequent handover to customer operatives.
- Service Management (Scheduled): The third stage deals with the warranty period and scheduling the preventive maintenance activities. Typical activities include the first/scheduled service calls, return and replacement (If applicable) and training.
- Service Management (Breakdown): This is a critical ‘After Sale’ Interaction where the customer interacts with the OEM to re-set machines following a breakdown. As a key driver influencing customer experience and brand perception, this phase consists of the following:
- Issue Logging Process
- Breakdown Service Process
- Part Replacement Process (outside AMC)
With digitization being adopted in the service model, OEMs have become integral to the customer’s journey throughout the complete lifecycle.
Mentioned below are the seeds of transformation we have observed in the service journey.
Enabling Consistency in Customer Experience with Futuristic Trends
After closely monitoring 50+ capital equipment manufacturers service their customers during the pandemic and beyond, we have identified seven trends that are going to be crucial for growth in the After Sales ecosystem:
- Trend 1- A strong need has emerged for skilled workers who can work with state-of-the-art technologies. Service orientation of the workforce will be crucial for attaining a seamless understanding of the new technological adoptions.
- Trend 2- Remote services of ‘installation’ and ‘breakdown resolution’ along with accelerated technology adoption for real-time access to machine data.
- Trend 3- Increased virtual support from manufacturers to provide value that goes beyond maintenance and repair.
- Trend 4- Increased focus on leveraging technologies providing real-time data for preventive maintenance and alerting customers before an event occurs.
- Trend 5- The emergence of AMC + Bundled Services, which includes Advisory, Machine Reconditioning and Re-installation for a greater engagement with the client.
- Trend 6- Evolving business framework with the introduction of machine-uptime-based fee model.
- Trend 7- Increased collaboration with the customers to ensure optimal maintenance of machinery.
Servitization: Re-defining the way OEMs work with their customers
Servitization models based on product up times/running times are being increasingly adopted by manufacturing organizations looking beyond the one-off sale (and servicing when required) model. With IoT and connected machines, manufacturers can keep a real-time tab on machine health and keep a close ear for timely alerts on imminent breakdowns.
With a ‘customer-driven model’ approach, servitization transforms companies from product-centric to ‘service-centric’. As a result, it helps improve customer engagement and retention, providing businesses with incremental but continuous revenue inflows. Close and routine collaboration with customers also helps manufacturers get a clearer picture of product improvement for focused R&D efforts.
The risk that Indian manufacturers face is the changing organizational culture from a product to service-centric culture. The mindset and organizational design required are different when creating a product for sale compared to routine customer service.
Servitization improves customer engagement and retention, but the jury is still out on improving the bottom line. Therefore, organizations need to make informed calls based on customer, product, and market types on whether to follow servitization or a product-centric route.
Conclusion: Re-imagining the Future with New After-Sales Models
Organizations will have to realign their organizations when catering to evolving customer expectations and the servicing possibilities due to digital adoption. While surpassing customer needs and maintaining profit margins are fulcrum to business strategies, they are not enough. Surviving in the new-age marketplace means playing by the rules that technology-driven servicing has drawn, including the adoption of servitization wherever feasible.
