As John Trautwein described in our previous blog post, end-users are increasingly demanding that their OEMs be more responsive to their service needs. SLA compliance isn’t at the level that end-users need it to be to keep mission-critical applications and operations online, especially since the pandemic struck. Meanwhile, ticket backlogs are increasing and quality and customer satisfaction ratings are suffering. The OEMs who solve this puzzle, and deliver the best and most agile service, are building a significant competitive advantage.
We’re seeing OEMs working to adapt and improve their responsiveness in two major ways. First, as we mentioned in that previous post, they are working to provide better SLA compliance. One increasingly popular solution is to use outsourced teams to augment their existing field networks; this helped to improve response times, service quality and overall customer satisfaction metrics.
The second strategy OEMs are using to improve responsiveness is to analyze and improve their workforce utilization. According to the Technology & Services Industry Association’s (TSIA) recent analysis on workforce productivity, built from data provided by organizations across the industry before the COVID pandemic hit, the average field service engineer works an average of 1,759 productive hours in one year. This breaks down as follows:
- 462 hours, or about 26%, are categorized as “utilization loss,” or time that FEs spend on things that aren’t directly related to their service work. This means that the average FE’s utilization rate (time they are available for direct, productive hours) is about 74% for the year.
- If we look at overall productivity for the average FE, which is the percentage of time in a given year that an FE applies in direct service to the customer, that percentage is further reduced.
- 166 hours, or about 9%, are spent on tasks related to sales, customer training, adoption and customer success
- Another 341 hours, or about 19%, are spent traveling to and from end user sites.
- In total, we see that in any given year only 790 hours, or about 45% of their total productive hours, are spent on actual repair work.
When you consider that the average FE spends less than half their time on service work, it’s easy to understand how ticket backlogs are increasing in the field and end users can often feel neglected or dissatisfied. Again, these numbers are pre-pandemic figures; with travel restrictions and other challenges that we’ve seen come along, actual utilization rates today could be even lower. There’s obviously a lot of room for improvement in terms of utilization and efficiency.
To date, service leaders have pursued two primary remedies:
- Increase staffing. Of course, this helps them stay current on service tickets and maintain key relationships with end-users. At the end of the day, though, managers aren’t making their organizational process any more efficient by adding more people. It’s also really expensive to onboard, train, pay, retain, etc. a larger team. Many organizations simply don’t have the resources to sustain this.
- Making current staff more efficient. Some managers have attempted to reorganize their service functions and the jobs of their FEs to cut back on extraneous activities and focus FEs more on service delivery. It’s a good idea in theory, but in practice they find there’s only so much reconfiguring they can do; without a certain amount of training, travel time, correspondence with colleagues, etc., an FE simply can’t do a quality job for end users or their organization.
Neither approach, then, presents a positive solution to response time and customer satisfaction challenges. That’s why a third strategy – hiring and integrating an outsourced service team – has emerged as a better option. Here’s why:
- Outsourced teams leverage local field service engineers, meaning they have the geographic coverage to respond quickly to end users, lower SLA response times and minimize travel.
- Outsourced FEs can fit into your organization however you feel is best to maximize the time and talents of your existing team. For example, Source’s FEs are often used for everyday preventative maintenance and break-fix and maintenance, freeing up an OEM’s staff for higher-value tasks and initiatives.
- Depending on the outsourcing partner, it could save you big money. We’ve estimated at Source that our field service network produces twice the utilization rate of a typical OEM FE; you pay for actual service time, not travel, administration and other operating expenses related to reorganizing or adding headcount to your organization. It’s a model and cost structure that produces big savings for our customers.
Put simply, OEMs are trying to maximize the amount of time field engineers spend on actual service work. To do this, they need to have the right number of employees on staff, dispatch them efficiently and enable them to complete their task(s) quickly. It’s incredibly difficult to find a proper balance, so outsourced service models are being used more as they prove effective and cost-efficient. They also are now commonly essential partners to OEMs and service teams that are earning a competitive advantage in the marketplace.
For more on how our outsourced service model can improve your utilization rates, visit sourcesupport.com/services/24-7-support-services.