THE ROLE OF MOBILE WORKFORCE MANAGEMENT TECHNOLOGY

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1 WRITTEN BY: JOHN CARROLL, CHIEF EXECUTIVE OFFICER

2 Page 2 of 14 In Part II of the four-part Smarter Services Technology Evaluation Series: The Road to Mobile Workforce Management Transformation, The Service Council looks at The Role Of Mobile Workforce Management Technology In Today s Field Service Organization. It outlines the process service organizations should consider when implementing a Mobile Workforce Management Solution, including the identification of problems, the consideration of competing solutions, the creation of a solution roadmap, the selection of a technology partner, and finally getting senior management to buy-in. Meeting the Business Objectives of the Organization According to IDC, 25 percent of IT projects fail outright. Meanwhile, 20 to 25 percent don t provide ROI and up to 50 percent require material rework. That s roughly 50% of IT projects that fail or don t provide ROI and greater than 95% of IT projects that are not successful. Mobile Workforce Management solutions enable companies to deliver superior field service and customer satisfaction (see Part I, Setting The Stage For Best Practices Service Performance). However, a successful Mobile Workforce Management transformation is dependent upon many factors beyond simply deploying new technology. It requires a full understanding of the overall business objectives, a keen understanding of historical processes, a standard system of key performance metrics along with the organization s current performance in those metrics, and effective communication to ensure organizational readiness and project execution. For any IT project, to be successful in meeting the business objectives of the organization, three things must be accomplished: First, fully understand the specific objectives, whether, for example, they are driving service revenues, improving service profit margins, or increasing customer satisfaction and loyalty. Second, realize what problems exist that prevent the organization from meeting those objectives, what is causing those problems, and gather information on how they can be solved. Third, when it comes to solving the problems and implementing solutions intended to meet the business objectives, there must be buy-in not only among management, but throughout the organization. Knowing what the business objectives of the organization are, is most often a conclusion that can be made relatively easily. The more difficult part is to understand what stands in the way of meeting those objectives, and for that reason the following step-by-step guide to leading a successful Mobile Workforce Management transformation is offered.

3 Page 3 of 14 Leading a Successful Mobile Workforce Management Transformation 1. Identify the Problems that Need to be Addressed Make a list of the problems you believe exist. Then, starting from within the service organization, talk with supervisors and management and elicit their input. Gather information from the technicians and other employees who report to those supervisors, and listen to what they tell you. So many problems that exist are rooted in processes at the transactional level, and oftentimes those inefficiencies go undetected by an upwardfacing management. Leading organizations keep the lines of communication open between management and labor, as this facilitates the ongoing detection of obstacles and barriers to superior performance, and allows for quicker resolutions. Recent research conducted by The Service Council brings to light some of the most common challenges that service organizations deal with today. Nearly half of the respondents (49%) cite a need to improve workforce productivity and utilization in order to optimize their field service performance. Almost as many (42%) report a desire to increase service process efficiency as a means to improve their operations. Together, these drivers indicate that service organizations continue to seek ways to drive down costs as they relate to time rather than as they relate to parts or equipment. Similarly, 39% cite customer demands for quicker response times and 35% are driven by customer demands for improved asset availability. Again, these service organizations are looking for ways to do their work more expediently, but surely without sacrificing quality or customer satisfaction. They know that decreasing Mean-time-to-Repair and increasing parts availability, for example, will simultaneously serve both to improve customer satisfaction and reduce operating costs. The search for problems with the service organization extends outside of its boundaries, however. Some of the problems within the service organization are only visible from outside of it, and some inefficiencies created by the service organization manifest themselves only externally. It can be difficult to know even where to start looking for such underlying problems, so offered here is an idea of some of the top challenges reported by service organizations through recent research conducted by The Service Council (Figure I).

4 Page 4 of 14 Figure I: Services Organizations' Top Challenges Lack of coordinated services cross- selling / upselling Lack of adequate sales resources Limited services marketing resources Lack of pervasive service culture in the organization Lack of collaboration between service and product Lack of understanding of the organization's services Lack of internal accountability / oversight Inadequate warranty / contract management tools Long billing cycle times 8% 10% 13% 22% 31% 30% 28% 28% 27% 0% 10% 20% 30% 40% Source: The Service Council, Q You should notice that most of these challenges are derived from deficient interdepartmental communication. So work with other departments, namely Sales, Marketing, IT, Human Resources, and Finance. If the lines of communication with other departments are closed, then open them, and keep them open. Just the process of asking people what they think about how the service organization is running and what improvements they would like to see goes a long way in building good will. Embarking upon such team-building with other affected departments will facilitate inter-department buy-in to solutions that you may implement down the road, and will ensure that you can approach senior management with solutions as an orchestrated front rather than going it alone. Using your list of inefficiencies, problems, and areas of improvement, identify and prioritize your goals as they relate to the organization s business objectives. This will be especially useful later when you approach senior management, as you will be able to relate the service organization s issues in terms of the whole organization s issues. However, a consistent challenge facing service organizations is obtaining an accurate measurement of performance; data they are using to identify efficiencies, problems and areas of improvement. This data is often the crux of the argument which justifies the Mobile Workforce Management Transformation and also the data used to determine the success of the project. It is also the data which becomes more easily accessible and accurate as a result of the deployment of a Mobile Workforce Management solution.

5 Page 5 of Identify Possible Solutions Nobody likes the word brainstorm anymore, but the meaning behind it could not be any more relevant to the approach that should be taken when it comes to solving complicated problems. Working with the relevant stakeholders, come up with possible solutions. Think outside the box, put everything on the table, and leave nothing out. Sometimes what at first seems to be the most laughable answer later turns out to be the only answer. A potential answer could be found in the approach service organizations are taking with respect to planning and forecasting, training, automation, and increasing customer involvement, which are all elements of service that, if used effectively, can provide service organizations with everything needed to get the job done, all while reducing internal costs, generating higher levels of service revenue and profits, and keeping customers both satisfied and loyal. Recent research confirms both the importance and application of these key elements by identifying the following strategic actions being undertaken by a majority of service organizations with respect to improving their service performance (Table I): Table I: Planned Strategic Actions of Field Service Organizations Functionality Present Percentage of Respondents Investing in mobile tools to provide field technicians with real- time access to required data and information in the field 72% Integrating new technologies into existing field service operations 67% Improving planning- and forecasting- related activities with respect to field service activity 62% Providing additional training to field service technicians and/or dispatchers 61% Automating existing manual field service processes or activities 56% Increasing customer involvement in the field service process via web- enabled self- help 52% These planned strategic actions are proof positive that the path to increased customer satisfaction, reduced costs, and a healthier bottom line is found by empowering those in the field while minimizing the time they need to be there. It is in management s best interests to invest in tools that allow their field technicians to be self-reliant and to bring customer issues to resolution quickly. In that spirit, leading service organizations intend on supporting their field technicians with a variety of online capabilities, including providing access to real-time parts and inventory availability (43%), ability to track and update the current status of work orders (40%), access to customer/asset service history (40%), access to resolution scenarios (35%), and access to product schematics and documentation (34%).

6 Page 6 of 14 So that it may be addressed separately here, one planned strategic action, in particular, is excluded from the list above: the development or improvement of the metrics that management uses to measure field service performance, cited by 82% of respondents. A properly implemented service performance measurement system can provide the data necessary to identify strengths and challenges in delivering exceptional service and enables service organizations the ability to make adjustments to perform at acceptable levels, resulting in improved customer satisfaction and a healthier service profit margin. Survey findings reveal that there are six primary service performance metrics, or KPIs, presently being used by a majority of surveyed service organizations: Customer Satisfaction (70%) Service Revenue (66%) Service Profitability (59%) Field Technician Utilization (57%) On-site Response Time Performance (52%) Total Service Cost (50%) However, there are an additional five KPIs that between one-third and one-half of the leading service organizations also use that help to distinguish them from all others. These include: Mean-Time-to-Repair (MTTR) (49%) Service Level Agreement (SLA) Compliance (48%) First Time Fix Rate (45%) Field Technician Productivity (i.e., average number of calls per day) (41%) Customer Retention (36%) While all service organizations report some reliance on a number of specific KPIs, it can be concluded that the leading organizations may use up to twice as many to monitor their performance on an ongoing basis. Therefore, a significant portion of the discussion on solutions within the service organization should be about management s capabilities as they relate to visibility and the detection of problems. It should also be pointed out at this time that just over one-quarter (26%) of the service organizations recently surveyed by The Service Council believe that increased software automation would be extremely valuable to their operations. These are also typically the same organizations that are attaining the highest levels of workforce productivity, customer satisfaction, and financial returns on their respective services operations thus placing them at the forefront of continued innovation in service delivery.

7 Page 7 of 14 Leading a successful Mobile Workforce Management transformation goes further than just identifying current problems and finding ways to fix them. It hinges upon envisioning ways to improve that go beyond what has been done before. The separation between good management and a great management is the ability to define a higher frontier of what s possible and then to achieve it. Recent research conducted by The Service Council indicates that, besides implementing those services-oriented strategies as discussed above, service organizations are using marketing- and sales-related strategies in an effort to reach organizational goals (Figure II). Figure II: Services Organizations' Current Strategies Proactively market the organization's services capabilities 48% Promote higher levels of services cross- selling / upselling Increase the customers under long- terms SLAs / contracts Develop services marketing tools Improve the services pricing structure Provide training for the services sales force Create / cultivate business partnerships Improve the SLA / contract attach rate at time of purchase Evaluate / prioritize incentives based on performance 29% 27% 26% 22% 22% 21% 21% 17% 0% 10% 20% 30% 40% 50% 60% Source: The Service Council, Q It is evident that today s service organizations, in order to ensure success, are working across departments to find new ways to generate increased revenue. Drawing on sales skills, field technicians are trained to drive service revenue through cross-selling and upselling. Marketing is developing new tools and pricing structures, meanwhile capitalizing on the service organization s success by promoting it as a point of differentiation from competitors. Once a service organization finds no more room for improvement in its quality of service, what else can it do? Tell everyone about it! Service is not an island within the organization; it is becoming the center of the organization. At this point you have a list of problems and areas to improve upon, and each item on that list should have at least one possible solution. Classify each of these solutions as one or more of the following: Organizational changes

8 Page 8 of 14 Process adjustments Technology implementation When it becomes impossible to grow the list of possible solutions, only then should you and the other stakeholders begin the discussion of them and the process of discarding those that are not viable. Compare and contrast solutions as they related to your stated goals. Remember that solutions you come up with will likely require justification that can be communicated effectively to senior management. For now, competing solutions should stay on the table, so long as they are viable. 3. Explore Technology to Support Business Objective Yes, this is already the time when the conversations with solution providers should begin. This is not the time at which you should decide on a particular vendor, but it can only be beneficial at this point to find out what problems can be solved through technology. Some of the solutions you have listed as process adjustments or perhaps even organizational changes are just possible solutions to problems that may be more affordably solved through technology. Vendors are in the best position to inform you about the extent of the capabilities they offer. And they have experience in helping organizations that have solved problems similar to or exactly like the ones you are currently facing. Buy versus Build. At this time, it is also important to give consideration to the issue of buy versus build. However, in most cases, buying a technology solution will typically be better than building one in-house. The principal reasons are as follows (Table I):

9 Page 9 of 14 Table II: "Buy versus Build" Why buying a technology solution is better than building one It is generally far less expensive to buy than to build. Leading vendors have already made their mistakes and have since fixed them. Buying a solution is less invasive and disruptive to existing service operations, the burn- in is quicker, and the training is better. In buying, there s no need to staff up with W- 2 employees, contractors, and consultants. The vendors already have their design, technical, consulting, and training people in place. The systems are more scalable and easier to upgrade, expand, or replace. (Think mergers and acquisitions.) Solutions generally may be used out- of- the- box even with some minor customization. Cloud technology is the great equalizer that allows a solutions vendor to provide you with the latest technology essentially on their dime. The decision to buy allows you to benefit from the economies of scale that the vendors have already realized. When something breaks, you don t have to fix it. If you make it, then you own it and have to maintain it. On the other hand, if you buy it, you just use it while they maintain it for you. Outgrowing your current system is never a problem. There s always a newer version or upgrade available. Source: The Service Council, Q Best of Breed versus ERP Solutions. It should also be kept in mind that the research clearly shows users to be typically more satisfied with the performance of Mobile Workforce Management Solutions provided by a best of breed solution vendor rather than a bundled offering provided by an Enterprise Resource Planning (ERP) vendor. That does not mean that an ERP solution will not or can not support Mobile Workforce Management, but rather that a services-specific, best of breed solution can generally be more effective. In any case, and regardless of which type of vendor or technology you eventually choose, it is extremely important to make sure that you evaluate all technologies, solutions, and vendors with the same high level of due diligence; that is, evaluating and comparing all potential vendors using the same set of criteria, and holding them to the same standards. Ultimately, however, it will all come down to an evaluation of functionality, acquisition cost, ease of implementation, ongoing maintenance and support, scalability and all of the other individual components that contribute to the Total Cost of Ownership (TCO) or Return on Investment (ROI) equations.

10 Page 10 of Outline a Plan of Solutions Construct an outline containing your list of solutions as a chronological and integrated plan of attack: Organizational changes come first. The introduction or elimination of roles can have profound ripple effects within the department as well as externally. If you were to adjust processes before making organizational changes, such changes may be rendered irrelevant or even wasteful. Process adjustments are next. If the organizational structure is in order, it s time to make the identified process adjustments. Ensure that new processes are being followed, closely monitor and measure results, and readjust as necessary. The management of processes is a process in itself, and as such, management should also readjust as necessary. Technology implementation follows. It is well-known that an organization should not fit itself to its technology solutions, but rather the technology solutions should fit the organization. However, that being the case, if the organization is not in order or if it is deficient in some way, a technology solution might not help, but instead may actually make things worse by reinforcing bad practices. Furthermore, if a technology solution were implemented first, and only then were organizational or process changes made, the technology solution may again need to be modified. Some of your solutions may be classifiable both as organizational changes and process adjustments, or both as process adjustments and technology implementation. In such a case, it may be impossible to make an organizational change without simultaneously making a process change or to make a process change without simultaneously implementing technology. Management should be cognizant that such solutions tend to have a larger impact on the organization, and monitoring and measuring the results may not only be more difficult, but in some cases the results may even be misleading. 5. Fill in the Outlined Plan Again, it is of utmost importance to work with other departments so as to facilitate interdepartment buy-in to the solutions that will be implemented. With their help, scrutinize the outlined plan, comparing and contrasting each solution as it relates to those that would be executed both before and after it chronologically. Among competing viable solutions, justify a winning solution in terms of how it better fits with the overall plan and how it better works toward achieving the goals you prioritized in the beginning of this process, and set aside other possible solutions. At this time, you should also know

11 Page 11 of 14 which path you ve chosen in terms of technology, and if you ve chosen to buy a Mobile Workforce Management Solution, you should have it in mind which vendor you would most like to work with. Management Buy-In Together with the help of other departments, you have built a solid plan to attain your goals and the overall business objectives. Will senior management get on board? The process for gaining management buy-in is different for every organization. It is typically a multi-part, multi-departmental process that crosses over departmental boundaries and internal political thresholds. For most organizations, the primary focus will be on the financials or economics, of the proposed technology acquisition and implementation, specifically addressing the issues that management can best understand: What will it cost? What will be our anticipated ROI, and when will we begin to see results? To address these key management questions you and your technology acquisition team will need to provide management with a compelling argument based primarily on the financials, citing figures such as ROI, Break-Even, and Total Cost of Ownership (TCO). (For a thorough discussion on assembling the ROI argument, see the first paper in this series, Building the Case for a Mobile Workforce Transformation. ) In any case, you will need to present management with a thoroughly well-vetted case comprised of both the hard numbers as well as the soft factors that will also ultimately impact the bottom line in some fashion. Increased productivity, reduced costs, improved customer satisfaction, and the ability to offer a more expansive services product line are just a few examples. You will also need to do your due diligence in terms of matching solutions to needs, choosing the right vendor, and seeking the proper level of scalable technology that will carry your organization forward for years to come (supported with new releases, updates, support, etc.). You will also need to fully document and compare the most practical alternatives, and be prepared to answer all of management s questions. In order to do so, you will need to understand both the sensitivity and elasticity of your technology recommendation (i.e., in terms of what happens if you don t move forward, or if you attempt to go the less expensive route, etc.). However, one thing that you will absolutely need to keep in mind at all times is that you may only get one shot at convincing management to move forward. You ll need to be prepared, concise, compelling, persistent and resilient. Case Study: Portugal Telecom Portugal Telecom is the largest telecommunications services provider in Portugal, and globally has over 97 million customers. Its portfolio includes telecoms, pay-tv and IT services for both consumer and business customers. In April 2008, Portugal Telecom

12 Page 12 of 14 launched itself into the pay-tv market with a vision to become the market leader, as it is with all its other services. Being available over ADSL, fibre and satellite, by the end of June 2012 Portugal Telecom had 1.16 million customers and had become the leader in triple-play customers, those customers having reached 766 thousand triple-play customers. Portugal Telecom defines triple-play customers as those customers "who have subscribed to three services provided by a single operator, where associated with a single customer account, whether or not offered as a bundle. Services may be provided under different brands", When Portugal Telecom decided to enter the pay-tv market it realized its vision to become the market leader hinged on providing the best possible customer service. In this highly competitive market, it could only be done with a field workforce that was fast and efficient. A key challenge was how to enter a new market without affecting the customer service received by its existing customer base. This problem was compounded by the complexity of pay-tv hardware installations, compared with domestic telephone lines or broadband. Engineers would now be installing routers and switching hardware as complex as what it is traditionally found in the IT departments of small and medium-sized businesses.! Over%97#Million#Global%Customers%! Over%4,200#Field%Engineers%! 2.1#Million#Site7Visits%per%Year%! 50%#Reduc=on%in%Customer% Complaints%! 70%#Reduc=on%in%Engineers%Failing%to% A?end%Pre7booked%Appointments%! 15%#Reduc=on%in%Over=me%Labor% Costs% Portugal Telecom's workforce in Portugal consists of over 4,200 engineers, making 2.1 million site visits per year. The management knew they were both core and strategic to the company's success as it expanded its service offerings. We are a customer centric company, said Manuel Rosa da Silva, Executive Board Member at Portugal Telecom. They are our lifeblood, inviting us into their homes and businesses to install telephone, broadband and pay-tv services. It is essential that we arrive on time, give the best possible service and ensure, whenever possible, that a second visit with more customer inconvenience is not necessary. Whether a technical problem occurs on the network or at a customer's premises, we want it fixed as fast as humanly possible.

13 Page 13 of 14 Improving the efficiency and speed of the field service team through a world-class Mobile Workforce Management solution was essential to expanding the service offering successfully. Three key requirements were identified to help improve field efficiency and customer service: Increase the efficiency of equipment provisioning and replacement services. Strengthen mechanisms for monitoring and supporting the field workforce. Help field service engineers develop new skills and the appropriate level of technical know-how for the now more complex customer environments. Portugal Telecom already had a software tool to manage its field service teams, but it was twenty years old and used batch processing to update the status of jobs overnight. A dispatcher would only know on Tuesday if an engineer had missed a Monday morning appointment. Portugal Telecom's call center was a major cost center, with a large amount of dispatcher time spent chasing the statuses of jobs and collating customer satisfaction feedback. This lack of flexibility and access to real-time data risked being an impediment to Portugal Telecom's strategy to become the pay-tv leader in Portugal. Portugal Telecom needed perfect execution every time and a Mobile Workforce Management solution that integrated seamlessly with its back office systems, which is comprised of Siebel, SAP and about 20 other legacy applications. Scheduling is only half the story, adds Rosa da Silva. We wanted a fully integrated solution that would give the field service team - dispatchers and engineers - everything they needed to deliver the best possible customer experience. They placed a strong emphasis on the Mobile Workforce Management solution to enable a workforce engineer an application that can be used on any device (whether online or disconnected), with connectivity to back office information systems, network management, single sign-on and enterprise communication features, such as video calls, photo-sharing for diagnostics and . They also placed an importance of Information/data being shared in real-time so that scheduling can be constantly optimized for future jobs based on the experience gained at every engineer visit. Portugal Telecom realized that the changes being made in its operations constituted a major change management project, as well as technical undertaking, in order to improve efficiency amidst their venture to expand its service offerings (pay-tv). The Mobile Workforce Management solution was implemented amongst a very complex arrangement of over 20 legacy systems including the order management system, integrated using Service Oriented Architecture through Portugal Telecom's existing middleware. Portugal Telecom decided to customize the solution so that all business processes, workflow logic and core support that an engineer would need was built into the

14 Page 14 of 14 application. This ability to personalize the solution meant that all of the information an engineer could need is available to them, even if offline or in a remote location, where connectivity may be limited. The rollout began in October 2010 and was conducted geographically to over 4,200 field engineers, with 500 new users going live every two weeks. The full software rollout took just five months to complete with all engineers, dispatchers and back office staff. Portugal Telecom's Mobile Workforce Management solution has now been fully live since May 2011 with significant improvements in customer service, as well as gaining a deeper understanding of how all field service teams operate as a single organism. Supervisors and management can understand the way time is spent by engineer, task, or technical problem. This information is continuously fed back into the solution allowing scheduling to be constantly optimized for future jobs, getting the right engineer, to the right job, at the right time. Each day, the solution automatically plans which technician attends each appointment with optimal efficiency and this information is sent to field workers on their mobile device. The solution gives dispatchers an intuitive map of the current location of the entire mobile workforce and the status of the job they are attending with an analytics engine which provides historical business intelligence, so that executives can analyze operational performance and report on key performance indicators related to customer service. There has been a 50% drop in customer complaints and a 70% drop in engineers failing to attend pre-booked appointments. The improved efficiency of engineers has also meant a reduction in Portugal Telecom's overtime costs of 15%. Field engineers are more productive on site by ensuring they have all the information and test procedures at their fingertips to complete an installation or repair. When an engineer finishes a job, or is delayed for some reason, the solution updates the dispatcher; then seamlessly re-optimizes the workload of the field service team, updating them via their mobile device as their schedules change. Engineers can also easily work with customers to arrange follow-up visits, confident that they are working with the latest scheduling information, delivered to their device through the Mobile Workforce Management solution. As bookings are made, dispatchers are updated in real time. We have achieved solid results in terms of operational performance and our wider key performance indicators. We now have operational visibility and command & control, at a much greater level, said Manuel Rosa da Silva, Executive Board Member at Portugal Telecom.

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