The evolution of the asset: why connected industrial equipment is crucial

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The late and great Sir Terry Pratchett once said, “It’s still magic, even if you know how it’s done. One area in particular that is getting smarter and smarter is our industrial equipment.

What was once a blind, disconnected and ambiguous machine can now give us visibility and insight into how products and services are consumed. He can self-diagnose if his parts are wearing out, and even order new parts and schedule a technician’s service call.

Connected and intelligent assets are now at the heart of modern business thinking and, more importantly, current business models.

Of course, not everyone’s hardware assets are state-of-the-art. Three main factors preventing traditional equipment manufacturers from providing the right levels of service are well documented: assets are owned and managed on-premises, assets are not properly connected, and visibility is lost across sales and owned customers. to the channels.

To some extent, these issues were understandable, in 2019, when there was less pressure to change and confront the age-old problem of managing legacy investments.

Some companies were reluctant to abandon traditional sales and service models because they were too constrained or culturally unable to handle a change in mindset. But that was just creating a problem waiting to happen and of course it did.

What the pandemic has revealed are both the inefficiencies and practical impossibilities that can arise from a lack of asset connectivity. As field service teams were forced into skeletal services, the challenge of maintaining machines and devices became overwhelming. Something had to give, either the availability and continuity of the systems, or the sanity of the engineers. No doubt, in some cases, it was both.

For some, this represented an opportunity to move to remote maintenance, where possible, to minimize risk to engineers, but also to manage resources more efficiently. According to a recent EY report, Why contactless field service presents an opportunity beyond COVID-19 suggests, remote service has benefits in terms of efficiency, but also ensures the well-being of service technicians in the field. Although it requires more asset intelligence for it to really work.

For many years, the value of servitization models has been well argued. Organizations with connected assets can benefit from reduced downtime through tools like predictive maintenance, but they can also benefit from efficiencies. Shifting asset costs from capital budgets to operating budgets and focusing on continuity and machine results has been a business eye-opener.

As a Boston Consulting Group article on the value of outcome-based business models puts it, “As the focus on creating and capturing value shifts from one-time sales to long-term partnerships, it leads to greater strong customer retention as well as rapid account expansion. . No wonder many CEOs are convinced that deploying results-based business models is the best way to win the future.

It’s been a consistent message for many years now, but it took the shock of the pandemic for it to be truly understood. The unprecedented challenges of the past two years have highlighted why service delivery must become more efficient, predictive and prescriptive. At the heart of this is asset data, which is crucial to de-risking service operations and delivering high-margin service offerings.

Faced with the unpredictability of today’s economies and markets, companies must focus on understanding their customers and their assets to optimize their services. Everything else sticks a finger in the air and hopes for the best.

By having complete visibility into the installed base of assets, service contracts and asset performance, organizations can begin to maximize equipment availability, optimize field service teams and therefore reduce maintenance costs. These are undeniable competitive advantages at a time when resources are stretched.

By moving from selling products to adopting results-based strategies, organizations can achieve rapid results that can propel businesses forward, as well as build agility and resilience into the model.

From accelerating time to value, to supporting asset-centric business processes, with preconfigured templates and industry best practices, to maximizing contract attach and renewal rates, by monitoring the installed base to ensure conversion from warranty to contract while respecting rights, organizations can begin to derive real value from their services.

For organizations that were hesitant to change their asset models before the pandemic, the COVID-19 virus may have done them a favor. Sometimes it takes the shock of newness to really see what’s in front of you.

Sumair Dutta is Director of Digital Transformation at ServiceMax.

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