There was a time when a good service experience meant having a breakdown repaired quickly, efficiently and professionally. Today, being good at break-fix is no longer good enough. Customers judge their suppliers not on how they deliver a product or service, but on the outcomes they experience. This is a trend diginomica calls the XaaS Effect, where XaaS stands for Everything-as-a-Service.
Look for example at the contract Cubic Transportation Systems has with Transport for London (TfL) for the provision of revenue collection services. The upkeep of the contactless turnstile gates and scanners that collect and validate passenger fares on the London Underground and buses — the same system underpins the OMNY system now rolled out by New York's Metropolitan Transport Authority — is not measured in terms of break-fix performance, it's based on operating time and passenger throughput. Cubic is no longer delivering a maintenance service, it's delivering friction-free subway stations, as a service — or as the transportation industry prefers to call it, Mobility-as-a-Service (MaaS). This has required a big change in how Cubic manages its operations, as Mike Gosling, IT Service Platforms Manager, explains:
We no longer supply ten gates here and four machines there. We supply hours of retail and hours of validation across the whole board — and those hours of retail and validation, we have to maintain to a service level.
This totally changed the way that we had to do our service, it totally changed the way that we had to manage our business. We couldn't just stick people at every place, because that would have blown the budget. There are devices all over the place. So to try to maintain these really high levels of service in place, we had to get smarter in the way we do it.
Focus on customer experience
The impetus for this change came from Transport for London's own decision to focus more on customer experience rather than simply collecting fares. Gosling explains:
Transport for London several years ago decided that they wouldn't just treat people as people [from whom they] needed to collect fares. They wanted them to be true, honest patrons and give everyone going through the service as good as possible an experience of the whole [lifecycle of] purchasing the ticket, using the ticket, validating Oyster cards, etcetera, no matter where they interacted with the system.
For Cubic, the key to delivering those outcomes cost-effectively was a service management system that automated as much of the routine decision-making as possible. Gosling describes a bell curve of incidents, beginning at one extreme with the very precisely defined, top-priority 'P1' incidents, which have very clear parameters set out in the contract with TfL. Then there's a large bump in the middle of the curve which represents all the day-to-day, routine call-outs. Here the key is having a system that can automate much of the process of assigning engineers based on skill levels, travel time, station opening hours and service level agreements. Gosling says:
Having a tool that can sort out these corrective maintenance incidents that come in, and prioritize them accordingly and get engineers out there as effectively as possible to meet the needs of this outcomes contract, was incredibly important.
Automating the heavy lifting
Then at the other end of the bell curve are the totally unexpected incidents that can't be planned for, where resource managers need accurate information and the ability to respond as quickly as possible. These are the tricky ones, as Gosling explains:
Those exceptions can kill you if you don't factor those in, because they can kill you reputationly, for example — especially in our business where we're dealing with Transport for London. If we had a major incident that we couldn't handle just as quickly and efficiently, our reputation could be splashed all over the newspapers. It could kill us from a contractual point of view, especially a P1 from a health-and-safety point of view.
This is where a tool that automates the predictable and the routine is crucial. Gosling explains:
It enables you to free up your resource controllers to be exception managers and that's the biggest single thing that it does. It takes the weight, the heavy lifting off the people and enables them to focus on exceptions.
That heavy lifting, if left, it causes pressure, it causes panic, it's a load of jobs, 'Oh we're really busy today,' etc. Having that heft taken off and allowing the people to handle those exceptions is really important.
Gosling was speaking during last week's IFS Cloud Launch Event, which remains online at the time of writing.
The buzzword in the services industry is 'servitization', but there's much more going on here than simply moving from a product mindset to a services mindset. The scale of automation and breadth of information that can now be assembled using digital technology has moved the goalposts for everybody. Customers now expect their suppliers to use technology to deliver the best possible experience. We call this the XaaS Effect, but I think IFS also captures this well in its notion of the moment of service as the key goal.
The customer testimony on display in the IFS Cloud event demonstrates the real-world impact of the XaaS Effect. It's no longer enough to respond to problems with fixes. Businesses are having to ramp up their investments in collecting and analyzing data and automating their processes in order to anticipate problems and help their own customers experience the best possible outcomes.
For Cubic and its customer TfL, that means keeping passengers moving through stations and collecting fares as smoothly and conveniently as possible. For commercial kitchen service organization Smart Care Equipment Solutions, it means maximizing asset utilization in restaurant kitchens. For digital shopfitter Spencer Technologies, an important component is giving customers visibility into the progress of installation projects and service calls. For windscreen repair and replacement service Auto Windscreens, putting customers in control of their own bookings through self-service pages on its website has played a part.
Each business has its own priorities and is on its own journey, but these examples are typical of how every business is transforming its operations in response to the XaaS Effect. They are investing in technologies, processes and culture that together allow them to engage with customers, monitor their use of products and services, and continuously improve their experience and the outcomes they achieve.