Transforming service experience and aligning brand values for a national industrial equipment manufacturer

@theservdesgroup
 

Abstract

The Service Design Group, the premier customer experience and service design consultancy in the US, uncovered opportunities to create value-add and differentiated services to combat declining renewal rates and downward pricing pressures. The Service Design Group's innovative, best practice customer experience, service design and process engineering solution — Service PathTM — provided a framework for envisioning a new service delivery system which resulted in increased revenue and renewal rates.

 
 

Context

A large, U.S.-based global industrial equipment manufacturer faced a problem – renewal rates for its planned maintenance agreements were declining. As both a manufacturer of equipment and premium provider of after-market services, yearly planned maintenance agreements provided a critical revenue stream and directly impacted the sustainability of the firm's business model.

An existing voice of the customer program was in place that pointed at issues as well as opportunities. Primarily, the voice of the customer data uncovered that while customers often wanted to renew contracts (due to the high quality of service levels) they had a hard time justifying the price of the contracts to the chain of command. A solution was needed that would "make value explicit" to the firms' customers.

Solution

We helped the client develop a customer engagement model for service contracts and renewals, with a focus on defining and prototyping touch points that made value explicit to customers. By mapping the current state of its customer journey, the client team discovered opportunities to proactively highlight value. We worked with the client team to define a new customer journey and engagement model, supported by two new and critical touch points: 1) a client portal, where customers could access historical information on services performed, and 2) a quarterly value report program, which would be delivered to customers via a high-touch model and paired with face-to-face review meetings.

Results

The current state and future state customer journeys created a shared understanding of the customer experience across teams. They also drove strategic alignment across functional teams. Lastly, they provided a roadmap for the team to follow and use for ongoing performance monitoring.

The client portal and value report concepts were developed via rapid prototyping. The prototypes made the concepts real, and allowed for testing and validation with customers before any investment was made in developing new systems. Multiple rounds of prototyping, validation and refinement were used.

The customer feedback to the prototype concepts validated that if the client were to implement these new components of the customer journey, customers would be more likely to renew yearly maintenance agreements (as the new solutions would directly assist them in demonstrating the value of planned maintenance to their leadership). Additionally, the prototyping and validation highlighted specific concepts that customers assigned more value to, helping our client prioritize efforts and investments moving forward. Even better, by involving customers in the validation process, additional business opportunities were uncovered (such as opportunities to provide financial forecasting and planning services).

The new customer experience and service delivery model was successfully rolled out in select pilot markets, resulting in a 2 to 3 point increase in revenue and a 4 to 6 point increase in renewal rates.

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