The new service paradigm
Long seen as something of an afterthought to the core business of selling products, service has become a way to stand out from the crowd by focusing on solving customers’ problems in the longer term, and helping them be more competitive, rather than just selling to them.DATE 2022-02-03
Jack Welch, who ran General Electric from 1981 to 2001, had this take on the service question: “Your challenge is not just to improve. It’s to break the service paradigm in your industry or market so customers aren’t just satisfied, they’re so shocked they tell strangers on the street how good you are.”
And of course, this is exactly what service suppliers should be striving to do – exceeding customers’ expectations by anticipating and solving their problems before they happen.
For decades, many corporations were slow to crack the paradigm, often tending to see service as a sideshow to their main business of selling products. But that is changing. Economic pressures, and the worldwide commoditization of equipment and hardware, are forcing manufacturers to find new ways to differentiate themselves from the competition.
The goods and service divide is obsolete. Services have become the key to unlocking the value of physical goods.”
BO EDVARDSSON, PROFESSOR OF BUSINESS, ADMINISTRATION AND FOUNDER OF THE SERVICE RESEARCH CENTRE AT KARLSTAD UNIVERSITY
FACTS - Selling peace of mind
Service Manager Peter Norrby says the mindset among Alfa Laval’s customers has changed from “don’t come to me and sell" to "come and help me keep my business running”. “It’s about asking how we ensure maximum customer satisfaction over the lifetime of the equipment. It’s about going from reactive selling of spare parts to a proactive selling of peace of mind.”
Increasingly, Alfa Laval uses advanced software and sensors to monitor the condition of installed equipment. Knowing the right time to replace components is critical to plant productivity and uptime.
One of the world’s largest ethylene producers in Saudi Arabia discovered this when Alfa Laval recommended a condition audit for the company’s 11-year-old gasketed plate heat exchangers. The heat exchangers had operated for many years without requiring maintenance and had delivered solid performance for so long that the customer saw no need for maintenance. But, even if gaskets are specially selected for the purpose, they can last longer or need replacement earlier than expected depending on actual operating conditions.
In fact, the audit data clearly indicated that the gaskets were approaching the end of their service life and reconditioning the plates was necessary. Early action averted a high risk of plant shutdown.
A short-term gain by selling will not make a customer happy if the customer sits with a problem for ten years – the customer will never come back. 'Sell and run' doesn’t exist anymore.”
PETER NORRBY, ALFA LAVAL
FACTS - The true cost of downtime
Remotely monitoring equipment and fixing issues before they become full- blown problems is a highly attractive prospect for many companies. These two examples, which show what the cost of heat exchanger failure could be in two different applications, illustrate why:
- USD 500,000 per day: Production stop in a petrochemical application with plate heat exchangers in critical positions.
- USD 30,000 per day: Production stop in a mid-size vegetable oil refinery where boiler failure leads to total stop at the plant.
‘The customer experience is our top priority’
Our industry is part of a journey where the whole world is rapidly moving towards a service society. It is all about providing solutions to the customers’ problems, rather than just supplying them with goods.
Ulrika Lindberg, Vice President Global Service, has worked with customer service for more than 15 years, she says: “We aim for ‘service excellence’, and one of my main tasks is to support Alfa Laval’s local Service organization in offering our customers the best service – both how we sell it and how we deliver it. As a customer, you will benefit from our complete service offering (the Alfa Laval 360° Service Portfolio) which ensures uptime and availability; from start-up, maintenance and support, to improvements and how we monitor services. We have all the parts and services to ensure that the equipment performs as it should.”
“I have a passion for service. It’s about the people and the skills, and naturally, providing customer satisfaction.”
What is your top priority?
“The customer experience. Customers should always feel that it is easy to do business with us, and with new technology and highly skilled personnel, we will offer an even more responsive and convenient experience. Going forward, in a fast-paced and digitalized world, we can work more closely together to develop new processes that speed up our response time and delivery process.”
Can you give any concrete examples?
“We always strive to be faster when it comes to deliveries and answers, and to improve delivery reliability and transparency. With new technology and continuous competence development, we will support our technicians in providing ‘top class’ customer service. Remote guidance is one concrete example. Another one is supporting customers with specialized competence on demand. This is sometimes crucial to ensure customers’ uptime.”
How do you see Alfa Laval’s service offer evolving?
“I expect products and services to be seen more as a complete offering. One example is our Performance Agreements, which includes preventive maintenance and service tailored to our customers’ specific needs. With a Performance Agreement you, as a customer, can rely on us to maximize your processes uptime. There will also be new types of services, in line with important macro and industry trends. In the digital world, for example, connectivity, the Internet of Things and Big Data will enable us to be even more proactive which will further improve our service offering. For some customer segments, these changes are just around the corner.”
How does Alfa Laval stand out from the competition when it comes to service?
“Alfa Laval has a very competent organization, both for solving acute customer problems and for working closely with customers to prevent future problems. We are very strong when it comes to reliability, partnership and trust. For more than 130 years, we have built a global presence with service centres and partners in nearly 100 countries and in key marine harbours. Our customers get local expertise, supported by the global breadth and depth of Alfa Laval, including highly skilled service technicians available around the clock. But we can always do better. We will continue to improve our service offering. It should be an obvious reason, along with our products, to choose Alfa Laval.”