As Industry 4.0 continues to generate huge waves of excitement in the tech world, both the cyber and physical are coalescing to help create unprecedented value for both manufacturers and consumers. A tech-only view hides the broader changes happening in the manufacturing world that have the potential to fundamentally alter the paradigm of the industry as well as create entirely new markets and product possibilities.
A massive level of transformation is currently underway in the manufacturing industry, especially when it comes to material science, Internet of Things (IoT), social platforms, analytics, artificial intelligence (AI), machine learning and, most importantly, the manufacturing process as a whole. This transformation impacts all areas of the industry in fundamental ways. It will redefine business models and markets as a result.
Some of the most fundamental changes are taking place in the aftermarket sector as organizations realize that drastic improvements in customer experiences are possible through better service. This, in turn, sparks brand loyalty that generates highly profitable service revenue, repeat sales and cross-selling opportunities, and additional competitive sales through word of mouth referrals from already satisfied customers.
The “Aftermarket” Marketplace
The after-sales service market has always been a high-margin business for manufacturing companies. However, the market is quite fragmented and varies by segments, which precludes building best practices and reference business models that can help organizations integrate value chains into one holistic business.
Current business needs
Automotive OEMs: Achieve fast and efficient claims management and reduce warranty costs by linking channels, leveraging existing data and systems, and creating warranty processes that are in sync with business needs.
Industrial manufacturers: Streamline the planning, monitoring, scheduling, dispatching, and routing of field service technicians and vehicles to fulfill service agreements that increase customer satisfaction.
Aerospace manufacturers: Map recall processes by tracking and managing each case to ensure customer satisfaction, minimize cost, and reduce risk.
The rapid pace of technology development, shortened lead times for product introductions and revisions, and a vast improvement in the capability of ICT have now opened the doors for massive changes in how this sector is organized and does business.
Current business challenges
1. Proactive monitoring of equipment warranties, maintenance agreements, and SLAs
2. Managed service contracts with related billing plans, price agreements, and conditions
3. Managed service and support requests that identify customers with their respective installed base
4. Faulty claims administration process with lack of visibility in warranty information
The above challenges are an integral part of the CIO agenda that hinders manufacturers from being leaders in their industries. Therefore, the leading solutions specific to the aftermarket services segment in manufacturing include
Connected supply chain: RFID and IoT devices and technologies like cloud and edge computing enabled by large API libraries for interconnects are providing an entirely new capability to supply chains. The supply chains are now completely connected, which allows them to be much more agile and responsive. Managers now have real-time visibility into events taking place across supply chains. Blockchain-based transactions enable multi-party transactions to be completely transparent and done in real-time.
Prescriptive maintenance: The traditional process beginning with an equipment breakdown and its eventual resolution at a customer’s shop has been highly inefficient, time consuming, and requires numerous manual interventions and follow-ups. Organizations that provide unique customer service that resolves these issues faster is what differentiates them from their competition.
Machine learning-based inventory optimization: Managing the spare inventory has always been a challenge for service managers. The inventory is distributed across locations with usage dependent on unpredictable service requests. The replenishment is managed by a planner’s understanding of the locations’ inventory requirements, which causes outages and non-moving stocks when monitored this way.
Manufacturers, whether they be automotive OEMs, industrial manufacturers, or aerospace manufacturers, need to have a 360-degree view of all operations. Having the right emphasis on the outbound (aftermarket services) and incorporating it in a digital plan helps to not only build customer loyalty but also accelerate business outcomes.