Are you getting Money for Value? - Summary

Steve Downton, Downton Service Management Consultants Ltd, Noventum Group

Getting paid for what you do

It sometimes takes the obvious to make us realize that we are too close to the problem to see it for what it really is.

I have heard of a man who had a mind to sell his house, and therefore carried a piece of brick in his pocket , which he showed as a pattern to encourage purchasers. Jonathan Swift (1667-1745)

Are we guilty of the same thinking when, as service directors we try and sell value added services by advancing our break-fix capability, as a basis for assessing the value of the additional services on offer? It is significant that there is now real concern being voiced by service directors and managers wanting to be paid for additional work done. On the surface this would appear to be a reasonable request, particularly as revenues and margins continue to fall in the traditional break-fix arena. Not getting paid for what you do is not a new trend. The customer, as ever, is expecting more and more from their supplier.

A number of actions have been taken to reduce costs through the increased use of remote support. Also there is a need for greater initial investment. However, now that everyone is moving toward the use of the remote environment, customers are now discounting its value, and the customer demanding lower prices is eroding any margin that was previously gained by lower costs.

Another danger is that remote fixing permits transactional based contacts which does not always enhance the ability to sell added value distances the service provider from the customer and hinders the possibility of building a relationship. It also means that when the engineer does make the visit it is more likely to be longer and involve more unpaid work, because the client will often take advantage and present the engineer with more tasks needing solving or attention.

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