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1 Speech by Matthias Mahnel, Managing Director of, on the occasion of PACKAGING VALLEY DAYS 2013, 10th of April, Kirchplatz 5a Pullach Tel: ; Fax: Internet: Impuls-consulting.de Mahnel@impuls-consulting.de Copyright Seite 0
2 Agenda Agenda of the speech 1. Introduction of 2. The importance of after sales service in the engineering industry 3. Service demands and solutions 2020 Copyright Seite 1
3 is pioneer and market leader in service consulting in the engineering industry Foundation Founded 1995 in Munich, Germany Located in: Pullach/ Munich, Germany Market position Pioneer und market leader in strategic service consulting in the engineering industry More than 200 successfully completed service projects Consultants 15 service professionals as experienced senior consultants...as well as a network of many service partners, e.g. universities, industry associations and research institutes Consulting emphasis Analysis, conception and realization of: Service growth strategies Goal orientation of service market development Acceleration of service core processes Optimization of service organizations Copyright Seite 2
4 Demand for packaging machinery The demand for packaging machinery is internationally growing (demand according to regions) World market for packaging machinery ~35% ~20% ~30% Europe NAFTA ~10 % Asia Pacific region ~5% Latin America* Africa and rest of Asia Share of world market Source Research,VDMA, Copyright Seite 3
5 Demand for packaging machinery and can be divided in four main areas that require excellent customer support (demand according to packaged products) World market for packaging machinery Others (incl. tabacco, building materials, industrial packaging, etc.) 20% Packaged Pharmaceuticals, household care products 20% Beverages 20% Food Source: Research /VDMA Copyright Seite 4
6 Increasing customer demands Customer demands and requirements for professional after sales service are increasing worldwide Forecast: Development worldwide Increasing demand on machine uptime and efficiency Increasing demand on throughput out the door Increasing pressure on total lifecycle costs (production and maintenance) Increasing demand on local services - but with a global approach Increasing transparency and professionalism for all service issues Know-how loss regarding maintenance on the customer side trend to outsourcing Increasing number of Do it myself customers in Asia, China and South America The demand for professional after sales service increases every day Copyright Seite 5
7 Service as factor of success Excellent service is more and more a critical factor of success for producers and users Service requirements Service as critical factor of success 80 s 90 s 00 s 10 s Time Reaction time weeks days Machine uptime Service products 5 days a week Break and fix services Impact on service organization machine manufacturer 24/7/ 365 Business Support Service organization Fragmentated Service Business unit Service processes Local service processes Globally standardized processes Copyright Seite 6
8 Importance of after sales service Currently, after sales service is in a paradigm shift, in the future service will be more and more solution oriented Service in the past Current service Future service Products Machine Support System Support Customers Solution Solution Support Service Promotion Sales Focus on selling machines Small range of service products Focus on inst./ comm. and break and fix services Reactive market approach Low customer orientation Focus on machine support Increasing range of service products Focus on value-added services More and more active service market approach Increasing customer orientation Focus on customer support Wide range of service products Life cycle oriented solution support Proactive market approach Total customer orientation Copyright Seite 7
9 Four steps to service excellence Successful service 2020 strategies are based on four steps Four steps to service excellence in 2020 Step 1: Getting Servicequalität customer to know the needs Step 2: Offering the right service products Step 3: Offering global service processes Step 4: Set up a customer oriented service organization Copyright Seite 8
10 Customer intimacy Customer intimacy/ customer segments Step 1: Getting to know the customer needs The machine builders need an excellent customer intimacy in order to understand the real customer needs for service Not all service customers have the same expectations Copyright Seite 9
11 Example: Customer segmentation With a bundling of different requirements the worldwide service customers can be divided into three service segments Step 1: Getting to know the customer needs Service customers can be differentiated according to: Typical examples for service segments: Worldwide service customers Own technical maintenance competences of the users high X Segment I Do it myself low X X Segment II Do it with me Segment III Do it for me low high Willingness to buy services from machine suppliers Copyright Seite 10
12 After sales service products In the past the service portfolio of machine builders was limited to basic services Step 2: Offering the right service products startup phase phase of usage phase of optimization installation & implementation production & maintenance migration Installation /SAT Spare parts Retrofits Training Repairs Reactive market approach Small variety of service products No customer segmentation Copyright Seite 11
13 After sales service products today, the machine builders support their customers with a huge variety of service products, based on the life cycle of the installed base Step 2: Offering the right service products startup phase phase of usage phase of optimization installation & implementation production & maintenance migration Installation /SAT Spare parts Maintenance contracts Consulting for OEE (Over all Equipent Efficency) Training Condition monitoring Repairs Modernization/ retrofits Ramp up support Supervision Overhauling Exchange Active market and sales approach Huge variety of service products Different customer segments Huge variety of preventive and online products Copyright Seite 12
14 Modular service contracts Many machine builders offer modular service contracts in order to fulfill all individual customer requirements for preventive services Step 2: Offering the right service products Full service contract Maintenance (incl. wear parts, spare parts, personal) Benefit for the customer Maintenance contract Maintenance (incl. wear parts and spare parts) Preventive maintenance contract Continuous preventive maintenance incl. wear parts Inspection contract Periodical condition monitoring Modular construction Copyright Seite 13
15 Online services Online services will become more important for the international customers in the future and should be consistently pushed by all machine builders Step 2: Offering the right service products Online Training Remote diagnostic Condition monitoring Online ticket Machine builders Worldwide customers Distance: Europe, China, America Online Booking FS Repair movies Spareparts webshop Copyright Seite 14
16 Attractive Service products The different customer segments as well as the service portfolio should match for a successful market development Step 2: Providing the right service products Service portfolio Customer Segment I Service Agreement I Basic service with repairs, spare parts and maintenance No additional support Customer Segment II Service Agreement II Guarantee of availability Service contracts All inclusive invoicing Customer Segment III Service Agreement III Performance optimization Complete business support Operator contracts Result: Different demand orientated services are necessary to fulfill the customer targets Copyright Seite 15
17 Excellent service processes Excellent service processes supporting the machine users fast, efficient and stable Step 3: Offering global service processes Fast Stable und scheduled Best in class service processes Customer oriented Efficient Copyright Seite 16
18 Excellent service processes In order to offer excellent service processes most of the machine builders have set up central service desks for all customer demands Step 3: Offering global service processes Call Entry Technical Support Field Service Spare parts Customer (internal/ external) End user Partner Service technicians Etc. Customer call Welcome Desk/ Call entry Answering of customer calls Capturing and comprehension of customer problems Incident ticket Solution Capturing of all relevant information within an incident ticket 17 Copyright Seite 17
19 Excellent service processes An excellent technical support can solve the majority of calls with qualified tools and transfer tasks to the spare parts department or field service dispatching Step 3: Offering global service processes Call Entry Technical Support Field Service Spare parts Incident ticket knowledge database 2 nd level support Solution? catalogue management Routing Spare parts Solution Technical specialist problem management Field Service Dispatching 18 Copyright Seite 18
20 Service organizations Most of the machine builders have set up customer oriented service organizations with clear tasks and responsibilities for all services Step 4: Set up a customer oriented service organization Service organization in the past Current/ future service organization No overall service department No direct allocation to the management board No service process owner Interfaces and divided functions One responsible service department Direct allocation to the management board Process owner for all service core processes Concentration of all functions in one department Conclusion Clear and transparent entrance lane with clear responsibilities Copyright Seite 19
21 Service organizations Allocation of the service Due to the increasing importance, service is more and more directly allocated to the management board in the engineering industry Step 4: Set up a customer oriented service organization Management Board % 40 % 86 % Head of distribution % 30 % 50 % Head of Engineering % 10 % 50 % Source: Research 2012 with 200 companies 20 Copyright Seite 20
22 Service Excellence Characteristics of excellent service organizations Excellent service organizations Detailed knowledge of customer needs Regular measurement of customer satisfaction in the service Customized range of service products Market oriented prices for spare parts and services Proactive service marketing Well trained service technicians and staff members Excellent processes with binding service level agreements Worldwide consistent service monitoring with a KPI cockpit Service as core business integrated in the business philosophy Maximum availability and performance support Copyright Seite 21
23 Current studies on relevant service topics Planning, controlling and measurement of service success Global Spare Parts Management Focus: Development of a service strategy Deduction of relevant KPIs Focus: Worldwide stock structure Inventory management Sales distribution Benchmarks/ Best practice examples Service as growth engine Fit for best Service Focus: Customer satisfaction Customer retention Growth strategies Market development Focus: Service as future success factor Optimization of service Best practice examples Copyright Seite 22
24 Coming together is a beginning. Keeping together is progress. Working together is success. - Henry Ford - GmbH Matthias Mahnel (Managing Director) Kirchplatz 5a D Pullach/München Tel.: +49 (0)89 / , Fax.: +49 (0)89 / Mahnel@impuls-consulting.de Your partner in service consulting! Copyright Seite 23
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