SaaS in the Field Service industry

A Field Service News White Paper based on exclusive research

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Whilst cloud computing as a concept can trace it’s origins back over 60 years to large academic and corporate entities of the 1950’s, it is fair to say that the emergence of the cloud as a viable means of distributing business critical software remains a relatively new concept and certainly a very twenty first century one.

In theory field service would seem to be an area that would benefit greatly from the cloud. The ability to give remote access to systems for mobile workers is obviously advantageous, whilst also the more manageable subscription based fees that Cloud based, Software as a Service (SaaS) solutions offer, mean that for the first time smaller and medium sized organisations are able to access the sophisticated service management solutions, that in the age of CAPEX only installations, were the reserve of just the largest enterprises.

So has the field service industry leapt into the cloud feet first? Or is there still some reluctance until the technology proves itself robust enough to be trusted with software as business critical as ERP, CRM and other systems that are used to manage the mobile workforce?

In February 2014 Field Service News in partnership with Tesseract undertook a research project, which aimed to take a measure of the appetite for Cloud based software and the SaaS distribution model within the field service industry. Our aim was to understand how widespread the use of cloud technology in field service is and also to look to the future to see if there is a growing trend towards using the Cloud in our industry.

In total 161 respondents completed the survey and these respondents were from a range of differing company sizes from across a number of field service disciplines including; Automotive, Industrial, Chemical, Utilities, Oil & Gas, Power, Warranty administration, local government and Retail & Lesiure.

In terms of size of the mobile workforce, as one would anticipate there were more respondents from the smallest bracket of up to 50 field service engineers which is reflective of the industry as a whole. However, there were also substantial responses from companies with large mobile workforces of over 500 field service staff, as well as categories falling between the two extremes, for us to be able to draw meaningful analysis of how companies of varying sizes differ in their approach to the cloud.

After the initial question ‘Is your field service solution on premise or in the cloud?’ our survey split in two. Whilst many questions are mirrored we have also included questions specific to those who are currently operating in the cloud and those who are still using on-premise. This has enabled us to ascertain the benefits of the cloud from those actually using it, and better understand the feelings of those not there as yet.

As far as the headline numbers are concerned the simple fact is that those companies that have placed there field service management systems in the Cloud remain in the minority.

Currently 77% of companies are still using an On-Premise solution with just 23% having actually moved their field service software to a Cloud based platform.

This is perhaps surprising given that SalesForce.Com, the first true SaaS giant and the company credited with proving the Cloud to be truly viable has been a runaway success since it’s launch almost two decades ago in 1999.

“Just 23% of companies have currently moved their field service software to a Cloud based platform” Yet when we consider that the first browser based Service Management software, launched by Tesseract only appeared just under ten years ago perhaps in actuality this figure is to be expected. Prior to this Field Service Software was CAPEX based, with system life cycles lasting anywhere between three and seven years. In such an environment the shift to a new technology will likely always be weighted towards a slower start, which is reflected by these figures.

However, if this were the sole factor in the slow adoption of Cloud you would anticipate that this trend would be exaggerated somewhat amongst the larger organisations. Yet other than a slight increase of 3% amongst companies with 300 to 500 field engineers, essentially ratios remain flat in all companies of all sizes.

This would suggest that there are other reasons for field service organisations not yet embracing the cloud…

CLOUD AND FIELD SERVICE

ABOUT THE RESEARCH:

On Premise vs. Cloud

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But lets first look at those companies who have made the move to the Cloud, to understand why these early adopters made the switch, the benefits they are seeing, the issues they are facing and whether it is a move they would recommend to others.

We asked those respondents that were on a Cloud based system what were the reasons they chose Cloud over an On-Premise solution, asking them to indicate if any of the following reasons were important to them. The benefits we listed were: more affordable pricing model, scalable solution, disaster recovery, easy remote access, speed of going live, and less reliance on the IT department. The results were interesting in that perhaps they did not conform to what are often seen to be the key USPs of Cloud based solutions.

Of these options easy remote access was the most popular reason cited with 61% of respondents indicating this was an important factor to them. The second most popular benefit was that Cloud solutions are scalable with 54% of those surveyed ticking this option.

Yet, often the most heralded benefit of the SaaS distribution model, affordability was only the joint fourth most popular option (tied with another benefit that we regularly see being championed i.e. the speed of going live.) Just over a quarter of respondents (28%) indicated that these were important factors to them.

When we look just at companies with the smallest of mobile workforces (i.e. those with under 50 field engineers) we do see an increase to 35% of companies that cite affordability as an important reason for choosing SaaS, though again it remains only the fourth most popular choice.

Perhaps also related to cost is the third most popular reason “less reliance on IT departments.” This again was more commonly cited amongst the smaller organisations with almost half (47%) identifying this as an important benefit compared to 36% of all respondents. In fact the lack of reliance on IT departments is perhaps one of the biggest cultural changes that SaaS has enabled.

Whereas previously implementing a new field service system would not only be costly in terms of capital expenditure, it would also add a strain on internal resources, with the IT department being largely responsible for both the installation and the upkeep of the system.

However, under a SaaS model this burden ceases to exist as the software provider undertakes the maintenance of the system themselves.

This includes patches and updates that are designed to fix bugs in the system or add/improve functionality.

Indeed if your relationship with your provider is strong enough you could even shape future iterations of the system you are using, tailoring it to your own needs.

Another surprise is that the built in ‘disaster recovery’ of Cloud was the least common reason cited.

”61% of respondents cited easy remote access as an important factor in choosing the Cloud. Scalability was the second most popular benefit with 54% of those surveyed ticking this option” By it’s very definition not having business critical systems housed on site at a companies head offices allows for business continuity in case of fire, theft, or any other disaster that may strike a business. Should a problem of this magnitude strike, by being Cloud based a company is able to access it systems remotely from anywhere in the world. This is a great benefit in terms of keeping a business operational and minimises the impact that your companies misfortune could have on your client base (which in turn could further add to your woes)

However, whilst it is a logical that Cloud solutions offer greater disaster recovery this seems not to be something the industry is particularly aware of.

This could be aligned to the perception that the Cloud is less secure that traditional On-Premise solutions, it could be a result of old mentalities not yet fading (i.e. if I can see it tangibly, it is easier for me to secure it) or even that we as an industry have yet to fully comprehend exactly what the Cloud is, so this added benefit simply isn’t a consideration for many – in which case it will come as an unexpected bonus for those that do eventually move to the Cloud.

REASONS FOR CHOOSING THE CLOUD

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To help us understand the context of how well accepted cloud-based field service management software is, we also asked these early adopters, if they were using cloud-based systems in any other business divisions.

When we asked would your company consider other elements of the business to the Cloud the results were not as certain as you may expect from respondents that had already indicated a preference for Cloud based computing and were actively using such a system.

Whilst more answered Yes (38%) than No (14%) the majority (48%) remained on the fence stating that there organisation would ‘possibly’ roll Cloud into other areas of business.

However, when we pushed a little further along these lines and asked “Would you company will ultimately move 100% into the Cloud”

“38% of companies using a Cloud based Service Management Solution believe they will eventually move all systems into the Cloud”We saw that the majority of respondents (57%) do feel that this is one day a possibility whilst 38% still believe that moving to a fully Cloud based environment is not something they could see there company doing at all.

A small number (4%) of bleeding edge, earlier adopters have already done so – whether they prove to be intelligently ahead of the curve or fool-hardy will of course be proven in due course.

Of those that believe their company would never fully embrace the Cloud across all divisions of the business, it is the key areas which hold the most sensitive data – Accounting and Payroll which are cited as being those most unlikely to ever be moved into a Cloud environment with 70% and 50% of respondents respectively indicating these are areas that would not be recommended for a Cloud solution.

Similarly, 40% also believe Customer Relationship Management (CRM) systems (where customer data is held) are also not fit for a Cloud based solution.

What this suggests it that with these areas all containing important and confidential data sets, it would appear that even amongst those who are actively using a Cloud based solution there are still some misgivings around the security of the Cloud.

Given the above it might come as a surprise to find out that of all the issues respondents working with a cloud-based field service management solution have actually faced, Security ranks the lowest reported problem amongst companies using cloud-based solutions.

In fact the most common issue with a Cloud based system proved to be connectivity issues with 60% of companies stating that they had faced problems in this area at some point.

However, it could be argued that connectivity issues are perhaps magnified by the ‘always-on ‘functionality that Cloud based systems provide.

It could also be argued that we are on the cusp of seeing this issue slowly ebb away in countries such as the UK, where all 3G mobile internet network providers are bound by government policy to be offering at least 90% coverage by June 2014.

In fact Vodafone are the only major network provider to be currently falling short of this target at 88.6% UK coverage.

The other key issue, which perhaps isn’t quite so easily solved, is the complexities of integrating Cloud solutions with legacy systems already in place.

“Security ranked the lowest reported problem...”40% of those companies using Cloud had found that getting Cloud based systems to integrate with their existing legacy systems had caused some issues for them.

However, we are seeing more and more vendors adding solutions for this issue to their list of USP’s whether it is via API or bespoke coding, so the battle is certainly being fought.

CLOUD IN OTHER AREAS OF THE

COMPANY

ISSUES REPORTED WITH CLOUD

BASED SYSTEMS

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As discussed above, the shift from On Premise solutions to Cloud is likely to happen over a relatively drawn out period. If this is proves to hold true, we should be able to see the shift become more rapid as the technology becomes proven and more accepted.

Looking at the time frames of how long those companies using cloud-based solutions have been doing so can provide us with an indication of this.

Indeed we see that of those companies that are now using Cloud for their field service management solution the smallest percentage (21%) have been doing so for the longest time (3 years or more).

The largest percentage of companies that are now on a Cloud based field service management system, over half at 54%, have only been operating in this way for between 1 and 3 three years.

“A quarter of companies using the Cloud have made the switch within the last six months” This would certainly seem to correlate with the theory that despite the fact there is not yet widespread acceptance and use of Cloud in field service, there is certainly an increasing trend towards doing so.

To further add weight to this assertion a quarter (25%) of those companies now using Cloud based field service management software have only been doing so for 6 months or less.

A considerable figure when we consider the deliberately short time frame we imposed on this shortest option. It would indeed seem that the move to the Cloud is beginning to quicken.

Of course a key factor in the speed in which the move to Cloud based systems takes place (if at all) is dependent on those earlier adopters seeing clear and tangible benefits of the shift. Proof of the pudding as it were.

So as not to colour the results in anyway around this critical

set of answers, we opted to leave the response to the question ‘What has been the biggest benefit to your company since moving to the Cloud” as an open text response. This has given us a truer understanding of what the key benefits to Cloud-based field service software were.

The most prominent benefit that stood out was the general performance of the systems themselves alongside the ease of updates. A quarter of all responses were grouped around the fact that by having a system that was easy to upgrade respondents found they were essentially getting a regularly improved and refined piece of software so performance levels remained above those that they had experienced previously.

The other most significant benefit was the cost.

Whilst cost may not have been as high as anticipated as a reason to opt for a SaaS model, it would appear that once the decision had been made that the more manageable payment methods of SaaS did indeed shine out as a key benefit of the model. Of course this is particularly true for those service divisions operating their own P&L.

Speed was also a regular spotted word amongst the responses, predominantly this is referring to the set up of implementation, however the speed of information flow between field engineers and head office was also raised as a key benefit. These, alongside the ease of use, were both popular reasons with both receiving 13% of the vote.

Other benefits that are worthy of mention are increased mobility, scalability and flexibility including being able to put multiple countries onto the same operating system easily and the easy accumulation of data via remote access in one source.

However, the greatest acid test of how successful the Cloud has been in terms of delivering field service software is whether those who have made the switch would recommend a similar move to others. Based on this criteria cloud-based systems are a hands down success with 90% of companies that are currently using a Cloud based field service management solutions stating they would recommend doing so.

“90% of companies using Cloud would reccomend doing so”Such a majority is certainly a powerful statement to the positive impact of the Cloud for those field service companies that have been early adopters and embraced the technology.

HOW QUICKLY IS THE CLOUD

TAKING ROOT?

BIGGEST BENEFITS OF THE CLOUD

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So what of those companies that are still using on premise solutions? What are the reasons for them not choosing to move to a Cloud based model?

Well lets continue to explore the premise that the move to a SaaS dominated market is a gradual one which will begin slowly before pickling up pace as companies move through the cycle of investing in upgrading and improving their current systems.

First of all we need to establish how long those companies still using an On-Premise solution have been working with their current systems.

The vast majority (60%) have been using their current system for at least 3 years. With the lifecycle of most CAPEX based On-Premise solutions lasting on average between 3 and 5 years, then this would certainly correlate with our earlier assertion that many companies are simply not ready to move from their existing system as yet, resulting in the majority of companies still using an On-Premise system.

In fact of those that are now using an On Premise solution only 18% are recent (within 1 year) implementations. With a small amount more 22% having had their current system for between a year and 3 years

It is when we look at the next question in the survey, which asks “Are you likely to consider a SaaS/Cloud solution when you next update your service management system” that the shift towards the Cloud becomes even more evident.

Of those companies currently using an On-Premise solution just over half (53%) have stated that they are considering a move to a Cloud based solution in the future. With 47% stating that they will not consider the Cloud for their next iteration of field service management solution.

If this figure remains true and there is a conversion from those ‘considering’ the Cloud to those adopting the Cloud then within a period of perhaps three to five years, when most companies will have moved onto next generation platforms, it is highly likely that we will see an almost 180º switch in the ratio of On

Premise vs. Cloud systems being in place.

What is particularly interesting is that again there is very little variation in the responses across companies of all differing sizes. This would seem to indicate that whilst perhaps the headline benefit of the SaaS model i.e. affordability is obviously of greater benefit to smaller companies, the other varied benefits of Cloud computing warrant the attention of even the largest of organisations.

When we look at the reasons why those currently using an On-Premise solution are looking towards moving to the Cloud perhaps the reason for this universal shift in the field service industry towards the cloud is identified.

As with those already using a Cloud based system, the primary reason companies are looking to the Cloud is for the “Easy remote access” it delivers. 58% of companies considering moving to the Cloud cite this as a benefit that attracts them most to a SaaS solution.

Again we see the responses of those already using the Cloud mirrored somewhat, and scalability is the second most common reason companies are attracted to the Cloud. 49% of companies considering the Cloud see the benefits of a scalable solution as a key reason to make the move.

Amongst those that have yet to make the move to Cloud however, the affordable pricing structure of SaaS scores higher and is third on the list of benefits attracting companies to the Cloud with 47% also listing this as a key consideration.

Disaster recovery elements fared better amongst those considering Cloud versus those that have already made the move. Out of all the companies considering Cloud, 35% felt this was a key benefit.

However, if we look at companies with the largest mobile workforces (501+ engineers) this figure falls to just 17%. It could be that these larger companies both already have sophisticated business continuity plans in place or perhaps have greater resources to protecting their own servers etc.

The speed of deployment and less reliance on IT departments were also strong attractions for companies considering a SaaS solution in the future with 37% and 33% of companies respectively stating these are key attractions for them.

COMPANIES STILL USING AN ON-

PREMISE SOLUTION:

CONSIDERING THE CLOUD AS THE

NEXT STEP

REASONS FOR THE SHIFT TO

CLOUD COMPUTING

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And what about those more conservative companies that are not yet prepared to consider the Cloud as a viable solution for their field service management systems?

We asked those respondents that indicated they would not be considering a Cloud based solution to identify the key reasons they did not feel comfortable with the cloud.

Perhaps unsurprisingly the leading reason cited was Security. Of course this is in stark contrast to the issues actually faced by those companies who have implemented a Cloud solution, however headline news stories about the lack of security in the Cloud prevail it seems as 47% of companies that are not considering the Cloud still cite security as a key fear.

Connectivity issues and integration issues with existing legacy systems were also both common objectives with 34% and 37% of companies respectively indicating that these issues gave them cause for concern around a move towards the Cloud.

Another factor, which registered with a similar amount of companies, was essentially based around brand loyalty.

34% of companies stated that a major reason for not considering a move to the Cloud is that they ‘want to stay with our current provider who don’t offer SaaS.’

With many vendors now developing a Cloud offering this could perhaps be an area where we will see more companies move across eventually?

One surprise amongst this particular set of responses was that only 10% of companies identified the fact that across a sustained period of over three years a SaaS model will actually work out more expensive.

In fact when we looked at the responses from the largest companies, who essentially would have the resource to continue with a CAPEX approach to their field service management systems we found that none identified this as an issue.

When viewed against some of the other responses to questions within the survey, it is possible to draw the conclusion that whilst cost is always a consideration in any business, when it comes down to getting the right solution for your field service management system, which is a critical operational necessity, cost is lower down in priorities than wider considerations that can impact on operational efficiency.

Continuing to look at those companies that are not considering a Cloud solution for their field service management system, it is interesting that whilst the large majority (72%) have not implemented Cloud systems in any area of their business, a still sizeable 29% of companies did have at least one element of their business requirements based in the Cloud.

This does initially seem curious as with a clear benefit of Cloud being ‘easy remote access’ it would seem a perfect bedfellow for the field service systems.

However, when we look at the reason given for why respondents felt Service Management software in particular should still be held On Premise the majority of respondents (70%) identify integration with existing systems as the main reason why they believe they need to keep their systems out of the Cloud.

Therefore, for those more conservative companies that would prefer to see a technology fully established and road tested before committing to it, whilst connectivity issues between the Cloud and existing systems still remain (as highlighted by the responses earlier in this paper) it could be prudent to hold back for the near future.

Whilst at the current time Cloud computing has yet to take a firm hold amongst the majority of field service companies, with most companies still using an On-Premise system, it would certainly seem that there is a definite shift towards the Cloud and the SaaS model that is gaining momentum.

Indeed if those companies that are currently considering a move to SaaS do move across within the next few years we could see a complete reversal in the ratio of companies operating On Premise systems versus those operating on Cloud based solutions, with Cloud being the dominant platform.

The benefits of Cloud are numerous and well suited to field service, with the ease of remote access being the key factor for companies either considering moving to the Cloud or those that have made the move already. Wider benefits such as the more affordable pricing structure of SaaS, the speed of implementation and less reliance on IT departments are of course also attractive factors to field service companies.

Perhaps the biggest issue that has slowed the adoption of the Cloud in field service to date is the perception that security is an issue for Cloud systems. Yet in reality this has not proved to be the case for those field service companies that are actually

THE FEARS AROUND THE CLOUD.

CONCLUSION

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operating in the Cloud. However, these doubts still remain and perhaps it is a matter of the technology having to prove itself secure over a longer period of time for these to abate fully.

In reality the biggest issue around the Cloud has proved to be connectivity issues and integration with existing legacy issues.

For the latter many providers are finding means of working around these issues including APIs, which allow for easier integration. Also as other elements of business software such as CRM move to Cloud these integrations become more seamless.

Connectivity is perhaps the Clouds biggest weakness.

A system that relies on being able to access the Internet could potentially cause issues for a field service company that operate in remote areas. However, we are also seeing continuous improvements in related areas such as mobile Internet coverage and so the issue of connectivity isn’t necessarily one that will remain an issue in the long term. Meanwhile, many field service management systems, such as Tesseract’s Service Centre 5.1 include the functionality of storing data entered when an operative is out of range and then automatically uploading it when the operative next enters within signal range.

Finally it is interesting to note that throughout the survey there was very little difference in responses from companies of varying sizes. It would seem that the fears and benefits of the Cloud remain the same to everyone in the market.

In summary, the findings of this report indicate that the case for Cloud is already a compelling one, however, there is still some reluctance to the Cloud in certain corners. However, much of this reluctance seems to be based on perception rather than actual evidence.

Also the issues that those companies now operating in the Cloud are facing are potentially short-term problems that the natural progression of technology will eradicate in due course.

Therefore it would seem that the Cloud is set to become an established platform for field service technology, and even ultimately become the most commonplace method of distributing software.

Launched in November 2013, Field Service News is the UK’s only dedicated journal to the Field Service Industry.

Delivering a mix of news, insight and industry analysis via its

web site fieldservicenews.com the Field Service News logo is set to become familiar to any professional who operates a mobile workforce in the UK and beyond.

With a wide range a guest commentators ranging from key industry vendors, specialist field service industry consultants and leading figures from the industry itself Field Service News aims helps you to cut through the noise and find the articles you need as a field service manager or director.

This White Paper was written by Kris Oldland, Publisher, Field Service News.

Tesseract was formed in 1985 to develop, market, sell and support specialised Problem Management Systems for the Service Industry, and can now boast over 300 successful installations world-wide.

“Our singular commitment to Service Management ensures that we are in touch with the requirements of our customers not only for today, but for the the future. Our development within the field of Service Management leads the way for the next generation of Service Operations.”

Providing the Service Management software is only part of the solution. Tesseract provide Training and Consultancy to help you achieve the best possible operation results from your investment immediately. We will also be there in the future to assist you and your System to adapt to the many and varied changes and development in both personal and business objectives.

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