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Why it’s service crunch time for capital equipment manufacturers

(Image credit: Image Credit: Chombosan / Shutterstock)

As consumers demand that businesses shift towards a service-centric mindset, capital equipment manufacturers are being pulled into an uncomfortable change. Historically, capital equipment managers sold products. However, customers increasingly care only about uptime (renting products rather than owning them), and capital equipment managers must now reinvent their roles.  

Alongside moving towards a ‘Product-as-a-Service’ model, capital equipment managers are now responsible for maintaining and servicing products. These products are mission critical assets for many organisations, so capital equipment professionals must transform their entire business model while also mitigating risk and keeping costs low—which brings numerous industry challenges.   


Substantial transformation   

Shifting to a ‘Product-as-a Service’ model from a legacy of selling high costs assets with service contracts naturally results in significant impacts across a business. Each stage in the process is inherently linked, so the approach must take a holistic view to successfully transform the business to reap the benefits of this change. 

With the service operation siting at the crossroad of sales, product, and customer, redefining service operations is core to a successful transformation. As seen in the software world, where Software as a Service (SaaS) and cloud-based offerings are quickly becoming the customer-preferred approach to consuming capabilities, capital equipment providers must undergo a transformation to support this demand from customers, and ensure competitiveness and profitability.    

Avoiding added headcount 

Another key consideration when seeking to improve operational efficiencies in manufacturing is striking the right balance between elevating service delivery and productivity without increasing headcount. Hiring truckloads of field technicians, training them, or even purchasing an existing third-party service provider, doesn’t address business fundamentals. At best, it’s a short-term win in increased service presence at the expense of operating costs and suffering profitability. At worst, the costs will overwhelm the organisation, service will slip back into the status quo, and the brand will take a hit.    

How, then, do providers ensure that exceptional equipment output levels are maintained to drive competitiveness while managing operating costs? Technology plays an important role here. 

Solutions – Technology 

The capital equipment sector is already a leader in the adoption and implementation of the Internet of Things (IoT). Many savvy industry providers use the IoT to monitor the condition of capital equipment, diagnose issues, and even track replacement devices, assets and parts as needed. With the adoption of IoT, Aberdeen Group reveals the capital equipment industry’s ‘first-time-fix’ rates are higher than that of other industries operating in field service environments. Using the IoT brings better business visibility and increased access to relevant customer, site, and asset details to ease field service efforts when they are required.   

However, an Aberdeen Group study found that while the capital equipment industry is leading the way in IoT, it is less advanced when it comes to the adoption of mobile technologies. These mobile technologies include: 


Armed with detailed and contextual data—and by having a complete view of the customer, their site(s), individual assets, past performance, current operational metrics, and historic issues—field technicians can precisely and efficiently resolve problems and address individual issues to help remove future service needs. 

In addition, using Artificial Intelligence (AI) that learns from the past will allow professionals to operationalise details without taking on massive administrative costs. Tools are already in use across field service markets that gather past data, which can predict future customer requirements. Similar to cloud software solutions that mine details across their customer base, the ability to influence the depth and breadth of details and recognise value allows capital equipment providers to deliver value added services. This can help position suppliers as the experts they are, while also providing the opportunity for an additional revenue stream.    

‘Generation Tech’ 

With Millennials now firmly established in the workplace—and Gen Z not far behind—employers are adopting an increasing variety of technologies to retain their younger workers. Tech entered the workplace some time ago, and now it’s used daily by both employers and employees. But technology is constantly developing and adapting. As manufacturers look to ensure that their engineers can provide effective, innovative solutions, new and dynamic approaches to capital equip will come to play an ever-increasing role in both engineers’ work and end-user satisfaction.   

Unlike their older colleagues, Millennials and Gen Z cannot imagine a world without the internet and have a very positive relationship with technology as well as accompanying attitudes towards the service-centric attitudes of consumers. Consequently, they can get to grips with emerging disruptive technology in the workplace relatively quickly, and will engage to a greater degree than past generations of workers. They’re happy to embrace change and even teach others about embracing new dynamics and how to thrive in them.   


Mobile solutions are well established in today’s world. They’ve evolved from simply representing paper based forms, to incorporating AI that aids a user through the process, and applying context to support an experience that focuses on bringing value to the user (e.g. reducing the administrative efforts, training required to use the solution). Likewise, the ability to work offline for extended periods, with access to attachments (e.g. SOPs, SWIs) across many devices, as well as the expansion of networks, helps users continue working without connectivity concerns.   


Augmented Reality (AR) is certainly less adopted than mobile solutions, but can provide tremendous value where complexities exist and the availability of skilled labour is an issue. Adoption is often a challenge with both AR and mobile solutions. Engaging the users as you evaluate solutions can help mitigate these concerns, allowing users to provide their input and gain insight into the value such solutions bring them. 

As customers continue to push their desire to pay only for the value that capital equipment brings, the ability to increase precision used and optimise the service operation will set competitors apart. Data gathered becomes incredibly valuable for projecting the future, anticipating issues, optimising manufacturing and design, and incorporating a process that feeds itself to continually improving itself. With greater precision inevitable, those equipped to gather and operationalise these details while minimising costs, will not only be positioned to improve their offerings, but also take on innovations that continually press toward individualisation. 

Steve Smith, VP of Strategic Industries, ClickSoftware

Image Credit: Chombosan / Shutterstock

Steve Smith
Steve Smith is VP of strategic industries at ClickSoftware.