Transforming Service Operations with IoT

Service operations is getting a much-needed overhaul with the advent of AI, cloud computing, big data, and other technologies and tools. As in other business functional areas, Artificial Intelligence (AI) is a primary change agent.

But, in our opinion, the Internet of Things (IoT) is fueling as much, if not more, transformation within service operations, specifically in driving more proactive service, improving resource allocation, and in creating more mutually rewarding customer experiences. We will explore this in detail, but first a couple of fundamentals.

What is “service operations?”

Within an enterprise-level business, "service operations" typically refers to the entire functional area dedicated to designing, delivering, managing, and continuously improving the intangible services provided to customers or internal stakeholders. Unlike manufacturing operations that produce physical goods, service operations focus on the simultaneous production and consumption of services, emphasizing customer interaction and experience.

This area encompasses all activities and processes that ensure services are delivered efficiently, effectively, and to high quality standards, such as managing professional service teams, customer support, customer success, and customer experience. Key responsibilities often involve optimizing workflows, implementing and maintaining technology stacks (such as CRM and ticketing systems), monitoring performance metrics (including time to resolution, customer satisfaction scores), ensuring that service delivery aligns with overall business strategy, and — above all — that customer expectations are met or exceeded.

What is the IoT (Internet of Things) in the context of service operations?

The Internet of Things (IoT) refers to a vast network of physical objects — literally, things — embedded with sensors, software, and other technologies that enable them to connect and exchange data over the internet or other communication networks.

In service operations, IoT sensors can be attached to a wide variety of assets – both those owned by the enterprise and those used by customers – to gain valuable insights and enable proactive service.

• Appliances: Smart refrigerators, washing machines, ovens, dishwashers, and other home appliances with sensors to monitor performance, detect malfunctions (for example, a refrigerator not holding temperature), and even track usage patterns for proactive maintenance or personalized service offers.
• Building infrastructure: Sensors can monitor HVAC systems, lighting, security systems (motion, door/window sensors), and plumbing for facility management, allowing for optimized energy consumption, security monitoring, and proactive maintenance of building systems.
• Field service: Technicians' diagnostic equipment, specialized tools, and heavy machinery used for repairs or installations can have sensors to track their location, usage, and even calibration status. This helps with inventory management, tool maintenance, and ensuring technicians have the right equipment on hand.
• IT hardware: Even servers, network devices, and other IT infrastructure components can have sensors to monitor temperature, fan speed, power consumption, and network performance, enabling proactive IT service and issue resolution.

In essence, any physical asset (or thing) whose performance, condition, location, or usage data can be valuable to service operations is a candidate for IoT sensor attachment.

Connecting IoT and service operation

When IoT devices and systems are connected to a larger service operations platform, such as Dynamics 365 Field Service or Dynamics 365 Customer Service, it can deliver significant benefits.

Proactive and predictive service

IoT devices can constantly monitor the performance and condition of products or assets in the field. By integrating this real-time data with ERP and CRM systems, service operations can move from a reactive "break-fix" model to a proactive, even predictive, one.

For example, sensors on a machine can detect early signs of wear or a potential malfunction. This data, fed into the ERP, can automatically trigger a service request or order necessary parts, while the CRM can alert the customer service team to reach out to the customer proactively before a breakdown occurs. This reduces downtime for customers, improves satisfaction, and optimizes maintenance schedules.

Enhanced operational efficiency and resource allocation

The real-time data from IoT devices provides unprecedented visibility into operational performance. This data can optimize inventory management (ensuring the right parts are in stock for service calls), streamline dispatching of field technicians (by knowing the exact location and status of assets), and even suggest the most efficient routes for service vehicles. This leads to reduced manual data entry, less waste, improved first-time fix rates, and overall lower operational costs for service delivery.

Improved customer experience and personalized service

By connecting IoT data to a CRM system, businesses gain a much deeper understanding of how customers are using their products and services. This allows for highly personalized interactions and offers.

For instance, if a smart appliance indicates a specific usage pattern, the CRM can trigger targeted marketing campaigns for related services or consumables. Moreover, if a device signals a potential issue, customer service agents, armed with this real-time context from the CRM, can provide more informed and efficient support, leading to higher customer satisfaction and loyalty.

Are you in the service operations business? Are you utilizing the IoT to drive improvements across every functional area? Are you leveraging AI tools such as Microsoft Copilot to drive automation in your process and speed capture and dissemination of IoT data? We’d like to hear how it’s working for you, and if it’s working for you, and share how Argano can help the IoT and AI work across service operations,  field service, asset management, customer experience and more. Contact us today to start the conversation.