Television, Heal Thyself!
I was asked by an investment banker to comment on business applications of the Internet of Things (IoT) technologies and specifically on IoT technologies and business models that pertain to this awful word “servitization”: equipment service, remote monitoring, predictive diagnostics and so forth.
Their interest in the topic piqued following a recently published article contrasting the author’s own poor television repair service experience with a hypothetical—but presented as realistic—repair scenario utilizing advanced IoT-based diagnostics. The scenario is given below. I changed the language but kept the essence of the original script intact.
- The television’s components monitor themselves for signs of degradation.
- The television set reports status to the manufacturer’s service department.
- The service department initiates a remote diagnostics sessions. Prognostics software indicates that a failure is likely to occur soon.
- Service orders the necessary parts and schedules a visit by a service technician.
- Service technician arrives (on time, for a change) and repairs or replaces the television set.
If you follow the frequent discussions in the press and blogosphere about IoT and its potential role in equipment service, you must have read similar scenarios and have little reason to doubt their veracity and practicality.
But let’s take a closer look. Let’s add some technical and logistics detail to the idealized scenario and reevaluate its technical feasibility and, as importantly, determine if we can make it work from a business standpoint in the real world.
1. Television Monitors Itself for Signs of Degradation
Most of the electronic components in a television set are passive components that have no ability to monitor their state and communicate it to other components, let alone to anything outside the unit.
Of course, the TV manufacturer could incorporate sensors and electronics to monitor key parameters such as voltage, current and temperature, which are common harbingers of impending problems. However, these added features will increase the price of the television set to the point it is no longer commercially viable.
2. Television Reports Status to the Service Department
All modern television sets have digital control circuitry and Internet connectivity, which some manufacturers use for firmware updates. If diagnostics information were available (see above), the same connection could be used to alert the service department about a failure.
However, from a customer service standpoint, this path has a couple of kinks. The responsibility to monitor and respond to service calls in real time adds complexity and resource burden that is impossible to cost justify in a high-volume low-margin business such as consumer electronics. Furthermore, warranty service is often handled by a third party authorized by the manufacture or is performed through the retail store that sold the television to the consumer. These facilities will certainly not be inclined to bear the responsibility and added overhead.
3. Remote Diagnostics Identifies an Impending Failure
We already identified remote measurements and monitoring as too costly for most if not all, consumer products. Even if these were available at a reasonable price, predicting time to failure, especially in electronic circuitry is extremely difficult. Mechanical systems exhibit vibration, noise, speed and response time changes, and similar telltales of deterioration. Electronic components, on the other hand, usually have MTBF that should outlast the typical TV ownership time and tend to fail unexpectedly and instantaneously.
4. Service Orders Parts, Schedules a Service Technician for a Home Visit
Service and parts logistics is a costly part of service operations. If can be cost-justified, remote diagnostics and prognostics technology as envisioned by the idealized scenario would be extremely advantageous in reducing part inventories and onsite visits.
5. Television Repaired or Replaced
In a way, both the manufacturer and the retail store aren’t as interested in repairing your TV; they want to sell more television sets to an already painfully saturated market. Providing high levels of remote prognostics service during the warranty period and shutting it at midnight of the last day of the warranty period will not bode well with consumers!
Service Lifecycle Management
Looking at the big picture of service lifecycle management (SLM), the principle ideas and process improvement proposed in the television repair scenario are valuable and should be considered not only for consumer appliances, but also in commercial applications. However, implementing SLM technologies in a manner that is useful and cost-effective demands careful due diligence.
- The customer value and expected savings from improved service delivery must be defined and evaluated in prudently constructed real-world scenarios
- The improved SLM process must be aligned with the overall business model and workflow
- Prognostics is expensive and difficult, and not always cost-effective!