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Report Sheds Light on Service Businesses’ Opportunities and Obstacles

Most companies remain optimistic despite current economic challenges.

June 1, 2023

A report recently published by Zuper, a provider of field service management solutions, together with research and consulting firm Blumberg Advisory Group, sheds light on some of the growth opportunities and obstacles service businesses with field operations (working at a customer’s location) are currently facing.

The report is based on survey data from 200 respondents involved in field service management (FSM) and related business operations within their organization. Per the survey, 64% of companies currently use an enterprise FSM solution, 34% perform between 1,001 to 4,000 service events annually, and 57% have a total revenue of less than US$500 million.

Supply chain constraints, a shrinking labor pool, and declining profit margins continue to challenge many service businesses, according to the report. However, most companies (87%) remain optimistic about growth opportunities over the next 12 months, due to solutions such as scheduling/dispatching software and workflow automation.

While optimism remains high, the report also revealed challenges smaller companies could face with digital transformation and implementing new technology.

“Technology is a double-edged sword in that it increases competition, and the organizations that take steps to build a strategic tech stack across CRM [customer relationship management], ERP [enterprise resource planning], and FSM solutions will be best positioned to drive long-term customer loyalty and employee satisfaction,” said Anand Subbaraj, Zuper CEO.

Other key findings within the report include:

Cause of Growing Field Service Costs
  • 75% saw an increase in field service operating costs over the past 12 months.
  • 25% cited labor supply for W2 and 1099 employees as the most significant factor impacting operating costs.
  • 23% reported rising cost of materials/tools/parts.
Adoption of Technology to Improve Operating Efficiency and Increase Profitability
  • 48% adopted technology to equip service employees with real-time customer and job details to improve employee productivity, accuracy, and service delivery.
  • 42% adopted technology to schedule and dispatch field teams, as well as to optimize routes to eliminate inefficiencies.
  • 42% automated workflows around work order management and accounting processes.
Factors That Impact Positive or Negative Customer Satisfaction
  • 48% reported rising labor and/or spare part costs as the leading factor for changing customer satisfaction.
  • 42% cited technicians’ skill sets and capabilities.
  • 33% noted responsiveness of service organization.
The Impact of Artificial Intelligence (AI) and Machine Learning (ML) on the Future of Field Service Operations
  • 52% believed AI and ML will most directly impact call center operations and customer service chatbots.
  • 43% predicted AI will enhance route optimization.
  • 39% predicted AI will optimize job prioritization.

 The full report can be accessed on the Blumberg Advisory Group website.

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