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Servigistics Rides Post-Sale Service Trend

by Stephanie Neil, MA Editorial Staff

Posted on Sunday, May 13, 2007 1:00:00 AM       Sign Up to receive Daily News Alerts in your E-mail Inbox                               

Manufacturers often cite customer satisfaction as a top priority. But when it comes time to replace a faulty alternator in that American-made car or swap in a new hard drive after a customer's server crashes, it's rare to find a service technician rushing to the scene. All too often, the technician will show up hours -- or even days -- after an initial service call is placed, offering all kinds of excuses about not having the right parts back at the shop. To top it off, the supplier wants to charge a premium for the service.

This kind of treatment occurs because many durable goods manufacturers view the post-sale service model as a necessary evil and a cost -- rather than profit -- center.

However, the reality is that post-sale service represents 24% of manufacturers' revenue and contributes 40% to 80% of corporate profit, according to AMR Research. That's the good news. But the challenge for manufacturers is to find a way to capitalize on the service.

Enter Servigistics, a service management software vendor that offers a holistic approach to post-sale service that includes parts management, workforce management, and strategic pricing models. Formed in 1999, the company has focused on helping customers optimize service parts inventory. Its main product, Servigistics Service Parts Management software, is based on mathematical algorithms that calculate demand history and forecasts to ensure that the right part is available at the right place and the right time. The company has added two more modules to its suite that offer workforce management -- planning, scheduling, and field service -- and pricing management.

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