Integrated systems contracts are low-voltage specifications created to meet the owner’s current and future needs. A bid specification can take weeks, months or longer to assemble. Winning the bid is a feat in and of itself, considering the market’s competitive nature. When the job is done, if you are simply shaking the owner’s hand and moving onto the next project, you are missing out on revenue that may be greater and more rewarding than the initial installation.
As the global security market expands, owners are paying attention. According to a recent study by India-based MarketsandMarkets, demand is growing for contractors to provide customers with maintenance and support services to maximize their current protection and detection solutions, especially with the increased number of physical security installations.
However, many integrated systems contractors are not taking advantage of this potentially lucrative side of the business, said Bob Harris, president of Attrition Busters, West Hills, Calif. Harris consults for integrated systems contractors on how to boost business profitability.
“There is a tendency to leave that money on the table for other people who are smart enough to pick it up,” Harris said.
He said success is all about generating recurring monthly revenue (RMR) and additional income from service and maintenance contracts.
“With service and maintenance contracts, you still have income when times are slow,” he said. “It’s a way to create your own better economy. But there are three big hurdles: setting a sales process and philosophy to successfully execute these contracts, the wherewithal to be able to properly understand and estimate the profit margin based on the complexity of the job, and understanding the concept of service from the standpoint of profit and loss.
“What’s the potential risk of having a service contract on an auditorium, for example? What was installed and what will it take to execute the contract successfully? Each project is different, but once the contractor learns the processes, it’s not scary at all,” Harris said.
In addition to pricing contracts properly, service contracts have to be regular, consistent offerings. Service contracts have to be a philosophy and way of doing business.
Technology adds efficiencies
Service contracts have evolved with technology and now incorporate advances such as real-time location. Deploying these types of software systems should not be viewed as an expense but as an opportunity to increase revenue, profitability and customer retention because of the ability to serve them better, said Chris Sullens, president and chief executive officer of WorkWave, Neptune City, N.J.
WorkWave provides a suite of cloud-hosted field service and fleet-management solutions that include WorkWave Service, WorkWave Route Manager and WorkWave GPS.
Sullens said contractors and field-service providers leverage internet and mobile technology for more efficient customer service. Contractors are becoming comfortable with cloud-hosted data. They recognize that the data is secure and permits them to be nimbler and more flexible, ultimately reducing field-service costs.
“The cloud and mobile technology allows a technician to have all the information they need about a customer and their site at their fingertips, including the location, schedule, what needs to be done and a checklist of parameters,” Sullens said. “All activity is recorded easily and in real time by technicians on-site who can also capture signatures and payments synced with the cloud application. This alleviates major inefficiencies that can occur when having to input data manually.”
Service goes mobile
New innovations in mobile technology are making the process readily accessible.
In 2012, WorkWave introduced routing algorithms for field-service calls.
“The algorithm matches the technician skills, the kind of equipment they need, if they need a Spanish-speaking technician, the times that the customer prefers, etc. All that goes into the algorithm,” Sullens said. “This saves time for the dispatcher and produces more consistent routes that are on time regularly and provide a better customer experience based on scheduling optimization.”
Micro Key Solutions, Kissimmee, Fla., is a longtime provider of accounting and service, central station and, now, mobile applications for security installation providers. It also sees the effect hosted software is having on the service side of the industry.
According to Victoria Ferro, president of Micro Key Solutions, the biggest change in these types of contracts is ready access to service tickets and service information remotely by way of the cloud or web connectivity, as well as the ability to track vehicles en route through global positioning systems (GPS).
Ferro said it’s critical for integrated systems contractors doing security work to automate their processes as much as possible, because automation adds value to the company’s service, increases productivity and boosts RMR.
“It is important for contractors to go to a paperless service-ticket environment for technicians for several reasons, most importantly, efficiency,” Ferro said. “Mobile technician apps ensure the technician has all the account information and details of that ticket instantly. These apps also link to the company’s main server to ensure that service history is automatically captured and that billing doesn’t fall
through the cracks.”
Automating processes can boost a company’s profitability by heightening time management.
“Companies are always striving to continue to improve processes, and one of the best ways to do so is to automate tedious tasks that waste time and labor and can lead to costly oversights,” Ferro said. “Once a company can get a good handle on automating these sorts of things, it will lead to increased profitability.”
“There’s definitely been an evolution in mobile applications,” Sullens said. “We have been moving all our apps to native applications for smartphones, which allows these programs to work in an offline state as well. This permits the technician or sales technician to do their job and not worry about the integrity of an internet connection.”
GPS tracking assists with more than tracking technicians. Now, for example, it can be used to assess driver behavior on the road, such as hard accelerating and braking.
“The owner or manager wants to know about these types of things,” Sullens said. “These instances can also alert the driver with an audible, such as a buzzer. A lot of positive things come from this, and we’ve seen a dramatic decrease in the number of incidents that could possibly lead to accidents when there’s GPS controls.”
The bottom line is contractors that take advantage of new technology are actually securing their future profitability and giving the customer better attention in the service process. Contractors that are more efficient and productive can add tangible value to the business.
“There aren’t too many things today where you can have your cake and eat it too, but this is the exception,” Sullens said. “If you invest in the right technologies as a service provider, you can do that. Now you have this ratcheting up of customer expectation, and that adds complexity to the business. Technology can help make business more efficient with routing, tracking, etc. It can also improve service levels at the same time, tighten service windows, and help with on-time performance and prompt service requests. Contractors can get a better view of how their technicians are performing in the field. It gives them the opportunity to drive improved profitability and do a better job of serving customers.”
Selling service and maintenance contracts takes a concerted effort throughout the organization. It’s a mindset that every customer should be offered a service contract, so they receive expedited service and have a solution provider they can rely on in the future to keep their system optimized.