What’s the true purpose of your field service organization? What are you trying to achieve on a daily basis? What do you think your goals are?

Here’s one way to look at the development of your FSO.

Peter Drucker is a famous management consultant. In 1973, he famously said that the “only purpose” of any business is to create a customer. (In 1988, he also did predict that within 20 years, organizations would slash management levels by 50 percent -- and he seems to have been wrong on that one. We all make mistakes.) 

Back to his 1973 statement, though. It’s part of what business people who have studied Drucker call “The Five Questions,” which are visually represented here:

 

In a recent article on Harvard Business Review called “The Internet Is Finally Forcing Management To Care About People,” the author (business journalist Steve Denning) makes this point about profits and share prices and revenue:

The foundation is Peter Drucker’s insight of 1973: the only valid purpose of a firm is to create a customer. It’s through providing value to customers that firms justify their existence. Profits and share price increases are the result, not the goal of a firm’s activities.

Read that last sentence. “Profits and share price increases are the result, not the goal of a firm’s activities.”

This is important to remember as you manage your FSO on a week-to-week basis. You work within a service industry. Your ultimate “product” to a client or customer is the service you provide them. It needs to be quick, efficient, and hopefully (in their mind) cost-effective. If you run a HVAC business, there’s a good chance your customers don’t know how to fix a HVAC unit. As a result, they’re not judging you on the process you used. They’re judging you on how they felt about the service and all the aspects of the service. 

Your goal, then, is to create (and retain) customers. You do that through providing strong service. The strong service is the action. The goal is creating customers. The result of all this? Money. Profits. Revenue.

Those are the results -- they are not the goals.

This may sound like semantics, but it’s important to understand. Many leaders of FSOs think the goal of their field service operation is to make money. That’s actually the result of the real goal, which is to create customers through providing great service.

This is all part of a complicated quilt around how to turn your FSO into a profit center. We have put together an eBook on just that, titled 10 ways to make your field service organization a profit center. We run through different options from sales/marketing help to productivity/collaboration tools, and give you ideas in each case for how to evolve your operation into a profitable one. You can download it now.

If you have questions about profitability and customer experience specific to your business model, definitely reach out to us.

 

Written by Jim Hare