Service to the Max for the man in the van

by Stuart Lauchlan
http://www.mycustomer.com/topic/technology/white-man-van-gets-his-own-applications/107733
Posted: 5/11/2010

The proverbial man in a van is famous for many things, from shifting furniture to becoming an influential political demographic in election campaigns. Now that man and his van are the drivers behind a new category of Cloud firm. "Our customers are firms that provide services, they can be medical device firms, industrial products firms, hi tech firms, little firms who do roofing or landscaping – essentially anything that involves driving around in a van," says Dave Yarnold, CEO of field services Cloud firm ServiceMax.

"Our overarching objective is to address the market need that exists for field services across the world. It's been a neglected market. There is nothing out there that is newer than ten years old, no on-demand offering," he adds. "When you get to the field services market, it has long been abandoned. When you get up into the high end, users are locked into long term product cycles with the likes of Oracle and Siebel. Siebel has been our biggest competition."

Pent-up demand
arnold argues that there is a pent-up demand both for functionally rich field service offerings, but more specifically Cloud-based on-demand offerings. "There's a lot of complex mathematics around how field service technicians get scheduled. Where are they, how are they, how do you work their schedules out? There's a need for good applications in field service," he says.

"You know, the biggest shock I've had over the past year has been talking to CIOs at large firms and finding out how ready they are to go to the Cloud. I'd been expecting to come across a lot more resistance. Instead I've heard lots of CIOs saying 'I want to get all this on-premise crap out of here!'. They want to see that there are functional Cloud solutions that they can map on."

That said, ServiceMax is taking an 'entry by stealth' approach to winning business. "We are doing a number of significant pilots," says Yarnold. "We did a small pilot with an industrial printing firm in the UK recently. It was an 8 week pilot where we got a few users up and running. We're currently doing the same thing with a semi-conductor firm. We get in, prove that the value is quick and the technology solution quick and agile and one that they can adjust.

"The proof point is both cost reduction and the ability to generate additional revenue. There are a lot of people in the services industry who are just leaving money behind. You have companies who are shipping out goods without checking if the customer is on a warranty scheme. Such firms are signing up with us for millions of dollars worth of cost reductions and additional revenues. They are able to go to customers and say 'we'd love to do work, but you're out of warranty'."

The Force is strong in them
ServiceMax is closely aligned to the Salesforce.com market, being built on the Force.com platform and seeing a good deal of business coming from the Salesforce.com community. "A lot of our customers are coming to us through the Salesforce.com AppExhchange," says Yarnold. "About half of our customers currently come through Salesforce.com sales reps or through the AppExchange. We've done very little proactive marketing to date.

"We made the great decision to select Force.com as a platform so we have been able to innovate and come at this at a much higher level than we could have done," he continues. "I want us to be an example of how to use the Platform as a Service (PaaS) model and do start-ups in a different way. We still believe as we look at the different platform alternatives that Force.com is far and away the best platform in terms of being an application development platform. In terms of addressing our market, it's absolutely the best platform."

But isn't tying yourselves to a platform such as Force.com every bit as proprietary as some of the technologies of old? "It isn't really proprietary," argues Yarnold. "We are able to take advantage of Google Apps, for example. I don't think it's limiting. We are able to integrate with QuickBooks at the low end and with Oracle and SAP at the high end. It doesn't matter to users what we are under the covers. They want to be able to move transactions into back end ERP systems, so we are working closely with guys like Boomi to make that happen."

ServiceMax was paraded as one of Salesforce.com poster children at the formal launch of Chatter in New York in March, although on first glance it's hard to imagine the field service market being a natural hunting ground for social media proponents. "Well yes, field service guys are belts and braces people who are not worried about Facebook," admits Yarnold. "We are just starting to have conversations with the belts and braces people. Do I want people talking about this as being like Facebook? No, this isn't Facebook. This is collaboration. It's another element of communication.

"I have to say I became a Chatter fan. We are big Salesforce.com users of course, we use it for just about everything. When we turned on the beta version of Chatter, we found that no-one switched it off because suddenly we were all able to interact and share information. Our customers are going to experience it in the same way.

"What we need to figure out is how we bring it into the core of our offering so that we are able to monitor the chatter that runs across our applications. We can have phone me technology from machines that say 'fix me' without waiting for humans to intervene. Chatter functionality will just be there. It will be an enhanced capability that just adds more to our products."

Calling Larry Ellison names
If the field service market is such a potent market opportunity, presumably it can't be long before the likes of SAP and Oracle come knocking with their Cloud offerings in this sector? "We want to go for space and to get enough attention among customers and prospects. When that happens, then the people who run SAP and Oracle today start to see that this is having an impact," concedes Yarnold. "But it does take time for that shift to happen.

"As a company, SAP has no incentive to sell an on-demand solution. To do that they have to flip their sales model and say that they are willing to incentivise their people to sell on demand. Until their sales people are willing to do that, it won't work. As a company, is the SAP DNA there to get behind on demand? I'm not sure. As a company they have been struggling because they are used to monolithic big licence sales. They have the DNA of the old models that conflicts with the new models. In the Cloud industry, we are all hoping that they continue to struggle over the DNA!"

What about Oracle – if Siebel has been the competition, presumably its owner is not about to sit back and watch market share go to a new upstart? "Will Oracle say that they have a Cloud solution? Absolutely. Oracle will actually compete with a hybrid of on-premise field service applications and on-demand CRM. It can take a while for customers to poke a finger at that, but they do."

That's fine by Yarnold who is well aware of the marketing clout of Oracle and seems ready to pick fights where he knows he can win. "Do I want to start calling Larry Ellison names – not yet, it's not the right time for that," he laughs. "I'll let Marc Benioff poke at Ellison for now – we can ride on his coat tails."