Service and added value: What does it mean in a post-pandemic world?
By Julian Hobbs, CEO UK Commercial Finance, Siemens Financial Services
In the world of B2B commerce, there is much talk about the importance of service. Service – some form of ‘added value’ - can make the difference between closure or coming second. But what does that mean in practice? I’d like to use the illustration of our own financing business to paint a picture of what ‘service’ really adds up to – on the ground and in the real world.
Every year, we invest heavily in measuring satisfaction levels with our OEM and reseller partners. We need to know how they feel about the support we are giving their business growth, where it is good and where it may need further work. Using the widely recognised methodology of ‘Net Promoter Score’, our target is always to be in the upper quartile of players in our sector – something we have managed for the last ten years and more. Our most recent such exercise – covering the full year 2021 – delivered a market leading score. Lifting the bonnet on the components that made up this achievement, however, starts to reveal where that satisfaction came from in more detail.
The last two years have seen an unprecedented acceleration of digital transformation – in the financial services sector, this transformation began years ago in the consumer space and over the last few years has taken hold within B2B.
This transformation was driven by two key shifts, one is the behaviour of the business customer, who increasingly embraces digital solutions.
As UK businesses embrace digital solutions in larger numbers, they want the same kind of service as their consumer interactions.
Accordingly, having moved out of the pandemic period, we’re keenly looking at our market-places, along with our OEM and reseller partners, to identify what has changed for good and what trends have now accelerated. The annual net promoter score exercise is just one aspect of this process.
As-a-service
One key trend is the move towards acquiring technology ‘as-a-service’. Not only does the phrase include the word ‘service’ – it also serves as an example of what the advantages of ‘added-value’ service can look like in practice. The really interesting thing for us at Siemens Financial Services is that the ‘as-a-service’ or ‘managed service’ approach (paying a monthly fee for use of a technology solution) cannot be achieved without the kind of smart finance that SFS provides. Smart finance is the essential enabler, bridging the reseller’s or OEM’s need for up-front payment and the end client’s desire for spread payments which align to the benefits they will gain from the solution. At SFS, the collective expertise and knowledge about how those manufacturing, infrastructure or healthcare solutions work in practice means that we can carve a financing structure that exactly fits the end client. And this is available to our reseller partners both larger and smaller. In fact, it’s arguable that for smaller players, offering smart financing options is one of the most effective tools helping compete effectively against larger rivals.
What is smart financing?
Breadth of financing solutions which offer a true spectrum of financing products and solutions which can be flexed and customised to fit each organisation’s individual circumstances.
Technology expertise
Leveraging deep understanding of the technology and how it is applied in practice, plus the benefits and return on investment it delivers in real-world applications.
Smooth, sophisticated processes which put customer experience front and centre – delivering speed and ease, supported by digital tools, techniques and specialists sector experts.
So, ‘service’ has now offered two advantages – easing cash-flow for the equipment vendor, and removing the need for capital expenditure for the end-customer. In fact, the notion of service goes even further in our business. Not every finance provider can offer smart, tailored support. It’s also important to offer a reputation and proven track record for reliability in all market conditions. End customers and integrators want a financier with an appetite for multi-OEM solutions (finance-offering captives still concentrate on their own products). All parties benefit from a range of financing tools (across leasing, hire-purchase, receivables structures, and so on). And specialist technology knowledge is needed to create optimal structures and terms that fit both sides of the deal like a glove. Digital capabilities are now a mandatory ‘added-value’ service to help OEMs and resellers compete effectively. In practice, this means we – for instance - were able to deliver continuity throughout the pandemic for credit decisions, transaction processing and payments, all because they could be done digitally and remotely. Digital capabilities are also the prime enabler for optimum ease of deploying finance as a sales proposition/aid, rapidity of credit decisions, as well as speed of payout from financier to OEM/reseller.
In fact, when you combine smart finance and digital capabilities, the outcome is more than the sum of its parts. There are no payment terms as with cash purchases, so as soon as the equipment is with the customer and the completed and correct documents are with us then payment is within 24 hours – again, all managed online.
In conclusion
Service is extremely important in B2B commerce. I know that my illustration in this short piece is just one manifestation of what the benefits of good service looks like. I hope it encourages my counterparts in other sectors to describe what best practice in their industries looks like, so that buyers and integrators know what to demand from their business partners.
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