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Show Me the Money: ROI From Wireless Job Dispatch

April 17, 2006
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Introduction

The benefits of mobile business solutions for field service are many and wide reaching. Business drivers such as worker productivity, customer service, and cost reduction are all positively influenced and the results flow directly to the bottom line profitability of the business. But wireless mobility comes at a cost and the investment required realizing these benefits can be considerable. Intuitively, a case can easily be made for a wireless investment but the days of technology for technology's sake are over. In today's competitive marketplace a clear return on investment (ROI) must be shown - in short, the numbers have got to add up.

In making a case for a wireless mobile solution in field service, this article discusses the business areas positively influenced by wireless job dispatch applications and the ROI achievable. It identifies areas where changes may be required within a company implementing wireless applications to ensure a positive outcome.

Mobility Background

According to a recent study by Accenture, mobile business solutions can dramatically improve a company's operations by bridging a growing gap between on-site employees and remote employees, assets, and inventories. Traditional on-site employees enjoy real-time access to enterprise data, which leads to higher productivity, greater efficiency, and improved agility. However, companies are increasingly becoming less traditional. More than ever, employees, assets, and inventories are located in remote locations, disconnected from the main office's people and systems. Between them sits the gap that wireless mobility can help close and, in the process, generate measurable business benefits. This trend is fueling dramatic growth in the uptake of mobile business solutions. Predictions for the U.S. market alone by the Yankee Group indicate that "Over 2 million field service workers will use software solutions that combine wireless data capabilities by 2008."

In the past, mobile business solutions have been the domain of large corporations and have simply been too expensive for small to medium sized businesses. Not any longer. Access Markets International (AMI) Partners Inc. reports that small to medium sized businesses are expected to lead the market in the near term rising to nearly 16.3 million users in 2006, amounting to a compound annual growth rate of 44 percent. Robust adoption is projected among small to medium sized businesses due to the lack of internal bureaucracy, the availability of more turnkey solutions, and increasing recognition of high return on investment, efficiencies, and competitive advantage from the deployment of mobile business solutions.

Driving these growth projections are wireless carriers who have made huge investments in wireless data networks. Key factors include:

  • Improvements in network coverage, reliability, and technology, e.g., Push-to-Talk and Location Based Services (LBS);

  • Device prices and suitability:

    - 2002 - Suitable device for business application - $900 PDA,

    - 2004 - Cell phones capable of running business applications - Free with a call plan; and

  • Wireless data applications are seen as a way to drive revenues.

    Business Benefits of Mobility

    Deploying a mobile business solution is a powerful way for a company to gain competitive advantage. Many of yesterday's early adopters have become today's market leaders, as they use mobility to build capabilities that further separate themselves from those that have been slow to the game. In addition, changes in the market are converging to promote wireless technology adoption rates. Key factors include:

  • Desire to make mobile workers more accountable,

  • Recognition of current inefficiencies,

  • Importance of customer service,

  • Comfort with use of cell phones, and

  • Drive to improve the bottom line.

    Field Service Issues

    Within field service industries a number of attributes make them prime candidates to benefit from a mobile business solution such as wireless job dispatch and management. Central to this is the fact that managing field service is often difficult to say the least. Poor response times, errors, lost paperwork, time wastage, and customer service issues are just a few of the challenges faced. Specifically, problems can be identified in the following areas:

  • Communicating with and managing mobile workers;

  • Data entry and the errors that result from paper-based job management and time/attendance systems;

  • Large time gap between work completion and invoicing;

  • Managing service agreements;

  • Vehicle costs, cell phone and other communication costs; and

  • Maintaining or improving customer service standards.

    These issues affect the business in various ways; however, they all have one thing in common - they hit where it hurts most - the bottom line!

    OK - Show Me the Money

    In exploring the ROI attainable from wireless job dispatch and management, some assumptions have been made with respect to the staff employed and the management of work and field service teams. These assumptions are based on over 20 years of experience in deploying field force solutions and draw heavily on feedback and case studies of customers using the ECONZ Wireless EService application.

    An ROI calculator employing financial management tools is used to provide a clear picture of the areas influenced and the return to the business. Areas explored include activity levels, staffing, current expenses, and average job charges and costs.

    Below is a list of the areas addressed with stated assumptions of the returns used in the ROI calculator:

  • Productivity: Worker productivity improvement is the number one benefit in terms of ROI. Improvements result from:

    - Elimination of timesheets and job paperwork: Client details, time, parts and materials, equipment information, and data forms are all completed electronically. Calculated as a function of the time saving, average job duration, and average job margin.

    - In-field productivity: 5 percent improvement in productivity of mobile worker. Less time between jobs, fewer returns to base. The mobile solution can walk the worker through the job, providing greater consistency, enforcing business rules and improving customer service. Calculated as number of additional jobs times average gross profit per job. Greater worker visibility allowing the scheduling of additional work.

  • Lower costs: Costs are reduced in the following areas:

    - Dispatcher: 10 percent reduction in dispatcher's time. Wireless dispatch allows for rapid and efficient assignment of orders to the right mobile worker at the right time. The workflow status of the mobile worker is available to the dispatcher at all times. Savings in job administration, communication costs, and rework caused by error and omissions.

    - Data entry: 33 percent savings on data entry. System reduces requirement for data entry. Errors and duplications are virtually eliminated. Customer and mobile worker queries are quickly and easily handled through up-to-date information from the system.

    - Vehicle expenses: 10 percent savings. Eliminates unnecessary returns to base. Optimizes dispatch routing.

    - Inventory management: Elimination of 80 percent of inventory loss (shrinkage) through accurate recording and tracking of inventory consumption.

  • Non-monetary returns: The emphasis of the ROI discussion has been on productivity improvement and cost reduction benefits. A number of other worthy benefits have been ignored due to difficulties in quantifying their financial return to your business. These factors include:

    - Management decision-making: Strengthened through improved job information, visibility of mobile workers, and reporting. More time for strategic, revenue/profit building activities.

    - Time savings for managers: Improved through reduced time required for worker management, administration, and paperwork.

    - Customer service: Improved through systemized workflow, faster response times, and better customer information available both in the office and also to the field worker.

    - Cash flow: Increased through the ability to invoice immediately after a job is completed. Job sheets awaiting data entry and invoicing represent cash to a business. Speeding this process up is a significant benefit.

    Return on Investment

    Wireless job dispatch will often produce a high ROI result. This result is due to two major factors:

  • Managing mobile service businesses is difficult and inefficient. Wireless job dispatch solutions are designed specifically to address the largest issues facing these businesses, providing the potential to return large productivity and cost saving benefits.

  • The hosted, Web-access model of solutions such as EService enables small to medium size businesses to gain the benefits of wireless job dispatch at an affordable cost. With no upfront charges and monthly access fee payment, users get returns as soon as they start to use the application rather than waiting months or years to recoup their investment.

    ROI Example

    As an example we have taken a food equipment service company with 10 field workers and two back office staff handling job inquires, job dispatch, data entry, and customer billing.

    The field service team average four jobs per day, 22 days per month, and are paid $25 per hour for a 40-hour week. The average job is billed at $352.00 and direct costs are $211.00, giving a gross margin of $141.00.

    Each field worker spends on average 30 minutes per day on job paperwork and timesheets.

    Productivity Calculation

    This productivity-based ROI calculator (shown at right) determines the return that can be achieved with a wireless dispatch solution considering only worker productivity improvements. Significant cost savings such as data entry and dispatch improvements are ignored. The return is calculated based on:

    1. 5 percent improvement in productivity of mobile worker. Less time between jobs, fewer returns to base. The mobile solution walks the worker through the job, providing greater consistency, enforcing business rules and improving customer service. Calculated as number of additional jobs times average gross profit per job.

    2. Elimination of timesheets and job paperwork. Calculated as a function of the time savings, average job duration, and average job margin. Job ticket and timesheet information including client details, time, parts and materials, equipment information, and data forms are all completed electronically.

    What Now?

    The ROI is there but how do you make sure that you get it? The answer to this question is the same every time... the companies that get the greatest ROI are always the companies that:

  • Review their work processes to ensure that they are using best practice job dispatch and management principles;

  • Devote senior management time and effort during implementation;

  • Appoint a product champion responsible for "selling" the application internally;

  • Make field workers part of the process - help them to understand why the company is doing this and how it will benefit them; and

  • Share the return - consider implementing a "productivity bonus" to reward revenue growth.

    Steve Davis is with ECONZ Wireless, provider of the EService wireless job dispatch and management application for field service companies. For more information, visit www.eservice.econz.com.

    Publication date: 04/17/2006

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