Smart Service Contract Management Unlocks Sales Opportunities
By Tina Lux-Boim
Most, if not all solution providers know that service maintenance is the guardian of their customer’s IT investment, not only in a traditional sense for hardware—servers, mobile devices, PCs and networking—but also for software and services as well. Business IT managers know it, too.
It’s no secret that service contracts add value to solutions delivered by the channel, build long-term customer loyalty, offer partners an annuity revenue stream and, most importantly, give customers a feeling of safety that their
IT assets are protected.
For many organizations, at the heart of every provider relationship is a sense of trust, knowing that your trusted advisors (and the vendor in many cases) have your back. With service contracts, many businesses look to their solution providers to monitor and manage service expirations and renewals. Who do the solution providers, in turn, trust to make certain they get it right?
For MMI, many of our channel partner clients are challenged by managing multiple contracts and contracting vehicles for their maintenance and services sales. Many use a simple Excel spreadsheet to manage the complexity—not the most suitable answer to ensure their customers receive timely warranty and contract exit notifications that allow them to make decisions regarding any additional maintenance purchase or potential hardware refresh.
Our answer for partners is powerful asset and contract management software, and the ability to automate proactive notifications from that information. Absent these critical tools, solution providers risk losing key sales opportunities and the trust of their clientele.
The upside for partners is huge:
• Increase revenues by improving maintenance and service contract renewal rates
• Reduce contract management time and cost
• Improve customer satisfaction and retention by proactively renewing service contracts
• Identify opportunities for new and replacement equipment sales
And, the stakes are just as high for businesses. In this tight economy, organizations are scrutinizing every decision for critical business functions to ensure they see a clear and undisputable advantage or gain in their business. Automating service renewals—either through a solution provider or outsourced to a third party–is a viable option to ease labor intensive and expensive processes. The benefits are even more pronounced when the opportunity to automate is in the cloud, requiring little to no capital
For channel partners and businesses with critical service maintenance contracts protecting their IT
investments, here are a few watchwords to heed:
• If you are outsourcing service management, make sure you are working with a value provider rather than a volume provider. A value provider brings highly specialized skills, expertise and customization capabilities to the party. A volume provider is more interested in signing as many customers as they can.
• Look for a value provider interested in taking the cost out of service contract management and one that offers technology that rapidly identifies and secures new and renewed maintenance service revenue. A value provider should complement a channel partner’s sales teams by creating visibility into a full portfolio of service and hardware refresh opportunities in a way that makes sense for the business. And, the ability to automate the delivery of quotes to customers making it easier for customers to transact service sales with their provider also is a plus.
• Find a value provider whose development team engages in regular interaction with the business and/or customers to stay on top of their needs. Look for a team with hands-on experience working with the channel and businesses in managing service maintenance.
As a solution provider, your ability to increase annuity revenue to grow your business rises directly with how effective you are at monitoring and managing your service contracts. If you don’t have it sufficiently covered, be sure to contract with a value provider that commands the experience, technology and know-how to help you get it done.