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About the Author
John Arthur Ricketts is a distinguished engineer in IBM Corporate Headquarters. As a consulting partner and technical executive, he has dealt with many services management issues, including those faced by clients in their own services businesses. His work in applied analytics led him to become a focal point on Theory of Constraints (TOC), and then to delve deeply into its potential for services management. His book, Reaching the Goal: How Managers Improve a Services Business Using Goldratt’s Theory of Constraints, was published by IBM Press.
Dr. Ricketts’ research and teaching have won awards from the Decision Sciences Institute and the Association to Advance Collegiate Schools of Business, as well as IBM. Prior to joining IBM, he was a professor, manager of applied research, and director of software engineering. Since joining IBM, he has worked on business development, service delivery, professional development, intellectual capital development, and strategic initiatives. His graduate degrees are in management and information systems, with supporting fields in computer science and behavioral science.
CHAPTER 30
Customer Support Services According to TOC1
Alex Klarman and Richard Klapholz
Introduction—the Need for Change
For several years, Customer Support Services2 (CS) operations were viewed as an enhancement to product or service sales and a significant revenue generator in itself. Over the years, however, the environment has changed dramatically where CS is providing only a marginal revenue stream at best in many operations.
The purpose of this chapter is to provide a “when to” and “how to” guide for analyzing the problems and designing a practical solution in the area of CS in product organizations. It shows how successful companies accumulate a very large installed base of their products over the years, with various commitments to its users. It can be either a blessing or a curse.
Good CS can be a significant asset, creating opportunities for repeat sales at low cost and effort. However, problems in this field can require ever-growing resources and steadily diminishing returns, as well as possibly jeopardizing future business relationships with clients and users.
The various domains of CS are presented, including the warranty, the nature of service contracts, the impact of CS on the revenues and the expenses of the firms, and the resulting impact on its bottom line. An analysis of the pertinent problems in all of these areas is addressed as well. The direction of the solution and the major solution components are described with respect to how they solve the core problems and therefore eliminate the limitations of the traditional approach to CS. Additional supporting actions required to provide a complete solution are given. Implementation and day-to-day management issues are discussed.
What Is Customer Support (Also Known as Technical Support)?
CS is a vast area of modern economy, and there is hardly a product or service that does not necessitate the use of it. Be it a cell phone, an electric can opener, a notebook computer, a TV cable service, a food processor,