White Papers      Webinars  Search

Register for our newsletter:

By making service integral to the product, vendors of smart products provide assistance with tasks, answers to questions, helpful value-added services, or solutions to a technical problem - without disrupting their usage of the product. Smart products become valued not for their features - often easily replicated by competitors and the basis for price erosion - but by the confidence, convenience and well being the products give to their owners.

Vendors of traditional technology products - personal computers, printers and the like - are at the forefront of the smart-products trend, along with an increasing number of broadband and internet service providers. But virtually all product vendors will eventually be affected by the trend, as smart products change the dynamics of the vendor-customer relationship and reset customer expectations of products. With intelligent microprocessors embedded into all kinds of familiar consumer and business devices from cell phones and handheld devices to set-top cable TV boxes to cars and home appliances, the stage is set for smart products.

Embedded systems are responsible for the increasingly sophisticated mobile telephone services offered with each successive product generation. Embedded systems are why Internet appliances will make inroads in business over the next decade, particularly in the hospitality, healthcare, financial services and education industries. Toy manufacturers are beginning to exploit embedded chips with wireless networks to increase the entertainment value of their products. Similarly, consumer appliance manufacturers such as Whirlpool, GE and Electrolux are creating "smart appliances."

Businesses are rushing to get embedded systems into the hands of workers to improve operations, lower product costs and help improve service to end-customers. Automobile manufacturers are beginning to use net-connected embedded systems to help technicians prevent, diagnose and repair problems more easily. Police departments, airlines, shipping services, rental car agencies, stock exchanges, municipalities, retailers and restaurants are equipping workers with wireless handheld devices powered by embedded systems. Mainstream businesses across many industries are installing applications-software products that provide anywhere-anytime-any device access to the company for employees, business partners and vendors.

Embedded service involves weaving service throughout every stage of product ownership. Specifically, it means targeting those "pain points" that can prevent customer success with the product and that could be resolved through appropriate service. Whether they are selling to consumers or businesses, product vendors need to recognise and address the "service lifecycle". Embedded service enhances customer satisfaction and reduces product costs at every stage of the service lifecycle: from researching and purchasing, to installing and first use and through ongoing usage and upgrading.

For example, 3Com has built intelligent service technology from Motive into its Network Interface Cards (NICs). The service enables 3Com to cost-effectively provide cradle-to-grave service (installation to driver updates) to NIC customers by using the Internet and a special downloadable Connection Assistant. When a problem or question arises about networking, installation or another topic, the customer simply clicks a button inside of his product, on the Web page or in the middle of a transaction and receives an answer on the spot, eliminating the need to abandon the business task.

Similarly, Hewlett-Packard is using Motive's intelligent service technology to power its HP Instant Support service for printers and other connected devices (in addition to traditional PCs, technical workstations, and PC servers). Fujitsu Limited is building intelligent, automated service into millions of PC products that are being distributed throughout Japan. In all three cases, embedded services increase the products' utility, improve their quality of experience, and make them less obtrusive in customers' lives.

Vendors of more mainstream products are also leveraging embedded service General Motors' OnStar service allows drivers to get directions, receive roadside assistance and make reservations - all by pushing a single button in the car. Intuit lets consumers and small-business users of its financial software file tax returns electronically, get tax and accounting advice from live experts, obtain credit reports and stock quotes, and access other resources that help them manage their financial health - all from right within their software applications.

Embedded service is consciously tied to the customer's use of the product and targeted at the goal of making them more productive and satisfied. But benefits accrue to the vendor as well: reduced product support costs, new revenue streams from extended services, sales of new products or product upgrades, and so on. For example, 3Com reports that customers who use the Motive intelligent service technology spend at least 45% less time getting their questions answered. Fujitsu's embedded service, which coincided with the rollout of Microsoft XP, is expected to reduce service calls about the new operating system because customers will be able to solve many problems on their own.

So, how can product vendors begin to move into the smart-products arena?

Firstly they need to recognise that embedded systems in themselves are no longer a space-age technology. Customers know - even if at a subconscious level - that microprocessors are in virtually every product they use. As PC vendors will likely attest, product vendors should weigh the value of delivering more complicated, feature-rich products versus differentiated services that make the product more helpful and service-focused.

Secondly vendors should, understand that value accrues not from the embedded systems themselves, but from the specific conveniences and assurances the systems afford customers. The value is not the embedded-service object itself, but the automated service it delivers. Customers want service: they don't want to know why a product has failed, or even if it has failed. They just want it to work - and ideally to fix itself when it breaks - to prevent the host product from noticeably malfunctioning.

Cell phone users will not tolerate things like the Windows "blue screen of death," and cable TV customers will become unnerved if they see a JavaScript error message - manifestations of service problems all too familiar to PC users. Smart products will shield the cell phone customer or the cable subscriber from backstage activities. The most successful smart-products vendors will take a holistic approach to embedded service, always looking through the lens of the customer's service experience.

Thirdly, it pays to think "inside the box!" By weaving intelligent, automated service directly into devices or appliances, vendors can start to approximate a help desk on a chip. Intelligent, automated service uses special software that can understand the context of a problem or question and then respond to it, with minimal human intervention.

With today's increasingly sophisticated service software, vendors can create products that proactively update themselves with new features or head off problems at the pass via "self-healing." Products can opportunistically look for ways to help the customer work smarter or get smarter: for example, a vendor of small-business accounting software could provide built-in access to live experts that augment certain features of the product. Implemented correctly, intelligent service can reduce service costs while providing a better customer service experience that can translate into more product revenues.

Fourthly and most significantly, vendors must realise that embedded service opens up new digital marketing conversations that can present additional revenue opportunities. For example, what about a premium, value-added service that proactively updates a device with the latest software? Or a service that delivers new product features without requiring the customer to bring the product in for a physical upgrade? The infrastructure - net-connected embedded systems - is there for leveraging beyond traditional maintenance and upgrading of systems. Once the embedded-service pipeline is established and credible in a product, it can be used to deliver additional, value-added services.

As intelligent-service technology improves, more vendors will be able to take advantage of it to build better, lower-cost and higher-margin products. Vendors will be able to embed intelligent service ever more seamlessly into products and leverage it to deliver ever more sophisticated forms of service. In the future, embedded service will be a major source of product differentiation for vendors and of value for customers.