Calculating The Cost of MVS Support
Impacts To The Customer Experience
And The Bottom Line
Author: John Ragsdale, Vice President of Research, SSPA

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Look Beyond the Numbers: MVS Support Costs Rising

At first glance, it would appear that MVS incidents are dropping. According to SSPA Benchmark data, MVS incidents represented 37% of total incidents in 2003, but only 30% in 2006. The number of these issues requiring collaboration with a 3rd party vendor also dropped, from 19% in 2003 to 15% in 2006. But as shown in Table 1, these percentages are misleading.

Table 1 MVS Trends 2003-2006

Source: SSPA Benchmark Data

MVS issues continue to increase because:

• Total interactions are increasing dramatically . Though the percentage of issues involving MVS dropped from 2003 to 2006, there was a 111% increase in interaction volume during this time period, so the actual number of MVS issues grew. On average, SSPA members had 2,974 MVS incidents per month in 2003, and 5,091 incidents per month in 2006: a 71% increase in MVS incident volume.
• Issues grow more complex . Troubleshooting is especially difficult when there may be more than one other vendor involved. Enterprise support teams have long provided assistance for database and operating system issues involving other vendors, but new platforms and infrastructures, from Web Services to Open Source, constantly raise the complexity bar.
• Consumers are feeling the burn. The biggest increase of MVS issues may be on the consumer front. A home technology user’s problem could be caused by a desktop computer, the operating system, a software application, peripheral hardware such as printers and scanners, or the internet service provider (ISV). Consumer companies tied with Enterprise Hardware companies for the highest percentage of MVS issues requiring collaboration with another vendor to resolve, as showing in Figure 1.

Figure 1 MVS Incidents Requiring 3rd Party Collaboration, By Segment

Source: SSPA Benchmark Data

Focus on the Customer Experience

Companies have an obligation to help their customers resolve issues as quickly as possible. With the increased interoperability of today’s enterprise and consumer technology, definitively isolating the failing component to one vendor may not always be possible: a conflict between enterprise software and an operating system version, for exactly, is an issue about which both vendors may need to take action to resolve.

Enterprise Technology Companies Step Up MVS Programs

For technology companies serving enterprise customers, MVS is increasingly treated as a premiere offering or advanced service option. Companies, with examples listed in Table 2, offer “one stop shopping” for any issue impacting their products, whether the failing component is within their own domain or that of a technology partner. Not only are customers provided excellent service, but MVS as an advanced service option can generate additional service revenues.

Table 2 Examples of Premiere MVS Programs

Increased Complexity Leads to Consumer Frustration with MVS

Consumers are burning up discussion boards with frustration over poor or disjointed service caused by multi-vendor support issues. Read the News discussion boards on ZD Net, product reviews for home technology on Amazon, or even consumer advocate columns in newspapers, such as Caroline Mayer’s “The Checkout” column from the Washington Post, and a common theme emerges: consumers have no idea who to call for technical support issues, but whichever vendor they call refers them elsewhere. One of Mayer’s recent columns, “ Tech Non-Support,” spawned a long list of reader postings on the topic.

Consumer companies should review guidelines for handing MVS issues, remembering that:

• Low satisfaction kills brand loyalty . Consumer companies that focus on cost containment more than the customer experience will find satisfaction numbers dipping and campaigns to increase customer wallet share faring more poorly than expected. Consumers will not recommend or repurchase from vendors that do not offer adequate support.
• Root cause is not always clean cut. Compatibility problems between hardware, software and ISPs are not necessarily any one vendor’s ‘fault.’ Particularly from the consumer’s view point, solving a technical issue doesn’t mean the vendor is to blame for the problem, only that they care enough to resolve the issue for the customer.
• Agent incentives may reinforce bad behavior . One manufacturer of consumer desktop computers tracks the number of live interactions deflected to another technology vendor, and offers incentives to agents with higher deflection rates. This can create an environment in which agents refer customers elsewhere before fully diagnosing the root cause or attempting a fix or recovery procedure.

Consumer facing technology companies may look to their enterprise brethren for MVS strategies that are more customer centric. For example, as seen in Figure 2, according to SSPA Benchmark data, consumer companies average half the number of cooperative support agreements as enterprise hardware companies. Consumer companies should also consider introducing different service and support contracts, including a premiere class which offers MVS.

Figure 2 MVS Incidents Requiring 3rd Party Collaboration, By Segment

Source: SSPA Benchmark Data

The SSPA Recommends

Multi-vendor support is not going away. In fact, with the increased complexity of the average home and office, MVS issues will likely continue to climb. The SSPA recommends that companies:

Calculate the total cost of MVS . The SSPA did an informal survey of members with a high percentage of MVS issues, and none could provide an average cost per MVS incident. Understanding the actual costs of MVS is critical, particularly with SSPA data showing MVS issues take 4 times as long as non-MVS incidents to resolve. Consider adding a custom field to track which partner or partners are involved in all MVS tickets, so the cost of supporting each partnership can be accurately determined through simple reporting.

Include MVS support costs in partnership budget . The cost of doing business in the technology industry includes budget set aside to integrate and interoperate with other technology providers. Lobby to include the actual cost of MVS by vendor in this budget. At least list the actual MVS costs in all baseline operating budgets for the support operation, not lumped into the general support budget for your own products.

Push Partners for Innovative Approaches . When business or consumer customers receive the runaround on MVS issues, all technology providers in the partner network can suffer. If a formal partner network doesn’t exist today, contact the tech support leadership at your partner companies and start one. Discuss sharing content repositories, cross-training, shared escalation procedures, and ideally, new approaches to streamlining problem resolution and tracking, regardless of whom the customer calls for assistance.

ENDNOTE
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For more SSPA Benchmark data regarding MVS, as well as additional insights and recommendations, see the December, 2005, SSPA Insight, “Tackling the Multi-Vendor Support Challenge.”

The average number of incidents opened monthly, via all channels, rose 35% from 2000 to 2003, and a staggering 111% increase from 2003 to 2006. See the July, 2006 SSPA Accelerator, “Multi-Channel Adoption Trends.”

If you have any questions about this article, please contact Shawn Santos at ssantos@thesspa.com or 858.674.5491.