The exploding evolution of technology over the last 40 years has produced countless innovations which have changed the entire dynamic of the marketplace – for a time. Over this period, we have seen entire categories of products, and even entire categories of companies, come and go.

Yet, technology services have really not changed significantly in all that time. Both professional services and support services are today largely packaged, priced, and sold the same way they were to mainframe customers in the 1960s, despite all the underlying changes in the technologies they support.

But the momentum of market forces – specifically, increasing product complexity and decreasing product costs – is quickly making that traditional model unworkable. A new model is emerging, called Value-Added Support.

When a customer purchases a product, he/she expects that product to deliver a certain level of value. Traditionally, support’s job has been to restore customers to that expectation of value when something goes wrong. The idea of actually driving customers beyond the expected level of value has never really been an issue.

That’s what Value-Added Support is all about. Value-Added Support services take a proactive approach to accelerating the customer’s time-to-value on a given product, and advance the total value of the product beyond the expectation the customer has at the point of purchase.

Value-Added Support embraces these essential attributes:

• Subscription-based renewable annuity
• Remote, rather than on-site, delivery
• Proactive, not reactive
• Use of integrated technologies to facilitate the identification, packaging and dissemination of knowledge
• Emphasis on one-to-many instead of one-to-one transactions
• Low incremental cost to serve new customers

All these help the support function maintain high operating margins and predictable revenue growth. Thus, Value-Added Support is built on this foundation.

Why is Value-Added Support important?

Traditional support models are all insurance-based – the customer buys a support contract so he/she can rest assured that when something goes wrong it will be fixed in a timely way. Value-Added Support goes far beyond that. It adds value to the customer in two ways. Value-Added Support accelerates time-to-value for the customers, either with or without the professional services organization.

Secondly, Value-Added Support increases the total value the customer receives from the product, to a level beyond what he/she expects at the time of purchase.

This is obviously very appealing to the customer. It means a faster return on investment, and a greater return on investment than was initially expected.

But this is also great news for the support organization, and enterprise as a whole, because with Value-Added Support, the customer actually consumes the product faster. This accelerates the time period prior to the customer re-entering the market for follow-on sales. In turn, that accelerates the follow-on sales business for every customer who receives Value-Added Support.

Add to that the fact that customers who receive more value than they expect are much more likely to purchase more units. This drives product and brand preference, and leads to market share gains.

So Value-Added Support is clearly a driver of product sales, directly contributing to improving both average re-purchase volume and re-purchase frequency in the installed base.

How does your company get started?

Of course, applying the principles of Value-Added Support to your company means forming a careful understanding of how your business works and the specific needs of your support organization.

To begin the process, the SSPA has compiled a list of ten basic ideas (which SSPA members can learn more about here). The list is certainly not comprehensive, but the ideas provide an important starting point for transforming your business. We call them the Ten Essentials for Transforming Support, and all ten are based on a single framework:

• Determining the value-added business and operating model that’s right for your company.
• Reducing the causes of low-value support.
• Shifting resources from low-value support into Value-Added Support.

In ten years, the support landscape will look nothing like it looks now. The transformations the SSPA describes are the primary support leadership challenges of the next decade, and Value-Added Support is an effective strategy for getting your organization out in front of the titanic changes that are coming. The alternative? As Geoffrey Moore, noted author and consultant puts it, “In the absence of a strategy, all you can do is cut costs.” And down that road, there is no future at all.

The concept of Value-Added Support was introduced in an SSPA Executive keynote presentation delivered at the SSPA Services Leadership Conference in November, 2006. The SSPA is committed to advancing best practices that will make these vital support industry transformations a reality—in the next few months, please visit our website where the SSPA will provide members with informative webcasts and white papers that explore case studies on companies that are currently providing elevated levels of support, the organizational impacts of Value-Added Support models, and other trends in the Value-Added Support space.

About Trisha Bright…………………………………………

Trisha Bright is responsible for the overall program delivery, member satisfaction and financial performance for all components of core SSPA membership, including the organization’s website, its renowned Benchmark Study Series, and SSPA News, in addition to other new initiatives.

Bright’s experience has provided her with a deep understanding of both services and marketing, notably field service and on demand businesses which are areas of emerging importance to SSPA.

She joined SSPA from Sun Microsystems, where as senior director of services marketing, she was responsible for developing and delivering Sun’s marketing strategy for network delivered IT services. For nearly 15 years at Sun she was involved in marketing, sales force communication, education services marketing and business development. Bright also worked for a number of start-ups prior to joining Sun. She holds degrees from University of California-Berkeley and Stanford University.