Published in Next Service
The field service management (FSM) market has emerged from the pandemic stronger than ever. And with the green economy taking off and technology migrating into all aspects of the industry, demand for field service – and the software and support to facilitate it – will only keep rising. It’s an exciting time for all involved. It’s also an opportune moment to survey what the growth projections look like and consider what they say about the evolution of field service. Here’s our interpretation.
The Bright Future of the FSM Market
The numbers vary, but all growth forecasts for the FSM market range from optimistic to explosive:
- $8.06 billion valuation by 2028 at 13.9% CAGR (compound annual growth rate)
- $8.93 billion valuation by 2030 at 11.9% CAGR
- $29.9 billion valuation by 2031 at 19.2% CAGR
Different methodologies account for the various numbers. No matter how researchers define field service or what they include in the FSM market, the numbers suggest that demand for solutions that support the needs of field service providers will grow quickly and steadily through the decade.
These numbers, while impressive, are not especially surprising because they are the continuation of long-running trends. Like all other industries, field service has undergone a steady digitization process in recent decades. And while this industry has been slower to adopt technology than some others, operating with just spreadsheets and basic technology looks less viable every year. Most providers now acknowledge the need to evolve into tech-driven businesses. The sudden disruptions of the pandemic only confirmed that fact, forcing providers to become mobile, digital, and customer-centric like never before. In this environment, FSM software has progressed from beneficial to more or less mandatory.
Increased interest in FSM software will propel growth in the industry. So will a growing number of vendors, applications, and service providers. Some estimates suggest that the market for FSM services – things like training, consulting, and implementation support – will grow faster than the market for FSM software. Both, however, are on an upward trajectory that indicates the FSM market at the end of the decade will be more robust than ever.
Comparing Growth Across the Globe
North America has historically been the largest consumer of FSM solutions since it has large markets for field service and numerous mature providers. Estimates suggest North America will continue to be the leading market, but other regions are driving much of the growth in the field service market.
Europe, for example, will account for up to 31% of the growth through 2025, according to one estimate. Large spikes in demand will come from Germany and the UK. Still, demand will rise continent-wide as field service providers rely on automation, cloud computing, and field mobility solutions to meet evolving customer requirements and stay relevant in competitive markets.
While FSM markets will grow worldwide, including in EMEA, the most robust growth will happen in Asia. Rapid economic development throughout Asia will increase demand for field services overall. But it will also elevate customer expectations in ways that providers will need help from software and data to meet. If providers in Asia could get by without FSM software, that’s no longer the case.
Comparing Growth Across Industry and Company Size
Some industries have a greater appetite for FSM solutions than others, typically those that are complex or subject to strict customer or regulatory requirements. The manufacturing vertical will likely drive the most growth in the FSM market as producers commit to higher standards for quality and efficiency while embracing concepts like predictive maintenance. The energy and utility industries will account for large amounts of growth, and companies in these industries look to increase their mobility and modernize legacy infrastructure. It is not surprising to see these industries high on the list, but healthcare also ranks there, as hospitals and clinics search for better ways to manage large, dispersed, people-driven business operations.
Similarly, large enterprises have historically been the largest consumers of FSM solutions, which is likely to continue. They need technology for a large workforce to deliver services that meet consistent standards for quality, safety, profitability, and compliance. That said, small and medium-sized field service providers feel these same pressures, which explains why FSM adoption is growing the fastest among SMEs. It’s clear that all providers now see the need to run on technology and that late adopters have the most ground to make up.
What’s Driving Growth in the FSM Market?
Broad trends like digitization and recent events like the pandemic help explain the growth of the FSM market, but more specific factors are important to note as well:
- Automation – The increasing complexity of service delivery, where things like inventory management, scheduling and dispatch, and compliance must all work in perfect sync to maintain profitability, makes manual, paper-driven processes an extreme liability. Providers are investigating and implementing automation to streamline workflows, eliminate errors, and create better alignment across all aspects of service delivery (and beyond). Automation, in addition to promoting efficiency, productivity, and integration, also helps providers scale service delivery quickly and flexibly. For all these reasons, demand for automation has and will drive activity – both demand and product development – in the FSM market.
- Mobility – With the advent of smartphones, tablets, and low-cost laptops, field service gained an essential tool in its history: a way for technicians to stay fully connected, updated, and informed while still in the field. Now seen as both necessary and accessible, mobile FSM solutions are fast becoming the engine of service delivery. FSM software extends the data and apps used in the home office to technicians in any location, improving all aspects of service delivery, from first-time fix rates to long-term customer loyalty.
- Integration – Point solutions for things like inventory tracking, dispatching, and reporting pose obstacles for providers striving to be more efficient and effective because of poor or non-existent integration between those solutions. As those obstacles – and the inefficiencies and mistakes they cause – become less acceptable, providers are looking to replace point solutions with platforms that integrate more (ideally all) the tools of field service together. Disconnected technologies result in a disconnected view of operations and limited means to manage service delivery in a cohesive, coordinated way.
- Record Keeping – The need to collect, store, organize, analyze, and distribute more data for more purposes also contributes to interest in FSM software. For instance, providers subject to regulatory requirements need ways to ensure that techs collect the correct information systematically. On a larger scale, any provider benefits from having more data, broader access, and better insights to guide decision-making. FSM solutions can replace paper-based processes with digital data and collect the same data in one location for easy access, analysis, and auditing.
- Customer Satisfaction – Customers expect field service providers to be flexible, transparent, and accommodating. They will quickly leave providers that can’t deliver the level of service they want. Meeting these expectations takes more than just commitment and customer service; it takes tools that enable field service to run seamlessly even when the unexpected happens. Technology keeps customers engaged, so logically, the FSM market is expanding quickly.
Key Takeaway for Field Service Providers
All the data about growth in the FSM market points to one key takeaway for providers in this industry. Namely, that field service runs on technology. It’s no longer a tool used by only the largest, wealthiest, or most cutting-edge providers. It’s no longer something that’s “nice to have,” either. The growth in this market is a direct reflection of the fact that every field service provider, no matter their size, specialization, or location, needs to have field service management in place. From here on out, providers should consider it a requirement for remaining competitive and relevant and see not having FSM software as the origin of all their problems. As the market for this software keeps growing, the holdouts will shrink until every provider has FSM software. Better to join that group sooner rather than later.
Next Service – Pioneering the Future of FSM Software
Next Service has quickly become a standout among other vendors. The deep and diverse toolkit we offer meets the needs of every provider and rises to the occasion in any service situation. Most uniquely, our software runs “on-platform” with NetSuite, sharing the same databases so that service delivery and business management systems work in perfect parallel and exchange information seamlessly. Our emphasis on maximizing ROI wherever possible makes Next Service a safe bet for any organization that has selected NetSuite as their ERP system.
For those providers who see the writing on the wall and realize it’s time to adopt (or upgrade) FSM software, Next Service makes any provider competitive in their market and compelling to their target customers. To get a free demo and consult, contact us.
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