Dave Mackerness, Director at Kaer, shares not only the details of the Singapore-based business’ journey to Cooling-as-a-Service but also the reason for their passion around the business model, what they learned in being an early adopter, and his perspective on what the future holds.
Sarah Nicastro: Welcome to The Future of Field Service Podcast. I’m your host, Sarah Nicastro. I’m excited today to be here with Dave Mackerness, who’s director at Kaer, to talk about Kaer’s journey to cooling as a service. Dave, welcome to the Future of Field Service podcast.
Dave Mackerness: Thank you very much, Sarah. It’s great to be with you.
Sarah Nicastro: Thank you for being here. Okay, so before we dig into the conversation, and there’s a lot to it, tell our listeners a bit about yourself and also a bit about Kaer.
Dave Mackerness: Sure. So I’m a director at Kaer. I’ve been with them for about 12 years and they have been in Asia for about 70 years, in various lines of cooling houses and buildings around South East Asia, and we pivoted to Cooling as a Service back in 2012, and we offer that for commercial buildings, so your offices, your shopping malls, data centers, pharmaceutical manufacturing, those sorts of facilities. That’s sort of now our core business and as we’re expanding throughout the region into India and some other Asian markets, that’s our only offering that we’re bringing to those markets.
Sarah Nicastro: Okay good. And you’re based in Singapore, correct?
Dave Mackerness: Yes.
Sarah Nicastro: Okay, awesome. All right so it’s night time Dave’s time, morning time Sarah’s time, so good. All right so one of the things that I really loved in talking with you Dave is the conviction you have around this business model. Right? And so I think that’s evident, you said you started this journey in 2012, and I think that’s certainly on the early side, in my opinion, for the industry and probably the region. So, before we dig into the specifics of the journey, can you talk a little bit about where that strong belief comes from that this business model is the path, not only for Kaer, but for a lot of other organizations?
Dave Mackerness: Yes, so I think. You’re right back in 2012 there was no such thing in our industry. I mean servitization had been happening around the world in different industries, but nothing in cooling. And for the first three to four years, we didn’t know if we were crazy or had a great idea, because no one else was doing it. It sort of came around, it was actually… I wasn’t involved in the decision to move to Cooling as a Service, my CEO was and he was talking with our chairman back in 2012 and asked him the question essentially how do we servitize cooling? Essentially every time they came up against a reason they couldn’t do it, he’d say well let’s investigate that a little bit more, let’s see how would we would apply it, and let’s try it. I think that the key thing was they tried it in our first project in 2013.
Dave Mackerness: And as that went along, I think we learnt more about the model and the more I learn about it, the more I speak to people like yourself and other professionals in the industry, the more I’m convinced that we’ve made the right decision, and I think we see this momentum gaining and this is doing two things.
Dave Mackerness: I think one is, it’s delivering a far better experience for our customers. Someone who has, was used to buying CDs and has moved to Spotify, or was used to going to Blockbuster and then signing into Netflix. It’s a very obvious difference and it’s chalk and cheese, in terms of the experience you get at the moment and that was the first thing that became apparent to us. The second thing was we have a real challenge specifically in that, people that are in the built environment may not be aware of this, but people who aren’t won’t be aware the role that cooling plays in terms of meeting some of our sustainability and climate change goals and target. In Paris in 2015 we set out this agreement that said we would limit the global temperatures rise by 2.5 degrees and that’s something everyone understands and is working towards.
Dave Mackerness: What people don’t understand is that cooling has a major effect on what we can do that or not. It’s almost make or break, if we can solve the cooling challenge we can make it, if we can’t we won’t. Cooling now makes up 10% of the world’s energy consumption. That’s today. The need for cooling is going to triple in the next 30 years, so if we don’t have more sustainable systems and better performing systems, the energy consumption of the world will be 30% cooling, so that’s unplannable, we can’t manage that.
Dave Mackerness: So, I think the cost essential benefits of the model is that drew us to it, and now it’s really being, we’re seeing that is the most sustained way and really the only way to hit these goals in terms of sustainability, so that is why I think we’re getting more and more passionate about it, because we see it as the answer and by transitioning to this business model we really can make a difference.
Sarah Nicastro: Okay, so I loved what you said about, then when you started in 2012 you didn’t know if you were crazy or if you on to something, right? Because to me that is a very accurate description of true innovation, right? Because you aren’t jumping on a bandwagon at that point, you aren’t making a minor enough change that it’s very comfortable, right? That’s an uncomfortable feeling, but I think that is a real signal of real innovation and so, I just think it’s interesting to point that out and to let folks know that, sometimes the most significant evolution come from a place of being very uncertain and being very uncomfortable and to your point just trying it out. You can have a contingency plan if this doesn’t go well we can do X or we can revert to the standard but, I think a lot of the leaders, the category leaders are in those positions because they’re willing to takes some risk. So, okay-
Dave Mackerness: And on that certainly, you’re right. There was no leader, there was no one we could look to, to understand is this going to be successful or not. I mean we work for a company that allows us to try new things and you’re right, we tried it so we added it as a service. So we did all of our legacy work that we had done for 70 years in cooling and then we said lets add this as a product or as a service… We started it and got a few customers on board. So what we did throughout year five we actually did all of our legacy business products and these as a service offering as well and then after about five years we looked at the data and there was two metrics we looked at. The first was NPS, net promoter score and we measured the net promoter score of our traditional model and it was okay, I can’t say it was bad, it was just okay.
Dave Mackerness: We looked at the net promoter score of our Cooling as a Service customers, and it was 57%. Which is extremely high. So our customers were just way happier and the same people were offering the other service model on our legacy products, so really it was the power of the model which unlocked that. The second thing was the sustainability, we had been talking about sustainability and performance in cooling systems since 1993, when Kaer opened its doors. Kaer was set up on that premise and we were doing okay, building we were making inroads and making an impact, but it wasn’t significant. With Cooling as a Service we’ve never been in a position like we’re in now to make a real considerable difference, so I was always thinking this thing.
Dave Mackerness: Just this morning there was something, I think it was on the BBC or LinkedIn or something and it talked about there’s a facility, I think it’s in Denmark, it’s somewhere in Europe that is doing carbon capture, and it’s capturing 1000 metric tons of carbon from the air every year. And I read that and I went and looked it up, there is a 55000 metric tons of carbon every year, so just the impact we could have is incredible alone. So when we looked at those two bits of data, the sustainability metric and the NPS metrics, we actually decided in 2018 to stop all of the legacy business, and just focus everything on Cooling as a Service because we thought, we have to really go all in. It was scary and it took five years to get that data to make that decision.
Sarah Nicastro: Yeah, that makes sense and I think that also an important point Dave for the audience which is, you want to take risk, you want to take calculated risk, right? So this idea of when you were doing this you didn’t know if you were crazy, right? Which is the calculated part came from not just shutting off the rest of the business, right? You decided to offer this as a choice to see how it went and to test it out, now over that five years not only do you have the data on NPS and you have the data on the sustainability impact but, you also are building up, I would imagine a variety of customers testimonials that you can leverage so that when you decide to go all in you have a lot of proof points behind you to say “here’s why where doing this”, “here’s why we know that this will work”.
Sarah Nicastro: So it’s, you didn’t just jump off a cliff without a parachute, right? You did so in a way that was pragmatic, but allowed you to get to this point of being able to have the factual evidence to back up the decisions to go all in. Right?
Dave Mackerness: Yeah and I think it was, actually so there’s two points of the decision to try it which was back in 2012-2013. The second one was to discontinue or phase out are other product line in 2018. Now you would think that that would’ve been the scariest point, but by that time we had convinced ourselves and allowed in Singapore and in other markets in Asia, that this was the way forward. So actually that was not a hard decision to make in 2018 because it was backed up by data.
Sarah Nicastro: Right, that makes sense. So maybe you consider this an unfair question Dave because you already said in 2012 when that initially decision was made you weren’t really a part of it but, if you have the backstory I’m just curious, if you’re in that place where you’re wondering are we crazy or is this going to work what was the initial catalyst that sparked the idea within Kaer of, Okay we think this is a feasible opportunity and we want to give it a go. What was the primary drive?
Dave Mackerness: So I do know the backstory. So actually it was a conversation between our chairman and our CEO, and they were having a discussion around why can’t we just sell air? If we sell cool air, why can’t we sell that? I think they had a discussion around Evian and water. How can we brand, they managed to brand water and sell water, so why can’t we do the same thing with air? And that was the catalyst to start thinking about, instead of selling equipment and selling products that people needed to make air, can we sell air itself? And I think it was an idea that was sort of thrown around a few evenings, but then out CEO who started putting it together and so what would that look like, and I think that was the thing that was important for us was that, so Justin Taylor is our CEO and he’s been with us since 1995, and had this discussion let’s see what it would look like and explored various different models, how we would do it.
Dave Mackerness: And essentially servitization wasn’t then, really so much as a known thing as it is now. So looking at different industries, what they were doing and seeing how we would do that and then put together a contract. Put together some friends and web in source and customers and then, it was over those five years, cooling service today is nothing like when we started out. The contracts are different, the deliverables are different, the level of service is different, so working with our customers to figure this out and put something that we were then confident with in 2018 that we could move I think was really important and he’s always been a massive advocate of the business model and really a massive advocate of customer experience. He never talked about equipment, he always talked about customer experience which now is obvious and everyone is talking that way, but back in 2012 it was so common.
Sarah Nicastro: So Dave I think that is a really good point is, want you’re saying what it makes me think of is that when I talk to companies that are really struggling with innovating to the degree that Kaer has, when it comes to really doing a 180 in business model, it’s often because it’s the folks at the top that don’t understand the value or don’t really want to make the change, so one of the things that comes up very frequently is that this type of evolution really requires top level buy in, so your story kind of reinforces that fact and I think it’s really interesting to me that in 2012, he had those view points because you’re absolutely right that in 2021 as a service and customer experience are sort of part of our daily vocabulary but, in 2012 they definitely weren’t, so I think that is super interesting and I think that I would be interested in picking his brain about that at some point so but, kudos to you all for being really on the cutting edge as far as that goes.
Sarah Nicastro: So I want to dig in a little pit deeper to some of the different area of impact that the Cooling as a Service model bring for care. So the first is the customers so let’s talk a little bit about that customer experience because I think that it is really important for organization to understand exactly what it is that their customers want, and be able to sort of reverser engineer how the business needs to change to deliver that, right? So talk a little bit about what this has allowed you all to provide in terms of brand new customer experience.
Dave Mackerness: So I think the business model itself sort of forces you to be relentlessly focus on your customer and I think that every company now says they’re customer centric. Everyone wants to be but, do they actually do it? Is their business set up around it, or do they just talk about how they throw catchphrases out into the market place. So with us, as a service provider, the only way to keep your customers or to get new customers is by differentiating through that experience. Because at the end of the day, our 24 degrees air is a commodity. I mean anyone can put that together, it’s how you deliver it and how you give confidence to your customers that they will have that exactly when they need it with the exact requirements that they have is really important, also how you build relationships around that, how they interact with you as a provider is really important.
Dave Mackerness: In the past, in all business models you get customers by product innovation, so can you get slightly incremental improvement on the speed of your computer and so on. It’s all product features and price and branding and marketing as well of course but, if you think about… Let’s think about Spotify and Apple Music, they’re offering very similar things to kind of the same people and if I sign up to Spotify today I can sign off tomorrow and stop my contract with them. The only way they can hold onto customers is better experience and so it’s forces you to do it, so you can’t rely on product innovation or things like that. I think that the first thing is because you have, and I talk about this a lot when I talk about circularity and sustainability, but it’s valuable for a customer in that when you have a portfolio of building and a portfolio of customers that you’re looking after, that portfolio gives you more data and gives more justification and verification for investing in innovation.
Dave Mackerness: So if I had 10 customers and could invest 50 million on something that could improve their experience it might not be so feasible, but if I have 1000 customers and now I invest that money and that improves the service across my entire portfolio, it justifies the investment. So I think when you’re looking at customer experience, you need to look at data and technology you can deliver to those customers and the approach that gives you the ability to do that. So we have changed dramatically, I mean we’ve been talking about cooling for decades, but we don’t look anything like what we used to five years ago and that’s because of the scale that we have. It allows us to invest in technology, it allows to invest in software and that experience. It also means that you shift the kind of people that you bring in to your organization. So we now, we’ve never had data scientist and app developers and web developers in our company before because that wasn’t seen as core to our business. Now, in the eyes of service world, is absolutely core to our business, it’s as core as cooling itself.
Dave Mackerness: So the business model really makes you shift the way you approach your customers and the way you partner with your customers. This isn’t a go out and win a job, leave the day after. We are with our customers for years, hopefully longer. So our longest customer is I say 2013 and we’re looking now at extending that and staying with them for even longer. So it forces you to be customer centric I think.
Sarah Nicastro: Yeah. There’s so much in this story that is really cool and I’m actually thinking of Dave in real time, not to put you on the spot but, there’s a couple areas I would love to have you back to dig into in a full episode, because I just think in sort of telling the initial story type conversation it’s hard to go deep enough on some different areas and I think, one of those is certainly around risk.
Sarah Nicastro: I think that the conversation around risk is a really important one because I think it’s scares a lot of people away or it forces them to dip their toe in instead of leap. Then what they’re doing is not this true shift, it’s sort of watered down version of it, right? Which then doesn’t accomplish the objectives that they set and then they feel like, oh it doesn’t work. But it doesn’t work because they’re not doing it the way they need to do it to really see what the outcome would be. And I think that there is probably a whole conversation we could have just around excepting the risk that comes with this and why it’s worth doing that. So if you’re game, I might ask you to come-
Dave Mackerness: So I would love to do but, just one or two minutes on risk. You’re absolutely right. When you’re talking about Netflix and software as a service businesses, it’s different investment of dollars in infrastructure, into physical buildings and what happens is that the providers then get nervous around return on investment or some of the risk around what’s going to happen with cooling in the future because you’re now investing. The problem is you cannot look at it this way. You have to understand what is your business risk and what is your customers risk and you cannot mitigate your own risk by putting on your customers contract clauses and penalties that you bake into the business model or essentially tying them down into things or locking them into things to secure your revenue.
Dave Mackerness: Those two things really kill the business model. So whilst you’ll be able to mitigate your risk, you will also essentially spoil your customers away and that is why when Netflix came around they said to me “Dave give me 10 dollars a month I’ll give you all you want” and I thought, I don’t really know, once I’ve watched them all what is going to happen? But I said “I’ll do it, 10 bucks a month”. If they had said to me “Dave it’s 10 buck a month but, you have to sign a 10 year contract and you have to pay me in advance for the first year and to terminate the contract you have to pay me a penalty of six years’ worth of revenue” I would’ve said “Yeah, no but thanks very much”. So you have to stay true to the business model and I would love to talk to you about that it’s really interesting.
Sarah Nicastro: Yeah. I think we should do a completely separate episode on that because I just think there’s too much to that we can’t touch on in a couple minutes but, I mean you think of that as you were describing the Spotify versus Apple experience and you can sign up for one today, try it, see if you like it, if you don’t like it switch to the other one tomorrow and I’m just in my mind seeing people cringe and think ugh that’s not for me, because it’s just not the norm and it is very scary but, Kaer is an example of how it can be very worthwhile to take that risk and I think it would be well worth the time to kind of dive into the layers of that and share a bit how you mitigate it what you need to just be comfortable with and why it’s worth doing that, all of those different things. So okay.
Sarah Nicastro: Anything we haven’t mentioned in terms of impact on company or sustainability that you think we should add? I know we’ve talked quite a bit on the benefits of the business model, anything else related to the benefits to care and the benefits in terms of the circular economy in that which you talk about.
Dave Mackerness: So I think with sustainability, you can look at it in a building by building approach or angle, and from that I mean we could talk a lot about systems that we’re building and including because of used data and used technology you can be far more sustainable this way. We’ve found also, it’s great when you go into this business model you keep finding the benefits. We got a call from the Ellen MacArthur Foundation and they said we want to do a case study on you because we’ve heard what you’re doing. And they were all about circularity. So a circular business model, which when they called and I said “Yeah, of course we’re circular,” I had no idea what that meant so then I started reading about it and understand more and the circularity benefits that you get so not just around sustainability and energy consumption and those sort of things but, if you’re looking at multiple buildings with in a portfolio how do you manage that in the most sustainable way.
Dave Mackerness: So at the moment in the cooling industry, you buy your equipment, you put it into the building, and you cannot change because it’s big infrastructure in the basement of your buildings. As that building goes through its life cycle, if it needs change, you’re stuck with the same system that you had when you built it or when you estimated what you were going to need, way back when you constructed it. So you’re locked in a system and you just have to do the best you can with it. Generally that’s not a great approach and then at the end of the life you throw it away or recycle it, you get rid of it and build a new system. Very linear, and now that we’re working with the portfolio buildings we are able to take a more circular approach.
Dave Mackerness: So, let me give you an example. During Covid we had customers that fell into one of three categories, one was customers that weren’t really affected with their cooling requirements (not so many of those), others were customers that their cooling requirements fell through the floor, so buildings were shut, people were at home – think about offices and shopping malls in the last year. And then you had other customers on the opposite of that coin whose needs went through the roof because they were in pharmaceutical manufacturing potentially, they were data centers, so we’re all watching Netflix not in the office.
Dave Mackerness: So their load requirements went through the roof. What would happen in those cases under a traditional model is they would have very poorly performing systems. With Cooling as a Service, the customers that had increased capacities could serve that new requirement. We could take from where we had excess capacity and move to where we need capacity over here. So what we do is we design modularly we can plug and play cooling capacity.
Dave Mackerness: It doesn’t matter what the equipment is it just matters the output. So for our shopping centers, we would move stuff to our data centers. One example where we had an increase in the load, the cooling requirements tripled in about an 8 month to 12 month period and they, on their roof top they can only have four big chillers, 4 bits of equipment. So what they would do in the old world is throw away the four smaller chillers and put in bigger chillers. What we can do now is we can take down those smaller chillers to use elsewhere and we can install new technology or increase capacity but, it allows us that ability to be a modular design. And that’s really changed and extended the life of our assets.
Sarah Nicastro: Yeah, that makes sense. So this is really interesting too, there is a lot of areas we could dig more into but, that makes sense and I think that the level of flexibility that you have and how the assets are leveraged, to your point the insights you have that you can use when you are responsible for the assets versus the customers, right? And you have all the information you need to really fully utilize all of those things is really impressive. Okay, so I have watched a couple presentation of yours and you’re a very good presenter Dave, I have to say I’ve been impressed and I’ve heard you share a couple of analogies that I would love for you to relay to the audience because I think there really interesting. And the first is your cow analogy, I know there is usually visuals to go along with these but, walks folks through the cow analogy.
Dave Mackerness: So this was how my CEO explained it to me and then I stole the idea. The way it goes is that when we are looking at servitization, we look at innovation in different industries and we looked at different companies and the standard companies come up when you think about what’s disruptive and what’s innovative. So it was Zoom, Office 365, Spotify, Netflix, IBM Cloud, Amazon Web Services, and when you’re looking at all these, Grab Food, the ride hailing Uber, and those sort of companies, we wanted to determine what they have in common. And what we realized was, what they had in common is that they stole their business idea from someone else. Which is quite a controversial statement and then we went on to say, that they all stole their business ideas not just from someone else but, they stole their business ideas from the same person.
Dave Mackerness: And the person that they stole it from was a guy called GW Maxwell. So in 1906 I believe it was in the US, GW Maxwell was the guy who invented the milk carton and he for the first time around, I think it was in San Francisco, he allowed people within that area to, instead of owning a cow to get the benefits of getting the milk that they wanted without buying a cow. They could now buy milk. And we had this analogy that we should be buying milk, we shouldn’t need to be buying cows.
Dave Mackerness: If we want milk in our coffee and our cereal in the morning, none of us own a cow in our house and most of us don’t’ have the ability to do so. So it was that milk carton, that was the first time we ever seen the service business model utilized, which is back in 1906 and since then every single company has used that or stolen that idea whether in entertainment, logistics, ride hailing, or in cooling. It’s not specific to a particular industry. So that’s the cow analogy. We say buy milk, don’t buy cows.
Sarah Nicastro: Yeah, there is a lot of people still trying to sell cows. Metaphorically, right? And so it’s such a good analogy because it’s very true come back to customers want outcomes, right? Customers want simplicity, they want peace of mind, they want what they need when they need it, not and entire cow in their backyard full of milk that they don’t need, right? So it’s a really good analogy.
Dave Mackerness: And then that’s, I think that was part of the original conversation that Justin was having, was we’re selling something that people don’t want, people don’t want cooling systems. They want cool environments that are comfortable to work in or they want process cooling or whatever it may be. So why are we selling something that people just don’t want? it’s almost like a means to and end to get the benefit that you are actually looking for.
Sarah Nicastro: Yeah, now the other analogy is the caterpillar.
Dave Mackerness: Yes the caterpillar effect is something I was looking at, a couple of months ago and it though now it’s hard see this, but as soon as you see it, it just makes so much sense. So what I was looking at was the performance of cooling systems in different buildings across different markets. You could look at the performance of systems in terms of their sustainability metrics or their carbon emissions. And I was trying to look at how wide is the spectrum in terms of performance and not oddly, it’s a very standard bell curve in that you have some people that are doing extremely well but there is not many of them, you have some people are doing extremely poorly, and then you have the vast majority of us in the middle that are doing okay. I then was thinking about the fact that we had to improve because of the Paris Accord and what people were talking about in terms of sustainability.
Dave Mackerness: I started looking at how it’s moving, how the distribution is changing and essentially what happens is the people who are at the forefront, that really care about and have money to drive performance of their systems, they go and buy new technology they have more data and they improve then it goes out a bit and that kind of flattens the bell curve and what happens next is that technology that was expensive yesterday is not so expensive today because there is newer technology so now the people that were in the middle of the bell curve, they have access to more technology and they have access to more data and the wisdom from those guys who went out and tried new things, so they catch up. So the people and the front go forward and then the rest of the world catches up, people go forward and then the rest of the world catch up. I did some slides and was looking and this animation and it just looked exactly like the way a caterpillar crawls. So then it drags the body behind it, moves forward, and then drags the body behind it.
Dave Mackerness: But the thing is, it’s extremely slow and the movement happens in a way we don’t see it. And this is really important. The reason we don’t see it is because we are improving and the front of that caterpillar is moving quite well this axis of performance. So we don’t look at the whole caterpillar we just look at the head, where we were in 2015. And then we get excited and we feel good about ourselves and go and what we do is look at the back of the caterpillar and realize that the vast majority of buildings are still performing worse then the head and to get past that 2015 bench mark will take about 20 years. So it was the caterpillar and how it crawls up this X axis that really got us to think about, okay we can’t stand by and just cheer on this caterpillar and say “Come on, you’ve got to go faster, I’m sure you can do it, come on we will have conferences will go to COP20.” Cheering this caterpillar on just seems like such a ridiculous image to me.
Dave Mackerness: And then we looked at the as a service business and as a service business is not limited by the caterpillar effect because you don’t have this bell distribution that crawl along the X axis of the graph. You have every single customer gets the exact same level of performance, every single customer gets the exact same level of, if you’re talking Netflix which is what I was using as an example, they get the same content, they get the same features. If Netflix improves overnight, every customer gets the new improvement. So I’m a Seinfeld fan, and when Netflix bought Seinfeld rights, overnight the whole world that’s plugged in to the Netflix service model got Seinfeld. It didn’t take 20 years for us all to catch up to that.
Sarah Nicastro: And here you are binging, for days on end.
Dave Mackerness: I’ve seen the first two seasons already, but you know it just really hit me in the face, that the caterpillar takes 20 years to get somewhere and if you move the business model or change it so you are not limited by that it takes 20 hours to get everyone up to that level and it’s really powerful.
Sarah Nicastro: I think in our follow up episode that’s another good point to dig into which is, you see people that are again, some working in earnest that don’t really understand the options for transforming models, some maybe trying to mitigate risk to the point of being detrimental to the truth of the model but, you see people trying to do, let’s do tiered service contracts, let’s do, and to your point every customer gets the same thing, right? So I think that’s another part to kind of dig into which is, what is the integrity of the model and why is it so important? Versus what are some of the common interpretations of the model that often lead to failure or less than ideal results? So, we don’t have to do that today, that’s going to be our follow up but, I think it’s a good point.
Sarah Nicastro: Okay, so two more questions for today Dave. The first is what are your thoughts or predictions on the adoption of as a service and the advancement of it related to sustainability, whatever thoughts you are thinking about the forward look of all of this over the next 12 or 18 months?
Dave Mackerness: I think you will find that adoption of the model will steadily increase, which it has been over the last five or six years. I’m not sure when the tipping point will be. Will it be in the next 12 months, 18 months, 2 years? I’m not sure. But I think will, in terms of, if I go a bit further – maybe 5 or 10 years – I am fairly confident that buildings will be servitized in every part of that asset. From the cooling system, which we’ve shown it can be done with, to the furniture the office is fit with, I know people are looking at doing that already, the IT infrastructure. There are so many people now that are looking to be asset light and agile. I think this is the, it’s the tip of the iceberg for cooling and it’s the tip of the iceberg for the entire built environment.
Dave Mackerness: And I’ve seen the benefits of it and it’s not revolutionary to be honest with you, because if you change the word instead of Cooling as a Service, if you called it a utility, electricity today from a utility provider, that’s electricity as a service. They buy water, from a water utility provider, that’s water as a service. So actually you’re just adding cooling as a service, you will then add lighting as a service. You will have lifts as a Service. Why would you buy infrastructure for lifts in your building? Why don’t you pay per floor that people travel? So technology and data and sensors in the built environment is allowing people to servitize these, until now, unservitizable building services. So I think you will see that happening across the entire board. It won’t just stick to cooling and I think that will be 5 or 10 years.
Sarah Nicastro: Yeah, okay. So we’re going to do a follow up episode if you’re willing on all sorts of different words of wisdom, lessons learned but, just to summarize today’s conversation. What would be your number one piece of advice for listeners?
Dave Mackerness: I think if you’re looking at servitizing your business, you will hear many times why it can’t be done and many times why you need to write difficult contracts or complicated contracts in order to do it. And I think it’s very simple for me – go back to that philosophy I was always told to ask why five times and if they can’t answer on the fifth time then you know it’s not a real reason. Change it a little bit, ask why not five times and every time someone gives you a follow up just say, why not and why not, and you’ll get to the fifth one and you’ll realize you don’t have to stick to the old way of doing things. So really, I mean it’s not easy, it’s very difficult to do and there is a lot of business risk involved but, you can take it a step at a time, you can move towards it, and you can learn from other industries.
Dave Mackerness: We didn’t develop this we stole the idea too, we stole the same idea that all these other companies did but, it’s extremely rewarding and I think when you look at sustainability and circularity it is the single most important thing that we can do across every industry to buy as a service or offer it as a service.
Sarah Nicastro: Absolutely, okay. Ask why not five times, I like that. All right Dave thank you so much for being here today and I look forward to having your back and digging in a little bit more to some of the lessons learned and the risk conversation. So thank you very much.
Dave Mackerness: It’s been a pleasure. Thank you for having me.
Sarah Nicastro: Yes. You can find more by visiting us at futureoffieldservice.com you can also find us on LinkedIn as well as Twitter @thefutureoffs the Future of Field Service podcast is published in partnership with IFS, you can learn more at ifs.com as always thank you for listening.