Augmented Reality in Service: Ready for Prime Time?

Management Report 2018, Si2 Partners have just published the first management report in their “Technology in Service” series on Augmented Reality. Based on surveys of service managers, senior executives and digitization professionals, the reports will shine a spotlight on the state of play of digital technology in industrial and technical service businesses. The survey results are used to draw lessons and develop insights on digital strategies and operational challenges and solutions, best practices, and the right ways forward for companies attempting to master digital change.

Converging advances in Machine Learning algorithms, sensing, connectivity, and computing capacity in the Cloud combined with imploding costs are driving the digitization phenomenon at rapid, and possibly increasing speed. The Internet of Things, Industry 4.0, Big Data and, more recently, AI have become hot constant topics of business conversation and hold the promise of massive improvements in productivity and wonderful new product and service offerings. Additive Manufacturing (3D Printing) and Augmented Reality are emerging as powerful complements. Yet the promise is accompanied by major disruption in the economics of many industries and of prevailing business models. Managements struggle with the consequences.

In its ultimate form, Augmented Reality is a transformational technology: It liberates information and data from 2-dimensional screens or pages and enables radically improved absorption and contextualization by users; It allows remote collaboration in a shared environment; And it acts as an interface between humans and machines, bridging the virtual and physical worlds regardless of location. Already in 2013, Gartner was predicting additional annual profits in field services of US$ 1 billion by 2017 for companies using Augmented Reality.

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Our report examines whether this prediction has happened and analyzes whether and how companies are adopting Augmented Reality technology; the challenges they are facing, the potential solutions and the opportunities they perceive.

Survey Highlights (Excerpts)

  • Augmented Reality (AR) is very new to most service companies and businesses,

but the trend to introduce the technology is accelerating.

  • Less than 1/3 of participants say they use AR in their business today, and of

those, 53% introduced AR only within the past 12 months. But 1/3 of non-users

say they will implement AR within the next 12 months.

  • Remote, virtual support by an experienced human, whether of own field

personnel or directly of customers is the dominant use mode of AR today.

  • But some participants are piloting digital content (e.g. use of 3D models for

instructions or simulations) and integration with real-time machine data

through the Internet of Things to provide context to engineers.

  • Most companies take AR introduction decisions based on productivity and

cost considerations. Most expect to save on scarce engineering resources and

provide better service (faster response times, lower MTTRs, improved FTF rates)

to customers. Some are creating AR-based offerings and have expectations of

additional or different revenue streams.

  • AR projects are mainly initiated by line managers rather than digitization

experts. It seems that the potential benefits of AR, at the intersection of

operational and information technology, are more evident to people directly

involved with operations.

  • Selected AR system features, applications, and use modes are not always fit

for purpose: One size does not fit all. This leads to lower levels of acceptance

and demotivation and can jeopardize the achievement of objectives.

  • Lacking connectivity at customer sites appears to be a significant problem in

AR service applications, where users are obliged to rely on third party or public


  • Satisfaction and acceptance leave room for improvement. Interestingly, customers demonstrate a higher acceptance of AR activities of service vendors than their own personnel. This is not surprising, as, in the end, customers will be the main benefactors of AR applications.
  • Most participants, 56%, are themselves satisfied or very satisfied with their AR system. However, only 44% say that acceptance by users is good or excellent.
  • Most managers say that AR is already making a difference, particularly in speeding up interventions (MTTR) and reducing travel requirements. The majority, 72%, say that results are on par or above expectations, 12% say results are mixed, and 16% that it’s too early to tell.

For further Information visit or email [email protected]

Si2 Partners

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