Astea Survey Finds That CEOs Fail to Back their Support of Field Service with Requisite Investment.

Business Editors/Hi-Tech Writers

HORSHAM, Pa.--(BUSINESS WIRE)--Dec. 2, 2002

CEOs View Field Service as Vital Product Differentiator But Half of

Their Companies Have No Plans to Invest in Field Service Automation

this Year

The great disconnect between CEOs' perceived value of field service and their willingness to invest in field service automation seems to be widening. A recent survey of more than 3,500 field service professionals and their senior managers discovered a major divergence between the importance placed on field service by CEOs and the commitment companies are showing to realize the potential returns of field service through automation.

The survey, conducted by Astea International, Inc., (NASDAQ:ATEA), found that of the nearly 1,900 respondents who claim direct decision making power when it comes to field service -- 56% of CEOs view field service as playing a vital role in their sales and marketing mission, either as a profit center or a product differentiator, but only 42% of those chief executives expected to expand their field service budgets in the coming year. Even more surprising, of the companies that are expecting to invest in upgrading and automating field service, 40% expect to spend less than $250,000 on such initiatives, an amount unlikely to allow for any real gains in field service automation.

The findings come despite a recent AMR Research Report that discovered that service businesses--divisions of manufacturing companies that provide parts, maintenance and other services to customers after original product sales--account for 40% to 50% of a manufacturing company's profit and 25% of its annual revenue.

"Clearly, C-level professionals realize the importance of field service, but somewhere between this perceived value and the organization's investment commitment, there is a breakdown within the organizations," says Zack Bergreen, CEO of Astea International, a leading provider of Service Smart, Enterprise Proven CRM solutions. "Thirty two percent of CEOs rank field service as a potential point of additional sales. Yet investment woefully trails the CEO's stated commitment to supporting field service and benefiting from it--as both a revenue source and competitive advantage."

The gulf is also apparent in employee attitudes toward field service. For instance, while 24% of CEOs say that field service represents a vital product differentiator for their organization, only 8% of field service professionals believe that management takes such a progressive approach when supporting and allocating resources for field service.

"In tightening markets, service often stands as a last defense in maintaining prices and profitability," says Bergreen. "Organizations that can make good on promises for excellent service and perform it at reasonable costs will be the ones that weather the turbulent economy."

Astea International (www.astea.com), which works with leading field service organizations worldwide, offers the following suggestions for overcoming the disconnect in field service:

1. Communicate the value of a present customer in terms of

replacement costs. At a time when new customers are hard to find,

the value of retaining current customers increases. If it

previously took five sales calls at $1,000 per call to secure a

new account, today it could take 15 calls, resulting in an

exponential increase in costs. CEOs must strive to communicate

this point at every level of the organization, quantifying and

sharing real costs at every possible turn.

2. Invest in technology and tools. In the survey, it was

discovered that nearly one-third of field support personnel who

responded believe their technology lags behind the rest of the

organization. CEOs need to support their conviction with real

technology investment, and if they have done so, ensure that the

investment is optimized.

3. Empower employees, customers and partners. Field support

personnel are the ones most likely to become overwhelmed working

on the front lines of commerce. By empowering employees and

customers with knowledge repositories and communications links

that reduce workload and resolve challenges more efficiently,

field service personnel will quickly realize and value the role

they play within the organization.

4. Move information closer to the boundaries of service. For Field

Service personnel to be and feel effective, they must be armed

with real information about the customer relationship. By

delivering this information to the field across multiple

platforms, mobile field service personnel can optimize their value

for the organization and the customer.

5. Recognize, reward and motivate. All of the technology in the

world cannot replace the primary need that drives most employees:

recognition for their contribution. Those organizations that best

communicate the value of field service are also those that

systematically recognize the impact that field service has on the

bottom line.

About Astea International

Astea International Inc., (www.astea.com), is a global supplier of integrated Customer Relationship Management (CRM) solutions that provide service-centric companies with a rapid return on their technology investment. Astea's flagship product, AllianceEnterprise CRM Suite, integrates, automates and streamlines sales and service business processes, thereby increasing productivity, competitive advantage, customer focus, top-line revenue growth and profitability. The full module set includes Sales & Marketing, Contact Center, Field Service, Professional Services and Mobile CRM solutions. Extending relationships from the field to the front office, the Company offers over twenty years of domain expertise, linking disparate business organizations and collapsing the time from contract to cash. Astea AllianceEnterprise manages the entire customer lifecycle from generating leads, to closing sales, to providing world-class support that drives business.

(C) 2002 Astea International Inc. Astea, Astea Alliance Pocket PC and Astea AllianceEnterprise Suite are trademarks of Astea International Inc. All other company and product names contained herein are trademarks of the respective holders.

This press release may contain forward-looking statements that are made under the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995 and involve a number of risks and uncertainties that could materially affect future results. Among these risk factors are possibilities that the companies mentioned in this press release may not purchase licenses for AllianceEnterprise, the continuing acceptance of Astea's products, general competitive pressures in the marketplace, and continued overall growth in the customer relationship management solutions industry. Further information regarding these as well as other key risk factors and meaningful cautionary statements that could affect the Company's financial results are included at length in the Company's Form 10-K for the fiscal year ended December 31, 2001, filed with the Securities and Exchange Commission.