Key Performance Indicators (KPIs) help field service organizations understand how their business is doing over time. Understanding KPIs helps organizations better understand their performance and determine where they need to improve to be more productive, work more efficiently, provide better service, and increase customer satisfaction.
So how do you know which metrics to measure?
Today’s field service management solutions now make it possible for service organizations to collect more data than ever. For example, capture data like time traveled, first-time fix rate, customer satisfaction rates, cost per job, and more. But often the data comes in various forms from many sources.
Unfortunately, many companies are not capitalizing on the vast amounts of data to which they have access. As a result, these companies are missing crucial opportunities to translate this rich data into actionable insights that positively impact decision making.
It is essential that organizations implement field service management tools that can intelligently capture and report performance data. The use of analysis, KPIs, and analytics improves the operational, financial, and service performance of a field service business.
Why KPIs Are Important
Key performance indicators (KPIs) provide a way for businesses to measure their overall performance against stated business goals. These goals determine the specific metrics that your organization should be evaluating.
In the field service industry, most companies find that the majority of KPIs fall into three broad categories:
- Customer satisfaction
- Operational efficiency
- Field worker performance
KPIs are particularly crucial if your business has problem areas. KPIs can help identify the underlying root cause of service problems and ensure that once corrections are implemented, your organization makes satisfactory progress over time.
There are numerous performance metrics you can use to measure your organization's performance. How many KPIs you choose isn’t as important as, choosing the right KPIs. Your KPIs must be closely tied to the most important organizational strategic objectives. As they say in business, people do what you measure, and this absolutely applies to field service management performance.
Here are four key performance metrics all field service management organizations should be consistently evaluating to measure progress toward achieving their business objectives.
1. Process Performance
Optimizing business processes is critical to execute service delivery and must be reviewed regularly. This can be done by implementing workflow management software which uses automation to reduce the number of activities executed, reducing delays and preventing redundancy. Time is the primary metric used to measure performance for process. Any reduction in time used to complete an activity or time saved from delays are key data points you can use to evaluate success.
For instance, all service business needs to know when their field technician has completed an assigned job to understand how billable vs non-billable activities affect their overall performance. Field technicians should spend the optimal time completing relevant jobs as opposed to completed administrative tasks. The goal is to improve productivity, which means evaluating and reducing key efficiency metrics like non-billed and overtime hours.
2. Operational Efficiency
Efficiency KPIs provide a broad snapshot of your service operations. Each organization has its own view of efficiency consequently these measures will likely vary from firm-to-firm. Efficiency measures should be based on how your firm defines success and align with your organization’s strategic goals.
For example, tracking technician travel, response, and repair times are crucial to determine operational efficiency. Identifying KPIs around this allows you to improve efficiency by allowing you to identify issues underlying long repair times. It can also show where additional technician training might be needed in areas such response times or job completion in evaluating technician performance. Finally, field service management software can identify issues related to scheduling KPIs, which when tracked in real time, can help your service team correct issues more quickly.
3. Service Delivery
Whether you are providing service to external customers or internal departments, service delivery metrics need to be analyzed. To get a realistic understanding of your performance, you will need to evaluate your customer metrics versus your cost. While every service organization’s goal is to provide excellent customer service organizations should also consider the cost required in providing the service. Evaluation of performance metrics such as capture time-to-resolution, downtime and equipment availability are vital in assessing service delivery success and identifying opportunities for improvement.
In addition to the performance of field service workforce you employ, you also should measure other service delivery KPIs such as parts and inventory as well. Inventory management KPIs, like the number of ordered parts that are returned unused, can give you important insights about productivity and costs. Automated inventory management solutions that re-order parts, report stock levels and parts usage can help you solve issues by analyzing these important KPIs.
4. Customer Experience
The metrics for customer experience is closely related to service delivery metrics and some may, in fact, feed into both. The difference is that customer experience should be viewed from the customer perspective and the handling of customer communication, the severity, and quantity of complaints, and customer satisfaction and feedback. In total, these factors can give a deep understanding of how your service is perceived and enjoyed by your customers.
All the field service KPIs mentioned above are key to improving customer experience. Measuring the average time taken to respond to calls, for example, allows you to see where you can improve response times which leads to improved customer satisfaction. However, you should also directly measure customer satisfaction, improving this metric increase customer retention rates and revenue.
How Should You Use Your KPIs?
After you have selected the field service KPIs that will be tracked, evaluated, and reported, the KPIs should be communicated not only to the field service team but throughout the entire organization. Your field technicians and broader service team should familiarize themselves with the KPIs and understand how their performance impacts the stated KPIs to achieve goal alignment across the organization.
A good field management analytics system should not only report performance but provide more in-depth trends that can be used for deeper analysis. Actionable insights can be revealed as part of the analysis which can be used as the foundation for fact-based decisions that improve the process associated with related KPIs. This evaluation process should be conducted regularly to be effective and be part of on-going operations and service improvement review.