The following is a guest blog post from ServiceMax partner Magic Software, an enterprise application and integration solutions provider. For more information, visit Magic Software’s listing in our online marketplace here.
In the field service industry, a productive staff, operational efficiency and effective resource management are all essential for empowering an organization’s most important attribute — its ability to satisfy its customers. Benchmarking for operational excellence enables field service organizations to improve customer satisfaction and efficiency by closing the gap between ideal and actual performance measurements through improved work processes and systems automation.
Here are four different types of KPIs (key performance indicators) that can used to benchmark different aspects of field service delivery in order to have the big picture of overall effectiveness.
- Quantitative Measures are tangible measurements expressed as absolute numbers, averages and percentages. This data should be reliable, repeatable and relevant — and collected without unusual amounts of effort. Examples of quantitative measurements include average response time, average repair times and the level of compliance with service level agreements. Your Mean Time to Repair Rate (MTTR), which measures the latency of the entire process from service request to completion, is an example of a quantitative measure used as a field service management KPI.
- Qualitative Measures are subjective or qualitative factors expressed numerically. For example, Net Promoter Score: your customers’ willingness to recommend your organization to friends and colleagues is a widely accepted qualitative measure of business success. It was originated by Bain & Company during research to find a faster, more responsive alternative to annual customer satisfaction surveys. Net Promoter Score is calculated by taking the percentage of promoters (9s and 10s on a 10-point scale) minus the percentage of detractors (0 – 6 on a 10-point scale). While customer loyalty isn’t the sole growth factor, Bain & Company determined that, on average, companies with higher Net Promoter Scores grow at more than twice the rate of competitors.
- Efficiency Measures typically express performance in terms of a ratio. For example, percentage of billable technician time. This lets you keep track of time your techs are actually working on servicing your customers rather than filling out timesheets, attending meetings or handling other activities unrelated to productive work. Other important field service metrics include First-Time-Fix Rate (FTR), which measure how often technicians successfully close a ticket on the first call is such a ratio measuring efficiency. FTF is often dependent on having the right parts and can be aided by effective integration for the availability of relevant information.
- Complexity Measures look at the combination of people, products and systems to understand the impact of complexity on performance. This is one of simplest metrics to measure — and also one of the most crucial. It breaks down the average response time of your organization into the number of distinct steps between service request and final invoicing. For instance, the customer calls to request service, a dispatcher manually enters a work order to the system, then a work order is generated, then the field tech is assigned and dispatched, then the tech arrives on-site and completes an additional form, etc. Breaking down service into a series of steps helps identify how many different systems and people are involved, redundant tasks and areas that can benefit from automation.
Since an organization’s field service performance is ultimately affected by many different people and business systems within the company, organizations will find that connecting and streamlining processes between systems will positively impact many of their KPIs. For example, Integration can help improve FTF rates by ensuring that information contained in other backend systems doesn’t get trapped there: parts inventory, purchase histories, service manuals and other data can be critical to making sure you avoid unnecessary truck rolls and reduce emergency shipments. In addition, better integration between systems can help reduce MTTR by implementing automatic triggers and event handlers between ERP and FSM to improve efficiency of dispatching, route optimization and field tech productivity.
Measuring and continuously improving operational excellence is important for any industry. In the field service industry, benchmarking all four dimensions of operational excellence is even more critical since excellent customer service is essential for a company’s growth and continued success. These benchmarks can help highlight integration bottlenecks and point to process improvements needed for operational excellence.