Demystifying KPIs & service metrics for better business performance

Key Performance Indicators (KPIs) and metrics are the basis for all actionable business intelligence. But how effectively is your knowledge managed?

Essential to successful field service management and workforce management is having the right information and control mechanisms to execute a superior performance management system.

Performance indicators form the foundations of such systems but many field service companies are not confident they are using the right KPIs and metrics in the most effective way.

This is according to a field service survey we conducted in which over 15,000 service organisations throughout the UK were researched in order to better understand the many issues associated with managing a mobile workforce. You can read the full survey findings here by downloading our white paper.

One of the key reasons for inefficient performance management is the inability to turn data into actionable insight. This is a common issue and not unique to the field service industry. In the age of information overload, difficulty discerning between the copious amounts of data readily available, can devalue the knowledge extracted. This is because without a clear strategy and KPIs, over-processing caused by multiple reporting and data sources can make information inconsistent, incomplete and unreliable.

What’s more, whilst service managers need granular real time data that tracks performance and activities performed by their mobile workforce, scheduling teams and back office administrators, senior executives and financial directors require top level reporting, addressing bottom line and profitability issues directly.

In order to ensure you have the right set of KPIs and methodology to increase the likelihood of success, it’s important to understand the difference between KPIs and metrics and where they fit into an organisational structure.

The difference between KPIs and metrics

Where are you going? How well are you getting there? Will you be getting there any time soon?

Good performance management ensures every field technician, call centre manager, scheduler and service manager is working towards the same agenda, timescales and service expectations. This increases your service quality whilst optimising workforce productivity.

KPIs are a set of measures critical for understanding:
• Past success
• Current success
• Future success

KPIs can come in many forms and will differ from field service business to business, but what makes them a KPI is their linear relationship to a business’s bottom line. A KPI is inherently connected to a service organisation’s targets and strategic goals, and if successfully applied, will provide a recommendation for strategic action.

Most high level service executives will be most interested in KPIs as they provide a snap shot of a business’ performance which can be analysed in isolation or in comparison to past or future targets. These provide top level insight which can be used to inform strategic direction and recommendations for competitive advantage.

Field service metrics

Metrics are most relevant to operational managers. The most useful service metrics provide measurable, quantitative evidence of operational performance and success of workforce activities. Used effectively, they can provide a granular breakdown of the core components that form a KPI.

For example:

First time fix rate – this could been seen as an important KPI for a field service business because it indicates a performance measure that directly impacts on a service organisation’s bottom line. If first time fix rate is low, then the business may have a high cost base due to poor field engineer performance, ineffective call centre problem diagnosis, poor stock control…etc.

In this instance, KPIs can be broken down into further performance measurements, providing more operational detail. Such as:

KPI: Field force utilisation

This is a KPI because low resource utilisation has a direct impact on a service company’s profitability. This KPI can be effectively used to uncover people related performance issues.

Relevant service metrics:
• Average utilisation of field engineer
• Planned utilisation of field technician
• Actual utilisation of service engineer

These are directly connected to the KPI because they represent service variables that impact on the successfulness of workforce deployment.

KPI: Profitability (sales vs costs)
This KPI directly addresses a service supplier’s need to identify whether they are recouping costs.

In this instance the following service metrics may be of importance:
• Running costs
• Non-labour costs
• Working time allocated to jobs

KPI: Additional appointments
This KPI could be used to establish the reasons behind a low first time fix rate.

Relevant service metrics
• Total reasons in time range
• Reason breakdown

These 2 variables working in conjunction build up a useful picture into workforce productivity by providing insight into why additional appointments have occurred within a particular time frame.

Effective use of KPIs and metrics, bridges the gap between operational performance and your overarching business strategy. This encourages cross level engagement and stronger collaboration, not just amongst your mobile workforce and admin team but as a business as a whole.

This transfers the power to continually improve into the hands of all your workforce, making service excellence and outstanding customer satisfaction an easier target to achieve and measure.

Oneserve specialise in field service management software, offering cost effective solutions for mobile workforces of any size. This includes a comprehensive range of analytical packages which transform performance management into a more effective system for service excellence. For more information, why not request a free product demo or call our service experts directly on 01392 367 367.