Are You Monitoring Your Service Dept.’s Health?24 Feb, 2012 By: Stacey Romak, BEI Services imageSource
Monitoring the operational efficiency of a Service Department is vital to the success of any dealership. As cumbersome as this process may seem, without it you could be throwing away thousands of dollars every month and not even know it! There are many “Critical Service Indicators” that your company can monitor to ensure you are plugging any “monetary leaks” in your dealership’s revenue stream.
What Are Service Vitals?
Service vitals are statistics used to gauge your Service Department’s overall performance. Service vitals that should be monitored on a regular basis include: First Call Effectiveness percentage (FCE%), Call Back percentage (CB%), Hold for Parts percentage (HP%) as well as response time.
The calculation for FCE looks at the percentage of time a technician completes a call without incurring a customer generated call back, or a hold for parts call. To ensure your achieved FCE% is the most accurate and fair representation of technician performance, it is important to examine what is considered a call back; as not all devices come out of the box working the same. Set up your own model specific CB criteria by looking at the service history for an entire model population. Monitor the average copies between visits and days between visits and take a factor of 50% of that for a call to be considered a call back. Using this type of model specific CB criteria will account for the differences in the way that models perform. BEI services maintains a national model call back criteria derived from millions of serial numbers that is more accurate due to the amount of sampling data.
As a company, establish goals for each of these key performance indicators. Remember, there is no such thing as 100% FCE. There will always be the need for parts replacement and factors that can lead to call backs that are not related directly to technician performance. Make sure the goals established are obtainable and realistic, for example: In order to properly calculate you call back percentages; you should only count customer-generated calls. Counting courtesy call, PM’s, and other types of non-customer generated calls will falsely inflate your FCE percentages.
FCE% = 72% or above
CB% = 20–25%
HP% = 8–12%
Response Time = Avg. 4 Hours
What other Critical Service Indicators should be monitored?
Model Based FCE
(First Call Effectiveness)
FCE in terms of technician performance is a key service vital. However, monitoring FCE at the model level is also a critical service indicator. It is important to remember that FCE is directly relative to call load, and call load determines response time! If you are looking for a way to reduce response times, find the models that have low FCE percentages and determine why. Find out if the cause is related to call backs (CB) or hold for parts (HP) calls. If the CB% is higher, the issue at hand may be training or call quality related. If the HP% is higher, then it is a potential car stock inventory issue that needs to be addressed. Take the steps necessary to identify and correct the issue, whether it is through additional training, or revamping the technician’s car stock inventory for the particular model group. By addressing the issue, response time will decrease and customer satisfaction will improve.
How do you determine equipment that you are servicing excessively, and how do you know what “excessive service” actually means when comparing individual devices at the serial level? Not all devices are created equal and some legitimately require more service than others. A machine that is producing 500,000 pages a month will likely see more service calls in 30 days than a machine producing 10,000 pages. The traditional 3 calls in 30 days formula used to define excessive service causes you to manually filter out instances like this costing you time, and money. This method simply is not the best indicator of what excessive service is.
To determine what truly excessive service is, compare the average Mean Copies Between Visits (MCBV) of an individual serial number to other devices operating within a similar average monthly volume range. You can then compare the achieved MCBV to the average for that model population. This gives you an accurate representation of the devices that are truly creating the most service calls. For example, some devices may only be producing 200 copies between visits where on average they should be producing 5,000 pages! It is clear that these devices should be able to produce a similar amount of pages between calls. But, if they are achieving less than the “average” they can be improved; and that improvement leads to fewer calls being created!
Technician Effective Time
Effective time is defined as amount of time that a technician is either traveling or performing maintenance on site. All other time can be considered “unaccounted” or non-product time. It is important to monitor effective time as a critical service indicator because it reveals technician’s time accountability and productivity in the field. Ideally you would like to see an effective time percentage of 85% and above. This leaves 15% for parts pick up, training, vacation and other “non-productive” time.
If the achieved effective time percentage is below 85%, take some time to discuss with the technicians the importance of time accountability. Make sure that if the technician is supposed to be on site at the first call at 8:00am, they are not consistently showing up at 8:30am or 9:00am. Also, monitor final call completion times to ensure that the technicians are working a full day. Even if you are losing 1 call per day, per tech due to poor time management, that can constitute the workload of an entire technician for the month or more.
A unique way to monitor and un-biasedly rate technician performance is through Tech Grading. Essentially, take key technician performance indicators and assign a letter grade based on technician achievement. Examples of areas in which you can grade technician performance include:
- Average Start and End Time
- Total Effective Hours
- Average Frist and Last Call Durations
- Parts Usage
- Call Back (CB) Percentage
- First Call Effectiveness (FCE) Percentage
- Total Managed CPP (Cost Per Page)
With this information broken down into a standardized letter grade, it is easy to identify technician performance characteristics. Also, grade cards can be distributed to technicians on a monthly basis so they know where they stand, and where to focus to improve performance!
Equipment & Parts Cost
Identifying the devices that are costing the most to service is imperative to sustaining a profitable service operation. Initially, focus on reducing the cost per copy of the top ten serials that are costing your company the most to service. Uncommonly high equipment cost can be attributed to many factors. Performance data on these models needs to be analyzed to determine if the inflated cost is a result of poor technician performance, excessive parts replacement or even lack of training.
Knowing what your company is spending on installed parts compared to others servicing the same equipment is also important. This is because you could be pumping thousands of dollars in parts into devices when it is completely unnecessary! Monitoring parts usage and performance reports at the model and the serial level will help identify areas where adjustments need to be made to avoid this type of loss.
In conclusion, the importance of monitoring these types of critical service indicators to gauge service department health cannot be understated. To make this process an easier task to manage, look for assistance through credible resources, such as BEI Services who has created a Critical Service Indicator (CSI) dashboard. It is designed to give you a graphical overview of your service department performance at the quick glance of a single page, with the added capability to drill down to view the specific details behind each service indicator. Not only will the dashboard display your company’s vital signs, but it further enhances this view with national performance comparisons. Monitoring service department health by addressing critical service indicators such as these is the key to a successful - and profitable - Service Department.