By Paul Mac Donald, Executive Director, United Servicers Association
Service efficiency can be defined in many terms. Increased efficiency can mean more calls. Increased calls can mean more revenue. More revenue with fixed costs of a service department means more profits. Profits: excess of revenues over outlays and expenses in a business enterprise over a given period of time….. As business owners every day, we purchase man hours from our technicians for the purpose of solving our customer’s problems. We aim to accomplish this by repairing their world of malfunctioning appliances. In doing so our efficiency is defined by our ability to charge for as many of those purchased man hours as is possible.
Similarly service efficiency can be defined in the number of customer problems we solve in only one trip to their home, commonly referred to as first call completes. The more first call completes per day the more man hours we can charge our customers and or manufacturers in hopes of making greater profits. But why the concern over our ability to achieve higher first call completes? The more billable hours we achieve the greater our ability to spread our costs over those hours thus lowering our hourly cost to run our business. Consider this example: A service company with 4 technicians completing just 4 calls per day at an average of $80 generates $320,000 in revenue per year. If technicians can each complete just one more call per day each they will generate $400,000 or an additional $80,000 more in revenue to help pay the overhead. This is significant as the overhead per day remains the same since we are selling a service and not products.
Completing one more complete per day is not an easy task but you can see the financial impact on our business. Efficiency for first call completes are often overlooked as the rewards are not obvious and often elusive. Increasing first call completes are not easy and require a team effort from all staff. FCCs are impacted by many influences in the day to day operations of our business. Influencers including dispatching techniques, technology with computers in the field, controlled inventory, the parts ordering process, prescreening of service calls, technician training, resources and tools. Let’s take a closer look at these influencers.
Dispatching techniques: you may think it’s obvious to schedule calls in a geographic chronological order that prevents the technician from back tracking but this is not always a priority and time commitments to customers often overrule. When there are multiple technicians in a company required skill sets often trump geographic or time commitments. Rush hour volume of traffic can impact the dispatching and efficiency of a route. Regardless of these stipulations the dispatching of a tech has great influence on first call completes; give it the time and resources it demands to make efficient use of a tech’s non-billable time each day.
Technology in in the field: Smart phones and laptops have come a long way and dropped significantly in price. A smartphone will capture the correct model and serial number every time and document any preexisting damage of the work space. Computers in the field provide instant access to service manuals, diagrams, parts availability and customer history bringing power to the technician to be more efficient on every call.
Parts Inventory: Having the right part at the right time is no accident and yet so powerful to increasing first call completes. Parts must be monitored, managed and inventoried based on usage and availability. Parts Inventory is the second biggest influencer on first call completes and our efficiency. Give it the respect it demands.
Prescreening of service calls is the single largest influencer and will make or break your service profits. Unfortunately, most of us overlook this crucial step. Every service call should be screened three times before a service truck is permitted to roll. First, by the CSR for complete model, serial, descriptive accurate complaint and customer information. Second, by the service manager to assure legitimacy of the call, skills, tools and parts required to enable completion on the first trip. Lastly, the technician himself must screen the call by calling the customer to confirm details and availability of the reported complaint. Only he can accept responsibility for the best use of his time and paying him on commission will encourage him to complete this vital step in being the most efficient he can be.
Training, tools and resources: last but far from least is to equip your technicians with regular updated skills training, all the tools necessary to complete every job and the vast resources made available today via the intranet that lends the assistance to help technicians solve problems.
Efficiency and first call completes aren’t easy but are essential to realizing profits in the service business today. It’s not easy but then if it was, customers would not need our services.
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Good article!