One of the signs of a mature organization is a drive for continual improvement. To do that, you need to be constantly measuring your performance. But which field service metrics provide the most value? To maintain your competitive edge, you should be paying close attention to these field service management key performance indicators (KPIs).
The Importance of Key Performance Indicators
A fundamental business truth is that if you measure something, it will improve. Even if a metric is essentially meaningless, it will inevitably improve simply because it is on the scorecard and people are focusing on it.
Therefore, you need to choose your key performance indicators (KPIs) carefully. You want to focus on the metrics that are aligned to your strategic goals and your organizational charter.
The Top KPIs for Field Services Organizations
While every company is slightly different, there are certain KPIs for field service organizations that have proven to be consistently valuable. Some of the following KPIs may be more important to you than others, but you should at least have an awareness of how your organization measures up in each of the following field service management KPIs.
Initial Attach Rate
The initial attach rate is all about adding “for fee” support contracts to the initial sale of the primary product. Companies with strong initial attach rates are able to position the value of services early in the relationship.
Initial attach rates are fundamental drivers of revenue growth. New support contracts (and the associated annuity revenues) are a gift that keeps on giving. When you attach a support contract at the point of the original technology sale, you capture revenue up front and open the door for future renewals. And when done right, they can have a very low cost of sale.
The attach rate is calculated by dividing the number of service contracts by the units of the primary technology sold. If you need help determining your attach rate, use TSIA’s Support Attach Rate ROI Calculator. The calculator is a great tool to help you improve your support contracts.
It’s important to note that initial attach rates can vary greatly from industry to industry. Recent TSIA research showed that the overall average initial attach rate was 48.9%, while the healthcare technology and industrial equipment industries showed average initial attach rates of 53.8% and 32.7%, respectively.* TSIA can help you benchmark your initial attach rate against other companies in your industry.
Percentage of Incidents On-Site
Without question, the most expensive way to resolve a service incident is to send a technician to a customer location. Therefore, it makes sense that monitoring the number of on-site visits would be an essential KPI for service managers to reduce costs and increase profitability.
Companies are finding new ways to reduce the number of trips technicians need to take to customer locations. Video support allows companies to triage an incident remotely. In some cases, video support even allows technicians to walk the customer through simple repairs, thereby eliminating the technician visit altogether.
First-Visit Repair Rate
Unfortunately, there will be times when a technician must be dispatched to a customer location to address an incident. Your organization should have metrics in place to assess the success of those on-site visits.
In the past, the focus was on minimizing first-visit repair time, which is the amount of time the technician has to be on site. However, at TSIA we believe the first-visit repair rate is even more important.
First-visit repair rate is the embodiment of great preparation. How well was the incident triaged? Could we use remote diagnostics of monitoring to gain additional data? Did we have the right FSE, with the right skills, the right tools, and if needed, the right part onsite the first time?
We will always have first truck rolls, but it is possible to arrive at a point where there is never a second visit. The industry median is 87% of on-site incidents are resolved in one visit.
For much the same reasons that it is a good idea to reduce the number of technician visits, it is essential to make those visits efficient. The cost of each visit increases the longer the technician remains on location.
Companies are finding success with smart, connected products that allow for remote monitoring. These connected products allow technicians to be proactive and spot potential problems before the equipment breaks down.
Connected products and other virtual interactive presence tools are crucial for helping to prepare technicians before they make a trip to a customer location. The technician will arrive on site with a clear idea of what is wrong, what tools are needed to fix it, and which replacement parts will be required. Such preparation eliminates much of the diagnostic work that takes up a large portion of on-site visits and eliminates the need for follow-up visits.
Customer Satisfaction
Of course, customer satisfaction will always be one of the most important field service metrics to track. If the customer is not satisfied, they’re probably not going to be a customer for very long.
Field services can have a tremendous impact on customer satisfaction. Whenever a customer has an issue with equipment, the situation has the potential to create dissatisfaction. The field services team, however, has the power to turn a negative situation into a positive experience.
The customer wants the repairs performed efficiently and correctly to minimize any downtime. If field service technicians can deliver short resolution times, a high percentage of first visit repairs, and low repair times, they are helping to maintain customer satisfaction.
TSIA surveyed the top-performing field services organizations and discovered that their overall customer satisfaction rating for on-site field service incidents was 4.6 on a 5-point scale.** This data can help you benchmark your organization’s customer satisfaction rating.
Final Thoughts
There are several other field service metrics that organizations may find insightful, including incident volume, cost per service incident, renewal rates, and more. This is all valuable information that will give you a more complete understanding of your business.
The four metrics discussed above, however, stand as reliable KPIs for the head of any field service organization. By monitoring these KPIs, you will begin to see what your organization’s strengths are and which areas are opportunities for improvement.