KPI’s in Field Service – Why They Are Important?

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KPI’s in Field Service – Why They Are Important?

Measuring performance on a regular basis in field service industry is a task that shouldn’t be treated as a second thought. KPIs or Key Performance Indicators has been around since the early start of modern commerce age, and its significance continuous to increase today as each of companies today- especially those who are in the field service- are somehow getting fidgety on the concept of KPI, or what KPI should they be tracking.

Definition of Key Performance Indicators (KPIs)

Many industry experts defined KPI as a tool that may be used by an organisation to define, measure, monitor, and track its performance over time toward the attainment of its stated organisational goals. The KPIs to measure vary between companies and industries. For instance, field service industry may evaluate itself on the basis of KPIs such as customer satisfaction or revenue from services.

Regardless of what definition your organisation adopts, KPI remains an indispensable tool that should be taken seriously.

Here are some of the points of why measuring Key Performance Indicators is a critical factor for success of your field service company:


1. You will know if you are meeting (or not) the monthly, quarterly and annual performance goals and targets

Measuring KPI will help you define what success- or failure- looks like. Making it integral periodic task forces you to look at what specific actions ad behaviours needs improvement to drive your company towards its desired goals.

The examination of period-to-period trends for any given KPI will lead to the likely identification of problem areas, areas requiring improvement, or areas reflecting significantly high levels of good – or bad – performance. From these trends, decisions can be made to review, assess and/or modify specific areas that require attention.

For example, let’s say your goal is to increase first-time fix rate by 2%. If by the end of assessment period you see that your field technicians have exceeded your target to 4%, you will have a better idea of the specific actions or set of procedural operations that your field workers have to maintain to achieve the similar success in the next assessment period.


2. KPIs Drives Behavior

Employee motivation and job satisfaction are critical factors to boost your company performance and culture. In the field service industry, KPIs can be a good source to drive your people towards behavior that is optimal for your company.  Once your business starts measuring the results of a certain business process or function, your employees will start focusing on it.

For instance, if the field service manager starts tracking customer satisfaction on a daily basis instead of a monthly basis, the field service technicians and other people in the field department are more likely to pay attention and exert great effort to meet or exceed customer expectations.

It is part of the human behavior to feel rewarded and motivated when receiving positive reports for meeting certain KPIs in the interim. It creates a sense of purpose and keeps them focuses on meeting or even exceeding their target goals.

This effect not only helps us to focus on our company goals and objectives but also influences our own actions. The key is to exhibit leadership to create a culture in which people are motivated to give their best while doing their job.


3. KPIs Encourages Accountability

“If it matters, measure it”.  KPIs reveal vital information that also reflects your employees’ performance. Without KPIs, you run the risk of making inaccurate decisions about your employees during reviews. Gauging KPIs provides you with quantifiable proof that a particular department or employee is performing poorly because of some issues like punctuality or a perceived lack of company engagement.

An assessment based on pure personal view can trigger to some internal conflict and misunderstanding which in the end can disrupt your operations.

Having a solid proof about your employees’ performance is beneficial to both company and its human resources to have a sense of accountability and transparency which is helpful when considering rewards, compensation rates, or job advancement.


4. KPIs Can Be Used as Promotional Tools

Being efficient to areas being measured is also a great way to drive more people into your company or to gain more trust and other desirable actions from your clients. Leveraging the power of KPI as a promotional tool can support your business growth and improve customer retention and loyalty.

For example, day-to-day, month-to-month, or year-to-year performance trends can be measured, tracked, and presented internally at strategic planning sessions, quarterly meetings, or other company events. KPIs that reflect internal successes with respect to performance may also be used for external promotional purposes, such as including the findings in customer newsletters, market reports, or as promotional pieces on the company's Web site.


5. Helps You Outperform the Competition

The vital information from measuring KPIs provides a snapshot of your company performance. This critical information is extremely important when you’re in a highly competitive market, as it lets you make systematic adjustments so that your performance is on par or can outperform your competition. Setting up the appropriate KPI in your company- those that aligns with your competitors and the whole industry- enables you to benchmark your business against competitors, hence allowing to improve your performance when It’s needed.


Given the significance of KPI to support business goals and growth, it is also important to ensure that your established goals must be quantifiable to create actionable KPIs based on them. Establishing a KPI based on vague statements is impossible to reach because it does not have any measurable component that results in actionable steps. Having a solid and specific value of what has to achieve, followed by implementing actionable items surely ensure an improvement in the overall results of your business.

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David Younger

CEO and Managing Director at The Service Manager
David Younger is Australia’s #1 Cash Flow Expert For The Field Service Industry. Over 25 years working with hundreds of field service business owners in virtually every industry, David has discovered the ultimate path to plugging up the “profit holes” in a growing business that will take it to the next level.
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