Lagging First-time Fix Rates Killing Mid-Size Business Profits
Many businesses regard service response time to be the pinnacle metric in measuring the status of their service organization, and where many companies focus their priorities. However, a new study suggests that mid-sized companies should take a much closer look at first-time fix rate.
According to research from the AberdeenGroup, mid-sized companies were significantly less likely than larger firms to resolve an issue on the first visit1. This results in longer asset downtime for the customer, and can result in missed service level agreements. The costs associated with the missed SLA’s, as well as the secondary dispatch can wipe out an organization’s service profit margin.
Two Ways to Increase First-Time Fix Rate
There are two main reasons issues do not get resolved on the fist call: the technician does not have the right knowledge or skill set, or does not have the right part on his truck. Below are two ways those issues can be minimized.
Optimized Scheduling
Most mid-sized service organizations schedule and dispatch technicians based on geographical proximity. While this works to get a technician onsite quickly, a company runs the risk of sending a technician that does not possess the skill set or parts to resolve the issue. Using scheduling optimization software, companies can create rules for work order assignment that evaluate technician skill level, part availability, geography, SLA requirements, and other criteria. (Learn more about optimized scheduling)
Getting Information to the Front Line
Arming your field workforce with a mobile solution can give your field technicians access to two critical areas of information. First, the technician can access the service history and learn what has been done in the past. He can also be linked to a knowledge management system where he can access issue resolution scenarios, product schematics, and best practices information. (Learn more about mobile field service solutions).
Research from the Aberdeen Group indicates that companies that employ these two solutions experience a 32% increase in first-time fix rate.
The ROI of First-time Fix Rate
Mid-sized business, which lack the vast coffers of their larger counterparts, sometimes look at technology options like the ones outlined above and question their affordability and impact on the bottom line.
Let’s consider a mid-sized business with 100 technicians who complete the industry average of 4.8 work orders per day.
100 technicians
x 4.8 work orders per day
x 250 working days per year
= 120,000 service calls/year
As indicated earlier, 40% of these services calls (48,000) would require at least a second dispatch. Research from the Aberdeen Group estimates that the cost per dispatch is $241.
48,000 service calls
x $241 cost per dispatch
= $11.6 million spent annually on secondary dispatch
Again, research indicates that companies who employ field service scheduling and mobile service software experience a 32% increase in first-time fix rate. This would reduce the number of service calls needing a secondary dispatch by 15,360, a cost savings of approximately $3.74 million.
When you look at all the numbers above, the question in your mind should change from, “Can I afford it?” to “Can I NOT afford it?”
ADDITIONAL RESOURCES
Whitepaper: Field Service Scheduling & Routing Excellence
Podcast: Using GPS to Cut Field Service Costs
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1. The Aberdeen Group, Mid-Sized Firms Lag Larger Counterparts in Service Efficiency, 2007