The cost of poor productivity is astounding. Tip 7 requires a little math, so stay with me.
You run a service department with 25 technicians, paid an average of $55k plus 27% benefits and a $20k annual vehicle cost. That’s an annual total of $89,850 direct cost per technician.
For simplicity we assume that they are 100% productive, that is, paid for 2,080 hours per year. So, the average cost per productive hour is $43.20.
During a ride along, you found that due to poor organization at the start of the day, technicians were burning about 15 minutes in unproductive time. (If you’ve ever watched 25 technicians preparing to leave for the day, you’ll agree this is a very conservative assumption.)
What is this lost time costing you?
0.25 hr/tech/day x 25 techs x 220 days/year x $43.20/hr = $59,396
But how much revenue could you generate if these techs were productive during this time?
With a $150 average ticket and a 1-hour average call duration…
0.25 hr/tech/day x 25 techs x 220 days/year x 1 call/hr x $150 revenue/call = $206,250
How much time are you burning in lost productivity? The answer is usually far greater than 15 minutes...time to do the math.
Share your experiences in the comments below and learn more about field service transformation with Chapman Management Solutions at www.chrischapman.ca.
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