- Track employee hours?
- Ask customers for feedback?
- Monitor revenue?
- Examine your company’s progress?
Whether you realize it or not, you use key performance indicators (KPIs) in your business every day.
As for performance assessments, KPIs tie directly to actionable objectives and goals. KPIs help HVAC business owners and managers focus on strategic and operational achievements, underscoring a company’s strengths and weaknesses. They can focus on every segment of business, from marketing to sales.
At the same time, many company leaders struggle with the KPI process, which can be confusing and intimidating. They don’t know what or how to track.
KPIs fail to produce the necessary data for several reasons:
- Your company doesn’t have a clear objective
KPIs should address the needs of your company and your industry. But if you don’t have a clear business strategy, how can you establish KPIs? Business owners can define relevant KPIs by using the SMART method. Instead of guessing what the goals should be, use KPIs that are Specific, Measurable, Achievable, Relevant and Time (SMART) bound.
- You’re not tracking consistently
The best part of successful KPI tracking is the detail the data provides regarding a company’s past, present and future. Without consistency, however, the information will be worthless. Identify one person in the company who will be responsible for collecting and distributing the data.
- Your employees don’t understand the information
If your KPIs provide good data, but your employees don’t know how to act on the information, there’s clearly a communication breakdown. Management should communicate the value of the KPI data and how it relates to the company and individual jobs.
Another reason your KPIs don’t provide helpful information is that you’re tracking the wrong things.
After years of study, The EverRest Group has determined that three leading KPIs are essential to HVAC company success:
- Technician conversion rates
Technician conversion rates, a leading KPI for the EverRest method, look at the number of tune-up and repair calls that are converted into replacement sales. HVAC business owners should track daily month-to-date and year-to-date conversion rates for the best data.
- Customer care calling performance
Customer care calls are a lifeline between your company and success. As such, callers should be prepared with information about the customer’s service and call history and a script.
- Sales/equipment costs
Since the EverRest method relies on replacement sales, HVAC companies must track how much they spend on equipment costs.
By using The EverRest Group’s three leading KPIs, HVAC companies can better determine where they are versus where they should be. Remember, the goal is to reach a minimum revenue ratio of 80% replacement sales to 20% service sales.
To help our clients reach their goals, The EverRest Group has put together spreadsheets for each of our essential KPIs.
If you have more questions about KPIs or any of the EverRest methods, please contact us today.