How To Apply The Principles Of Effective Metrics

By Israel Lang, Executive Consultant, HTG Peer Groups

A few weeks ago, I wrote about the “Quest for the Holy Grail of Metrics” (part 1 and part 2). In that post, I talked about some principles that I recommend using to build a set of metrics to help in three critical areas. Those areas are customer satisfaction, profitability, and employee engagement.

There are key lag measures in each of those areas that should be measured by almost everyone in the technology solutions provider business. These include response and resolution times, utilization and effective rates, and W-2 multiple, to name a few.

However, what we often miss are the lead measures that predict the outcome of the lag measures. Lead measures are both predictive and influenceable. Chris McChesney and Sean Covey do a great job talking about these concepts and principles here and here.

So, let me give you three examples of how to develop lead measures that can impact some of the common metrics we all measure.

First, let’s talk about customer satisfaction. Many organizations I work with use a process called Net Promoter Score (NPS). I am not going to go into that system today; but for the sake of this article, we will discuss a hypothetical company called Acme Corp. 

Let’s say that Acme Corp’s NPS scores have been trending lower. Many times organizations will look at response and resolution times or first call resolutions as things that might impact customer satisfaction. The managers at Acme come to the conclusion (and I agree) that those are generally lag measures.

They then ask themselves, “What is something that can be influenced and is predictable that would impact first call resolution?”

After some analysis they realize that a number of similar tickets are getting escalated to senior techs. These techs are taking longer to get back with customers due to work loads and therefore resolution time is also being impacted. Upon further reflection, they realize some new technology and new customers have recently come into the organization. They make the bet that if the senior techs spend some time developing some Knowledge Base (KB) articles that the help desk folks can use to resolve those issues, the number of first response resolution tickets will increase and resolution times will go back down.

The goal for the quarter, what gets measured, is for each senior tech to identify two recurring issues that are getting escalated and to write a Knowledge Base article on how to resolve each issue. There are three senior techs and 13 weeks, so 39 issues and 39 Knowledge Base articles become the metrics to measure against.

A few weeks in, the senior techs review their initial 6 KBs with the help desk team in their staff meeting. After the meeting, the managers watch to see if escalated tickets start to move in the other direction. If they do, they continue the process. If not, they make adjustments as needed.

Our second issue is around profitability. The Acme Corp service manager identifies that the field services team’s quarterly numbers have started to slip. He reviews ticket counts and concludes it isn’t for a lack of work. Often the metric that would be examined would be utilization.

Over the course of the last quarter, Acme Corp has started to see their utilization percentage for their field services team start to slip. A common reaction would be to tell the four field techs to just bill more. However, Acme Corp digs a bit deeper and determines two things are occurring:

• One, the field techs are coming to the office each morning before starting their day as dispatch doesn’t have their schedules updated until about 8:30.
• Second, when reviewing time sheets the managers see that most days the field techs are only documenting about 4 hours of work each day and often are at least a day or two behind in documenting a full 8-hour day.

The managers come up with two lead measures to help improve the utilization numbers over the next quarter. The first is the number of days the field techs have their first stop (ticket) on their calendars before the end of the previous day. In other words, how many days has dispatch sent them to their first stop instead of having them come into the office? The goal is four out five days (Wednesdays they come into the office for a team meeting). Getting those 30 minutes of time to be billable could result in upwards of 8 additional hours of billable time each week.

The second measure is making sure the techs fill out their time sheets daily. This means filling them out thoroughly, not gaming the system and just accounting for 8 hours via admin time. The idea is real time ticket updating. Each day the dispatcher reviews their time sheets and determines if they have sufficiently recorded their time. This change could result in 15 minutes of additional billable time each day or an additional 5 hours of billable time each week.

Combined, those two activities could result in 13 additional hours of billable time each week and a potential change of 8 percent on the utilization rate. Over the course of the quarter that would be 169 hours and potentially a $16,900 drop to the bottom line.

The managers again discuss the current reality with the team and ask for the small changes to be made immediately. Over the course of the quarter they watch, measure, and review the results with the team. The team sees their utilization numbers start to inch their way up.

The final area is employee engagement. The latest employee engagement survey (You do those, right?) comes back and shows the service team engagement levels are slipping. The management team meets, discusses what might be occurring, and what action they should take.

The service manager reveals that because of growth, she has started to spread out her one-on-one meetings with her team members. Those meetings had been critical in retaining and growing their team in the past. The management team reviews what else she has on her plate. They assume a couple of her less critical functions so she has the margin to meet with her team regularly.

The lead measure becomes how many one-on-one meetings she has weekly with her team. The assumption behind this metric is over the next six months if she has five or more meetings a week with her team the employee engagement numbers will go up.

In all three cases, the managers along with their teams identified items that could be measured that could be influenced and are predictable. These measurements had a direct correlation to the lag measures of customer satisfaction, profitability, and employee engagement. Choosing to proactively take action changed the fate of Acme Corp’s service department. I encourage you to set up your own lead measures and see if it will do the same for you. 

Feel free to reach out and start a discussion on which measures might make an impact on your department. 

Israel Lang is part of a team of coaches and consultants serving the IT industry. Prior to joining the HTG Peer Groups staff, he spent almost 20 years in various roles in service and operations at a solutions and managed services provider.  Israel’s company was a member of HTG for many years, and he is a strong proponent of the peer group experience.  He loves helping companies go further faster through developing executives, managers, and teams into effective leaders who reach their fullest potentials. You can reach him at ilang@htgpeergroups.com or on Twitter @israellang.