How to improve the percentage of billable hours KPI

Percentage of billable hours is a measure of productivity, because it refers to the percentage of time your technicians are doing work which is directly billable to a client. This is one of the more financially focused KPIs that field service organizations tend to track.

With most KPIs or metrics, the most important aspect is what you do with them – in other words, how the KPI drives decision-making. This is very clear with percentage of billable hours. The most productive field service technicians will have a high percentage of billable hours, and the least productive technicians have a low percentage, meaning they spend the majority of their time on tasks not related to client billing.

For profitable growth in your FSO, you need to shift as many field technicians as possible to a high percentage of billable hours. This means they are out in the field doing calls and on-sites and those calls and on-sites are directly billable to a client. It moves them away from logistical or non-billable work, which can potentially be shifted to back-office employees or done within field service management software applications. Your technicians should not be doing that type of work. They should be fixing problems for clients on-site and selling those clients on additional service options your organization can provide.

If you track percentage of billable hours as a KPI, you will thus create two buckets for your technicians: 

• High percentage of billable hours tied to client work
• Low percentage of billable hours tied to client work           

You cannot simply jettison the people in the second bullet point. You need to make them better. That means tracking their time, helping them understand where -- and on what tasks -- they are losing productivity, and pairing them with people in the first bullet point. You can even create training modules and best practices around technician productivity.

Now, admittedly, not every single technician you ever employ will be insanely productive with his or her time and billable hours work -- but you want to get as many of them as close to that as possible, because that will tie back to (a) customer satisfaction and (b) your potential for growth.

One of the biggest problems that many organizations have -- and we see this often in field service too -- is that companies will over-focus on logistics, tasks, and process. Those are all very important to running a successful business, but they are often not really work. They are ‘the business of doing business,’ which means they are time-consuming activities that take away from the real billable work on-site with clients and customers.

In order to have technicians excelling at this KPI, you need to make sure that logistical work, task work, and process work is relatively controlled -- meaning people understand how to do it and what needs to be done, but do not have to spend their entire days focusing on it. Again, a good solution here is a field service solution. In essence, this allows you to automate and outsource some aspects of managing the day-to-day business and focus more on the real value-adds.

We put together an eBook around eight field service KPIs that you should be tracking; percentage of billable hours is just one. If you are new to using data as a competitive advantage in your FSO, this is a good guide toward some initial focal areas. You can download it now.

Written by Julio Hartstein