Evaluation of technician performance is largely focused on the results of individual work performed. Efficiency rating is a measurement of the ratio of actual time spent versus sold labor hours. QC failures and warranty labor negatively impact sales and profits and objectives should be to minimize these figures as much as possible. To assess performance – measurements should be compared to one or more benchmarks. Examples of benchmarks are averages of similar shops, same month previous year and established targets. If a performance indicator is above the benchmark this indicates an area of strength. If below the benchmark an opportunity for improvement is signified. Following are performance indicators that can be used to identify technician strengths and weaknesses:
- Efficiency Rating – Technician efficiency rating is the measure of actual time spent on a given repair versus sold time. If a technician can complete repair work in less than the hours sold then profitability is increased. So it benefits the shop to provide an environment in which the technician can be as productive as possible. If the technician is paid a percentage of sold labor he or she benefits as well.
- Profitability – Profit margins on labor, parts, tires and total repair order can be used to measure technician performance. Although the technician doesn’t have any control over sales prices – the type of work assigned can impact profitability. So the technician wouldn’t be evaluated on these measurements but they can be useful for management purposes. These measurements can be evaluated against target goals to ensure that income levels are achieved.
- QC Failures – The percentage of QC checks that result in failure and require corrective action will give an indication of how well the technician is performing in ensuring that work is done correctly before QC is done. Checking this against benchmarks will indicate whether this is strength or weakness.
- Warranty Labor – Having work redone as a result of a customer having to bring their vehicle back to the shop due to something not being repaired correctly can have consequences beyond the cost of labor. Although this number can seem quite small as a percentage it’s very important.