T + M = Performance & Profit
For years the expression “T&M” has been universally understood as the abbreviation for time and materials, the pricing method used in the service and repair business for many decades. These days, most of the leading service and repair companies have switched to flat rate pricing of some type, and it has produced significant increases in sales volume, bottom line profits and customer satisfaction.
There is a new T&M. The replacement for the T&M acronym is now training and motivation. It has nothing to do with pricing, but knowing what it means and using that knowledge will produce the same dramatic gains - if not more - than learning about flat rate pricing.
Training: Let's start with the “T.” If you do nothing else to spruce up your business, training your technicians will make one of the most significant improvements in productivity you could imagine.
Technical training is a given. The kind of training I am speaking of is the training that will produce one of the best returns on investment I have seen in this business. Training technicians in the latest customer service techniques offers a real payoff.
This kind of training includes more than the usual maxims, “Wear a uniform and always be nice to the customer . . .”
Good customer service training is comprehensive. It covers every step the technician takes: what he wears, what he says, where he parks the truck, how he diagnoses the job, the pricing, closing the sale, selling add-ons and much more.
Technicians who are not thoroughly trained are not going to perform. No different than if they did not have the basic technical training they need for the service and repair work. Your technicians work with people - your customers - as much as they work with fixtures, equipment and tools. With preparation, they will succeed.
Better TrainingNot only is customer service training essential, but the method of training is important. Since we are talking about performance, effective training has to be related to the technician's performance on the job. The only feedback we usually have on a technician's performance is from customers.
Unfortunately, it is frequently the unhappy, dissatisfied customer who contacts us. So we only learn about a technician's performance when it is poor. We can correct the improper actions, but it would be better if we could avoid any unprofessional actions before they occurred. How can we do that? With performance measurement.
You would never ignore financial records and reporting, and then wait until the end of the year to see if you had any money left over to measure profits. Or wait until the bank called with an overdraft notice to monitor your checking account. For financial resources, we keep current feedback.
Yet we often use a very passive approach to monitoring our technicians' performance. Unless we hear something negative from a customer, we assume everything is going well. They do their job, no complaints; all is well.
Naturally, step No. 1 of any performance analysis is to give the technician the tools to do the job. Those tools include the kind of training I have reviewed - the best customer service techniques available. Otherwise, you are limiting his potential to excel as a technician.
Beyond that, we need to have some management tools to help us do our job. We need data. That's how we measure any performance in the business.
Criteria For ExcellenceSomeone wise told me a long time ago, “In business, what gets measured, gets done.” I have found that to be true.
The entire process depends on two key elements:
- The standard (the technician has to know what to do and what is expected of him); and
- Measuring performance (observing the technician's action).
Whether you have professionals set up the performance measurement for your company or you do it yourself, you need weekly, written reports that provide feedback to you, and - just as important - to the technicians about their performance. Daily sales figures are part of the package if you want to grow your business.
These reports are the source of the data you need to effectively manage the most important resource you have, your technicians. Once you have this data, you are ready to make one of the most significant improvements in the way you run your business-one that produces revenue and profits.
MotivationMotivation is the “M” of the new T&M. Some good news is once you have the proper training and performance measurement system in place, the motivation is not difficult. Let me give you some examples of how the motivation portion of your new management system can work.
As soon as a technician knows his performance will be measured, it usually improves. However, more important than that, excellent performance will now be noticed. And it should be noticed, and recognized - and rewarded. Excelling on the job brings a sense of pride for technicians, especially when it is recognized and rewarded.
What business owner wouldn't want to recognize and reward (bonuses, pizzas, prizes - you decide) exceptional performance? Prideful, exceptional performance produces satisfied customers, more jobs and more money in your pocket.
Make the new T&M part of your management system and enjoy the rewards.