Using the right metrics to improve performance
In the Q4 2018 Mitchell Industry Trends Report, Ryan Mandell, Director, Claims Performance, Auto Physical Damage Solutions looked at ways to effectively measure and drive performance in today’s fast changing collision repair industry.
In the report, he highlighted four key steps in helping achieve that. These are:
- Embracing Competition
- Measuring KPIs that Inform Behaviours
- Less is More
- Creating Visibility
Given the amount of data available, Collision Management wanted to find out more about how shops and other stakeholders can effectively use the information and metrics available to them to continually push forward, advancing the repair process and achieve favourable outcomes including better performance, profitability and customer service.
Collision Management: We talk a lot about collaboration in the collision repair sector these days. Where do you think this fits in and how does it relate to competition?
Ryan Mandell: Advanced technologies such as Advanced Driver Assist Systems (ADAS) are having a big impact on the repair process. One of the key things the industry is facing is to make sure repairs are performed in a safe and proper manner. As an industry, we’ve always been focused on ensuring the repair is done right, that the frame rails are straightened, the metal has good integrity and that panels line up. What’s changed is that we need to make sure ADAS and other safety systems are performing correctly and that requires diagnostics and correct calibrations as part of the repair process. Moving forward, we see the frequency of scanning and diagnostics increasing dramatically and to do this effectively will require dialogue between the different stakeholders involved. At the same time having competition is healthy and it’s important for team members to see how they stack up against their peers. Showing clear results, focusing on accountability and providing positive and constructive feedback can be a great motivator to achieving excellence, which is what we all strive for.
CM: There is so much data being generated today, how can a collision facility make sure it’s able to focus on the metrics that really matter?
RM: I think one of the biggest ones is quality control. When I was managing a collision centre, we had 23 metrics within our shop group that we were graded on. Customer service and net promoter score was part of it and then virtually every other metric was based on performance, budget, throughput or cycle time. What’s interesting is that there was no key metric that focused on quality. Today, quality has to be at the forefront, especially when it comes to having ADAS and other systems functioning on the vehicle. It’s something customers will look for as it’s their safety that is ultimately in our hands when we do these repairs.
CM: Do you think there is a danger of shops focusing on too many metrics to measure performance?
RM: It’s important to pick the right handful of metrics that can actually drive the right outcomes. When you’ve got 47 different ones its often hard to figure out which are the most important but when you have six or seven key metrics that you’re able to focus on that highlight what the business is all about and can drive the right outcomes, you’re much more likely to reach your desired objectives. Honing key metrics is a critical component of driving real success in a business.
CM: We’ve seen a lot of focus on cycle times as a key driver of repairs for many years but with advancing technology and complexity, repairs by necessity are taking longer. How is that impacting how shops should really measure repair performance?
RM: I think a key factor today is measuring Keys to Keys instead of repair cycle times. With Keys to Keys you can measure repair efficiency, length of rental (LOTR) and customer service. You are seeing longer cycle times overall but it’s okay as long as the customer knows steps are being taken to ensure their car will be safe and functioning correctly when they get it back. You want to make sure your customers know up front when they can expect to get their vehicle back and to do it properly, shops need to educate their customers in terms of what goes into the repair and the kind of things that will take place. Again, it goes back to quality as a key metric and emphasis on “less is more.”
CM: There’s also a lot of discussion about how to effectively set customer expectations. What are your thoughts
RM: When you’re able to set that initial expectation, it’s going to be much easier to meet it, than if you say to the customer they’ll have their car back on such a day and the work gets pushed out another week. Think about having renovations done on your house. If the contractor says the work will be done in a week and it goes into a second or third week, how do you feel? You’re going to feel frustrated and disappointed. It’s the same thing when it comes to collision repairs. The customer needs to be at the heart of an effective performance strategy.