Choosing the right key performance indicators (KPIs)

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    Written by HarmonyPSA on 2014-02-04 Last updated 2018-06-27 - 2 minute read
 

The challenge for most busy tech businesses is two-fold. Firstly, deciding which data to track and, secondly, figuring out how to capture and present the data in a way which is easy to analyse without the whole process eating too much time.

Of course, every business is different and your set of KPIs must match your specific business goals. However, we have found for the majority of IT service providers there are three key areas to measure, workforce efficiency, customer satisfaction and financial measures.

  1. Workforce Efficiency

Performance metrics per employee

Understanding and achieving appropriate employee utilisation rates is essential for ensuring optimal operations, cost control and planning for more efficient growth.

Trends in ticket closure rates

The ability to see your ticket closure rates by issue type, source and priority will show you exactly where the bottle necks are so that you can eliminate them. Keeping an eye on changes in your backlog volume will help identify any process issues that need to be tackled and improve workflow and reduce the risk of 'lost' tickets

Track and Evaluate Sales Targets

By analysing trends over time you can both identify and reward individuals and teams who are excelling and highlight opportunities for development. Accurate historical data can also inform more rigorous future targets.

  1. Customer satisfaction

Contract renewal rates

When customers are happy with performance and feel as though they are getting value they tend to renew and even increase their contracts. A dip in renewals can mean that there are serious issues to address.

Trends in ticket submissions

Looking at trends ticket submissions by customer will give an indicator of performance. Catching changes in trends quickly will allow you to get on top of issues quickly and help retain and grow your customer base.

SLA Reporting

Don't put your business at risk through poor service performance. If you have guaranteed SLA's you need to make sure you are meeting them.

  1. Financial

Accurate Revenue and Cost Reporting

Using a deferred revenue system to keep an accurate P&L means that you know what is really going on in the business at any one moment in time.  With accurate and up-to-date financial data at your fingertips you can make better decisions, faster.

Pipeline Reporting

Accurate pipeline reporting allows you to understand what’s at risk, and what is likely to close when, so that you can plan for the business that is coming in, or get out there and generate some new leads!

Report on Billable vs Non-Billable Time

While billable hours generate revenue for your business, non-billable are still important to keep the business running smoothly. However, it is necessary to balance them out in order to control margin. Find out which customers yield a revenue stream that exceeds the costs and which don’t.

Profitability by Client, Contract, Type and Service

Understanding exactly where you are making money – and where you are losing it. This is especially important for recurring contracts because underlying costs can quickly get on top of you. Understanding profitability enables you to protect your margins. Find out which customers yield a revenue stream that exceeds the costs and which don’t.

Using HarmonyPSA you can produce the metrics described in this post without the need for complex spreadsheets. Harmony provides end to end business automation software for technology businesses. Powerful customer filters and pivot functionality brings unparalleled multi-currency analytic capability. Contact us for a demo today.

 

About the Author: Harmony Business Systems Ltd (HBS) is the company behind HarmonyPSA, the most complete cloud PSA software on the market. Developed with functionality to cater for even the most complex needs of MSPs, VARs, ISVs and Professional Services organisations, HarmonyPSA truly is the next generation of PSA systems. HBS is an independent company based in the UK. Follow HarmonyPSA on


Tags: Business, choosing the right KPIs, customer service metrics, financial metrics, it service providers, key performance indicators, KPIs for tech businesses, MSP Business, General PSA, workforce efficiency

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