Just got back from Comfortech in Baltimore last month.  It was a fun trip, got to catch up with several  people who I had not seen for a while (people like Dan and Theresa Haire, owners of Jim's Heating and Cooling in Washington, MO).  With a name like that, they have to be successful!  Wink, Wink, Nudge Nudge. 

Sat through several breakout sessions, a couple stood out in my mind.  First one I went to was Linda Couch, Parrish Services in Virginia.  Her topic was how to improve technician productivity.  It was an eye-opener, which is good at 8 AM.  She told us that the key to increasing productivity is to first decide what and how to measure.  Linda said she measures gross profit.  Period.  Not sales, not billable hours, not MA sales, but simply gross profit.    That is the one thing she wants to measure that has a measurable impact on the financials.  That number flows to the bottom line.  She also said that as the business changes, you may decide to change the things you measure.  If you are thinking of selling or retiring some day, the people buying a HVAC company today look at a revenue stream, which is usually funded by maintenance agreements.  So if you are planning to sell, count the MA sales each and every day. 

Linda suggested you look at the numbers on a regular basis.  She looks at gross profit, and they look at it on a regular basis.  How regular stunned us.  She said they pull the numbers from every service ticket, every install, every customer interaction.  Yes, the tech calls into the dispatcher, gives the results of the call, and gives his estimated gross profit on the job.  Each job.  Several people in the audience had a problem with that, essentially they said that the tech did not know the GP, and they didn't want them to know that.  She asked if they ever went to a supply house.  If they do, they know what parts cost.  And they know what their labor cost was, so it is not a stretch to figure out the estimated GP.   But that is not what stunned us.  This did.  They put those numbers into a spread sheet, listed by employee with the highest GP first, ending up with the lowest.  They sent those numbers out to every employee every two hours.  You saw that right, every two hours.  They micro-managed that information. 

Now, the poor employee who had to scroll down to find their name... they were not feeling good.  She said the employees who had to scroll each time were not fired, they usually quit before the company fired them.  Peer pressure took them out.  So has this been successful?  They have successfully grown the business each year in the last several  years, when it has been tough to do that.  Eighty employees, a large chuck of the available market in Manassas, Virginia.  She told us it was not unusual to have a travel time of 45 minutes.  Lots of their business was scattered over several counties, over the blue ridge mountains, it is not an easy territory to work in.