By Robyn Goldenberg & Christina Scherwin
In the February 2022 issue of Chauffeur Driven, we discussed the benefits of using specific key performance indicators (KPIs) to gauge the health and success of your business—especially when goal-setting in 2022. Now that we’re midway through the year, let’s do a deeper dive into our recommendations for what you should be tracking.
As a refresher, a KPI is a way of measuring how well you are doing over time when it comes to a specific goal. While there are many different types of KPIs, they all share the same basic framework: they help to evaluate how well an organization is achieving its goals by measuring performance in key areas such as sales volume, revenue growth, cost reduction, customer satisfaction, and more. By identifying measurable goals and tracking progress towards these targets, organizations can stay on top of their performance and make timely adjustments to address any issues that arise.
What’s the Difference Between KPIs and Metrics?
You’ve probably heard both of these terms being used interchangeably, but they have different meanings. KPIs are specific measures of progress toward a set goal; metrics, on the other hand, can refer to a variety of measures and indicators, including quantitative data and benchmarks.
In general, KPIs are narrower in scope than metrics and tend to be more focused on a particular area of concern or success. For example, an organization might keep track of its sales revenue as a KPI and track the number of new customers it gains each month as a metric. While both are important for tracking progress, it is important to recognize their distinct roles in order to get the most accurate picture of how well an organization is performing.
KPIs can help give you a clearer picture of how your business is performing and are great for pointing out where improvements need to be made. By focusing on these critical areas that we’ll discuss below, you can ensure that your company provides the best possible service to your customers. Let’s dive a bit deeper into each of these, plus some others you may find helpful to track.
Fleet- and Operations-Related KPIs
- DOT compliance: This KPI measures how well your company complies with DOT regulations, which can result in fines or other penalties if not monitored by your company. If you want to improve your DOT compliance, you should ensure that you are current on all transportation regulations and that your employees are trained in compliance. Consultants like Chris Przybylski and Joe Guinn over at LBC Fleet can answer any questions you might have.
- Vehicle maintenance: A company should track how often their vehicles need to be serviced and plan accordingly. This will help keep transportation costs down.
- Average trip length: This KPI measures the average time a customer spends using your transportation services, and can determine how efficient your transportation services are. If you have a long average trip length, you may need to reevaluate your transportation routes or pricing.
- The number of complaints or service failures: This KPI measures the number of complaints you receive from your customers. It is essential to track because it can give you an idea of the satisfaction of your customers with your transportation services. If you have a high amount of complaints, quality and consistency should be your focus.
- On-time arrival rate: This KPI measures the percentage of transportation services that arrive on time and is essential because it can give you an idea of the reliability of your transportation services. If you have a low on-time arrival rate, you should focus on improving the punctuality of your transportation services.
- Revenue per vehicle mile: This measures how much revenue your company generates for each mile that a vehicle is driven, which can determine how efficient your transportation services are. If you are not generating enough revenue per mile, you may need to reevaluate your pricing or transportation routes.
- Upselling for reservation agents: This KPI is interesting for reservation teams. Track their average booking number: Is there a training program in place for teaching them to upsell?
- Price: This measures the average price that your customers pay for your services and can give you an idea of your competitiveness. If you have a high rate, you may need to reevaluate your pricing to compete with other transportation providers or up your service to justify your above average rates.
- Customer attrition rate: This KPI measures the percentage of customers who stop using your services over a certain period. A high customer attrition rate can indicate poor customer service or dissatisfaction with your company. If you want to reduce your attrition rate, you should focus on improving your quality.
- Percentage of repeat customers: This tracks the rate of customers who use your services more than once, which a high percentage of repeat customers likely indicating satisfaction with your transportation services. If you want to increase your rate of repeat customers, you should focus on improving the quality of your services.
- Customer satisfaction rating: This determines measures the satisfaction of your customers: satisfied customers are more likely to use your transportation services again. Improve your customer satisfaction rating by services more valuable to them. You can also find out more from your customer reviews.
- Customer reviews: A company should always push for customer reviews and work to get as many as possible. You want to have reviews for at least 10 percent of all rides.
- Driving records: This measures the driving records of your employees and can give you an idea of the safety of your services. If you have many employees with poor driving records, you may need to evaluate your hiring practices or provide more training for your team.
- Overtime: This KPI tracks the amount of overtime your employees are working. If this number is high, you may need to reevaluate your transportation routes or staffing levels. Overtime should be managed carefully, especially so chauffeurs are not overworked or face burnout.
- Employee retention: This measures the percentage of employees who leave your company over a certain period. A high employee turnover rate can indicate poor working conditions or dissatisfaction with your company. If you want to reduce your turnover rate, focus on improving the quality of your work culture. Get your staff to buy into the culture and feel like part of a team—or work on improving it overall. One way to do this could be to create team events (such as ax throwing, lunch in the office, or dinner in the office). Whatever you choose to do, it’s essential to connect with each employee and make people care about the company and their job.
Robyn Goldenberg is Director of Operations and Marketing for Strategy Leaders. She can be reached at robyn@strategyleaders.com. Christina Scherwin is VP of Sales and Consulting at Strategy Leaders. She can be reached at christina@strategyleaders.com