This KPI shows you the relationship between your Technicians speed in completing jobs and the abilities of your Front Counter staff to sell the hours to your customers.
Most franchise manufacturers provide dealers with allocated times for jobs on all vehicles and this allocated time is what the Hours Worked are usually measured against. The Hours Sold is the responsibility of the front counter staff and they could sell more or fewer hours than the manufacturer's' book times.
In order to make gains in profitability, your Technicians must complete the job in a lesser time than is allocated by the manufacturer, or the front counter must sell more hours on the same jobs, thereby increasing your Productive Efficiency.
Example:
A) Hours Sold = 1,130 B) Hours Worked Productively = 957 C) Productive Efficiency = 118% (A ÷ B X 100)
Discussion:
Productive Efficiency is a double-edged sword. If your Technicians take more time to complete the job than the manufacturers allocated time then your profitability diminishes and Productive Efficiency falls below 100%.
Related Terminology:
This KPI is also known as Productivity and Working Efficiency.