A Great Service Manager Can Recession-Proof Your Business
When the service manager is effective in their role, it drives revenue growth, customer loyalty, and bottom line profits.
The service department is the lifeblood of any HVAC company. When managed correctly, it can grow the whole business, not just through repairs, maintenance and accessory sales, but by becoming the No. 1 replacement lead source for the company, too. The byproducts of any well-run service department are sales leads. The service department should be able to generate enough gross profit dollars to cover the operating expenses for the entire company.
As a company grows, the business owner or general manager can easily get bogged down managing multiple departments. The service department represents an enormous amount of time and activity. It has many moving parts and is critical to providing great customer service. It’s a department that truly needs its own manager.
Putting the right person in this job has many benefits. First, it frees the business owner or general manager to work on the business instead of in it, lifting them out of the day-to-day so they can focus on the big picture with a mind towards growth.
A strong service manager can truly recession-proof your business — especially important in these difficult times. When the service manager is effective in their role, it drives revenue growth, customer loyalty, and bottom line profits. But a poorly run service department stifles these things and can lead to client and technician turnover. Since technicians are at a premium right now, that’s not a risk you can take.
These are just a few of the reasons why it’s vital to have a great manager in charge of your service department. Don’t make the mistake of only hiring for technical skills, though. Today’s service manager needs a different set of attributes and skills. Here are my tips for finding, hiring, training and retaining for this key position.
Personality Over Skills
An effective service manager needs a variety of skills and personality traits, but when choosing one, I recommend leaning towards personality and aptitude over skills. Skills can be trained, personality and aptitude can’t.
The attributes needed in today’s service manager include:
- Excellent people skills for working with your team and your clients. They’ve got to be an amazing leader that others want to follow and support.
- Great time management, problem-solving and decision-making so they can work under pressure and multitask.
- Real empathy and a desire to help people so they can create customer loyalty with every call.
- A positive mental attitude to cope with negativity and customer service issues. A positive attitude helps them problem-solve and handle the mental pressure that comes with those issues.
- Mechanical aptitude, which doesn’t necessarily mean technical knowhow. You’re looking for a mechanically inclined person who has the ability to learn, understand and communicate technical topics.
- Trainable skills to look for or nurture in a service manager include:
- Business acumen such as planning, the ability to understand budgets and financials, and the ability to balance profitability and people.
- IT skills for both the administrative and technical sides of the business. Today’s industry is changing a lot, including how you manage transactions, so computer skills are a big advantage.
To determine if the person you’re considering has what it takes to make your service department better, it’s important to ask the right questions during the interview process and to have them take a personality assessment to make sure they will be a great fit for the position and for your company
Promote from Within, or New Hire?
Many business owners wonder whether it’s best to promote a service manager from within the organization or hire from outside. If possible, it’s best to promote from within to improve employee retention. If technicians and other team members can see a promotion path ahead, they are more likely to stay with your company, reducing turnover. In addition, the person you promote will already know your company culture and have the trust of the rest of your staff.
However, you should still make sure they have the right attributes to run the service department well. Give them a personality / job fit assessment to make this determination. The worst thing you can do is promote from within and have that person fail because they’re not the right fit.
Promoting your lead technician may seem like an obvious choice, but it might not be the best choice. Having the best technical skills does not mean they will be a good manager of people, so choose wisely. Many is the technician who was great in the field only to fail miserably as a manager.
If you need to hire from outside the organization, look for previous experience in a service-related field, along with the attributes and skills listed above. No matter what their previous experience, be sure they get the right training, too.
Training and Measuring Success
After you have the correct person in place, it’s time to train them and measure their effectiveness.
Must-have courses include leadership and management training, how to manage and grow a service department, how to develop and manage maintenance programs, as well as training in soft skills, communication and empathy as well as financial training, gross margin enhancement and other business topics.
Non-technical service managers should attend technical training with your technicians. Many manufacturers offer this online. The service manager should go on ride-alongs with the technicians, and work alongside dispatchers and Customer Service Representatives (CSRs). Service managers are often called upon to fill in throughout the business, so they should understand everyone’s role, including tasks like accounting, billing, taking calls and ordering parts.
To measure their effectiveness, look at the big picture, not just the numbers from the service department. These metrics can include:
- Gross margin
- Average ticket
- Maintenance conversion rate
- Sales leads generated – Number of tickets to lead conversion
- Maintenance agreement program growth
Also look at efficiency metrics like:
- Labor percentage
- Billable time
- Travel time
Reviews are another important indicator. Check online reviews for external customer feedback. Your team’s feelings can be seen in your retention and turnover rates.
All of these metrics create a picture of how your service manager is doing, and whether they need extra training or intervention.
Getting Help, Getting Results
HVAC business owners are busy, so finding and training the perfect service manager can seem like a huge task. But you don’t have to go it alone. To ensure you have the right person and are supporting that person with quality training, be sure to reach out for help.
Try enrolling your service manager candidate in a robust training program specific to your industry. In fact, the service managers who do best are those who receive personal business coaching, so partner with a program that can provide one-on-one training.
Working as a service manager is a rewarding career path for a variety of people. In today’s world the position is less technical and more people-oriented. Choosing the right candidate and nurturing them with excellent training and support can show exponential growth and see your business through the most challenging times.
About Jennifer Shooshanian
Jennifer Shooshanian is a Senior Service Coach and Trainer with Business Development Resources (BDR), the premier business training and coaching provider to the home service industry. With over three decades of experience specializing in HVAC Service Operations Management, Jennifer is one of the most knowledgeable and accomplished service performance experts in the United States. Her classes offer structure, growth, and profitability strategies that will help dealers recognize the tremendous profit potential of a well-structured service department. Learn more about BDR at www.bdrco.com.