Average Days to Close

The ideal number of days to close out a work order...

How long, or how many days, should it take to complete a repair on a customer’s machine? An even better question is: how many days does it take for your service department to close out a service work order? I’ve been asked about the ideal number of days or the average time to close out a work order. The answer is less than it currently is. Whatever time it takes your service department to close out a work order, it’s too long unless you’re running a perfect service department. If that’s the case, stop reading and forward this to someone else to read.

John Dowling, Author, Speaker, Consultant, and Co-Founder of By The Boxes

An aged work order refers to a work order that is over 30 days old. Depending on your location and industry, this timeframe may vary, but 30 days serves as a good rule of thumb. Aged work orders should be a concern for every level of management within a dealership. If a dealership does not regard aged work orders as a concern at every management level, it will likely struggle with cash flow, profitability, and customer satisfaction. These issues are all symptoms of aged work orders.

How should we address or correct an ongoing work order problem? One way we should not approach it is by berating the service manager, making threats, shouting, and demanding that they fix the issue. That rarely works. Most service managers and branch managers don’t fully understand how the service process operates. They believe that a service manager’s job is to fix equipment, which is partially true. It’s the technician’s responsibility to repair the equipment. The service manager’s role is to oversee the process of repairing customers’ equipment. While these roles are similar, they are not the same.

We must break down the service process to discover where the bottlenecks and issues are that are causing our prolonged work order lifecycle. An extended lifecycle will result in an aged work order. How have I analyzed the service process? Well, I’ve divided it into 10 steps or stages. In my book, Service by the Boxes, I refer to these steps as boxes. What we are looking for is how many days it takes to move the work order through each step or box.

We need to know how many days it takes from the day the customer drops off his piece of equipment at your dealership to open a work order. If it takes more than 24 hours, that is too long. All work orders should be opened the same day the piece of equipment is dropped off.

Once the work order is opened, how many days does it take for a technician to be assigned and to begin the diagnostics process? To be best in class, this should happen within 24 hours.

After the technician diagnoses the equipment and creates a parts list, how long does it take your parts department to generate a parts estimate? Once again, parts estimates should be completed daily.

How long does it take the service department to complete the service estimate and get the customer’s approval? This should occur within 24 hours of the parts estimate being created.

When the estimate is approved, the required parts should be ordered on the same day. How long does it take your parts department to order approved parts? If it takes days or weeks, you have a problem.

Once the parts have been received, do you have a designated location to stage them for the technician? What is the procedure for informing the technician or the service manager that the parts they ordered have arrived? How long does it take? I hope it’s the same day the parts are received.

This next stage of the work order process often overwhelms most service departments, particularly those dealing with aged work orders. Once the technician receives the parts and finishes the repair, how many days, if not weeks, does it take for your technician to submit a completed service report? Technicians should submit their service reports on the same day they finish the repair, without exception.

Once the service report is submitted to the service manager or office, how long does it take to process it, i.e., to close the work order? I’ve seen service managers hold on to completed work orders until the last week of the month before they even start processing them. It’s completely absurd. Completed work orders should be closed on the same day. All the work has been completed; we must close the work order. That’s cash just sitting in your service office! 

After the work is completed and the work order is closed, how long does it take to collect payment for the repair? This might be the most crucial step in the whole process. It doesn’t matter how efficient your technicians are, how many turns your parts department has, or even if your service manager keeps all his work orders up to date. It’s all for nothing until you collect the cash. The transaction isn’t complete until you get paid. 

Kevin Landers, President of Rocketwise Inc. and Co-Founder of By The Boxes

What should the life cycle of a work order be, and how many days should it last? Additionally, review the steps we discussed and measure the time it takes your service department to move from step to step or box to box. Find ways to determine why it takes so long and explore methods to decrease this time. It’s challenging work, but it will yield benefits in cash flow, profitability, and customer satisfaction.

I have recently partnered with Kevin Landers, President of Rocketwise, inc., an IT consulting company. We have launched a new company, By The Boxes, a software development company, and we have developed a work order tracking app that will track every stage of the work order listed above. You instantly have visibility to see how many days it takes you to move a work order from stage to stage or box the box. The By The Boxes work order tracking app will be a game-changer in our industry. To schedule a demo, email  john@bytheboxes.com or kevin@bytheboxes.com.