Key Performance Indicators (KPIs) are operating figures and show at a glance how a company is currently doing. Which key operating figures should your fiduciary company measure in order to strengthen its position in the market, even in the face of the weak economic forecast? In this blog post, you will find out.

Turnover, cash flow, equity ratio, growth figures and customer churn rate: Fiduciaries help their SME clients to define, calculate and analyse key operating figures. In addition to basic and industry-independent KPIs such as profit, cash flow and equity versus debt ratio, the definition of other KPIs depends heavily on the size of the company, legal form, industry and business objectives. For example, in scaling companies with an expansion strategy, the length of a sales cycle can be one of the most important KPIs for business performance, while in a logistics company, the inventory-turnover ratio allows valuable conclusions to be drawn about the economic situation.

Below we have listed the key operating indicators that fiduciary companies seeking to maintain or improve their market position in these uncertain economic times should measure.

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Customer profitability

How much turnover and profit do you make per mandate? Which customer segments are the most profitable? And why is it important to know the profitability of your customers? If your fiduciary company concentrates on mandates with similar process flows, the cost price decreases due to the economies of scale. In fiduciaries, the time spent per mandate represents the economy of scale. This allows fiduciaries to devote more time to looking after clients and acquiring new clients. With an increasing number of mandates thanks to the additional efforts in the area of client acquisition, your fixed and standby costs such as rent, wages and software licences are in turn spread over more projects. This reduces the costs per mandate and creates a so-called fixed cost degression. Therefore, calculate the value and profitability of existing customers and prospects.

Customer Retention Rate

The customer retention rate is the percentage of customers who continue to be your customers after a certain period. Your retention rate can help you better understand what keeps clients loyal to your fiduciary. Because it is often easier and cheaper to retain and develop relationships with existing clients than to attract new ones, you should know your fiduciary’s client retention rate. How many of your biggest customers have you been able to keep over the last three years? Have you lost profitable mandates in the last five years? Why did customer relationships come to an end? The operational metric of customer retention rate allows you to deepen customer relationships. By cultivating relationships, you can lay the foundation for up-selling or cross-selling. Upselling means offering more sophisticated services than before and cross-selling is selling additional services.

Average response time

How long does it take on average for your customers and prospects to receive a response from your team? For inquiries via e-mail, the response time should not exceed 24 hours during the working week and telephone callbacks should be made on the same day or at the latest in the first hours of the following working day. Communication apps like Slack allow you to communicate efficiently with existing clients. Bear in mind that your team does not have to present a solution to the client with every message. Sometimes it is enough to acknowledge the request and let them know when they can expect a comprehensive response. By setting the average response time in the form of a KPI, you create binding guidelines for your team.

Staff utilisation

How efficiently does your team work? Are all employees well utilised? Are you using your skilled workers profitably? Especially in countries with high labour costs like Switzerland, employee salaries are often the biggest cost item for SMEs in the service sector. Staff utilisation is therefore an important indicator for fiduciary companies. When determining staff utilisation, ask yourself not only whether you are using your fiduciary professionals efficiently, but also how effectively they are working. Do you offer them the right working environment to use their strengths profitably and to develop themselves further? Technological innovations relieve fiduciaries of many repetitive tasks. Nowadays, for example, no one should have to type out receipts in fiduciary companies. Fiduciary software such as Accounto takes care of document processing and up-to-date accounting. If you can outsource routine activities to a stable and secure fiduciary software, you will have more time for personal advice and your fiduciary company can focus more on the needs of existing, potential and new clients. This gives you a weighty competitive advantage. In the future, only those fiduciary companies will survive and grow that stand out from the competition through their ability to innovate, productivity and a custom-fit offer.

Satisfaction of your employees

The shortage of skilled workers in the fiduciary sector continues and good fiduciaries are in high demand in the labour market. The satisfaction of your employees should therefore be an important operational indicator. Define how you will measure employee satisfaction. This can be done using either a simple scale or a template from HR companies that can be adapted to your needs. Find out how satisfied your team is with the current work situation with the help of individual interviews and employee surveys. Do your employees feel valued? Do you find your work meaningful? Do you provide an attractive working environment? What about team cohesion? In case of problems, you should always react proactively and look for solutions together with those affected.

Reading Tip: In this blog post, you will get tips on how to make your fiduciary company a more attractive place to work for fiduciary talent.