E-Darwinism: The
Evolution Of The Virtual Contact Center BY
BRYANT DOWNEY, CINTECH SOLUTIONS
Charles Darwin defined a competitive advantage as
an adaptation that affords an organism greater
survival probability in a changing environment.
Although his theory of natural selection attempted to
describe the evolution of humans, his survival of the
fittest concept applies just as thoroughly to
business. In today's business communications world,
the virtual contact center is evolving from a pipe
dream to a business tool accessible to organizations
of all sizes.
THE EVOLUTIONARY ROOTS OF THE CONTACT CENTER
For decades, the telephone ruled the earth as the
primary form of communication. It was a switched
network world and anything that wished to survive had
to conform or be crushed. In this PSTN environment,
the toll-free number evolved and businesses were soon
connecting to customers and partners located anywhere.
Telephone calls from customers flooded in and staff
and technology were dedicated to handling these calls.
The call center was born.
The call center offered businesses myriad
competitive advantages, including quantum leaps in
customer service capability, partner support
opportunities and preferential treatment for
high-priority customers. The call center thrived and
continues to do so today...but it has limitations. A
traditional call center is restricted to one physical
location. PSTN circuits must connect any location
where call center agents work, and to establish those
connections over anything but a very short distance is
extremely expensive.
Managers have long sought a practical way to unify,
not just connect, geographically separated call
centers. Although the term hadn't yet been coined,
managers were seeking virtual call centers. A virtual
call center is, in essence, just like a standard call
center except its agents can be located anywhere and
work together as if they were in the same room. It
offers the same functionality as an in-house call
center, including skills-based routing, queuing,
real-time monitoring, historical reports and trend
analysis. Managers knew that the efficiency gains,
flexibility and human resource advantages of such a
call center would be tremendous. The virtual call
center, however, just wasn't realistic in the PSTN
environment.
A few, very large call centers do manage to connect
separate locations using highly sophisticated and
expensive networking systems. Few companies can afford
these systems, and even these high-end technologies
don't create a true virtual call center. They can
overflow calls from one center to another in the event
of a volume spike, natural disaster or power failure.
They cannot, however, unite agents into common skill
groups, seamlessly manage calls among multiple centers
or monitor agent performance in remote locations. For
the most part, once a call is sent to another call
center, it's gone. There is no practical way to be
sure it got there, track it or generate reports about
how it and other overflowed calls are being handled.
THE METEOR THAT CHANGED THE COMMUNICATIONS WORLD
Sometime about 65 million years ago, it is theorized
that a giant meteor crashed into the earth and changed
the planet almost overnight. It is believed that this
one-time event altered the world dramatically, making
it possible for mammals to flourish. Today, we stand
at a similarly bright point in the evolution of
business communications.
About five to seven years ago, Internet Protocol
technology emerged and changed the communications
environment almost overnight. IP technology was
nothing less than an evolutionary explosion. It
revolutionized communications in two ways. First, it
eliminated distance as a barrier because it enables
connections across any data network, and second, it
opened the door to entirely new channels of
communication, such as e-mail and chat.
In recent years, as e-mail and Web chat joined
voice as primary communications channels, businesses
have begun integrating these elements into their call
centers. Because these Web-enabled call centers
handled more than just calls, they became known as
contact centers. Another evolutionary step was taken.
In the IP environment, the virtual contact center
is no longer a mirage constantly eluding contact
center managers. PSTN calls can be converted to IP
packets and inexpensively transmitted over the network
in the same manner as e-mail and Web chat. Using WANs,
a data network can extend anywhere in the world.
DON'T RUSH TO JUDGE VOIP QUALITY
"My kid made a soup-can-and-string telephone that
sounds better than VoIP," you say? Get ready to
reevaluate. The problem is that most people experience
voice over IP (VoIP) over an unmanaged WAN, such as
the Internet, where quality and reliability are nearly
nonexistent. There are too many uncontrolled variables
such as bandwidth, volume, demand spikes and
congestion points to make VoIP effective.
However, in LAN and managed WAN environments (VPN
or WAN with guaranteed service levels), quality
factors are all controllable. With recent decreases in
bandwidth cost and increases in quality of service
standards utilization, VoIP in these environments is
cost-effective and the quality is on par with
traditional voice.
OF OPPOSABLE THUMBS AND VIRTUALITY: THE
COMPETITIVE ADAPTATIONS OF THE VIRTUAL CONTACT CENTER
Thumbs gave primates a tremendous array of competitive
advantages. Similarly, the virtual contact center
offers an entire arsenal of benefits.
The virtual contact center versus independent
centers. Erlang formulas, named after Danish
mathematician Agner Erlang, were developed to
accurately predict the relationship between call
volume, wait times, number of agents and several other
variables. They help prove one of the key benefits of
a virtual contact center versus independent centers:
the virtual contact center requires fewer agents to
handle the same call volume.
Let's take a simplified look at how this works in
an organization with four independent contact centers
each handling a constant 100 calls per hour compared
to that same organization operating virtually.
Configuration
|
Contacts
per hour
|
Agents
required
|
Four
separate contact centers |
400
(100 each) |
36
(9 each) |
One
virtual contact center |
400 |
29 |
One
virtual contact center |
510 |
36 |
Assumptions:
Average contact duration = 180 seconds
Average wrap time = 40 seconds
Answer target = 80 percent within 20 seconds |
Assuming an agent cost of $40,000 (roughly the
industry standard), the four separate centers can
achieve $280,000 in annual savings by creating one
virtual center. Or, looking at this effect another
way, the same 36 agents handling 400 calls per hour in
separate centers could handle more than 500 calls per
hour in a virtual center.
Additional
Mid- to Large-Size Contact Center Comparison
Table |
Configuration
|
Contacts
per hour
|
Agents
required
|
Four
separate contact centers |
2680
(715 each) |
200
(50 each) |
One
virtual contact center |
2860 |
184 |
One
virtual contact center |
3130 |
200 |
This table
illustrates the efficiency gained in a mid- to
large-contact center environment as an
organization moves from four independent call
centers to one IP-based virtual contact center
with four locations. |
The virtual contact center offers advantages far
beyond cost. From their desktop, administrators and
supervisors can manage the entire virtual contact
center network. They can access real-time reports,
historical trending data, monitor activity on an
agent-by-agent basis and even watch or listen to how
an agent is handling a customer.
Yet another benefit of the virtual contact center
is the expanded pool of skills available. Let's
imagine a customer calls a center in Phoenix about a
problem he is having with the optical output of a new
DVD player. While the Phoenix center can handle
general questions, this question is more specialized
and beyond the scope of the center. There are,
however, agents in the company's Detroit contact
center that specialize in optical connectivity
problems. In a separated environment, the Phoenix
agent would have the customer call the Detroit center
or, with advanced capability, the call could be
transferred, at which time the customer would likely
wait in queue for a second time. Once the call is
transferred, Phoenix has no idea if the call actually
made it to Detroit, if the problem was resolved or how
long it took. In the virtual contact center, the call
is automatically transferred to Detroit based on
caller-directed input. The Phoenix agent's time is
better spent handling questions that fit his or her
skill level, the caller reaches the correct resource
faster and managers can access full reporting on how
the call was handled.
THE VIRTUAL CONTACT CENTER VERSUS THE
CENTRALIZED CONTACT CENTER
So what happens to a one-location contact center when
the Blizzard of 2001 hits? Or when rolling blackouts
turn computers into expensive paperweights?
In a virtual environment, the customer contact
world doesn't end during an emergency. Again, using a
virtual contact center with four locations as an
example, if one location goes down, the impact on the
customer service function is only a 25 percent
capacity loss. Managers can log-on from home, or any
location, to quickly reconfigure routing tables,
record automated announcements and take other
administrative action needed to assure that the
virtual contact center is able to absorb the impact.
THE HR ADAPTATIONS OF THE VIRTUAL CONTACT CENTER
Virtuality allows organizations to place their contact
center wherever favorable labor markets exist. Suppose
a company is located in New England, but the market
for agents there is so tight the company would have to
pay agents more than most professional athletes to
attract quality personnel. The problem can be
eliminated when the company sets up a virtual contact
center location in Salt Lake City, where there is a
skilled labor pool that does not demand six figure
salaries and a chauffeured limo.
A virtual contact center can structure its
locations so that time zone issues are no longer a
concern. A center with locations in each North
American time zone, for example, can staff each with
agents who work a standard 8:00 a.m. to 6:00 p.m.
shift. By contrast, a single center located in the
Eastern time zone would be in the unenviable position
of needing a full shift of agents until 9:00 p.m. to
cover contacts from the Pacific time zone.
Even in a local contact center situation,
virtuality offers recruiting advantages. Imagine a
center located in the Los Angeles area. The virtual
contact center could have locations on the east, west,
north and south sides of the metropolitan area. Agents
could work at the location closest to them instead of
traveling across the city to get to work. Recruiting
and retaining employees is much easier in the former
scenario.
Work-at-home employees are yet another human
resources advantage of the virtual center. There are
countless reasons a company may want to set up a
valuable agent to work from home, and with the virtual
contact center it is little more than a matter of
connecting the agent to the data network.
IT'S EVOLUTION, NOT MAGIC: SEPARATING HYPE FROM
REALITY
Whenever new technologies evolve, wild predictions fly
fast and furious. Promises that IP would usher in the
era of the "buildingless" contact center in which
hundreds of agents each work from a separate location
can be filed right alongside that fat-burning pill
claiming to magically make you lose weight while you
sleep.
While the buildingless virtual contact center is
technically possible, it's just not practical. For
most employees, face-to-face collaboration and
supervision will remain one of the best tools
available to assure high productivity. Individually,
certain employees will function extremely well in a
work-at-home situation. In most cases, though, the
management issues of a large workforce in a completely
separated environment are enormous.
So let's take a look at the two most likely
applications of virtual contact center technology.
Multiple small- to mid-sized contact centers
working together. Most medium- to large-sized
organizations already have multiple contact centers
working independently or with some minimal level of
coordination. These companies will simply apply
virtual contact center technology to capitalize on the
efficiency, customer handling and management
advantages of virtuality.
Most companies with single contact centers aren't
likely to tear them down and build multiple smaller
contact centers. Rather, as their contact needs grow
(and grow they will, with ever-expanding use of
e-mail, chat and other Web-based channels), many will
add smaller, separate centers and connect them
virtually rather than continue building on their
current center.
The extended contact center. The
emergence of the virtual contact center allows
existing contact centers to extend anywhere, thereby
sparking the full evolution of the informal contact
center agent. These are people outside the contact
center whose primary job is not handling customer
contacts, but who may be the best resource to handle
certain high-level queries. As an example, let's go
back to the customer calling about the optical output
on his new DVD player. Perhaps his question relates to
a distorted audio problem. The agent recognizes this
highly specialized problem and transfers the customer
to the company's engineering team responsible for
building the optical transmission apparatus. One of
the engineers takes the contact and helps the customer
solve the problem. Informal agents aren't new, but
until IP technology eliminated the distance barrier,
centers were limited to resources located in the same
building.
Work-at-homes, field personnel or any other
distributed employee can also be connected to the
extended contact center simply by adding them to the
data network.
EVOLUTIONARILY SPEAKING, IT'S THE GIRAFFE'S
NECK, THE ELEPHANT'S TRUNK
As in nature, the business world rewards those with
advantageous adaptations. Such is the case with the
virtual contact center. The business advantages
offered by the distributed contact center are just too
great for it to do anything but flourish.
As companies move to capitalize on these new
adaptations, multiple virtual centers will become the
norm. This will result in a dramatic decrease in the
size of the average physical contact center location.
In fact, the trend has already begun. Research company
Ovum, Ltd. recently predicted that the average number
of agents per contact center will drop approximately
50 percent over the next five years.
This is not to say that the large, centralized
contact center will become extinct anytime soon, if at
all. For some companies, this configuration offers
advantages. Even the large, single-location center
will be touched by aspects of virtuality, be it to
retain a valuable employee who wishes to work from
home or to add to and expand the services of the
contact center.
So enjoy the view from this evolutionary peak. Look
backwards and see the incredible evolution of customer
contact from the telephone to toll-free to call center
to virtual contact center, all in just over 100 years.
Look forward and envision the customer contact
possibilities of the virtual contact center and a
nearly limitless IP world. Somewhere, Charles Darwin
must be impressed.
Bryant Downey is the chief technology officer
and co-founder of Cintech
Solutions, Inc. Cintech creates Internet
technology solutions, including the NetVIA e-contact
center, to manage and analyze interactions with
customers, partners and associates.
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