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IP Contact Centers
July 2004

Enhancing Service And Reducing Costs With The IP-Based Virtual Call Center

By Steve Kaish, CosmoCom

As businesses worldwide struggle with a lackluster economy, intensified competition and the tentative buying habits of customers, a new mantra is sounding: 'It's all about the customer.' Companies have experienced first-hand that excellent service attracts and, most importantly, retains customers. As a result, customer service excellence has joined cost reduction and new revenue-generating services at the top of their list of winning business strategies. It's not simply the strategy du jour. An Information Week study in late 2003 indicated 90 percent of surveyed managers said that improving customer service is a primary concern. Major telecommunications companies are putting their money where their mouths are, with BusinessWeek Online estimating that $5 billion was spent on call center and billing-related technology in 2003.

Call Center Priorities To Meet The Challenge
Now the heat is on for call center managers to deliver the customer service excellence strategy. They are challenged to increase customer satisfaction and reduce costs, while still managing complex day-to-day operations. To meet this challenge, most organizations have identified the following as the top priorities:

' Move offshore as much as possible. According to a study by Deloitte and Touche, by 2008 telecom will outsource 275,000 jobs offshore, many of them call center agent positions. Datamonitor predicts that 43 percent of financial services agent positions will move offshore by 2007.
' Transform multiple standalone operations, including offshore operations, into a single virtual call center for maximum efficiency, consistency and control.
' Reduce the application integration backlog that slows down agents and decreases productivity.
' Provide unified, universal customer access via telephone, e-mail and Internet to open less costly or more convenient interaction channels, while preserving quality and consistency across all.

The primary theme of this article is to explore the benefits of virtualization. An IP-based virtual call center addresses all of these priorities, helping call center managers achieve their complex goals and deliver service excellence. In the above list of four priorities, virtualization is only one. But as we will see, virtualization actually touches on all four of these major themes.

Virtualizing The Call Center
Creating a virtual call center is one of the most effective ways to accomplish both of the seemingly contradictory objectives of service improvement and cost reduction. With a virtual call center, an organization's agents can be located in multiple locations while managed and utilized as a single entity. As a result, staffing resources are optimized and experts are available to any caller via location-independent skills-based routing. Also, the mergers and reorganizations that are so common today are less painful and costly on an enterprise's call centers with a virtual call center infrastructure in place.

The virtual call center model also assists with employee retention and satisfaction, thereby reducing recruitment and training costs. Using this model, it's not uncommon for an organization's employee turnover to decrease by 80 percent or more within one year after moving to a virtual call center. Furthermore, 90 percent fewer calls are escalated, and as many as 30 percent more inquiry calls can be converted to orders. The virtual call center clearly benefits management, but it also benefits agents. Because calls are disseminated among the entire pool of agents, rather than to geographically specific ones, the workload is more equitably distributed, resulting in more manageable workloads. Additionally, busy signals and wait times are reduced, tending to decrease the caller negativity that can wear down even the best agents.

But virtualization itself requires an investment that must be justified. Virtualization is more cost-effective and easier to justify with the inherently virtual IP-based architecture than with any other technology. It's also easier to deploy because IP is based on software that runs on commodity servers and workstations, and the only equipment an agent requires is a standard PC, headset and Internet connectivity. As a result, IP-based solutions are affordable, and fast-deploying virtual call centers, in which multiple agent locations, agents at home, even follow-the-sun agents, are all managed and utilized as parts of a single system image.

Virtualization And Offshore Outsourcing
Perhaps the most powerful example of the need for virtual call centers is the trend to outsourcing agents offshore ' which, according Deloitte and Touche, will be further fueled as more data-oriented services are offered. This study also indicated that while the cost reduction opportunity was significant ' with early adopters reporting initial savings of 20 to 30 percent ' it also raised significant concerns regarding control loss and operational complexity. Creating virtual call centers with IP mitigates these concerns because it enables managers to retain complete operational visibility and control of activity across the globe via Web-based administrative and reporting tools. It also allows agents to be located anywhere, while still providing 100 percent feature functionality, including PSTN voice, and enables seamless call routing within global organizations. Customers can reach the most cost-effective and appropriately skilled agent without losing access to onshore specialists, when needed.

Application Integration
Most call center agents interact with multiple legacy applications. For example, telecommunications agents face an average of seven different legacy applications, and for some it's as high as 15. This situation translates directly into cost factors: agent time for navigation; training time and cost; agent churn and the cost of the inevitable errors in lower customer satisfaction. But progress to overcome this challenge is slow because of the high cost of integration with legacy call center technologies.

IP solutions often take a unified approach, incorporating ACD, IVR, CTI, multimedia recording, predictive dialing and administrative tools onto a single platform. This automatically eliminates a significant amount of custom integration. For multisite contact centers, it also eliminates the need to acquire and maintain duplicate equipment. Furthermore, IP-based solutions often include integration tools based on open standards, which are easier to use, quicker to implement and less costly to maintain when compared to CTI.

Where does virtualization come into the application integration picture? With virtualization, you integrate once for all locations. This can be an enormous source of savings.

Universal Access
As organizations provide more messaging services and Web-based customer self service, it becomes increasingly important to transform the call center into a contact center ' one that supports every contact channel in a unified way to maximize productivity, minimize response time and provide customer interaction history across all channels. IP-based solutions facilitate this, as all channels can be accommodated through the IP architecture. All interactions can be tracked in a unified way, CRM screen pops can look the same for all channels and customer interaction history and agent reports can include them all.

The Challenges
Consider, for example, a company that serves millions of customers via hundreds of agents in four different locations that have always operated as independent contact centers. Direct employees might staff some of these locations, and outsourcers might manage the other two. Each contact center houses and manages its own ACD with its own queuing patterns, routing rules, administrative tools and reporting. Therefore, any change would require four separate adjustments to four different systems by four different people who might be operating in four different conceptual paradigms. This alone makes the environment inefficient and error-prone. Furthermore, with four separate systems, the cost of obtaining reports on the entire operation is prohibitive. This company would have no way to monitor its outsourcers' operations beyond a few periodic summary reports.

Adding to these inefficiencies is the fragmented way in which the organization handles different contact types. The call center might use three channels to communicate with customers: telephone, e-mail and fax. Each channel is handled and tracked separately. For example, e-mail may come to a single mailbox shared by all agents. Fax is a completely paper-based process: time-consuming and prone to error. The company may, for example, wish to add Web chat to the mix in the near future but is reluctant to fragment the situation further.

In addition to an ACD, the company's headquarters houses two CRM systems: one from a third party and one developed internally. To enhance customer service, the company may want to integrate the CRM systems with the call center systems, providing screen pops of customer data based upon information from both the incoming call and the IVR. The organization begins integration within the headquarters location, but after six months of work, integration between the ACD and CRM system is still working inconsistently.

This company needs a solution that will streamline its customer care organization into a unified, coherent virtual contact center that operates through a single back-office integration, uses the same business processes across all locations and enables monitoring and management of any agent in any location. The company may also wish to channel all customer contacts, regardless of type, into a single queue, automate the e-mail and fax processes and enable chat as part of a new, unified paradigm. Finally, the company needs to reduce agent talk-time by providing screen pop integration with third-party and proprietary CRM systems.

A Solution
A company with these issues might choose a unified IP contact center suite that includes multichannel ACD, e-mail response, IVR, CTI, predictive dialing, multimedia recording and administrative tools.

Since an all-IP platform frees call centers from physical constraints, the company is better able to create a virtual call center with multiple locations managed and operated as a single entity. The four physical call centers, including the outsourced operations, can serve one set of queues and use the same business rules. Administrative tools enable the staff to configure and manage the virtual contact center, including any changes to personnel, skills, queues and groups. Changes can be made on-the-fly to quickly respond to the changing environment.


Managers can share administrative functions with the outsourcing partners and have access to real-time and historical features that reflect activity across all locations, both features available regardless of the outsourcer's location.

Multichannel capabilities allow the company to handle all customer contacts, regardless of type, through one system. The platform can support all current channels, as well as chat, and can track all in one system with universal queuing. E-mail can be distributed directly to the desktop, rather than to a shared mailbox, helping create greater efficiency and reduce response time. Faxes can arrive in electronic form, allowing agents to respond from their desktop rather than a physical fax machine, also replacing paper archives with electronic storage.

The organization can integrate its third-party and proprietary CRM systems to the contact center system. The IP solution can simplify this traditionally expensive and time-consuming process for two reasons. First, much of the functionality that must be done as custom integration in a premises-based environment is built into the platform. Second, the solution can include an out-of-the-box integration enabler for packaging the solution with both out-of-the-box and homegrown CRM applications. Using this tool, the company will be better positioned to integrate both CRM systems in a few hours, creating a screen pop based upon information collected from both the incoming call and the IVR.

An IP-based contact center platform can enable this company to transform its multiple operations into a single virtual call center. A solution of this type can support all required contact channels in a unified way and streamline the e-mail and fax processes. Finally, the company is able to more easily integrate both of its CRM systems with the solution and deliver an informative screen pop to the agent's desktop. As a result, the company can improve efficiency and control, increase agent productivity and enhance customer satisfaction.

An IP-based virtual call center helps call center managers reduce costs and increase customer satisfaction by addressing their four major priorities, as follows:

' Multisite call centers, including outsourced and offshore locations, can be managed and utilized as a single entity with unified queues, routing rules, administration and reporting, maximizing efficiency and enhancing customer service.
' Such systems are affordable and easy to deploy, allowing call center managers to more rapidly take advantage of offshore outsourcing.
' Integration is done once for all locations, which can significantly reduce integration costs.
' IP-based solutions facilitate support of all contact channels in a unified way to maximize agent productivity and minimize response time.

As a result, call center managers are able to achieve their complex goals and deliver the customer service excellence strategy.

Steve Kaish, CosmoCom's vice president of sales, Americas and Japan, has extensive business and technical leadership experience in the telecommunications industry. Prior to joining CosmoCom, he was Telcordia's director of product management for the industry's first production Class 5 softswitch. Prior to Telcordia, Kaish managed a number of architecture teams launching innovative service offerings at AT&T's Bell Laboratories, including the AT&T WorldNet Internet access service, as well as AT&T's first network-based call center service.


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