March 1999

The Runaway VRU: Business Impact And Corrective Measures

BY SHARNA KAHN, KPMG LLP

In the past several years, "customer satisfaction, customer retention" has become a mantra of sorts at customer-focused organizations of all sizes, in all industries. Companies are extremely aware of the importance of front-line customer contact and routinely invest millions of dollars in telephony equipment, call center software and customer service representative (CSR) training. However, despite this concerted effort in improving customer relationships, many companies overlook poor implementation of the true "front line" - the voice response unit (VRU) which guides customers to the assistance they require. Companies must learn to recognize poor VRU implementations to most effectively correct the problems.

Customer Disservice Is Rampant
The fact is, at the VRU front line, customer relationships are almost as likely to be aggravated as enhanced. Recently published research suggests that as many as 40 percent of the VRUs implemented for customer self-service do not deliver requested customer information effectively - they do not provide a "quality experience."

In focus group research, customers have likened frustrating VRU self-service experiences to "an experiment in a mouse maze that contains no cheese." The so-called "runaway VRU" leads the caller aimlessly through myriad choices, then penalizes an incorrect choice with disconnection. In some cases, the caller cannot escape the maze and is forced to listen through to the end, without an option to speak with a live CSR.

Finding The Right Model
Defining and selecting a model for the call trees (menus) is the first step to creating either a productive or annoying VRU experience. This model is determined through a series of steps, including a clear understanding of the company's goals regarding the customer experience. These goals might be:

• Company-centric - providing information for a large percentage of the call types and providing customer data for a certain segment of the customer base and/or
• Customer-centric goals - identifying the customer before the call is transferred to a CSR who can then deliver more personalized service.

Selecting a model through an industry standard or benchmark is a logical place to start. However, organizations implementing VRUs should keep in mind that data used to define industry standards may be very different than what specific customer bases and business drivers require.

If the industry-standard model is indeed correct and serves a company's end goals, it may be sufficient. But what if, through customer service surveys or declining sales or customer base, it becomes evident that the "right" VRU model still leaves customers frustrated or unhappy with your service?

The Runaway VRU In Action
The following banking example illustrates the negative business impact of a runaway VRU:

A major bank has been using its current VRU model for several years, believing the model to be satisfactory. The bank's credit card customer service department is reached through a toll-free number listed on the credit card. Callers identify themselves by entering their account and PIN numbers by touch tone or voice. The menu then leads the cardholder through a short series of choices for self-service and offers an option to be connected to a live agent at any time or for all requests not covered by the menu. The bank's model appears to be clear and straightforward, but is it?

Unfortunately, after the caller provides account information, the menu continues to cycle although no responses may be given. No default is offered should the customer become confused or miss a response window. In addition, customers choosing to speak with a CSR are not identified by the VRU to the agent. Customers have to repeat their account information when they connect with a CSR. Finally, the menu choices are limited and do not fully cover the most common reasons why customers call.

Small Mistakes Cost Big Dollars
At first glance, these inadequacies do not appear to be egregious errors. However, two important outcomes must be considered, both of which can contribute to significant business losses.

First, multiplied across thousands of inbound calls, the increased costs of longer call-handling time (both VRU and agent time) add up to a significant amount. As customer service organizations receive continued pressure to handle increasing amounts of calls per hour, addressing call volume at its source is an obvious, but frequently overlooked solution.

As a result, menu-choice defaults or other "opt out" selections should be provided for impatient or befuddled customers.

Second, it is well known that customer dissatisfaction increases as individuals are asked to repeat their stories to multiple CSRs or other company representatives each time they are transferred. This dissatisfaction includes the perception of a relationship devaluation between the provider and the customer. Other providers are actively looking for, and catering to, your customers who reach this conclusion. With the cost of acquiring a new customer estimated at more than five times the cost of retaining an existing one, simple arithmetic clearly proves the high cost of losing customers.

Finally, the most common call types for this bank's card which were not handled by the VRU were shifted back to the CSRs. By forcing agents to answer questions which could easily be handled electronically, negative impact is seen on queue times, cost per call and, ultimately, the customer experience.

Finding The Right Model
To determine the correct model for your implementation, consider both customer-centric and company-centric requirements. Ronda Closner-Sensenig, a principal at Knowledge Plus, a telecommunications technology consulting firm, said, "Often times, companies implement VRUs to cut costs for customer service, but the end result is a reduction in customer satisfaction and service quality. It's a classic example of being penny-wise and pound-foolish."

Fortunately, the effectiveness of investments in VRU solutions can be monitored quickly and easily, facilitating continual refinement of the model after it is up and running. Either while the customer is using the VRU system or through telemarketing surveys, timely data can be gathered. Employees from across the implementing organization can be enlisted to use the system and provide candid feedback. Customer focus groups can give in-depth feedback about the entire VRU customer experience.

Additional, abundant numeric data can be easily gleaned from the VRU system itself. By tracking the statistics on call types, call time in the VRU, calls opted out to agents and other indicators, a best-in-class model can be determined to deliver the ultimate customer service experience. Make competitors' runaway VRUs work in your favor!

Sharna Kahn is a senior manager in the customer management practice at KPMG LLP and may be reached via e-mail at [email protected]. For more information about Knowledge Plus, e-mail [email protected].

BY CAROL WINGARD, INTERVOICE, INC.

When evaluating IVR solutions, whether basic, Web-enabled or within a fully integrated inbound/outbound call center - and when choosing an IVR supplier - buyers need to focus on these key criteria:

• Maximizing customer use of the system (effective call flow and user-friendliness are key to the effectiveness of an IVR system), and;
• Simplifying and making life easier for call center managers and the organization's telecom and IS departments.

For the above to occur, the following must be provided by an IVR supplier:

• A broad choice of host database, legacy systems and device connectivity options. Connectivity between the IVR solution and every other element between it and your customers' access device is critical. Look for a supplier that has already written the interfaces to your legacy systems and whatever access device you plan to enable your customers to use. Time and other valuable resources will be saved.
• Industry-specific partnerships. If your organization plans to integrate the IVR solution with industry-specific application packages, determine whether or not the supplier has an existing relationship with the applications provider. If so, chances are the interface between the IVR solution and the application has already been written. This will streamline the implementation and deployment process while significantly raising the probability of success.
• A comprehensive graphical user interface (GUI)-based applications development tool. Whether your organization plans to develop, test and deploy its IVR applications in-house or outsource the project to the IVR supplier or a third party, the development tool is a critical element. A graphical approach to building call flows can save significant time throughout the entire development, test, review and approval, and subsequent modification process. Look for a solution that has been evaluated by at least one of the major industry publications.
• Applications expertise. The application is the key to a successful IVR implementation when success is defined by the level of customer utilization. Your customers are more likely to choose to use your IVR system when the call flow logic is sound, the length of menu choices is short, and the explanations are clear. The more complex the application -- or applications -- the more likely the possibility that your organization will need assistance from the IVR supplier for application development and/or subsequent modification. Here again, experience is key. Ask your IVR suppliers how many applications they've deployed, the industries they represent and number of people involved in their applications area.
• A broad range of speech recognition capabilities fully integrated in the system. Adding the right speech recognition technology, or combination of technologies, can significantly increase customer use of your IVR services, resulting in a greater number of calls processed, improved customer service levels and reduced overall call center operational cost. Since the type of speech recognition required will be dictated by the nature of your planned application(s), make certain your IVR supplier can demonstrate a proven track record with today's most advanced technologies.
• Availability of enabling technologies, such as text-to-speech, fax, etc., as well computer-telephony integration (CTI) and outbound dialing capabilities. Other enabling technologies further automate tasks which, without them, would require CSR invention to complete. With today's costs of training and retaining skilled CSRs, the economic incentive to automate is compelling. Beyond a well-outfitted IVR is a solution that exploits the advantages of CTI, giving agents a plethora of customer information to further accelerate and improve the customer service function. Finally, consider the possibility of growing your IVR solution to include outbound campaigns, further improving agent productivity. Unless you are resigned to inbound call automation only, look to suppliers that offer the ability to grow their IVR system to a CTI-enabled and blended inbound/outbound call processing solution.
• Applications and technical support. Regardless of whether your organization intends to develop and maintain applications and the technical aspects of the system over the years to come, assistance from the IVR solution provider will invariably be required. Ideally, you should expect your IVR vendor to offer a number of service levels, from help desk to full, around-the-clock availability.

If your organization plans to be around in the long run, go with a solutions provider that has demonstrated its staying power with a proven track record.

Carol Wingard is vice president of marketing for Dallas-based InterVoice, Inc., where she is responsible for developing the marketing strategy for the company's call center and network-based enhanced service solutions. InterVoice, Inc. is an ISO 9001 certified company and a leading global supplier of automated call processing systems.