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Simulation Training: The Power Of Continuous Performance Optimization
By Wade Baker Sivox Technology Inc.

The Current State Of Call Centers

There are more than 160,000 call centers in operation worldwide. These centers are facing increasing challenges, including globalization, the need for more knowledgeable call agents, pressure to reduce training costs and rapid acceleration in call volumes. Add to this the necessity to attract and retain highly skilled employees, and there is a critical need for more effective and efficient training of call center employees.

The rise of call centers is directly tied to the increasingly competitive need to provide better customer service. Corporations have learned that better service not only keeps customers happy, but can also provide additional sales revenue in post-sales customer calls. Greater customer satisfaction and increased revenue are predicated on efficient, highly trained call center agents, however. Yet the turnover rate among call center employees may run as high as 70 percent a year in some industries.

Furthermore, call centers cannot transfer knowledge fast enough, for as markets, products and services rapidly change, new training must be implemented quickly yet thoroughly. For example, a leading telecom provider company changes 70 percent of its call center scripts every seven weeks. Add to this the industry-acknowledged attrition rate of call center professionals of 40 percent to 90 percent per year, and the need for rapid and thorough training of representatives on the front line of call centers becomes crucial to survival.
Call Center Training Requirements

In order to reduce costs and increase agent performance, call centers must adopt new technologies for quicker and more efficient agent workforce training. These software solutions must be interactive, specific to each organization, quickly deployed and rapidly adapted, with ongoing feedback to monitor individual trainee progress.

Research indicates that learners retain more information when they are interactively involved with the content. Passive learning, in fact, such as classroom training, is the least effective. Furthermore, passive learning is the least cost-effective in terms of hours, manpower and facilities. A Datamonitor, Inc. survey reports that while nearly half of all organizations still view their call centers as “cost centers,” nearly a third (32 percent) expect these same call centers to generate profits through contextual selling on behalf of the agents. These contextual selling skills require more product knowledge and more experience than current turnover rates allow.

Call Center Costs
Two-thirds of contact center costs are related to agents, with the total costs to train new agents estimated to be $15 billion per year, according to Friedman, Billings, Ramsey & Co. Inc. Here is the business problem contact center operators face:

• Ninety-two percent of consumers form their image via the contact center;
• Two-thirds of costs are related to agents;
• 30 to 60 percent agent attrition;
• Cost to recruit and train a new agent is $10,000;
• Nearly 1.5 million new agents are recruited and trained each year in North America;
• Total annual cost of recruiting and training new agents exceeds $15 billion; and
• One percent reduction in turnover equals $500 million annual savings.

Simulations As Business Solution
While there has been a massive deployment of contact centers over the past decade, the efficiency levels with these hubs have lagged. As contact center operations become paramount, contact centers are expected to seek solutions for improving agent retention and customer satisfaction. E-learning simulations are emerging as critical software solutions with proven capabilities to help contact centers do a better job of reducing turnover and improving both customer and agent satisfaction.

Enterprises that have invested in e-learning have told Gartner that their biggest payback occurs when they include simulation as part of their overall e-learning curriculum. Gartner tells its clients that workforce optimization software suites for contact centers will emerge in 2005, providing the basis for optimizing the performance of the contact center and its agents. According to Brandon-Hall, simulation is now the most critical characteristic of the next generation of e-learning products and services, with domestic revenues of e-learning simulations projected to increase from $300 million in 2002 to more than $6 billion in 2006.

As a broad range of industries feel the effects of, and conform to, the realities of a highly competitive global economy, contact center managers are under increasing pressure to generate greater value and performance from their agents. Given that approximately two-thirds of contact center costs are agent-related, companies are demanding and increasingly implementing solutions that reduce agent cost and generate increased agent output. Moreover, use of business-focused learning simulations systems will increase to support internal and external compliance initiatives, as well as new government regulations, as simulations are needed to train users on new technologies, corporate policies and operating principles.

Actual Call Center Training Today
Among most call center training facilities today, the use of e-learning and software-based simulations is still in its infancy. In order to train new customer service representatives (CSRs), most training centers rely on role-playing with mentors/coaches and on software system training before introducing the CSR to live customers. Even in the most advanced facilities, wherein software simulations seek to recreate the CSR-to-customer experience, the simulations are static — restricted to tight scripts that provide no immediate feedback to the trainee.

The reason for call center reliance on mentor/coach and peer-to-peer role-playing is obvious — the coach can provide the trainee with immediate feedback and suggestions. The coach can point out what went wrong in the role-playing and make concrete recommendations for improvement. Unfortunately, this one-on-one training is costly, time-consuming and inefficient; how many hours does it take for one human coach to role-play with each trainee? Are peer role-playing exercises useful? Can a coach be available to train one-on-one with existing CSRs as they adopt new products and services and need additional training? In peer-to-peer role-playing, the results are only as good as the weakest “player” in the training. Peers can never deliver consistent messages and in-depth knowledge of best practices. This last criteria — consistency — is especially problematic when deploying peer role-playing throughout a training facility. Effectiveness is questionable, and the outcome never measurable.

Nonetheless, the effectiveness of dynamic, interactive one-on-one training is the ideal in any learning environment. It dramatically improves retention of key concepts; it boosts confidence and competence; and it provides the trainers and coaches with immediate feedback on the CSRs’ progress.

Software simulations and e-learning are today being deployed throughout numerous facilities in an attempt to address both the effectiveness of coaching and the inefficiencies of using live mentors. Unfortunately, most software-based solutions have yet to encompass the most powerful aspects of mentoring — its dynamic ability to provide on-the-spot feedback and assessment.

In addition, e-learning and simulation development tools fall into roughly two development environment categories: boilerplate, general-purpose soft skills training modules to be used as is; or templates and toolboxes for building simulations from scratch, often using proprietary tools with a limited ability to integrate with existing IT infrastructures.

Static Simulations vs. Dynamic Simulations
By definition, static means unchanging. Most static CSR software simulations use canned customer calls or strictly scripted lessons. The trainee is expected to “play along” with the script. The CSR is scored and graded by completing this static scenario, and no interaction occurs between the trainee and the simulated customer (script). In fact, the trainee, in many cases, isn’t even expected to respond to the scenario — is expected to merely watch as it plays out. While this is an entirely rote and, therefore, limited exercise, the trainee nonetheless does gain some experience with “hearing” a typical customer example and applying the expected language to it. The simulation does not actually hear or understand what the CSR is saying during the session, though, and as a result, the simulation system can provide no qualitative feedback to the CSR during, or even after, the simulation. Many base their evaluations on completion of simple multiple-choice quizzes.

A dynamic simulation, in contrast, adapts to changes during the session. To closely mimic, as much as possible, a live coaching session, a dynamic software simulation system must actually “hear” what the trainee is saying, consequently responding accordingly with suggestions. In addition, a dynamic system will steer the trainee along the optimal, best practices path during the simulation, rather than routinely play itself out. Finally, the system must track trainee progress throughout the session — at key junctures — for meaningful evaluation to occur.

Dynamic Simulations For Continuous Performance Optimization
While immersive, interactive simulations have proven themselves in the field for initial agent training at many companies, the reach and the utility of dynamic simulations both extend far into the call center. Simulation development should not be restricted to initial training. Areas in which organizations may find on-demand, desktop training delivery of use:

• New-agent training;
• New-offer training and upselling;
• Compliance and regulatory training; and
• Agent certification.

Call centers today are subjected to intense pressures to deliver new product and service offerings through their existing customer contacts. On-demand delivery of simulation training to existing agents allows organizations to carry out on-the-fly training, and make new service and product offerings more rapidly and efficiently.

As regulatory restrictions are introduced, companies may roll out compliance and testing to the existing agent pool much more quickly and effectively than one-on-one training. If a company ties its training to quality monitoring software, results can be achieved most effectively.

As agents mature, moving up and through the ranks, certification is key to performance optimization within the organization. Dynamic simulations can help streamline and validate an agent’s increased performance and skill levels.

Rapid changes in business and the workforce are driving an increased requirement for real-time knowledge transfer and improved customer response in call centers worldwide. These changes include high personnel turnover rates, running in excess of 40 percent of call center employees, combined with an acceleration of employee knowledge requirements. Performance optimization has become CRM’s latest calling card. The Datamonitor Report shows a growing trend in using e-learning technology to make the CSR more efficient and productive.

One of the most efficient and cost-effective strategies is to enable the transformation of agent center training through the use interactive simulation software. Unlike traditional role-playing and classroom training, which is costly, time-consuming and inefficient, a dynamic simulation development platform for best-practices training and agent productivity enhancement, based on true-to-life data system screen entry and customer dialogs, serves agents’ needs regardless of their role in the organization — from initial training to professional certification. CIS

Wade Baker, CEO of Sivox Technology Inc. (www.sivox.com), has spent 20 years building high-technology companies. From 1996 to 2001, he was the president, CEO and a director of Payback Training Systems, Inc., (now known as Avaltus), a market player in the content publishing and dissemination of vertical libraries for the provisioning of e-learning solutions to diverse industries. SIVOX provides interactive simulation training, with installations in over 50 call centers employing tens of thousands of agents who use the technology daily to improve call center performance.

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