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October 2008 | Volume 27 / Number 5
CALL CENTER Technology

Top Ten Ways to Reduce Contact Center Costs While Improving Service


Contact centers are almost always under cost scrutiny, especially during slow economic periods, as the responsibilities they are charged with are still seen by many organizations as peripheral to their core functions.

Yet unlike in the past, most senior executives now have a growing understanding of the value of contact centers provide, namely helping them to retain customers and their revenues and support. The challenge then becomes what are the best ways to reduce contact center costs and to keep existing and to attract new customers.

So we put that question, as a Top Ten, to several leading firms. While some have responded with ten items others have replied with less, but all of them have insight that could help your contact center thrive and grow including in difficult times.

Aspect (www.aspect.com)
Serge Hyppolite, Director of Interaction Management
1) Unified Solutions
Unified solutions help contact centers reduce costs because IT won’t have to integrate a number of siloed applications, which requires a lot of time and effort. Additionally, contact centers will save on implementation, administration, and reporting costs, and then later maintenance costs because all the applications are on a single platform: it’s easier and quicker to pinpoint the source of the problem and fix it quickly. In addition, contact center managers won’t have to spend time configuring multiple systems each time a new agent is added or leaves the company. With a unified solution, contact centers also lower operating costs because agents won’t lose productivity when they are logging in and out of disparate systems all day long




Ultimately, the benefit of a unified solution is a seamless experience for the customer regardless of the channel they’re using for contact. For example, an outbound collections reminder can be easily turned into an inbound call where the customer makes a promise to pay to the speech self-service system or directly with an agent

2) Unified Communications (News - Alert)
Unified communications, when deployed correctly and with the right portfolio of solutions, can result in a number of benefits for all types of organizations, from multinational corporations to single site small businesses. A unified communications strategy can take the guesswork out of operations by creating and implementing clear, streamlined processes that have a direct impact on the bottom line. Unified communications can have a profound impact on activities such as a simplified contract-toorder process; the elimination of time-consuming tasks in the purchase of materials; and cutting, even completely eliminating, order rejections. And not only do these streamlined processes result in lower costs, but also can create an improved customer experience

Businesses and consumers both gain when knowledge workers can be part of the enterprise pool of customer-facing employee to best address consumer demands. High-value sales or service interactions can be addressed directly by the appropriate employee – no matter their location – based on availability, to provide the high level of customer service that result in the elusive ideal customer experience

3) eLearning
Too often contact centers are trying to use the wrong tool to get training to the agents. It’s simply too expensive to provide instructorled training or team huddles, so it’s vital that training be done at the desktop. Unfortunately, most corporate learning management solutions don’t work in the contact center because training still has to be scheduled and is often cancelled based on service levels Superior performing contact centers today leverage eLearning to change training by pushing up to 80 percent of ongoing training content and 100 percent of the communications content to the agents’ desktop. This enables adult learning and reduces the training costs and risks of training and also improves agent adoption of knowledge and skills. This helps companies overcome the difficult task of improving agent skills, ultimately enabling contact centers to deliver improved customer service, collections and sales

CB Richard Ellis (www.cbre.com)
Mark Seeley, Managing Director, Labor Analytics Group
1) Relocate to lower cost labor markets. Labor makes up nearly 80 percent of a contact center’s overall operating costs, is by far the low hanging fruit when it comes to cost savings

By relocating a 500-agent contact center to a new labor market that is just $1.00/hr less, the cost savings equal over half a million dollars per year, per shift

2) Operate in areas with little or no employment competition. As many are aware, competition for employees drives wages and turnover rates up. By locating in a market or sub-market with low competitive pressure, call centers can save significantly, reducing payroll and attrition costs

3) Source labor markets that have the right demographic and skill make-up. Labor markets that better support a call center’s specific skill and educational needs translate to a higher performing employment base

4) Recruit strategically (i.e. target market). Targeted recruiting methods reduce recruitment costs, as well as lower turnover, by improving the applicant to hire ratio and sourcing applicants that are a better fit for the job

5) Refine the screening process. Reduce your 90-day churn rate by better educating applicants about the job before they are hired by conducting caller simulation and preemployment orientation programs

6) Improve training programs. Properly preparing agents for the job reduces stress and, as a result, turnover. It also improves performance

7) Take advantage of economic development opportunities. Municipal, county, state and federal programs are available, even if you are not relocating to a new location. Make sure you are taking advantage of any available programs that can reduce training and recruitment costs, as well as income and real estate taxes

8) Source lower cost real estate markets. Not surprisingly, low cost labor markets often go hand-in-hand with low cost real estate markets. Real estate costs typically make up 10 percent – 15 percent of a contact center’s overall operating costs

9) Also, locate near your labor base to increase applicant flow and reduce employee transportation costs. As gas prices rise, contact centers are experiencing higher turnover and more challenges recruiting when the facility is not proximate to the labor base

10) Implement a home agent strategy. Do away with your real estate portfolio altogether (or at least a portion of it), by implementing a work-at-home program

Convergys (News - Alert) (www.convergys.com)
Mike Cholak, Vice President, Global Consulting Services
1) Incorporate the “voice of the customer” into strategic decision-making by implementing a robust customer satisfaction survey program that includes access to real-time information

2) Use satisfaction results to understand which agent behaviors have the greatest impact on the customer experience, and focus there

3) Design and implement accountability support structures at the agent and manager levels using critical agent skills as a key performance indicator (KPI)

4) Include customer satisfaction metrics in scorecards, and report out at four levels: Agent, manager, site and account

5) Realign the focus of coaching and training to ensure agent behaviors critical to driving customer satisfaction that are central to ongoing efforts, and provide the tools to be successful

6) Develop a customer experience “map” to understand what the customer experiences after they call the 800 number, and proactively identify account, product and/or call processes that hinder achievement of the satisfaction goals

7) Conduct a segmentation analysis on the agent population to group agents into distinct categories (e.g., “Elite” versus “Laggards”) based on satisfaction performance

8) Calibrate quality assurance scores to agent segments to check alignment and ensure that agents are coached to consistent behaviors

9) Establish a sub-group of agents empowered to handle less complex contacts on the first call, and proactively route customer contacts to this group the lowest performing agents off the floor and replace them with new hires

Enkata (www.enkata.com)
Liz Amaral, Director of Contact Center Product Marketing
1) Understand why customers call. Before you can attack the issues driving up service costs, you need a clear picture of why your customers contact you. Most companies rely on inaccurate methods or sampling strategies that can distort the picture. Find out what’s in that “Other” category to start targeting cost drivers

2) Move the right calls to self-service. How many calls should be handled in a lower cost self-service channel? Do customers know about these channels? Are your self-service channels truly meeting customer needs? Answer these questions, guide your agents to educate customers and address any gaps in your self-service options to reduce unnecessary incoming calls

3) Eliminate unnecessary repeat calls. In a typical contact center, over 30 percent of all calls are repeat calls that could have been avoided. Do you know which ones? Measure First Call Resolution (FCR) accurately for 100 percent of calls at a call mix level to identify those calls that can be prevented in the future. Then implement a program that includes setting clear goals for your agents and then holding them personally accountable for issue resolution

4) Manage to a new definition of success. Your agents need to understand the importance of both excellent service and keeping calls to an acceptable length. Make sure their scorecards are aligned to your corporate goals by creating a balanced view of productivity and quality of service metrics

5) Use peer rankings to motivate excellence. Every agent believes that they are performing above average unless given facts to show otherwise. Providing daily peer comparisons on cost and quality metrics empowers agents to develop their skills and seek help when needed

6) Establish a formalized coaching program. If your supervisors are spending less than 50% of their time coaching agents, you’re missing your best opportunity to increase agent efficiency and effectiveness. Hold supervisors accountable to coaching targets and remove the administrative work that gets in their way

7) Coach your agents based on facts, not aggregates. Every agent has a unique set of strengths and weaknesses. Why coach based on an average? If you can identify individual performance challenges at a granular level, backed up by the specific calls that led to poor performance, your supervisors can make coaching sessions constructive and productive

8) Reward your agents based on a new definition of success. Regardless of how you are measuring and coaching agents, if the same balance is not reflected in your incentive programs you won’t see the desired impact. For example, if you introduce FCR as in important initiative, you need to make sure agents are recognized for improving their resolution rate

9) Identify corporate roadblocks to eliminate inefficiencies. You know that certain policies and procedures interfere with service delivery goals and drive up average handle time or call count. Use root cause analysis to shine a light on the broken processes that can be fixed to streamline call handling and improve the customer experience

10) Sell when the time is right. Tacking on a canned sales pitch to the end of every call is a sure fire way to drive up costs and drive down customer satisfaction. Provide agents with real-time directives on what to offer and when, increasing the relevance to the customer and the likelihood of success

Infor (www.infor.com)
Tony Compton, Director of Product Marketing
1) Self-experience. Place yourself in your customers’ shoes and call your 800 number. Call more than once to gain a true perspective. Interact with your contact center and experience what a customer does. If your experience is positive, your customers are more likely to enjoy their experience, leading to an increase in wallet share

2) Itemize the gaps in your call center’s performance for immediate evaluation

3) Scrutinize how your call center supports your organization’s overall CRM initiatives

4) Ensure your workforce is properly aligned with your contact center’s goals and has the required skill sets to provide effective customer interactions that encourage loyalty

5) Align technology with personnel. Every contact center is different and supports varying missions. In many instances, companies will align either technology or staff with goals but not both. Make sure your staff and technology are in synch and support each other’s success

6) Trust the system. Advancements in technology have led to complex algorithms that can provide highly accurate offer recommendations based on a customer’s interaction history and profile

7) Singularity. Ensure your staff has access to all relevant information at all times. It does not help if an agent must send a customer, or prospect, to another holding cue to learn about additional services your company offers. Provide agents access to, and training for, cross-sell opportunities

8) Be smart with your data. Today’s contact center’s are a wealth of information; capturing every detail about each customer. Identify the types of information you gather and ensure the data aligns with your CRM goals and determine how you can best use the information to encourage offer acceptance

9) Succession planning and training. The industry’s 20 percent turnover rate leaves frequent gaps in the workforce forcing companies to rely on under trained, green agents. The high turnover often leads to inconsistent customer interactions and poor service. Keep your staff trained, encourage participation and feedback and plan ahead for turnover

10) Update your measurement. Calls per hour and service requests per shift limit the effectiveness of agents to generate revenue. Benchmarks have evolved to focus on revenue per hour or services sold in a shift where the focus is on bottom line metrics to determine the effectiveness and success of an agent

Interactive Intelligence (News - Alert) (www.inin.com)
Christine Holley, Director of Market Communications
1) Incorporate self-service options. Call centers have used self-service features such as IVR for years. Increasingly, they’re adding Web-based and other modes of self-service, such as speech-enabled IVR. Whatever type of self-service option a call center offers, the key to reducing costs while improving service lies in how it’s applied and to what. Generally speaking, self-service options offer the greatest reduction in costs when applied to simple transactions, such as updating an address or checking a flight time

2) Optimize staffing. Workforce management (WFM) enables more accurate staffing needs projection and alerts supervisors when inbound demand slows so they can re-allocate or reduce staff. Call centers should look for systems that are pre-integrated with the ACD so they receive accurate and real-time data that helps them plan schedules and make changes on-the-fly, and which can create schedule simulations. The systems should include real-time adherence with instant notification of compliance issues to permit immediate action on irregularities

3) Deploy outbound/blended technology. This allows instant reallocation of inbound to outbound agents that can reduce costs and create demand when business is slow. Automated outbound IVR is a cost-effective way to improve customer service while avoiding inbound calls by notifying customers ahead of time, such as the power will be turned off during a certain time of day for repairs

4) Accommodate remote agents: Increasingly call centers are considering transitioning agents to a home-based model. The drivers include cost savings based on lower overhead and turnover rates compared to in-office agents and improved customer service. For instance, remote agents are typically more amenable to working after hours, which enable call centers to more easily provide extended service hours. By being able to select from a larger labor pool (not constrained by geography) call centers have a better chance of securing skill-sets that they require. Remote agents also provide business continuity should the contact center “go off line,” thereby minimizing service interruptions. The technologies to support remote agents are mature and widely available. There are IP-based systems with full functionality that enable remote agents using a PC or regular phone to perform call control, including call recording; access databases; view the presence of other agents; and even receive online coaching and monitoring from a supervisor

5) Consider Software as a Service (SaaS (News - Alert)). SaaS can be a wise choice when companies would rather hold off on major capital expenditures. Small and mid-size businesses (SMBs) and large organizations with departmentally-focused initiatives are often good fits for SaaS. To ensure the cost savings of this model don’t sacrifice customer service, call centers should look for vendors that have successful track records developing software, such as multi-channel routing, blended dialing and Web self-service. SaaS solutions should enable switching to a premise-based or even combined hosted and on-premise solution without re-writing applications

6) Focus on quality monitoring beyond productivity measures. Call centers have traditionally focused on measures such as agent talk time and speed-to-answer to evaluate quality. To take customer service to the next level, call centers should also focus on measurements that capture “the voice of the customer.” Examples include automated post-call satisfaction surveys and speech analytics technologies such as emotion detection, which monitors calls in real-time to detect heightened states of emotion in order to improve customer satisfaction and agent effectiveness

7) E valuate new models for communications-enabled business processes. They can result in soft ROI, such as increased productivity. For demonstrable cost savings, however, call centers should be aware of new business process automation (BPA) platforms that not only launch the call that a BPA system might trigger but also leverage functions such as presence, VoIP, queuing and routing to automate that process in the first place

(8-10) The final three ways call centers can reduce costs while improving customer service are adopting standards-based, single-platform software ‘suites. They meet three architectural criteria – open, single-platform and all-software – are the foundation for call centers to cost-effectively provide optimal customer service. This enables call centers to quickly and easily create and modify applications to adapt to conditions the future brings. The cost savings alone are compelling; based on a recent BenchmarkPortal (News - Alert) report the total annualized cost per agent for software-based, all-in-one solutions averages less than half that of multi-point solutions

West Interactive (News - Alert) (www.westinteractive.com)
Bruce Pollock, Vice President, Products & Services
1) Integrate database services from across the enterprise. Bring together all relevant data from across the company for a 360° view of the customer. Not only does this enable the contact center to deliver the optimal response to customers’ needs, it can improve productivity, reduce average call length, and increase cross- and up-selling revenue

2) Leverage unified communications. By taking advantage of the power of open systems to integrate data and voice management, companies can cut telecommunications costs while opening the door for an entirely new level of service. For instance, multichannel and multimedia capabilities available through IP technology can be utilized for greater responsiveness, productivity, and customer satisfaction

3) Proactively connect with your customer. Proactive communication can reduce calls to the contact center while building a long-term relationship with the customer. One of the best ways to differentiate yourself is to focus on the end-user. Customers want to transact with you more effectively. Make the customer experience seamless by applying ease of use methods that deliver needed information with quality and speed. Delivering information ahead of customer requests will reduce inbound calls and enhance the customer experience

4) Recognize, track, and learn customer needs. Make strategic use of customer service surveys for happier customers, greater revenue, and cost savings. Capturing and applying customer data in a real-time environment delivers more efficiency, reduced call time and increased first-call resolution. The customer also feels the information is personalized and you are ready to provide answers to their questions

5) Create customer-centric self service and self help. Customers want to interact in the most effective way with your company. Employ customer-oriented self service to maximize satisfaction and reduce calls to live agents. Companies can experience reduced costs by improving the performance of its speech applications, while offering a more personalized self-service experience

6) Create a true multi-channel experience. Take advantage of consumers’ increasing willingness and preference for channels such as SMS or Web to deliver a competitive differentiation as well as to lower phone costs. Integrate all channels and ensure an excellent experience in all supported channels for a competitive differentiator

7) Turn to hosted services. For economies of scale, hosted services offer access to best-of-breed technology while reducing upfront and ongoing infrastructure costs. Boost contact center performance while reducing IT maintenance costs

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