Bring out your calculator and start looking at these numbers. By the end of this article you will have a pitch for an idea that could or should earn you a huge bonus. First of all you need to start by hunting and gathering information. Numbers are the foundation here. The hidden costs and saving potential might be huge.
- Gather information.
Information is gold. Make sure to log all contacts and categorize them. Make sure to train your staff to categorize accurately. This information is for statistical purposes.
- Analyze your data.
Read about the Pareto Principle, this applies very much in your business.
- Gather the tribe.
Summon a tribe meeting; make sure to present your findings. Then ask: So what can we do to reduce these three issues to minor issues? The responsible ones are sitting in another seat than you.
- Shake the tree
If nothing happens, add costs to your findings. “We are spending x number of hours, equal of this bunch of money on an issue that should be gone”
Here are some rules I live by
- The best service is no service (Thanks Bill Price)
- 80/20-rule (Pareto Principle) always applies to a certain degree.
- The only acceptable reason to contact our company is to place an order.
(The rest is noise, costs and customer’s reason of getting grey hair)
- Track, Analyze, Take Action, Follow up, repeat.
Imagine having an inbound call center with 60 employees. They handle on average 50 contacts each day. This equals 3000 contacts. This means that you probably have an average of 3600 contacts each day. Most directors will leave you alone if you handle 83 % of all contacts, ignoring the fact that 600 contacts was not able to reach you on their first try. (Most people calls twice, so 83 is actually an acceptable number, if you want to be cost effective, and the financial director nodded in consent)
So you have a cost of 60 staff members, times a huge salary. Do the math yourself. But I will use $30.000 as an example.
Cost of salary per year: $1.800.000
So let us take a look at the pareto principle. 80 % of the contacts are caused by 20 % of the issues bothering your customers. So the top list will look like this.
- Bug number 104 – 18 % of all traffic.
- Complain about wrong calculation in billing – 16 %
- When are you launching your new product? – 7 %
- Some issue about something – 5 %
- And the list is starting to become long and unimportant…
So the three first are the reason why 41 % of your customers are contacting you. If you eliminate these reasons, you will reduce the number of contacts from 3600 each day to 2124 each day. The customer service staff will love you until they realize that their jobs are at stake, and then the financial director will love you more, and the customers will go bananas, getting your company logo as a tattoo.
You can reduce the staff by at least 18 people, it will make your staff more capable of handling peaks and you save $540.000 and get happier customers. How is that working for you? Fixing the top 3 reasons will also probably cost way less. You also saved a lot of money on expensive consultants by reading this. Give me 5 % of your savings and we can call it a deal.
Do not fire anyone yet.
You have liberated 18 people from a cost intensive operation. You have 18 people that know your product, move them around into money making positions, try to convert some of them to sales, make sure some get into marketing. Maybe you have some jobs that have been ignored because you had no time. You do have time now.
“It is not this simple” – Yes I know. I have heard such rumors before.
More numbers. We must include handling time in our report as the group of leaders is sceptics. Same top list of issues, this time with 5, 6 and 7 minutes average handling time.
Issue number 1: 18 % of handled traffic. 540 x 5 minutes. 45 hours each day in dealing with this one. 225 hours in one week. 900 hours in a month. With 900 hours you can change the world. It will most likely take less than 900 hours to fix the reason.
Issue number 2: 16 % of handled traffic. 480 x 6 minutes. 48 hours each day. 960 hours in a month. You get the picture?
Issue number 3: 7 % of handled traffic. 210 x 7 minutes. 24,5 hours each day. 490 hours in a month.
Now you have 2350 hours each month, how long will you let this go on? If you would be fined $42.000 each month for some reason, you would deal with it fast. But wasting this money is ok?
If leaders say: “It is not this simple” – well then… start to measure the cost, pinpoint responsibility and don’t let leaders get off the hook easily. Track this instead of the average number of handled contacts per agent, and you will make a huge impact.
The traditional way of solving 3600 contacts?
“We can handle 3000 contacts each day with 60 people, to handle 3600 and the expected 10 % growth we need 15 more people next year.” Even found in text books.
Print this article and give it to your customer service manager.