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# Measuring cost per call

## One reader asks, "Should I be worried if my cost per call has risen \$0.51 in two months?" Lori Bocklund explains the calculation behind cost per call.

"Cost per call" -- what is this a true measurement of? Should I be worried if my cost per call has risen \$0.51 in two months?
Cost per call (CPC) is one of several key performance indicators (KPIs) call centers use today. It is certainly a measurement of efficiency, but can reflect other things as well. It can't be viewed in a vacuum. Rather, you need to consider it in the context of your business goals, and your initiatives based on those goals. For example, a company with a big push to grow revenue per customer may happily see cost per call increase if corresponding measures of revenue per call or per customer are increasing at a greater rate. Using CRM tools and processes, the customer service reps (CSRs) may be spending more time with customers to up-sell, cross-sell, and optimize the relationship.

Having said that, an increase of \$0.51 in two months could be significant, and could be bad. You need to first check that the calculation has not changed. There is no single "right" way to calculate CPC, so make sure the same factors are being included (labor - loaded or unloaded, network, real estate, utilities, IT, and other overhead are all possibilities) and the same formula is being used as before. Then, do a root cause analysis to determine where the increases are occurring.

As part of the process, assess the reasons for the change, and whether they appear to be a temporary anomaly or some sort of trend that you need to reverse. An example would be if you have many new hires/trainees and they're still getting settled in, you probably need not panic. If you have a significant drop in call volume and you haven't decreased any of your fixed costs, that alone may account for the change. Make a plan to either address issues or monitor key elements as a result of your analysis.

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