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The 'year of the customer' in the contact center

An annual benchmarking study of over 350 contact centers across the globe indicates that many are shifting their focus from cost cutting to improving the customer experience.

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After years of focusing on reducing costs and improving efficiency, contact centers are now looking to improve customer satisfaction, and recent research even suggests that 2006 could be "the year of the customer."

The Merchants Global Contact Center Benchmarking Report released yesterday by Dimension Data plc, a Hauppage, N.Y.-based IT services firm, studied 363 contact centers across the globe across multiple industries. The study was conducted in conjunction with Synovate Research, an international research firm based in the U.K.

"From an organizational perspective, we're seeing contact centers are being taken quite seriously," said Cara Diemont, editor of the report and global marketing director for the customer interactive solutions group with Dimension Data. "The shift toward the customer experience rather than wholesale cost reduction is a really positive thing."

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Another trend the report highlights is that contact centers are playing a more strategic role in organizations For example, the report found that 78% of contact center managers are reporting to a directorial level and 25% report directly to the CEO. Moreover, contact centers are increasingly aligning themselves with the goals and objectives of the business. Of those surveyed, 51% are aligning the contact center strategy directly with the company's overall strategy.

And contact centers are responding by providing metrics that business leaders care about. Results that demonstrate a renewed commitment to customer satisfaction include:

  • Decreasing average hold time: 39% of contact centers ranked an improvement in caller wait time in their top three components to positively impact customer satisfaction.
  • Faster time to answer: This year's report showed an average speed to answer incoming calls of 22 seconds, compared to 28 seconds in last year's report.
  • In this year's report, the top three strategic priorities defined by contact centers were customer satisfaction (75%), quality/process improvements (70%) and technology strategy (70%), a markedly different focus from last year's top three -- budgets, technology strategy and headcount targets.

    "This year, I think the shift to customer service and process improvements shows that people have realized that cutting costs and reducing head count is not going to solve their problems long term," Diemont said. "That's a really positive trend."

    Technology continues to provide opportunities

    Additionally, technology remains a significant priority, according to the report. Consider:

  • Almost half of the contact centers surveyed indicated that they have hybrid or pure Internet Protocol (IP) PBX and ACD switches. All the contact centers that are planning to install an ACD (10%) indicated that it would be a pure IP solution.
  • Over two-thirds have some means of identifying their customer during an interaction using a customer database and 46% use some sort of CRM application.
  • 31% use some sort of speech recognition technology and another17% plan to install it in the next year.
  • 25% have chosen to rent technology (compared to 4% last year), 15% have chosen to buy hosted technology and 31% purchased hosted technology from their telecommunications provider.

    "We're seeing a lot of focus on keeping customers happy by improving what we do with agents," Diemont said. "People are now realizing that in addition to improving agent productivity they also want to improve effectiveness. There's been a lot of workforce optimization investment."

    Helping customers help themselves

    Self-service continues to provide a way for contact centers to free up agent resources through technology. Of the companies surveyed for the Dimension Data study, 39% are using self-service applications. The Colorado Department of Revenue (CDOR) has been using self-service technology from Bozeman, Mont.-based RightNow Technologies since 2000. The Web-based system was set up quickly with some of the most frequently asked questions about taxes, said Ro Silva, manager of public information and education.

    "We get questions like, 'How do I file my income tax?,' 'Where is my refund? Forms?, Phone line assistance numbers?'" Silva said. "What used to happen is we had an e-mail service where people would ask these questions but we had no knowledge-based system. One person had to answer all those questions. It was getting out of control."

    What's resulted is a huge decline in the number of inbound e-mails. In the first year, the CDOR actually got more e-mail volume, a frequent situation in deploying self-service and one of Five Dirty Secrets of CRM. But after that first year when CDOR got 24,000 e-mails to its contact center, that number has declined to roughly 6,000 per year.

    The Colorado DOR managed to reduce its operating costs with the new self-service system, a frequent requirement of public institutions and one where RightNow has managed to make some headway with 125 public-sector customers around the world.

    Work left to be done

    While some strides have been made in promoting contact centers for their business value, many are still considered cost centers, according to the Dimension Data report. For example, while the study found a reduction in the percentage of contact centers that operate merely as cost centers compared to last year, this year's report indicates the reduced number actually still includes over half those originally surveyed.

    "There's a little bit of a disconnect about what [contact center] ambition is and what they're doing," Diemont said. "We don't see a lot of people measuring more strategic measures like lifetime value (12%) or profitability (18%). Even the number of sales opportunities identified is 22%. From a customer perspective, we're still seeing fairly tactical measurements being used which is a little disappointing."

    Contact centers should articulate their value to business leaders, "not just through customer satisfaction levels, but more from a commercial perspective," she said. "There's very little ability to articulate it. Only 45% are measuring resolution rates compared to 88% of those measuring calls abandoned."

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