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The 2004 Service Elite
The Elite award honors customer companies that have gained impressive returns on their customer service investments. Winners were selected based on return on investment, project implementation times, and overall impact on the organization.
For the rest of the March 2004 issue of CRM magazine please click here
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Nothing could be easier than boasting of a commitment to customer service. Far more challenging is having the courage to acknowledge that there is room for improvement, and taking bold steps to enhance the quality and convenience of customer interactions. CRM magazine recognizes five organizations that have made major strides in delivering on their service promises and have demonstrated with action, rather than words, that they put the customer at the center of their operations.
Agent facing/universal desktop suite: City of New York With a $40 billion annual budget and millions of citizen-customers, the City of New York can be seen as an enormous corporation with a widely diversified range of services. When these services didn't run like clockwork, however, residents were often confused as to where to turn and the dozens of call centers operated by the city were sometimes less than illuminating. Upon taking office as mayor, Michael Bloomberg launched a program to develop a unified 311 city contact center and break down the barriers of information between New York City residents and the city, state, and federal services that exist to serve them. "He did not want an IVR," says Larry Knafo, first deputy commissioner of the department of information technology and telecommunications for the city. "There are [more than] seven thousand services listed in our knowledge base. [An IVR] would have made things worse than before." Knafo led a team that initially brought 13 of the city's call centers together on a single queue with a single data repository, having selected Siebel eGovernment as the backbone. The project, which was announced shortly after Bloomberg took office in early 2002, went live in March 2003. New York's 311 project has three main goals. At its most basic level it acts as a city referral service, pointing people to the right offices to resolve problems like potholes and missed garbage collections. This service went online immediately. It also aims to act as a one-stop city information service--rather than having to forward calls to other agencies, 311 aims to have first-call answers to as many resident questions as possible, be they about the hours of operation of a park or current parking regulations. Finally, Knafo aims to have 311 act as a single-source service bureau for the city, able to open tickets and track problem resolution across city agencies.
Already, 311 operators have that access into problems like street damage, and can issue tracking numbers to callers who can monitor the progress of their request online. "[City agencies] know we're watching what they're doing, and the mayor sees reports telling him how they're closing out the calls," Knafo says. To build the eGovernment knowledge base, Knafo's team met with every city agency, pored over every internal newsletter and publication, and read voluminous procedural documentation as they worked to encapsulate everything the city does in a single searchable database. The 311 project was budgeted at $25 million for the first year, including staffing and implementation. By consolidating existing call centers rather than hiring and training new staff, the project came in well under budget. "Our most valuable ROI is improving service for New Yorkers. They have a better handle on when their complaints are getting resolved," Knafo says. Key Results: The City of New York
  • implemented a city services knowledge base and referral hotline
  • $25 million in cost savings over the first year by preventing redundant call center build-out
  • project came in $4 million under budget
  • more than $1 million savings in reusable Siebel infrastructure for other, non-311 call centers Workforce optimization: Nissan Motor Acceptance Corporation In its fight for survival Nissan Motor Acceptance Corporation (NMAC) examined every possible option for improving its operations. One area the automaker found needing improvement was its contact center. NMAC had long staffed its contact center on little more than gut feelings, but this was leading to costly inefficiencies. "We were overstaffed Wednesday through Friday, desperately understaffed Monday and Tuesday," says Sean Hicks, senior manager of consumer communications. NMAC's contact center had to evolve to operate with more part-time staff and flexible shifts for full-timers, and to be more accurate and responsive to both end customer and dealer inquiries. Implementing cultural change was not easy, and it wasn't until late 2002 that the unit was able to begin training for and rollout of a Blue Pumpkin precision workforce management system. "We started floating breaks and lunches first, and let [agents] get used to that," says Tanya Messmer-Himes, workforce management specialist. Once the company started allowing innovative work structures, such as a schedule that has progressively fewer hours throughout the week, volunteers began to line up to partake in the benefits of the system. In the year-plus that NMAC has managed its contact center workforce with Blue Pumpkin, the unit has seen dramatic performance improvements, and learned a few things about the way it operates. Reporting on actual agent availability times showed NMAC management that once agent-unavailable times were factored in, true schedule adherence was at about 70 percent. Training and staff moves have boosted that figure to 95 percent. More accurate staffing has also improved handle times. In return, faster handle times have contributed to far less call abandonment. All told, more efficient call response has cut the telecom costs of NMAC's toll-free service by more than $70,000. Better use of resources has allowed NMAC to increase labor hours by just 6 percent, while the customer base increased by 9 percent and call volume climbed 10 percent. "We're starting to see the spread in how we're getting more efficient," says Messmer-Himes. Supervisors have also been freed up to work on call evaluation and coaching, rather than combing through the vacation "black book," which was managed with very little forethought and planning under the old methods. As a result of NMAC's efforts, average speed-to-answer was cut to less than 50 seconds, or just one third the running average under the old scheduling system. Forecast errors dropped to less than 5 percent, which has helped cut overtime costs by nearly 40 percent. "The Monday after Thanksgiving was one of our biggest days, and we missed our forecast by 24 calls. You can't get any better than that," Hicks says. Key Results: Nissan Motor Acceptance Corp.
  • more than $70,000 annual savings in toll-free call connection costs
  • schedule adherence increased from 70 percent to 95 percent
  • nearly $100,000 annual savings in labor hours due to accurate forecasting
  • overall first-year ROI of nearly 400 percent Quality monitoring: Continental Airlines The air traveler is a delicate creature. Between carry-on limits, meal cutbacks, and lengthy check-ins, the last thing airline customers want to deal with is a turbulent experience with customer service before a flight. A few years ago Continental Airlines recognized that its contact center operation had lost sight of the goals of speedy, effective customer service, and lacked the tools to get back to full throttle. "We completed a time-in-motion study with our team leaders...and it indicated they were literally spending more time with administrative tasks than actually monitoring calls," says Andre Harris, director of reservations training and quality assurance for the airline. The answer was a strategic initiative to improve real-time measures of agent performance and customer satisfaction, shored up by Witness Systems' eQuality monitoring suite. As a result, Continental has a far greater understanding of the successful and vulnerable aspects of its operation, gleaned from better categorization of common inquiries as well as the ability to monitor and replay calls with both voice and screen capture. It is also far easier for the airline to understand the weak spots in agent competency. By targeting e-learning courses to match consistent inquiries to the help desk, Harris says that internal support calls now run no more than 4 percent of total call volume, down from an average of 6 percent or more. "That [was] two agents tied up on one call" that are now being saved on more than 1 million calls annually, Harris says. The cut in support calls has also helped contribute to a first-call resolution rate up 17 percent since 2000. Call-mix survey results are also driving ongoing changes at Continental. One of the most important insights gleaned from the new monitoring and reporting system was that a disproportionately large number of calls came from customers seeking to reconfirm their flight reservations. Continental has taken a multipronged approach to solving the problem, both by educating customers that reconfirmation is unnecessary, and by taking steps to automate the process and free up call center resources for more challenging problems. The education program has already avoided more than $1 million in costs annually. As part of the customer service overhaul, Continental decided to get serious about measuring agents on delivering accurate information above all else. The company cut the accuracy portion of its call evaluations from 16 measures down to one--in other words, either agents are reliable sources of information or they are not, so any incorrect information results in a failing grade for accuracy in that call's score. In all, Continental cut more than 50 percent of the attributes on its evaluation, discarding soft measures for those its customers said were most important to their satisfaction. Using eQuality automation, Continental was able to double the number of calls evaluated by a supervisor while saving 50 percent of its coaching time in the first year alone. "Customers should notice an increased focus on accuracy," Harris says. "Our philosophy is that while we hold our agents to very high standards and we measure their performance diligently, we also provide them with the best tools and training to allow them to do their jobs and be successful." Key Results: Continental Airlines
  • $1 million savings from reduced reconfirmation calls
  • first-call resolution up 17 percent
  • quality scores up 10 percent
  • reduced internal help desk calls by 50 percent Web self-service: Polaroid Polaroid has come a long way from being known only for the self-developing Land camera. But when the company launched an aggressive digital-products line, it faced a serious problem: Customer service inquiries were projected to increase by a factor of 10, and on that basis nearly $5 in support costs would need to be budgeted for each unit sold in a product line retailing between $50 and $150. That was clearly out of the question, as was postponing the product launch. So Yale Cohen, Polaroid's group manager of worldwide service communication, was given less than two months to implement a large-scale customer knowledge base that could handle the vast majority of service inquiries for the new product line. Polaroid selected RightNow to provide the technology, and started working frantically to populate the system. "We put together a team of people to gather content, prepare the site, and integrate the RightNow tools to route email and answer questions," Cohen says. Over the next 18 months Polaroid sold some two million digital cameras, with customer service backed by the RightNow database. Support costs rang in at under $1.60 per unit sold, a dramatic savings from the initial projections. Guided by detailed reporting on the questions asked, Polaroid has been able to increase self-service resolution rates from the 90 percent achieved at launch. Because RightNow scans questions entered on the Web's email form and offers potential matches from the knowledge base even if a customer does not explicitly ask for a self-service search, Polaroid has managed to deflect fully 98 percent of all inquiries that would have reached an agent. That translates to more than 1.5 million calls avoided over a three-year period. The frantic days of the original implementation are behind, but the urgency remains. Every new product launch is accompanied by seeding at least 15 content items into the RightNow database to anticipate the most commonly asked questions and customer concerns. The database has also been expanded to better direct customers to third-party support sites for those licensed products Polaroid does not directly support. "We know when we get an email that we did not take care of the customer on the site," Cohen says. Those concerns are addressed by the knowledge base content managers, who have the power to rewrite existing documentation or introduce new knowledge items to be located by RightNow searches. CSRs are also in contact with the content managers, and can log and submit new questions or revisions to existing answers for inclusion on the site. Key Results: Polaroid
  • built a customer-facing searchable product knowledge base for a new product line in under two months
  • prevented a predicted order of magnitude jump in call center inquiries
  • offered satisfactory self-service to 500,000 potential callers each year for three years
  • saved 66 percent of projected support costs for a new product offering Email management: TaylorMade-adidas Golf Golf enthusiasts take their game seriously, so they take the tens of thousands of questions they email each year to TaylorMade-adidas Golf (TMaG) seriously as well. Unfortunately, the company struggled under the volume, with less than half of all inquiries answered within a 24-hour period. This was due to a manual process that relied entirely too much on agents duplicating effort and copying and pasting from a limited range of canned responses. Rob McClellan, director of global e-marketing for TMaG, was facing an annual growth rate for email of more than 100 percent, and knew it was time to improve his company's responsiveness. More than half the queries were common questions, but sending common answers simply took too long. Taking a cue from adidas America, McClellan implemented KANA Response to handle front-line email requests. "We had people answering emails using a regular email client, so we didn't know what people were writing in about, or if there was an urgent marketplace issue we should make people aware of in assembly or R&D," he says. The new email system goes beyond simply automating greetings and sign-offs. Accurate replies can be prepared to commonly asked questions about such items as recently announced products or the procedure for a product return. Queries are sorted into skill-based queues based on an analysis of the subject matter, recognizing that some agents are better qualified to answer more technical or product-oriented questions than others. TMaG has better internal communication as well, with the ability to send complex questions to subject matter experts elsewhere in the company, who can then reply directly to customers as though they were in the customer service queue. Ultimately, TMaG was able to greatly improve compliance with a 24-hour turnaround goal, and now typically operates above 90 percent. That improvement came while email volume was increasing between 50 percent and 100 percent per year, and while the company was able to hold contact center staffing steady for 18 months. One of the most significant service improvements TMaG has been able to make thanks to KANA Response comes from an interactive survey provided at the bottom of each email reply. Up to 1,000 customers return the survey each month, and highly negative responses are pushed to the top of the contact queue. "Usually within five minutes of completing a [negative] survey, we're contacting them on a phone call or [by] email to address the issue," McClellan says. "That has a profound impact on somebody. If you make a mistake and go over the top to fix it, they really appreciate it." Key Results: TaylorMade-adidas Golf
  • more than doubled email-agent productivity
  • maintained contact center staffing levels despite doubled email volume
  • immediate follow-up for dissatisfied customers
  • handle time goals met at least 89 percent of the time
  • five-year internal rate of return of 76 percent Jason Compton is a Wisconsin-based freelance journalist who covers extensively CRM and related issues
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