• May 18, 2011
  • By Donna Fluss, president, DMG Consulting

New-Gen WFM Solutions Make a Real Difference

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The contact center workforce management (WFM) market has finally come to life. A new generation of solutions the past couple of years has brought fresh features, capabilities, architectures, services, pricing, and delivery models. Some of those offerings were developed in the U.S., but more and more are coming from other countries. As a result, a fresh perspective has helped alter and expand how vendors approach the WFM challenge. 

The contact center WFM market is at a critical juncture. New vendors and enhanced offerings are entering the market, giving buyers a greater variety of options. End users can choose among solutions with varying degrees of effectiveness, complexity, ease of use, and accuracy.

For example, for the first time, users can decide to trade off functionality for ease of use. What’s more, they can choose how they want to procure a WFM solution: cloud-based, managed service, or premises-based.

Europeans Enter WFM Market
Also reshaping the competitive landscape is the number of new solutions from Europe. European WFM product providers have different priorities from their U.S. counterparts. Europeans certainly have to address forecasting and scheduling, the two primary components of any contact center WFM solution.

But those solutions also dedicate significant resources to handling country-specific work rules, which encompass the requirements of government regulations and unionized shops; this is not as much of a priority for many U.S.-based contact centers. However, the requirement for Europeans to address this challenge results in a slightly different approach to contact center WFM.

Accuracy is a Costly Concern
The accuracy of the forecasts generated by WFM solutions is an area where recent innovations are altering the competitive landscape. Managers want accurate WFM solutions that allow them to properly staff their contact centers to meet service levels while keeping a lid on the cost of overstaffing. The algorithms used in most WFM solutions err on the side of slight overstaffing, to ensure that the department’s service level is met. While the result is likely to be relatively insignificant for a small contact center (100 or fewer agents), the impact of overstaffing is costly, possibly as much as millions of dollars for contact centers with more than 1,000 agents.

Ease of Use Matters
Another area where the market is seeing innovation is ease of use. Hundreds of contact centers have bought and installed WFM solutions, but they are being used infrequently, if at all, because they are too difficult to operate. Other contact centers use only a limited amount of the functionality available in their WFM solution because the staff does not know how to modify or run the application. (They likely started with one or two trained people who left the company and then found it too expensive and to train new WFM specialists.)

A number of the newer WFM entrants have put great effort into delivering user interfaces that make it easy for customers to employ their applications. Those vendors believe that their applications should do most of the work, instead of expecting customers to act like programmers. Customers don’t like having to remember and perform numerous complicated steps to make changes to their WFM solution. DMG expects to see a great deal more innovation in this area during the next few years, as some of the easier-to-use applications win business from market leaders. This would motivate other vendors to invest in ease of use.

Multichannel Grows in Importance
The majority of contact centers handle phone calls, though a growing number address just emails and chats. All of the contact center WFM solutions address calls, and all of the vendors claim to handle emails and chat sessions, as well. Some of those claims are legitimate but others are not. And few of the solutions do a good job of handling social media interactions, which will take on considerable importance in contact centers during the next few years.

The multichannel capabilities of WFM solutions have become an area of differentiation among solutions. Many WFM offerings lag behind in providing effective multichannel capabilities, despite their claims. While this was not an issue two years ago, contact centers are finally making progress in building multichannel operating environments and, increasingly, require multichannel WFM applications to help them optimize their agent-related resources.

Inbound/Outbound Environments Increasingly Common
In the recent past, inbound contact centers handled predominantly incoming calls, even if agents occasionally made outbound calls to follow up on inquiries. Outbound shops concentrated on improving their connect rates and dedicated few resources to the handling of inbound return calls.

Although it took way too long, outbound shops have finally begun to realize the importance of handling the large percentage of inbound calls that result from outbound messages, and a growing number of inbound shops are getting involved in proactive customer care and other activities for which automated dialing is helpful.

This change has a major impact on workforce management, because it requires managers to properly plan for and optimize both inbound and outbound activities. It is no longer sufficient to depend on the pacing mechanisms of an outbound dialer. Managers need to schedule their resources to ensure that they meet both their service level and connect rates in increasingly complex operating environments. The more complex the operating environment, the more it needs WFM. DMG expects to see continued investment and innovation in this area during the next few years.

The New Front Office
Executives are slowly starting to realize that applications that can reduce the staff-related costs of operating areas as complex as contact centers can also be applied to improve the performance of other back-office functions. Additionally, contact centers are tackling more of the tasks traditionally handled by back-office groups.

As a result, the market is pushing for back-office WFM solutions, and a growing number of contact center WFM vendors claim to provide this functionality. The reality is quite different from the claims. Erlang-based solutions clearly have not been designed to address back-office work, such as mortgage and claims processing. Workforce management solutions that cannot plan for backlog are also not intended to be applied to back-office activities. DMG expects back office to become a significant growth area for WFM solutions, but it will take three or four years before the number of implementations becomes significant.

What This Means For Managers
There are now enough solutions with varying capabilities to allow managers to find an application that meets the needs of their department. And while there is plenty of variety, the solutions are not equal. Managers will need to make trade-offs when they select a solution.

For example, if accuracy is the primary issue, it will sometimes come at the expense of ease of use. If ease of use is the priority, the application may include only a limited number of channels. The contact center WFM market has come a long way in the past three years, but more progress and investments are required before these solutions are welcomed enthusiastically by managers.

Donna Fluss (donna.fluss@dmgconsult.com) is founder and president of DMG Consulting, a leading provider of contact center and analytics research, market analysis, and consulting.

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