• November 1, 2007
  • By Coreen Bailor, (former) Associate Editor, CRM Magazine

Checking the Pulse of the Contact Center

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We're all aware that the contact center typically collects and houses more information than any other department within an enterprise. But no contact center has ever optimized its performance -- and subsequently the performance of the overall business -- by just reporting on captured data. The real shift in performance from mediocrity to excellence comes when that data is leveraged to drive behavioral changes that will ultimately elevate an organization's ability to meet and surpass defined objectives. Contact center performance management (CCPM) -- the concept of measuring, evaluating, and advancing agent and center activity -- can be a strong catalyst for transformation and improvement. Often dismissed as nothing more than visually impressive graphics and flashy reports, CCPM applications can actually help centers increase revenue, agent productivity, customer loyalty, and employee satisfaction, while effectively managing operational outlays. But despite its ability to provide quantifiable benefits, CCPM appears to be one of the best-kept secrets in the contact center industry. "There is a real danger right now that if in fact contact center performance management doesn't do a better job of defining itself, getting out there in the marketplace, and really solving business problems, then it's just going to end up adding to the problem it's trying to solve," says Wendy Lauther, vice president of performance management at Verint Systems. On the other hand, if the purpose, benefits, and value proposition of CCPM applications are made clear, then CCPM's days of being a lesser-known process may be numbered. Who's Who The primary difference between CCPM and the better-known corporate performance management is that the latter is driven more by financial data. Contact Center Analysis Framework

At its core, contact center performance management is about raising customer satisfaction and service levels while at the same time reducing costs. DMG Consulting, which specializes in customer-focused business strategy, operations, and technology, defines CCPM on three levels:
  • Strategic level: Contact center performance management "provides a framework for aligning the goals of the contact center with those of the corporation."
  • Tactical level: CCPM "uses goals, KPIs [key performance indicators], metrics, data sources, and balanced scorecards for capturing and reporting how well the contact center delivers to its objectives in order to identify the actions necessary to address areas of weakness or strength. "
  • Practical level: CCPM "streamlines and simplifies contact center reporting, enabling managers to use a carefully selected set of KPIs, metrics, and reports to manage their operation[s], instead of the numerous reports and hundreds of measures previously required."
"For the call center, CCPM removes subjectivity and it creates one source of data," says Donna Fluss, president of DMG Consulting and author of the "Contact Center Performance Management Market Report," announced in January. CCPM is far from new. Organizations have used homegrown applications for their performance management needs for at least 20 years. But the market for packaged tools is still relatively immature. There are three main buckets of vendors within the CCPM landscape, according to DMG Consulting: Reporting vendors: Include players like Business Objects, Cognos, Oracle's Hyperion, SAS Institute, and SPSS. Vendors with corporate/enterprise PM capabilities: Include Oracle, Pilot Software, and SAP. Best-of-breed CCPM vendors: Include AIM Technology, Merced Systems, and Performix (acquired by NICE Systems in 2006), as well as Aspect Software, Authority Software, Enkata, Exony, HardMetrics, Informiam, Latigent, Merced Systems, NICE, VPI, Verint Systems, and Verint's Witness Actionable Solutions (formerly Witness Systems, which was acquired by Verint in February 2007). Getting a Read CCPM gives contact center managers visibility into actual performance and delivers data that can be used to spur performance. Irish telecom provider eircom is a prime example of a company reaping the benefits of a CCPM deployment. The company uses CCPM functionality from NICE's Performix, making it possible to align employee targets with company objectives, and provide employees with daily online performance results. In addition, team leaders in eircom's telesales and service center can now spend more time coaching rather than handling administrative tasks. The results are hard to ignore: 7 percent upsurge in revenue, 10 percent jump in productivity, 9 percent decrease in operating costs, 10 percent reduction in staff costs, 9 percent increase in contact center call quality -- all of which contributed to eircom achieving ROI in less than six months. By setting and understanding objectives, companies can put in the necessary legwork upfront to identify the most relevant KPIs to drive center and corporate initiatives. "The goal of performance management should be sitting down with the team leaders and saying, 'What are the handful of things you use to manage, and let's make sure you get the right data, that it's in the right format, and you get it every day so you can be effective,' " Lauther says. "It's going to create a true sense in the organization of how valuable the contact center is." Mark Selcow, president of Merced Systems, puts it this way: "There are metrics that are really top of mind for people and the benefit of performance management is that you actually move the needle on those measures." Contact Center Performance Management
By identifying proper goals, data sources, and metrics, CCPM efforts can remain focused on the issues and concerns facing all stakeholders. But determining what new metrics should be used may require managers to re-evaluate the value of existing metrics that have been hammered in the psyche as cornerstones of contact center success. The metrics that are important will vary based on what the business is trying to achieve. Unfortunately, though, many organizations focus too heavily on one side of the equation -- efficiency-driven metrics such as average handle time and number of calls handled -- rather than creating a more complete view of agent performance by evaluating customer-experience-centric metrics such as first-contact resolution (FCR). Rob McDougall, president of Upstream Works, a vendor specializing in improving FCR, notes that metrics should reflect the big-picture goals. "One of the biggest areas of potential cost savings is reducing the amount of callbacks, which can exceed 25 percent of all your inbound calls," he says. "And in the big picture of customer retention, FCR is gaining a lot of support as the best metric to evaluate customer satisfaction." BNY Mellon Shareholder Services is the arm of The Bank of New York Mellon that provides the shareowners and employees of small, midmarket, and Fortune 500 corporations with core stock transfer services, corporate equity services, corporate actions, and direct investment programs. (The bank is the result of the merger between Mellon Financial Corporation and The Bank of New York in July.) The unit uses FCR and dashboard functionality from on-demand vendor Enkata, which contributed to the company's 10 percent improvement in first-contact resolution. "We're actually able to track and report value of every single contact," says Frank Madonna, a senior vice president and chief operating officer of BNY Mellon Shareholder Services. "There are now clients who are speaking to us about not only just decreasing contacts and eliminating contacts, which [are] absolutely very important, but also figuring out a way to increase the value of every contact." Here's another example of CCPM's importance to delivering a complete view of a customer service representative's performance: Consider a CSR with an average handle time that exceeds the center's desired target. At first glance, it appears the agent is performing at a substandard level. But examining the sales side reveals that the agent consistently outperforms colleagues in terms of cross sells and upsells. "If you're trying to juggle three metrics, then performance management is a good tool to use because you can have all three metrics expressed, and you can begin to see how they interplay with each other," says Jim Davies, principal analyst at Gartner. "By having a performance management tool that can look up all the metrics across those strategies, you can begin to show the impact." CCPM can also play a significant role in strengthening agent productivity. Mike Smitheman, AIM's vice president of product management, cites one customer, an insurer in the Northeast, as an example of a company using PM to empower supervisors with tools to further agent development. When agents are struggling in a particular area, the AIM system notifies supervisors of performance dips, and gives them a mechanism where they can assign a training program and track how the training initiative is impacting agent performance and driving desired behaviors. That provides a real pathway to success, Smitheman says: "Bring in real data from the system, track that process at the lower level, and aggregate that up through the organization to see where it's having a positive effect on the business." The Importance of Integration An effective CCPM application integrates the right data from various siloed systems -- the automatic call distributor (ACD), quality monitoring, workforce management (WFM), interactive voice response, speech analytics, ERP, CRM, HR, and beyond -- to provide a holistic, centralized picture of actual performance. "If contact center performance management only regurgitates the information that's in an ACD or from one or two systems and doesn't take the entire picture of what's going on in the contact center into account, it's not going to make an impact," Verint's Lauther says. Paul Stockford, chief analyst at Saddletree Research, uses the example of an agent who exceeds his sales quota to reflect how integrating the right technology can fortify agent satisfaction through what he contends is the "Holy Grail" of CCPM: workflow automation. (For more on the subject, see "Modern Times, Modern Methods.") "In a typical call center that would be calculated at the end of the quarter, then it would go through another process to go through payroll and then get a bonus check cut," Stockford says. "If it comes at the end of the quarter, a lot of the satisfaction that comes from a job well done might be lost if there's a great deal of time between when that objective was met and when there's actual recognition in terms of either a bonus check or even an 'Attaboy!' at the end of September," he says. "They have practically forgotten what they've done in July." But if an integrated PM application had been used it would have recognized the outstanding performance, initiated a workflow to HR to cut a check for a determined amount, and triggered a notification to tell the supervisor the percentage by which the agent surpassed his sales goal. "The next day the agent comes in and sits down at his desk, and there's a bonus check sitting there waiting for him," Stockford says. "You not only get a measurable ROI in terms of eliminating manual intervention in the process, but you also get the added benefit of an intangible ROI from what one can assume would be a happier agent: 'Somebody recognized that yesterday I did really well and here's the bonus check to prove it.' " Adoption Angst It's important to note that performance management's penetration into the contact center has been sluggish at best. While the market will expand by 27.5 percent this year and 28 percent in 2008, the adoption rate for CCPM tools was at a paltry 1.03 percent in North America in 2006, according to DMG Consulting. The market's poor adoption rate is the result of several underlying dynamics. In addition to the need for the market to clearly communicate the value proposition of such systems, CCPM applications aren't exactly easy on the checkbook. Best-of-breed tools are typically sticker-priced at about $1,000 per user, according to one analyst. Another huge impediment to stronger CCPM adoption boils down to the nuisances of integrating data from multiple systems. "The more complex the call center environment is and the more tools you've got in there, the more complex it is to actually do the implementation, and that has been a hindrance in the past," Davies says. Companies must commit to data integration, and that means business and IT have to be aligned, adds Merced's Selcow. "There are obviously incredible benefits that are derived when you integrate all that data and there's a common fact base," he says. "But business and IT aren't always aligned. Sometimes just the daunting nature of undertaking that data exercise can get people to say, 'I'll do that next year.' " And, Ri Pierce-Grove, analyst for customer interaction technologies at Datamonitor, says, "Effectively uniting all these component technologies and optimizing their use can place a heavy burden on professional services." Even as these issues persist in hindering widespread acceptance, vendors claim to be striving toward CCPM solutions that are more affordable and manageable. For example, CCPM applications are becoming more plug-and-play types of tools equipped with more prebuilt data connectors, which can help companies save the time and money that are usually spent on heavily customized integrations. Moreover, some market players have extended their product-delivery models beyond on-premise to hosted and managed-services environments. In addition, some CCPM providers are also looking to lower the risk of entry by enabling their customers to bite off smaller, more modular chunks rather than take the all-or-nothing strategy, according to AIM's Smitheman. That approach may pay off handsomely. "If you break things into modules, people can understand them better," Fluss says. The Future of CCPM Clearly, the market is still far from achieving widespread recognition -- but that may change, according to Saddletree's Stockford. "Once it's more widely accepted in the contact center and the benefits are better understood, we'll start to see performance management applied to back-office functions," he says. Another area that is expected to generate more interest is CCPM's use throughout the customer lifecycle. For example, a customer may phone a contact center, but a direct result of that interaction may be a field service visit by an engineer, a process that can be tracked with a PM tool. "At the moment we see contact center performance management as just 'how the agents are performing in the contact center,' " Davies says. "But there's a need to have more of an end-to-end process view of performance management." Davies also expects CCPM will soon shed its standalone status. "It's going to be part of a broader suite, either workforce optimization, CRM analytics, or just CRM," he says. There's already been some recent activity on the workforce side of the equation, including: Witness's 2005 acquisition of WFM vendor Blue Pumpkin; the acquisitions of Performix and WFM player IEX by NICE, which already had strong analytics functionality; Spanlink Communications' 2006 purchase of Calabrio, another WFM vendor; Verint's purchase of Witness this year; and Aspect Software's 2006 acquisition of quality monitoring vendor SophistiCom Technologies and its 2007 partnership with Merced. (Merced, for its part had previously partnered with IEX delivering PM functionality powered by the Merced Performance Suite.) Vendors such as Envision Telephony have developed WFO capabilities internally. Other expected developments include a much-improved focus on workflow and applications becoming more industry-specific -- tailoring out-of-the-box reports, dashboards, and workflows for particular verticals. And there will also be continued interest in making use of real-time stats. "Call centers that are successful with performance management are looking at the overall historical record of the agents' performance, as well as monitoring and measuring their performance in real time," says Larry Skowronek, vice president of product management at Informiam, a performance management vendor specializing in real-time applications. "It's about, 'See a problem now, fix it now.' " SIDEBAR: Revving Contact Center Performance Here are the recommended steps for setting up a successful contact center performance management program, according to DMG Consulting:
    1. Identify or establish enterprisewide goals. Review the goals of the corporation and all departments supported by the contact center. Identify contact center key performance indicators (KPIs) that measure these goals. 2. Identify contact center goals for productivity (service and sales), effectiveness, quality, training, and customer satisfaction. Identify contact center KPIs that measure these goals. 3. Determine which metrics are required to measure each of the KPIs. 4. Determine the best data source for each of the metrics. The best source is generally the originating system or application. (Keep in mind that many metrics are available from multiple sources and different calculations are often used to determine the same KPI.) 5. Validate all calculations and don't use secondary metric sources unless that is the only option. 6. Test each of the data sources to ensure that its numbers are valid and can integrate with the performance management system. 7. Assign weights to metrics to reflect their relative importance in determining a particular KPI. 8. Create balanced scorecards reflecting the goals of the contact center, external departments, and the corporation. Each scorecard will address productivity, efficiency, quality, training, and customer satisfaction for each of the goals. It will also specify which KPIs are included and their weights. 9. Review balanced scorecards with all relevant constituencies inside and outside the contact center. Make any necessary changes to goals, KPIs, and metrics until buy-in is obtained. 10. Communicate the new performance management program goals and objectives to all contact center staff. 11. Train the staff on the new goals and objectives for which they are now responsible. 12. Conduct a pilot to ensure that the KPIs measure the activities necessary to monitor adherence to internal and external goals, as reflected in the balanced scorecards. 13. Collect and analyze historical data to establish a baseline set of consistent, prior-period performance metrics for contact center and external goals and KPIs. 14. Compare results of baseline and pilot to identify areas requiring improvement. Document these areas and develop action plans to address all areas of weakness as well as to reward outstanding performance and achievements. 15. Correlate KPIs to enterprise and departmental goals to make sure that the metrics are appropriate and effective. 16. Institutionalize the performance management program to ensure ongoing benefits. This includes defining the frequency of reports and responsibilities of all impacted areas, inside and outside the contact center. Set up a closed-loop process for addressing all areas of weakness uncovered by the analysis to ensure that improvements are addressed on a timely basis. 17. Communicate success of the performance management program to contact center staff, external constituencies, and senior management. 18. Expect to change goals, KPIs, metrics, and data sources as business and technology evolves.
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