• March 8, 2007
  • By Marshall Lager, founder and managing principal, Third Idea Consulting; contributor, CRM magazine

Workforce Management Grows Up

Demand for workforce management (WFM) software and services reached $221 million globally in 2006, up 9 percent from 2005, according to "2007 World Contact Center Workforce Management Systems Market," a new report by Pelorus Group. WFM software and services now account for one-fifth of the $1 billion-plus market for workforce optimization (WFO) products and services. Sales of WFM software and services are expected to grow at double-digit rates, reaching $443 million in 2012. This is the seventh annual report of this nature compiled by Dick Bucci, associate analyst with Pelorus, and his perspective is that there are multiple reasons for this rapid growth rate. "Some of the many factors involved are the rising cost of labor; some contact centers are paying agents upwards of $20 an hour in the U.S., and wages are also increasing worldwide," Bucci says. "Another is the low penetration rate of workforce optimization solutions. Depending on the region, 35 percent is about the maximum market penetration, compared with 65 percent for technologies like call recording." The market penetration issue will likely begin to evaporate now that small and medium contact centers are becoming noteworthy. "Vendors are starting to recognize the things they need to do in order to expand penetration," Bucci says. "Most sales so far have been to large contact centers, but most contact centers--50 percent to as much as 90 percent--have 150 people or less." Small contact centers have been overlooked, according to Bucci, with virtually all applications concentrated on serving large contact centers. The arrival of on-demand call center applications has and will continue to speed the uptake of WFO and WFM in the smaller centers. The relative ease of implementation and low degree of required resources, combined with the lower pre- and post-implementation costs, make software-as-a-service very attractive to contact centers of all sizes. On-demand solutions tend to be flexible as well, suiting them to the changing business environment, Bucci says. "With multichannel efforts and the speed of new marketing campaign introductions, the agent's job becomes more complex, requiring multiple skills and a WFM system that supports it," he says. It's still hard to sell to the smaller contact centers, Bucci says, because most WFO sales currently are direct from vendor to end-user company. "There needs to be a channel developed. One of remaining issues is with utilization--WFO solutions aren't being fully used, because the vendors are unable to provide the necessary level of post-sales support to small contact centers." Related articles: Intensive Care
Learn these WFM lessons to breed the best contact center forecasting, scheduling, and managing efforts. WFM Needs Some Attention Leveraging Workforce Optimization for Contact Center Success
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