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Contact Center Analytics: Driving Greater Efficiency, Higher Revenue, and Increased Customer Satisfaction
February 2005

Table of Contents
Executive Overview The Contact Center Challenge: Balancing Satisfaction and Efciency The Importance of Customer Satisfaction: Ensuring Future Revenues Increasing Customer Satisfaction: The Challenges Using Analytics to Optimize Performance Contact Center Analytics: Optimizing Cost and Effectiveness Siebel Enterprise Contact Center Analytics 1 2 3 4 6 8 11

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Executive Overview
Historically, contact centers have been viewed as a necessary evil. Customer service was regarded as a function that should be provided at the lowest possible cost. This thinking was pervasive and reached its peak with the strong outsourcing and offshoring trends in the past few years, as companies aggressively pursued cost reduction. However, this intense focus on cost, while effective at driving down operating expenses and increasing overall company prot margins, has inadvertently created its own problems. With the singular focus on minimizing service cost, many companies failed to realize that customer service was becoming a major differentiator and began experiencing increasing customer churn along with the loss of long-term revenue potential. Not only have customer expectations of service quality increased over the past few years, but customers have also shown an increasing willingness to switch brands. Unfortunately, while contact center managers were optimizing for lower cost, customers were taking their business to competitors that offered equivalent products and their desired level of customer service. To recapture customer loyalty, the view of the contact center must change dramatically. Instead of being treated as a cost to be minimized as much as possible, the customer contact center needs to be regarded as a valuable asset for building lasting and protable customer relationships. As the primary interaction point between a company and its customers, the contact center offers the potential to solve customer problems, sell additional products and services, and avoid the cost of sending expensive resources into the eld. Companies with best-in-class contact centers typically have happier and more loyal customers, lower costs, and lower employee turnover. How can a company achieve high loyalty and customer satisfaction while keeping costs under control? How can a manager understand what drives increased cross-selling revenue, lower service costs, customer satisfaction, and loyalty? More importantly, what actions can managers take to optimize both efciency and service and sales performance? Understanding the drivers of contact center performance requires real-time, comprehensive insight that can pinpoint problems and potential solutions for contact center managers and front-line customer service representatives (CSRs). Achieving this kind of intelligence requires a next-generation analytics solution. This paper discusses the goals of customer satisfaction, the hurdles to getting there, and the most appropriate solution for contact center managers to achieve top performance at reasonable cost.

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The Contact Center Challenge: Balancing Satisfaction and Efficiency

Historically, most contact centers have been managed by service departments and regarded as cost centers. They were managed to maximize efciency and call throughput while minimizing costs. Since stafng costs were the largest expense, managers attempted to keep staffing levels as low as possible for anticipated call volumes. Contact center agents were typically measured on efciency metrics such as average handle times, talk times, and number of calls per shift, motivating agents to keep calls as short as possible, quickly moving on to the next. In order to further reduce stafng costs, many organizations have either outsourced their contact centers or moved them offshore to take advantage of lower labor costs. For some companies, particularly those whose customer calls tend to be simple inquiries, this strategy has produced signicant cost savings. In other industries, however, where customer inquiries tend to be more information-intensive, such as banking and securities brokerage, outsourcing has produced disappointing results. Complex customer inquiries require more knowledgeable agents, and when conducting high-value transactions, customers want to talk directly to an agent to make sure their problems are resolved properly. In these instances, the lower costs achieved through outsourcing were offset by decreasing customer satisfaction and increasing customer defections. In highly competitive markets where consumers have more product choices, customers have also come to expect better service. Many companies have discovered that cost reduction efforts produced unintended resultsincreased customer churn, lost revenue, and declining prots. While cost reduction efforts made sense in the short term, the longer-term benets of customer satisfaction, such as future revenue streams, were unintentionally sacriced.

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The Importance of Customer Satisfaction: Ensuring Future Revenues

A renewed focus on customer service and satisfaction leads to improved customer loyalty and increased revenue. For example, reducing customer churn by 1 percent can translate into the same percentage increase in revenue. Particularly in industries characterized by low switching costs and products that are difcult to differentiate, customer service offers a way of providing distinct value to the customer.
The Contact Center as a Customer Satisfaction Center

As corporate brands become less important and switching costs decline, the importance of customer service has increased and, in some industries, become the major differentiator. Companies that align themselves to better serve their customers enjoy lower customer churn, lower costs, and higher prots, since satised, loyal customers purchase additional products and services. At the same time, customers expect better service. They expect their calls to be answered promptly and their issues resolved quickly and to their satisfaction. Long periods spent on hold, multiple transfers, and interactions with inexperienced or poorly trained customer service representatives can damage the relationship. Accordingly, every customer interaction has the potential to either strengthen the relationship or drive the customer to a competitor. As a result, the customer contact center has emerged as a critical factor in building long-term, protable customer relationships.
Comprehensive Contact Center Management Reduces Service Costs while Maintaining Satisfaction

In addition to helping to increase customer satisfaction and loyalty, contact centers also provide an opportunity to reduce the cost of providing customer service. This can be accomplished in multiple ways, such as avoiding the dispatch of expensive eld service people or by providing more cost-effective alternatives to speaking with a live agent. Technologies such as Web, chat, email, and interactive voice response (IVR) systems provide new opportunities to direct and promote satisfactory customer interactions via equally effective and more economical channels.
Customer Satisfaction and Loyalty: Focusing on the Long Term

Achieving high customer satisfaction levels, low churn rates, and effective cross-selling requires a strategy that balances the seemingly conicting factors that affect contact center performance. Such a strategy can increase overall business performance by balancing efciency-based measures with effectiveness measures that emphasize customer service and cross-selling. Whether a contact center is focused primarily on servicing customers or generating additional sales revenue, maximizing the value of customer interactions depends on a companys ability to clearly understand the factors impacting performance and make decisions that leverage or resolve those factors. Through this level of insight, contact centers can achieve and maintain high satisfaction levels and higher revenues while keeping their costs as low as possible.

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Increasing Customer Satisfaction: The Challenges

As the importance of loyalty and customer satisfaction becomes more clear, companies are struggling to nd ways to provide great customer experiences in the most cost-effective manner. Creating a high-impact contact center means achieving the following three goals: Understand customer behavior, needs, and satisfaction drivers Provide customers with the most cost-effective service When required, provide access to a well-trained, effective agent who can ideally resolve a customers issue in a single call As they work to achieve these goals, many organizations face the following challenges:
Fragmented Data Hampers Insight Into Customer Needs

Delivering great customer service requires a deep understanding of each customers needs. Is this a customer who has bought in the past? What products do they currently have? Would they be receptive to a cross-selling or up-selling offer? Customer satisfaction efforts have typically focused on factors such as timely call handling and quickly resolving open service requests. However, in this era of increased customer expectations, quick issue resolution is only part of the greater set of customer expectations. Customers now expect agents to know their contact history, correctly anticipate their needs, and handle their issues effectively, all within a single call. Customers also expect agents to be knowledgeable about the companys products when handling their inquiries. Most organizations have a wealth of customer and performance data. However, this data often resides in disparate systems, such as various nance, sales, service, order management, and human resources applications. This kind of complexity makes integrating all of this data into a single, comprehensive view incredibly difcult. To achieve the goal of balancing excellent service with greater efciency requires integrating data from all of these sources, transforming it into powerful information, and delivering it in a timely manner to guide employees actions.

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Difcult to Identify Drivers of Contact Center Performance

Currently, it is very difcult for contact center managers to quickly and easily identify the causes of high and low customer satisfaction. Are problems with Web self-service driving people to the call center? Is the IVR menu easy for customers to understand, or are they getting frustrated and abandoning it to speak to a call center agent? Are the call center agents adequately trained to successfully handle most customer inquiries? To understand the drivers behind desired outcomes, such as the reasons behind successful rst call resolutions, companies must be able to compare data from disparate systems, such as telephony switch data, service request statistics, and human resources data regarding the agents who handled the calls. Typical contact centers have a mix of systems such as ACD, CTI, IVR, Web, email, chat, and CRM. Each system records data about customers, transactions, calls, service requests, and agent performance in different data formats. The presence of older, proprietary switching technologies and highly customized ERP systems increases the complexity even more. In some cases, contact centers may run different versions of the same technology. These systems generate volumes of data but, because of the many different data types and formats, make it very difcult for managers to get an integrated view of their operations. Rather, managers receive fragmented reports, often in the form of spreadsheets, which provide information generated by only a single system. Because it is very difcult to correlate information generated from one system with that of another, managers cannot get the big picture and have a difcult time understanding the root causes of the issues they face.
Existing Reporting Methods Are Limited and Provide Answers Too Late

To drive increased contact center effectiveness, information must be provided to managers and CSRs in time to inuence their actions. The periodic, nonintegrated reports require them to intuit an overall picture from uncorrelated data, or rely upon internal data analysts to stitch together information, a process that could take weeks. This time-intensive, laborious process is difcult to replicate and may not support additional analysis at a more detailed level. This inexibility prevents the manager from identifying the underlying causes of customer dissatisfaction or unfavorable performance trends. As a result, managers are reduced to making intelligent guesses often weeks or months after the trend began, leaving little chance to quickly stem negative trends or take advantage of rapidly emerging opportunities.

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Using Analytics to Optimize Performance

To effectively achieve high customer satisfaction while controlling contact center costs, companies need a solution that can both integrate data from all relevant sources and provide timely, actionable insight to managers and CSRs. While most companies have deployed data warehouses and business intelligence systems to help them more effectively manage customer relationships, traditional data warehouses generally fall short of expectations, are very costly, and can take years to build. Additionally, many customer-focused data warehouses cannot provide contact center professionals with a holistic view of their operations by integrating data from disparate enterprise systems, telephony switches, and customer information sources. Whats more, the multiple systems deployed in the contact center make it very difcult for the IT department to access data and combine it into an integrated view for effective analysis. As a result, companies cannot get the information they need to truly understand the factors driving contact center performance and the impact of these drivers on the overall business. Solving this challenge requires a solution that can deliver the following:
Cross-System Insight to Drive Better Performance

To achieve greater effectiveness, contact centers need to combine data from multiple systems into a single, comprehensive view that helps managers and CSRs understand the factors impacting business outcomes. Advanced analytic applications solve this problem by integrating data from systems across the enterprise in a common repository. Once this information from multiple systems is integrated, it can be easily transformed into the kind of timely insight that answers questions such as: How do low average handle times correlate to agent experience? Are we successfully matching our service levels to customer value? Which channels provide satisfactory service at the lowest costs? Where and why are customers abandoning the IVR menu to speak to a live agent?

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Timely Intelligence for All Roles

As performance monitoring becomes more time-critical, managers need to be alerted to emerging situations requiring immediate action. These situations, such as unanticipated call volumes or product issues, require immediate attention. Advanced analytics deliver critical information while it is still possible to impact outcomes. The standard weekly or monthly reports that companies currently struggle with report information after the fact and cannot provide this kind of timely insight. Advanced analytics also improve the effectiveness of information by delivering it to all employees, in a format that is relevant to their role. For example, timely insight on customer protability, service history, and propensity to buy dramatically enhances the CSRs ability to respond more intelligently to customer needs, provide the appropriate level of service, or cross-sell more effectivelywhile the customer is on the phone.
Up-to-the-Minute Performance Insights

Contact centers, like all business functions, need to be managed against performance objectives and aligned with the overall organizations goals. Advanced analytics help to effectively manage contact center performance by providing managers with up-to-the-minute reports and metrics that gauge whether or not performance targets are being met. Key performance indicators (KPIs) help managers to more effectively evaluate overall site performance and individual agent performance. Advanced analytic applications also enable the correlation of cause and effect as they relate to performance, improving on standard operational reports that provide detailed information on performance statistics, but cannot provide insights into the underlying causes. For example, intelligence dashboards allow managers to examine each agents sales performance and cross-selling activity, helping managers determine whether or not agents have adequate product training and can effectively cross-sell. Managers can take action by providing necessary training and monitoring its effect on the agents cross-selling performance.

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Contact Center Analytics: Optimizing Cost and Effectiveness

Deploying an advanced analytics solution can result in the following benets for contact centers.
Deliver Benets of Analytics for the Contact Center: Optimized Cost and Quality

Analytic insight helps contact centers to better manage customer satisfaction levels. With advanced analytics, contact center managers can optimize the customer experience across different channels such as Web self-service, IVR systems, or live agents; the quality of the customer experience can also be maintained by ensuring that CSRs provide service levels that meet customer expectations. Since advanced analytics provide a comprehensive view of the customer, agents can quickly understand the customers situation, anticipate the customers needs, and effectively resolve issues. This results in better tailored customer service and faster issue resolutiondelivering the level of customer service that inspires strong loyalty.
Maximize Agent Performance and Workforce Utilization

Workforce costs are the single largest expense in a contact center, running as high as 70 percent of total costs when recruiting, training, compensation, and benets are considered. Advanced analytic applications provide managers with a better understanding of how workforce factors such as agent training, skills, compensation, and tenure affect contact center performance, such as customer satisfaction rates and overall costs.
Easily Identify the Drivers of CSR Performance

Correlating telephony switch data and customer service requests with data derived from HR systems, can provide valuable insight into how factors such as tenure, compensation, education, and training impact CSR performance. Timely insights can help pinpoint issues as they arise, enabling supervisors to quickly take corrective action such as hiring more agents with necessary skills, providing certain agents with additional training, or changing the IVR menu options to ensure that customers are routed to the agents who are best equipped to resolve the particular issue.

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Empower CSRs to Monitor Their Own Performance

For sales-centric contact centers, tracking CSR sales revenue, up-sell rates, and cross-sell rates provides additional insight into CSR performance. Since agents are motivated by what they are being measured against, key performance metrics can be provided to each CSR in a fully customized, easy-to-use CSR scorecard. This scorecard can balance multiple metrics such as average handle time and customer satisfaction scores, helping CSRs understand how they are performing relative to company objectives and their peers.
Provide Real-Time Insights to Guide CSR Actions

The best time for a CSR to have an effect on customer relationships is while the customer is still on the phone. Analytic applications can provide key insights to CSRs by embedding analytic information in the same application with which they view the customers information. This provides the agent with valuable customer insight such as the customers buying history, churn propensity, and propensity to buy additional products. Equipped with this information, the CSR can take specic action to prevent the customer from defecting or make a more compelling cross-sell offer.
Better Anticipate Call Volumes and Stafng Needs

For contact center managers, having better insight into anticipated call volumes and queue loads can help them build more effective stafng plans. Overstafng the contact center unnecessarily increases operating costs, while understafng runs the risk of increasing wait times, losing potential revenue, and adversely impacting customer satisfaction. Advanced analytics help managers anticipate call volumes by providing insights into the events or conditions that drive calls. With powerful insights into call volumes, the nature of calls received, and how quickly resulting issues are being resolved, contact center managers can make better stafng decisions. Utilization measurements such as agent availability, schedule adherence, auxiliary time, and available work time can also be easily measured. With this information, contact center supervisors can not only ensure that they have the optimal number of agents for anticipated call volumes, but that these agents also have the requisite skills to handle the calls effectively.

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Effectively Manage the Channel Mix

One strategy for reducing service costs while maintaining customer satisfaction is to provide alternative service channels. Alternative customer service channels, such as self-service Web sites, IVR menus, or email can provide customers with effective alternatives to speaking with a live agent. In most cases, customers can more quickly and easily receive the answers that they need. These alternative channels are increasingly important, since the cost of resolving customer inquiries by phone can cost up to ve times more than interactions handled over other, less costly channels.
Effectively Manage the Range of Customer Service Channel Options

Evaluating customer service effectiveness requires measuring customer interactions across both alternative service channels and call centers. Managers need an integrated, big picture view to ensure that all channels, particularly the self-service channels, are providing a satisfying customer experience. Since self-service channels bear different customer expectations regarding responsiveness and customer satisfaction, analytic applications can capture metrics such as Web site usage to determine how effectively these channels are supporting their customers. Reported in near real time, supervisors can spot emerging problems and make changes immediately.
Understand and Drive Customer Channel Selections

In order to understand the effectiveness of self-service channels, managers need to understand how these channels are used, which types of inquiries are involved, and how usage impacts customer satisfaction. Managers can track metrics such as cost per contact, channel response times, and customer channel preference. Analytics provide managers with the critical insight that determines when and where customers abandon lower-cost channels in favor of speaking with a live agent, and why. With this insight, managers can take action to improve the effectiveness of alternative channels, such as providing customers with better menu options or improving Web site navigation, so that customers can more easily resolve their issues.

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Siebel Enterprise Contact Center Analytics

Siebel Systems, the worldwide leader in customer relationship management systems and customer analytics, provides Siebel Enterprise Contact Center Analytics. This suite of advanced analytic applications provides organizations with powerful insight into all aspects of their contact center performance. Siebel Enterprise Contact Center Analytics empower executives, managers, and front-line employees with critical information aggregated from a variety of sources, nally providing the necessary insight that allows them to take targeted actions that improve CSR productivity and performance, reduce costs, and increase customer satisfaction.
Comprehensive, Next-Generation Data Integration

Siebel Enterprise Contact Center Analytics are built on a next-generation business intelligence platform that is optimized for combining data from all contact center systems, particularly telephony switch, email, Web, and CRM systems. Siebel Enterprise Contact Center Analytics also integrate information from nancial, human resources, and supply chain systems, providing the most comprehensive view of processes that impact contact center performance.
Complex Insights That Solve the Customer Satisfaction and Loyalty Challenge

Picture this scenario: Using Siebel Enterprise Contact Center Analytics, a call center manager notices an increase in call volume and customer complaints over the past several months. Monitoring the call types, the manager notices increased morning call volumes regarding lost, missing, or late deliveries. A look at the deliveries to those customers reveals that many orders are backloggedthey are not scheduled to ship as committed. The manager drills into Siebel Enterprise Contact Center Analytics and sees that the product supplier has been late on many deliveries. Upon further investigation, the manager discovers that his company recently changed payment terms with the supplier from 30 days to 90 days, and the relationship with that supplier has suffered. The manager can now take action. He sends an immediate email notication to customers with pending orders to apprise them of the problem, along with an offer of a 10 percent discount on future purchases for the inconvenience. He also noties the CSR team on how to handle the problem. Finally, he adds a late order option to the contact centers IVR menu with a message informing callers about problems related to orders from the supplier. He also places a notice about the problems on the companys self-service Web portal. This scenario is an example of how Siebel Enterprise Contact Center Analytics can help contact center managers quickly diagnose problems and take effective actions to correct them. Siebel Enterprise Contact Center Analytics provide the most comprehensive view of contact center performanceproviding organizations with the ability to take specic actions to improve customer service, lower costs, and increase revenue.

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