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Is Cost of Performance the Undiscovered X Factor?

Is Cost of Performance the Undiscovered X Factor?

Is Cost of Performance the Undiscovered X Factor?

A Q&A with WiserOwl Founder, Robert Bradshaw

Robert Bradshaw

Robert Bradshaw is the co-founder and president of WiserOwl, a US-based company helping contact centers dramatically improve performance and the customer experience while saving money.

Contact Center Pipeline recently spoke with Robert about how viewing operations through financial efficiency enhances control over performance and the customer experience. You can read more about this in his new report, “How cost of performance is the undiscovered X factor in contact centers”.

How would you describe the position most contact centers are in right now?

I’ve never seen contact centers in the hot seat like they are today. Not only are they tasked with maintaining peak performance in a rapidly changing market, but they must handle them with downward spending pressure.

We all know companies invest heavily in their contact centers to preserve and improve the customer experience. But, despite those investments, the American Customer Satisfaction Index (ACSI) shows little improvement in customer satisfaction ratings. This indicates that even when companies are investing in ways to preserve and improve the customer experience, they’re still not satisfying customer expectations.

To their credit, every contact center leadership team I’ve spoken with is actively working to solve this issue. But, based on the results we’ve witnessed, many of their initiatives will fall short.

And this is the position many contact centers find themselves in — trying to preserve and improve the customer experience with less. Others have it even tougher, supporting a growing business without spending more.

Why do you think many initiatives are falling short?

It’s not like people aren’t trying to succeed. Technology is better than ever, and for someone like me who has been in business for 30+ years, the innovation going on right now is unprecedented.

But after consulting with contact centers ranging from 10 to more than 5,000 agents, I learned their senior leaders all shared the same blue-sky desires:

  1. The power to know the cost of problems before having to decide on solutions
  2. The ability to speak contact center operations in a financial language that senior leadership understands and trusts
  3. The visibility for all managers to see that their decisions have a cost, and for them to take ownership over their part of the cost of decision making

But complicated costs and technologies get in the way. And as a result, none of the leaders were in a position to achieve their desires.

Let me give you an example. Not long ago I witnessed a client make an expensive decision to improve efficiency across multiple contact centers before we’d deployed WiserOwl. Now, they’re smart folks and did all the right due diligence. But because they did not have visibility into the root cost of this efficiency issue, there was no way to know in advance if the solution was aligned with their goals.

In the end, it turned out to be a costly lateral move. And it did not win any friends or supporters at the top who had approved this spending based on promised financial benefits. That’s a tough spot, both for contact center leadership and the technology vendor, whose solution is a good one.

I see this happen all the time — a lack of financial clarity causing contact center leadership to spend $10 to solve a $5 problem. This often leads to incorrectly prioritizing initiatives that do little to preserve or improve the customer experience.

Is seeing the cost of performance the undiscovered X Factor?

It is. We’ve learned that contact centers cannot speak the financial language of executives, because they often struggle to answer three questions that are fundamental to the C-suite and every other revenue-impacting business unit:

  • Before committing, how will your decisions save or make money, where, when, and how much, and with real-time updates?
  • How efficiently is money working down to any decision, process, channel, and agent?
  • How will you empower and retain staff without spending more money?

Let me explain why this is such a big deal for contact centers.

Customer experience is influenced by an agent’s attitude, and that can make or break an engagement. We all know how to do our jobs, and our attitude affects how we carry out tasks. A positive person will create positive outcomes, even if they don’t thoroughly understand every piece of a detailed process.

Now for agents: they are managed using measures mostly out of their control. How many agents can achieve handle time and CSAT and FCR goals continuously? Virtually none. And when contact centers measure agents based on goals they have little control over, the customer experience suffers.

It is the financial language of cost of performance — the percent of an employee’s pay spent on engagement — that empowers agents and managers. It is the single point of truth that is equal for everyone, regardless of their pay, skill, experience, tenure, or workload. It always knows who’s working hard and who’s hardly working, whether remote or onsite. And it tells you precisely how much a problem or opportunity costs, in advance.

We call this financial clarity.

How is seeing money at work better than current methods?

I’ve seen contact center leaders ask their CFO or COO where they should save money. That’s a slippery slope because most execs don’t understand contact centers. And sooner or later, they’ll ask for something the contact center can’t deliver.

Now contact centers base performance on various metrics: CSAT, adherence, handle time, etc. And all these metrics create a complex picture full of false positives and negatives. But, by translating each metric into its exact dollar amount, managers have an instantly understood and trusted comparison of every aspect of their operation.

Let me give you a real-world example of how much easier it is when work is translated into money. We had a client using speech analytics who identified an opportunity to reduce handle time by 30 seconds in one queue – but they needed IT support. The CIO wasn’t interested because the contact center could not prove an ROI like other lines of business he supported. With financial clarity, the contact center proved the 30 seconds amounted to $500,000. The CIO approved a $50,000 fix that saved 32 seconds, generating a proven 900% return the C-suite loved.

Financial clarity changes the conversation because it enables contact center leaders to speak the financial language fluently. A single point of truth that explains how efficiently people are working, regardless of skill, experience, workload, salary, team size, or the many measures I mentioned earlier.

Leaders can now accurately forecast the financial impacts of their decisions – down to the cent.

How does financial clarity retain agents and save money?

Contact centers are complex, with many measures and opinions on how to manage them. Two keystone indicators are turnover and spending. High turnover and/or high spending indicates a problem. In my experience, it’s the measures contact centers rely upon. And because agents can’t control the measures they’re measured on, they grow demoralized and leave. This turnover forces managers to spend heavily on proficiency lag.

Financial clarity solves turnover and retention and puts an agent’s success or failure in their own hands. Why? Because financial clarity doesn’t care how long an agent has worked at their contact center, how much they’re paid, or any other metric. It cares about how much of an agent’s salary was put toward engagement, and how efficiently they used the money.

Let’s say you take 100 agents. They have varying salaries. They handle different queues and volumes of contacts every period, and have varying levels of experience. In real-time, who is working hard and hardly working? Where might help be needed, and what would that help entail?

Financial clarity focuses on a single metric that is within the control of every agent and manager, measuring their performance equally. It reveals exactly where agents are struggling and where they’re performing well.

Everybody talks about agent empowerment, but nobody gets down to the heart of the matter — making it work. For the first time, you have the power to truly empower your workforce.

What do you think is the long-term benefit of financial clarity?

The long-term sustainable benefits from financial clarity are far-reaching — reduced turnover, greatly improved ROI, reduced spending, higher engagement, and better customer experience.

A client came on board just before the pandemic, and we reported that just $0.38 of every dollar was going to engagement.

The C-suite was watching – and wanted to make serious changes.

We partnered with contact center and IT leadership, and even with the pandemic and sending agents to work from home, they increased engagement spending to $0.71 of every dollar paid to agents – nearly a 100% increase. Not to mention, CSAT runs a consistent 92%, hold and wrap-up times are each less than 10 seconds, and turnover is less than 20%.

The same contact center team now enjoys renewed relations with the C-suite!

The bottom line is that most US contact centers spend less than 50% of their budget on engagement, which should be near 70%. Through this financial lens, contact centers can better understand how performance frustratingly falls short of expectations.

We have a new report that explains these concepts better. Go to https://wiserowl.com/research/ to read it.

Robert Bradshaw is Founder/President of WiserOwl. With 30+ years in marketing, business development, and sales roles in startup and Fortune 100 firms. Contact center experience includes companies in healthcare, health/property & casualty/life insurance, airlines, retail, and electric utilities.

Linda Harden

Linda Harden

Linda Harden is the Publisher of Contact Center Pipeline magazine.

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