Call Recording Solutions for Call Centers

Quality Monitoring : Return on Investment

Cost Benefit Analysis

I. Introduction

In addition to helping contact centers increase the level of customer service, Quality Monitoring systems offer new capabilities across multiple platforms (i.e. phone, e-mail, web chat), which can save time and money. A Quality Monitoring system pays for itself by increasing management effectiveness improving agent efficiency, providing more focused training, reducing agent turnover and improving customer satisfaction and loyalty.

Quality Monitoring

• Supervisors can save up to a half-day of administrative time per week by eliminating the manual process of reviewing calls, e-mail and web chat, completing paper evaluation forms, and creating performance reports.
• Increased agent efficiency reduces handling time of calls, e-mails and web chats.
• Detailed contact evaluations pinpoint opportunities for improving agent performance providing guidance for focused training programs and better utilization of training funds.
• Turnover is reduced, as agents are assured of more objective performance evaluations, receive more focused training, and have the ability to track their own progress.
• Through leveraging the Quality Monitoring system agent effectiveness is enhanced resulting in significant improvement in customer satisfaction and loyalty - leading to lower customer attrition due to poor service.

II. RETURN ON INVESTMENT

Specific savings that you may expect with your implementation will vary according to many factors including, for example, call center size, current procedures and resources applied. The examples in this section are guidelines based upon knowledge garnered from our contact center clients and are not to be considered guarantees of savings that you may experience with your implementation.

Measurements that are included in these examples like labor rates and average call length are based Purdue Benchmarking study.

First Contact Resolution

According to the Purdue Call Center Benchmark Study, contact centers resolve 78.3% of calls on the first contact, whereas the remainder, 21.7% required the customer to re-contact the company. Repeat contacts result from an agent's inability to effectively bring closure to a customer service inquiry or sales related transaction across any platform (i.e. phone, e-mail and web chat).

A Quality Monitoring system provides the contact center with the ability to more carefully review agent performance unlike live monitoring. In live monitoring there is no ability to review the call or e-mail composition again to perform precision evaluation and assessment. More accurate assessment translates into better coaching and feedback information to improve agent first contact resolution performance.

Refer to the following example, which details the incurred savings from a 2% increase in first contact resolution rates.

Table I: First Contact Resolution	Before	After
First Contact Resolution Rate	78.3%	80.3%
Total Number of Agents	40	40
Cost per contact	$6.03
Calls per annum	710,000	695,800
Potential Annual Savings		$85,626

In summary, a Quality Monitoring system can increase first contact resolutions in the following ways:

• Higher assessment precision than live monitoring by leveraging transaction playback functions
• Agents who have a particular aptitude for resolving calls and e-mails on a first contact basis can be recorded and used as examples of the proper method to resolve the initial contact.
• Quality Monitoring allows the ability to track first contact resolution.

Increasing Management Productivity

Manual methods for performing quality assurance can be tedious and time consuming. Taping at an agent's desk, performing real time monitoring, and completing and scoring paper evaluations takes time and prevents managers from more important tasks such as performing side-by-side coaching or handling escalated calls.

Results from our user-base indicate that automated monitoring allows supervisors to monitor and review the same number of contacts in two-thirds of the time. Reducing the monitoring time results in significant savings.

Table II: Management Productivity	Before	After
Number of Supervisors	4.5	4.5
Hours spent Monitoring per Month	202.5	141.8
Hourly Rate	$17.33	$17.33
Monthly Cost to Monitor	$3,509	$2,457
Annual Cost to Monitor	$42,108	$29,484
Potential Annual Savings		$12,624
Time Savings		30%

Time Saving Benefits

Supervisors do not need to find analog tapes, dial into a switch or sit by an agent's side to find a call to evaluate. Complete calls and e-mails are immediately available for evaluation at the reviewer's desktop.

Statistical analysis of agent performance is achieved instantly without having to manually crunch numbers.

Supervisors have a complete picture of contact center quality from overall, group, and individual performance across multiple platforms (i.e. phone, e-mail, web chat). Instant comparative analysis provides management with better direction making the best use of coaching time.

Increased Agent Efficiency

Quality Monitoring enables contact center management to identify ways to improve techniques for contact handling to decrease the time it takes to respond to customer inquiries. At the same time, Quality Monitoring allows supervisors to evaluate phone/e-mails to maintain the quality of the customer experience.

Today, many contact centers measure performance through quantitative measurements such as the average length of time on a call or processing an e-mail. This type of measurement may indicate that the best agent spends 1.4 minutes on a phone or e-mail transaction, while a poorer performing agent spends 3.2 minutes. However, ACD and e-mail/web chat statistics do not tell you why one agent spends more or less time handling the customer contact — you have to see and/or hear the transaction.

A Quality Monitoring system allows you to focus on the qualitative aspects of the conversation (call handling techniques, sales ability, product knowledge, company policy, e-mail/web chat composition skills and use of technology) and set benchmarks that combine these qualitative aspects with the quantitative ones. By using a Quality Monitoring system, contact center supervisors can isolate the specific areas where agents need assistance. Zeroing in on those specific areas for training can reduce average call and e-mail handling times while still improving customer service. These savings can be substantial. As indicated below, reducing the amount of handling time by only 3.3 seconds, (reduction of 1%) per transaction resulted in savings of $10,000 per year.

Table III: Agent Efficiency	Before	After
Total number of contacts handled per day for all agents	2,840 calls	2,869 calls
Average length of servicing	330 seconds	326.7 seconds
Total phone/e-mail handling time saved per transaction		3.3
Total cost per second per agent		.0042972
Total direct cost = $ 15.47 per hour
Total savings per day for all agents		$40
Potential annual savings		$ 10,000

Agent Efficiency Benefits

More highly skilled agents means quicker phone e-mail and web chat servicing and quicker problem resolution.

Ability to target specific areas that need improvement decreases the call and/or e-mail handling rate - even for a good agent.

Continuous tracking and reporting on performance improvements motivate agents to increase their efficiency which, in turn, keeps call and e-mail processing times down.

More Targeted Training

Areas for improvement that are not identified can become a hidden risk that has a negative impact on contact center performance. Training programs that are developed without adequate information can miss the mark, resulting in wasted resources.

Quality Monitoring systems enable supervisors to pinpoint the problem(s) that the agent is having, whether it is limited product knowledge or difficulty closing the sale. Based upon a detailed agent profile including the date of hire, date of completed training, and even the name of the coach or trainer, the potential cause of a limited skill set can be identified. A customized training program can be designed to help develop the required skills. All the relevant people in the organization can be made aware of a new skill set that is needed, including the recruiter, training, supervisor and agent.

Table IV: Targeted Training	Before	After
Hours of Training per Agent per year	12	11
Number of Agents	40	40
Training Hourly Cost	$ 14.47	$ 14.47
Total Training Costs	$ 6,945	$ 6,366
Potential Annual Savings		$ 579

Training Benefits

• Reduce the time it takes to make the agent productive
• Minimize the need for retraining
• Identify problem areas early on and take corrective action
• Evaluate effectiveness of training programs by tracking evaluation results over time.

Increased Agent Retention

Providing clear call handling guidelines, and then periodically scoring each call, and giving prompt feedback is the best way to keep agents highly motivated. If an incentive program is needed to keep morale high, Quality Monitoring systems provide the required information that can be used to track and reward top performers.

When agents have more job satisfaction, they are more likely to stay and continue to service their customers. Keeping star performers on staff longer provides more consistency of service and keeps valuable resources that can grow and can continue to contribute their skills to the company.

In this example, the implementation of Quality Monitoring system results in reducing agent turnover by 1%. The cost of training new agents, $6,572¹. The total savings due to a reduction in training costs for new agents are $2,629.

Table V: Agent Retention	Before	After
Turnover Rate	28%	27%
Total Number of Agents	40	40
Number of Agents Replaced	11.2	10.8
Training Costs for New Agents	$ 73,606	$ 70,977
Potential Annual Savings		$ 2,629

Agent Retention Benefits

• Less time and money spent hiring and training new agents.
• Experienced agents can be utilized to set examples and train new agents
• A well-trained and experienced workforce will allow you to operate at full capacity

Summary of Savings

In summary, the total potential savings are:

Table VI: Quality Monitoring system	Before	After	Total Amount
Increased first contact resolution rate	710,000	695,800	$ 85,626
Increased management productivity	$ 42,108	$ 29,484	$ 12,624
Reduction in call handling time	$ 1,006,833	$ 996,765	$ 10,000
Reduction in training costs	$ 6,945	$ 6,366	$ 579
Reduced agent turnover	$ 73,606	$ 70,977	$ 2,629
Total savings by using Quality Monitoring			$ 111,458

NOTE: These numbers do not include the incremental revenue that could result from better customer service, satisfied customers and increased revenues.

Customer Loyalty ROI

Beyond the operational efficiencies, clearly the greatest benefit of leveraging Quality Monitoring systems is ensuring long-term customer loyalty. Regardless of the quality of a given product or service, the customer experience can make or break not only your organization's reputation, but also your bottom line.

Let’s look at a very conservative estimate of the financial impact of improving customer satisfaction using a Quality Monitoring system.

In this example, we will show how even a small percentage of customer transactions that are handled badly can result in an incredible hit to a company’s bottom line. We will then show how leveraging a Quality Monitoring system can help significantly improve customer loyalty and profitability.

Using the same contact center profile we used throughout this document, let’s add another component. The customer component. Assume that for this particular contact center, the average lifetime customer value is $80. We garnered this value using the following formula:

Lifetime Customer Value = (Total Lifetime Customer Revenue) - (Operations Expense + Customer Acquisition Cost)

The assumption here is that every time you lose a customer, you not only lose the business for that transaction, but you can lose that customer’s business forever. To understand the power of customer loyalty, let’s take a simple example. If all of Starbucks’ current customers, from this day forward, only purchased one more cup of Starbucks’ coffee in their lifetime, how long could Starbucks stay in business?

Whether it’s a bad cup of coffee or the service that went with it, either can end the customer relationship. It was probably not long ago that you or someone you know said "I’ll never do business with that company again" after facing a particularly negative customer service experience.

Getting back to our example, we have a customer value of $80 for this contact center of 40 agents that handle 7 million contacts per year. When reviewing customer satisfaction survey data from this contact center, we uncover that 4% of those customers surveyed gave the lowest possible rating on overall satisfaction. Based on passed attrition studies, we anticipate that 60% of these customers will leave the franchise due to the poor service they encountered. Based the average lifetime value of these customers ($80) and the annual transaction volume (700,000), we anticipate that customer dissatisfaction will cost the company $1,344,000 [700,000*4%*60%*($80)].

However, the following year, this contact center leveraged Quality Monitoring to improve agent evaluation and assessment and to improve the product knowledge and customer treatment skills of agents. As a result, this contact center reduced the percentage of customers giving the lowest rating on overall satisfaction by 1% effectively preventing $ 3.3 million in lost revenue from customer attrition.

Table X: Customer Revenue Impacts	Before	After
Lowest Possible Overall Satisfaction Rating	4%	3%
# of Transactions with Lowest Possible Rating (Annualized)	28,000	21,000
Attrition Rate for Customer Dissatisfaction	16,800	12,600
Lifetime Value of Customer ($80)
Loss of Customer Revenue due to poor service	1,344,000	1,008,000
Total Potential Revenue Saves Per Year		$ 336,000

Table XI	Before	After	Total Amount
Increased first contact resolution rate	710,000	695,800	$ 85,626
Increased management productivity	$ 42,108	$ 29,484	$ 12,624
Reduction in call handling time	$ 1,006,833	$ 996,765	$ 10,000
Reduction in training costs	$ 6,945	$ 6,366	$ 579
Reduced agent turnover	$ 73,606	$ 70,977	$ 2,629
Decrease in Unproductive Training Time	$ 118,231	$ 94,585	$ 23,646
Loss of Unrealized Customer Revenue due to poor service	$ 1,344,000	$ 1,008,000	$ 336,000
Total Potential Savings			$ 471,104