Go BackBuilding a successful, fully-costed business case for Workforce Optimisation projects
By Adam Faulkner, Director, Sabio.
Contact centre managers and the board know that research shows that 67 per cent of overall contact centre costs are associated with staff.Through optimising the management and development of employees, and by focusing on the success of their interactions with customers through techniques such as speech analytics and customer feedback, contact centres can gain dramatic improvements in profitability, productivity and employee satisfaction.
One approach that can help address this is Workforce Optimisation or WFO, which represents the convergence of seven major contact centre activities that enable enterprises to deploy the best and most appropriate resources for meeting customer demand and increasing customer value.
Many WFO tools are modular and consequently can be deployed as an entire solution or as a selection of modules - possibly in a phased approach. The good news is that, while the investment in people, process and technology required to successfully implement an effective WFO solution can be significant, the vast majority of solutions demonstrate a clear payback period of between just seven and 12 months.
Building a compelling business case for WFO
Implemented correctly, WFO makes strong business sense, but how do you go about building a compelling business case for the benefits that WFO might bring to your organisation?
In most cases there are two areas you can focus on - tangible and intangible benefits. The tangible benefits are of course those that can be quantified and are often related to cost savings, productivity improvements, increased revenues or the saving of management time. These tangible benefits are the ones that are typically used to justify a project. However, while it's often the intangible benefits that can potentially bring the greater business impact, these are usually very difficult to quantify let alone justify! Examples here might include the impact of increasing customer satisfaction, improvements in overall employee morale, or the growth in the percentage of service issues that are addressed during the first contact.
Proven ROI methodology
At Sabio we work with organisations using a proven ROI (Return On Investment) methodology to help build a business case and clearly identify any potential immediate tangible and intangible benefits. This process first examines typical inbound agent activity, then examines the largest payback areas in terms of productivity improvements, top line revenue growth, and overhead expense reduction. We then put this into an ROI calculation model that determines the exact payback period in months.
Our experience also suggests that the ROI calculation model shouldn't just be applied during business case development, it's an approach that is particularly valid during implementation to ensure that the process is aligned with business objectives. We also believe that WFO ROI measurements should be assessed every three months post implementation, effectively establishing a benchmark that can be assessed as part of the overall performance of the contact centre.
The good news for contact centres is that the two key areas impacted by a successful Workforce Optimisation approach - the customer revenue contribution and operating expenses - can both be positively affected by the kind of effective performance management that WFO enables. Growing customer revenues and reducing operating expenses leads directly to increased profitability and therefore significantly eases the approval of business cases.
Breaking down agent activity
Analysing inbound agent activity can be enlightening for organisations as they find out that often less than half of an agent's overall work time is spent on actual customer interactions. The rest of the time is swallowed up by wrap-up activities, coaching, breaks and briefings. In addition it's also important to factor in a reasonable level of idle time, as all agents need some breathing space. What's important here for your business case is to establish the right combination of productivity and variation to match your contact centre's goals.
In terms of productivity, WFO payback can be linked to three main areas - increased agent utilisation, agent productivity and first contact resolution. Here you can estimate factors such as reduced idle time through accurate forecasting and optimised scheduling, as well as a fall in lost time through Workforce Management's ability to track real time adherence.
WFO also helps agents to become more productive by establishing optimum Average Handling Times and minimising queue hold times. This can have a significant impact on agent motivation, career development and job satisfaction, while a broader commitment to training and development focused on improving customer service as well as the use of interaction management systems can play a key role in improving first contact resolution.
Growing top line revenue
When it comes to top line revenue, WFO implementations can support an increase up-selling/cross-selling as well as positively impacting conversion rates. WFO techniques here that come into play include coaching and training, sharing agent best practice, and improved planning for business peaks so that a minimal number of customer calls are abandoned.
In addition to improving agents capability of securing new or additional business, WFO can also strengthen customer retention performance, using techniques such as customer feedback and speech analytics to initially identify dissatisfied customers and ensure their issues are addressed quickly. More positively, these approaches can also be applied to learning exactly what it is that customers like and replicating this activity more widely. Improving overall employee quality, retaining more experienced agents and achieving more consistent service levels will also help to improve customer retention rates.
Reducing overhead expenses
The third key area where WFO can deliver significant payback is in reducing overhead expenses, specifically training delivery costs, cutting agent attrition, optimising telephony costs and being in a better position to reduce disputes and possible penalty payments.
The targeted use of eLearning can make training delivery more cost-effective while also enabling the rapid delivery of best practice techniques to agents at exactly the time they need it. WFM techniques such as shift-swapping and being able to book their own holidays also help to increase agent autonomy, while the latest performance management approaches encourage the use of more transparent performance feedback so agents know exactly what they need to do to meet their individual goals. These factors all help to reduce agent attrition.
Additional benefits can come through using Interaction Recording to support agents in disputes and provide a key management aid in delivering against SLAs.
Calculating WFO ROI
When building an ROI calculation model as part of a WFO business case we always advise managers to be fairly conservative in their projections. It's easy to over-inflate WFO efficiencies, but our advice is to aim for an achievable level and then over-deliver! It's also possible to reference comparable organisations in your industry or standard best practice as a benchmark for WFO performance.
When looking at your contact centre operating costs you should consider your resource and telephony costs, current revenue generation, your administration overhead and other expenses such as recruitment and training. This also needs to be balanced against customer retention rates and your average annual ongoing revenue per customer.
Once these operating costs are established you can start to factor in WFO efficiencies in key areas such as:
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Increased agent productivity/utilisation
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Reduced Average Handling Time
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Increased agent motivation and empowerment
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Reduced disputes/complaints/penalties
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Increased revenue
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Increased single interaction resolution and
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Administration savings
By collecting and processing all this data you should then be in a position to calculate your overall WFO ROI summary which details expected savings in staffing, recruitment and training, and improvements in service, as well as have an indication of potential revenue growth in figures. From tangible benefits alone you should be able to build a compelling business case, leaving the intangible benefits to deliver the performance improvement that will allow you to develop your overall WFO strategy over the coming years.
WFO offers a compelling payback opportunity, so it's hardly surprising that analysts such as Datamonitor see agent optimisation as one of the key investment priorities over the next three years. They go on to say that while individual WFO components such as Workforce Management or Quality Monitoring will provide a certain level of ROI, it's actually when you start to implement a multi-component, integrated WFO solution that you start to unlock significant levels of return.
