How a company views its call center is crucial to determine the value of the operation, the need for how much and which technology, the strategy used and the evolution of the call center.
There are three normal stages of call center evolution—operational, transitional and strategic. Management's view of the role and goals of the call center shapes its future and whether it will transition into a unit that's in total harmony with the company's strategic plan and customer relationship data.
Operational Call Centers
These are the most basic and are primarily customer service oriented with little or no sales generation. Utilities are a good example of this stage. Customers contacting this type of call center can usually schedule installation, report trouble, check account balances, make delinquent payment arrangements and, in some cases, pay over the phone.
Management views an operational call center as a cost center and not as a profit generator. Since labor costs comprise about 65 percent of call center operation expense, the goal is to provide customer service yet keep labor expenses down as much as possible.
Call avoidance with self-service is the strategy. Cost containment is the goal. Call automation and information access by the customer are the normal techniques. Live-agent contact is expensive and management tries to reduce the amount of this contact. Better training plus quicker and easier agent access to account information can reduce call time and frequency. ROI metrics are all about reducing labor costs.
Operational call centers are effective when there's not much competition for the customer. Competition, however, forces a transition into the second stage of call center evolution.
Transitional Call Centers
These call centers evolve from cost centers to profit generators at least in part. As with operational call centers, transitional call centers concentrate on customer service functions but add another dimension—sales.
Retailer call centers are good examples of the transitional stage. Customer service duties are handled along with sales responsibilities. New products and services, special offers, service upgrades, newsletter signups and more—customers and prospects learn about these when they call in.
Check on the status of your order and you'll learn about a new widget that relates to your ordered items. If you want to find out about store locations and hours, you'll also learn about special discounts that expire in a few days. We can take your order right now—credit card number please.
Management's view of a transitional call center is much more than the "necessary evil" of an operational cost center. Their view transitions the center into a profit generator—a sales channel. Technology that allows the call agents to view the customers account activity and preferences and that provides a suggested script for the call offers is important to success.
This channel requires information from CRM packages and some type of knowledge management access. Agents need training in products and services in addition to salesmanship techniques.
Transitional call centers have the same need as operational call centers—to keep labor expense in check. That goal is more difficult to attain because better trained, knowledgeable call agents are crucial to success. Smart technology and call agent analytics provide relief.
The goal at these centers is to service customers effectively while up selling and cross selling. The technology used needs to provide agents with the necessary information for successful customer interaction. ROI metrics focus on lower labor costs and higher revenue per customer.
Transitional centers generate profits and are an attractive customer touch point. But, how do they relate to other sales channels and company strategy?
Strategic Call Centers
From operational to transitional and now to the third stage—the call center transitions into a strategic operation that ties into all sales channels.
Strategic call centers provide customer service, drive sales and attempt to maximize customer satisfaction resulting in increased customer loyalty and a higher customer lifetime value.
The technology used should connect the call agent with the customer data from all company channels—knowledge management, CRM and smart technology like Knowledge Builder, which provides the agent with insightful information (client has purchased products X and Y and, therefore, probably is a good prospect for product Z).
In addition to a better customer experience and increased sales, strategic call centers emphasize call agent training and satisfaction as well. It's crucial to provide them with the necessary tools, training and a stimulating work environment. Performance management technology, quality control monitoring and coaching has a big role in strategic centers.
The more competitive the industry, the more likely the call center will transition to the strategic stage. Using technology that provides insight, training agents and using performance analytics, and maximizing opportunities per customer contact—all are requisites of an effective strategic call center. Increased sales and higher customer loyalty are the likely result.
Evolution Is A Gradual Process
At which stage is your call center? Is it operational, transitional, strategic or in a gray area between stages? Navigating the complexities of CRM and information flow takes time and investment in better technologies and training.
Analyzing current performance against the expected ROI from evolution improvements may lead your company to a "one step at a time approach." This provides some immediate ROI, which helps fund the next step. Unless your company is in a non-competitive situation, as competitive pressures increase, call center evolution becomes an imperative.
About Randy Saunders:
Randy Saunders is the Marketing Director for Cincom’s Customer Experience Management products, with more than 25 years experience working with partners, Fortune 1000 and small-to-medium-sized businesses. Previously Randy has held marketing, sales and management positions at BusinessLabs, Gannett, SmartStar, and The Kroger Company.
Cincom Systems delivers software and services to simplify complex business processes. For more than 43 years, we have empowered thousands of clients worldwide to outperform their competition by providing ways to increase revenue, control cost, minimize risk, and achieve rapid ROI.
Published: Monday, June 5, 2006