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Article : How Hyper-Competition Changes Workforce Management

Hyper-competition is a new term created to describe a more cutthroat and dangerous form of enterprise warfare. It is fueled by fast moving technology and intensifies in troubled economies. Hyper-competition exists when the very business model seems to be under attack. Competitors attack across multiple functional areas – product, support, services, terms, etc. New market entrants spring from non-traditional areas. Existing "known" competitors begin to make sudden, unpredictable moves. All exert relentless pressure on margins.

Workforce management is an old term in the call center industry that has to do with forecasting and scheduling center resources to maximize enterprise gain at minimal cost. The processes associated with workforce management are well defined and broadly understood. Via manual efforts or use of sophisticated software solutions, transaction demand forecasts are created. Agent work patterns are established. Individual agent work preferences are identified. The software algorithm creates a set of agent schedules that attempts to meet business needs while considering agent lifestyle issues. Workforce management is important because it's service affecting and involves real money – paid agent labor hours. It is also tactical in nature and focused upon the best deployment of existing resources.

The impact of the Internet upon business, society and the very nature of competition is still not fully realized but several trends are already clear:

  • The balance of power has shifted in multiple areas. Specifically, power has shifted to consumers and away from sellers. Coupled with the increasing pace of business, implications for the contact center include a shift to more autonomous agents and away from rigid command and control hierarchies with a tilt towards effectiveness and away from ruthless efficiency.

  • Businesses are being pressured into transforming themselves operationally and functionally. More see centers as strategic. Holding market share and increasing revenues from existing customers prevail over more expansionist strategies.

  • More vertical markets are experiencing elements of hyper-competition.

One enterprise response to hyper-competition is a forced emphasis on customer service because it is the primary influencer of customer satisfaction. All these elements cause workforce management to morph.

Center management is faced with an impressive set of challenges. The industry has been single-mindedly pursuing efficiency for a quarter of a century. We know how to manage service level and trim average handle time. The necessary shift to effectiveness means that management has to focus on agent behaviors between the time they say "hello" and "goodbye." The interactions have to produce positive results in revenue, satisfaction or loyalty not just meet the time standard. Effectiveness is entirely dependent upon motivated, enabled "Gold Collar" agents.

The nurturing, coaching and personal development of agents necessary to transform transaction-factory agents into Gold Collar agents is what workforce optimization is all about. While workforce optimization is concerned with multiple processes and disciplines, it is frequently associated with performance management. Performance management, itself, is often confused with performance reporting but there are considerable differences. Chief among them is the notion of Key Performance Indicators (KPIs).

While KPIs may be a simple as average time per contact, more interesting metrics can be created as the center taps into more sources of performance data. Usually a center is drawing most its performance information from the ACD system. Perhaps their view is augmented by data from e-mail, workforce management and quality monitoring systems. When human resource databases and CRM databases are accessed and all agent time is carefully accounted for, very interesting KPIs can be developed. Examples include cost per activity, cost per new case, cost of agent non-adherence, customer satisfaction by agent and, of course, sales or revenue by agent.

A vivid example how incremental information from diverse data sources can alter center management's perception of individual agent performance can readily be demonstrated. Suppose we are the team leader for a small group of 7 agents. For space saving purposes, I have printed a single, expanded team performance report that includes data from a variety of sources. Most team leaders don't see anything like the example. At best they see some of the columns on the left-hand side. For the moment, pretend that only the first 5 columns on the left are visible.

A naïve team leader might conclude that Bob and George are the best performing agents based on raw calls handled. Considering the differences in sign-on time and examining average talk and after-call work we still might conclude that Bob and George are top performers but we also note that Chris is performing at a high level.

If we suddenly gained access to the next 5 columns of information, our perceptions of agent performance shift. Bob, a seeming top performer, is revealed to have very poor quality scores. Bob seems to be focused on speed. He is not effective from a quality standpoint. George is better at quality but still performs below the group average. In fact, through a quality lens two new agents rise to the top – Abbey and Frank.

Another shift occurs when we obtain first call completion rates from the CRM system. Yet another new name appears to be the top performer, Ed, followed by Abbey. Research has shown the highest correlation between customer satisfaction and first call resolution rate. Much better than quality scores. Way better than service levels.

Workforce optimization is the contact center response to hyper-competitive times. The next logical step in creating nimble, profitable companies in the hyper-competitive 21st century is to unleash the unrealized potential of the center workforce through efficient scheduling and effective performance management.


About the Author
Bill Durr is Chief Evangelist at Blue Pumpkin Software. His focus is upon the education of individuals and corporations on contact center technologies and best practices leading to excellence in the delivery of customer service.

About the Company
Blue Pumpkin is a provider of workforce optimization, a fast-growing market enabling businesses to leverage their most critical resource: their people. Blue Pumpkin solves the urgent needs of more efficiently deploying resources and effectively managing employee performance – significantly impacting customer service, loyalty and profitability.

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Published: Thursday, June 19, 2003

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