Original Publication: Customer Management Insight - October 2008
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Take your contact center to the next level of profitability by combining CRM with business unit intelligence.
Contact centers are a vast and centralized resource of the customer wants, needs, and desires. Truly advanced contact centers have developed means to harness this Voice of the Customer feedback and share this intelligence with other departments to foster process improvement, product development/improvement, refined marketing campaigns, etc.
One of the largest areas for strategic value creation in contact centers, however, is adding intelligence to the existing ACD routing. Replacing elementary (often outdated) ACD systems with multi-channel, skills-based routing and enabling agents to log into multiple queues improve the ability to route contacts to the most appropriate agent. This leads to increased first-call resolution and customer satisfaction while lowering agent talk-time and costs. This improves a contact center’s operational performance and customer loyalty.
Further enhancing skills-based routing by integrating with a CRM database takes the contact center’s ACD to the business intelligence level. This substantially augments the ability to provide a “wow” customer experience and provides measurable improvement to your bottom line. Identifying customers in real-time categories, such as ‘most or least profitable’, ‘past due’, ‘at risk of attrition’ or ‘strategic accounts’, is the first step to deploying an enhanced routing strategy. Once these categories are established, specific rules are then applied to the routing and reporting of these contacts, including the ability to automatically redirect a VIP call to the front of a queue, or to a preferred agent, or the ability to play customized on-hold announcements just for that category of caller. Where applicable, these same rules can be applied to other channels of communication, including email and web chat requests, IVR transactions and even inbound faxes.
Customer Segmentation (Hiring and Firing) At Work
The senior leader for the contact center of a large credit union illustrates the concept of business intelligence. A few years ago, he led an initiative for the contact center management team to work with their ACD vendor to design software connecting the ACD with their financial database to prioritize members based on deposit and loan balances. Members with the highest balances would be routed to the agents with the highest scores in quality monitoring and customer satisfaction. These members would also be assigned a higher priority within the ACD giving them the lowest wait time. Conversely, members with numerous non sufficient funds fees, overdrafts, and delinquencies would be assigned the lowest priority thus have the longest wait.
This proposal caused quite a stir with the executive team. Credit unions take great pride in providing quality service equally to all members. The contact center leader was requested to attend the weekly executive meeting to discuss their concern over the proposal. During the meeting he provided an overview of the proposed system design. The company’s chief financial officer very bluntly stated he had difficulty with the concept since he felt it would be unfair to lower income members and all members should be equally treated. He strongly opposed supporting the proposal. The other executives joined this lead and voiced their own concern that this seemed unfair to members.
Instead of backing away, the contact center leader offered a recent analysis jointly prepared by the finance and marketing departments that showed that the credit union earned 15 million dollars from the top 20% of members and lost 7 million on the bottom 20%. The only reason the credit union could even afford to serve the lowest 20% was because of the most profitable members. It is in the best interest of the lower profit members that preferential treatment is given to the most profitable members. In fact, since the credit union returns increased profits to all members by lowering loan rates and increasing deposit rates it is in the best interest of all membership to retain and attract the most profitable members. If unprofitable membership decreased due to the lower tier service to them then that benefits overall membership as well.
The CFO leaned back in his chair contemplating the original proposal from this new perspective. It didn’t take long for him to change his mind, and all the other executives joined him. The new design was given preliminary budget approval.
Examples of business intelligence routing such as this are nearly limitless. Maxing customer service profitability depends in part on its developing a system that can differentiate quickly and accurately among customers based on the degree of service they require, the revenue they are likely to generate, and if they need to speak with service, collection, or sales agents. Not all customers require the same level of service or generate the same potential revenue. Some companies struggle with this concept since they want to provide the same quality service to “every customer, every time.” However, retaining and attracting profitable customers allows companies to be able to afford to continue servicing the unprofitable customers.
But Can We Afford It?
With preliminary budget approval in hand, the contact center management finalized the design with the ACD vendor and received the final price. The CFO would now decide the final approval of the project. Before giving the green light, though, he wanted the answer to another question: He felt that the contact center, in all likelihood, assisted mainly the mid to low profit members. He assumed the higher profit members probably use self-service offerings, such as online banking, and thus rarely needed the contact center. The CFO now doubted if there were enough higher profit members to justify the cost.
The contact center leader realized this was an excellent piece of data that he had neglected to include in the project justification. He asked the VP of IT if it were possible to run a query of the accounts accessed by the contact center agents over the past three months and match it against the database of member profitability. The VP agreed and one week later had some rather surprising results. The data showed that 58% of accounts accessed in the contact center were from mid- to high-profit members. This made sense when compared to the types of calls handled by the contact center since it had the ability to open accounts and accept loan applications. Marketing had increased promotion for this convenience in its materials.
Armed with this new information the contact center leader requested a meeting with the CFO, where he pointed out that the new design included a caller ID component so that, if the number matched the number listed on the account, the prioritization would occur sight unseen to members. He also made sure to let the CFO know that caller ID was coming through on 90% of the calls with a 35% overall match, with a growing trend of matching numbers. Once again the CFO was swayed, stating this clearly would be a benefit to both the credit union and members.
The reality is that the economy will continue to contract until 2010. In August the federal government reported that higher inflation has lowered Americans standard of living. As consumer budgets continue to get squeezed, so will corporation budgets as rising prices further cut into profits. Companies will fight for profitable customers and struggle with “supporting” the unprofitable ones. Strategic contact centers have the capability, desire and vision to differentiate the level of customer profit to maximize their contribution to revenue.
The common myth within our industry is that this level of sophistication is priced beyond the reach of the small- and medium-sized call center. The truth is that this functionality does exist in affordable, off-the-shelf applications. What doesn’t exist in most contact centers, however, is operation based on business unit intelligence. This involves having a strategy to use the data from this intelligence to design CRM-based enhanced routing. To be fully effective contact centers also need a vendor to partner in implementing this strategy/design for the real-time categorization of customer contacts. Smart vendors have recognized these projects as not only an additional source of revenue, but as a means of differentiating their services – becoming more of “a peer in the boardroom, rather than a vendor in the hallway.” The typical contact center uses canned routing based on the vendor’s general design. To operate as a strategic asset that utilizes business unit intelligence, select a vendor that allows you to route based on customer needs.
