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The Link Between Customer Satisfaction and First Contact Resolution

Customers tend to be impatient when they want service. It doesn’t matter if they are calling their bank or their cable company. They want a resolution to their problem or an answer to their question right then and there!  Research across many different industries bears this out. Customer satisfaction—for virtually any type of customer service—is strongly correlated with FCR.

For a contact center, FCR is the percentage of contacts that are resolved on the first interaction with the customer. For live calls or web chats, this means that the customer’s issue is resolved before they hang up the phone or end the chat session. Calls or chats that require a customer callback or are escalated to another source of support do not qualify for first contact resolution. For emails and web submitted tickets, which now account for a significant percentage of all customer contacts, the de facto standard emerging in the industry is that resolution within one business hour of receiving a customer email or web ticket counts as FCR.

FCR is typically measured in one of two ways:

The agent checks a box on the trouble ticket at the conclusion of the call or chat session to indicate if the interaction was successfully concluded on the initial contact.

Customers are asked in follow-up customer satisfaction surveys whether their call or chat was resolved and concluded on the initial contact with the service desk.

The first method requires periodic audits to ensure that agents are accurately reporting FCR on the tickets they handle. This is done by reviewing a representative sample of tickets each month to determine if the tickets designated FCR by an agent are, in fact, being resolved on the first contact with the customer. Neither method of measuring FCR is perfect, but it is one of the most important KPIs to track and trend.

Want to take a deeper dive into contact center metrics? Join Jeff at Contact Center Demo, November 12-14.

Why It’s Important

A high FCR is almost always associated with high levels of customer satisfaction. FCR is a measure of how effectively your contact center conducts its business and is a function of many factors, including the complexity and types of transactions handled, the experience of your agents, the quality of agent training, and tools such as knowledge management and remote control. The metric is most often measured monthly because a monthly timeframe is long enough to provide statistical significance. But it can also be measured annually, weekly, daily, or even hourly.

The figure below shows the relationship between FCR and customer satisfaction for a representative cross-section of service desks worldwide. This strong cause-and-effect relationship should come as no surprise. As stated above, we all want closure on the first contact with our service providers!


Net vs. Gross FCR

Certain types of contacts cannot be resolved remotely by the contact center. These include hardware break/fix and physical move/add/change requests. So, do these contacts count against a contact center when calculating FCR?  Well, yes and no. Let me explain.

Gross FCR looks at all incoming contacts and makes no adjustment for contacts that cannot be resolved by contact center agent. The formula for Gross FCR is:

Gross FCR = (Number of tickets resolved on first contact ÷ All incoming tickets)

By contrast, Net FCR adjusts for contacts that cannot be resolved remotely in the contact center. Specifically, the calculation for Net FCR carves out those contacts that cannot be resolved at the agent level. The formula for Net FCR is:

Net FCR = (Number of contacts resolved on first contact ÷ (All incoming contacts – contacts that cannot be resolved at the agent level)

In other words, the denominator of the Net FCR ratio is adjusted to include only contacts that can potentially be resolved by contact center agents. These adjustments are sometimes called carve outs.

Net FCR is by far the more relevant of the two FCR metrics. In fact, most organizations do not even track Gross FCR because it produces a distorted picture of contact center performance and is often misinterpreted.

Key Drivers of FCR

As shown above, FCR is a key driver—in fact, the most important driver—of customer satisfaction. But what drives FCR?  If a contact center wants to improve FCR, how would they go about doing it?  If we go back to our cause-and-effect diagram for service desk KPIs, we can see that agent training hours are the biggest driver of FCR.

FCR Cause and Effect

The figure below show the relationship between New Agent Training Hours, Annual Agent Training Hours, and Net FCR. The clear implication is that agent training pays off in terms of improved FCR, and that, in turn, yields improvements in customer satisfaction.


Benchmarking Ranges for Net FCR

The global averages and ranges for Net FCR for the first half of 2017 are shown below, along with the comparable statistics for the key drivers of FCR, agent training hours.

Global FCR benchmarks

The ranges for FCR (min to max) are quite large. The reasons for this have been explained above and include variations in training hours and the use of technology tools such as remote control and knowledge centered support.

Want to learn more about how you can improve your FCR results, along with other contact center KPIs? Join me for session 501 at ICMI Contact Center Demo: Turbocharge Your Metrics with Benchmarking

This post originally appeared in HDI SupportWorld. It was republished with permission.


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