Assessment of Lion’s Financial Services Call Center Effectiveness

This reportboth evaluates Lion Financial Services’ current call system with the proposal from the Customer Solutions Group, and recommends another course of action for the company. Lion Financial Services’ call center is the primary means of customer contact and should therefore not be treated as a cost center. Our proposal increases customer satisfaction by decreasing queue times, meeting customer needs more efficiently and maximizing first-call problem resolution.

Description: LSF and Call Center System

Company Description

Based in Chicago, Lion Financial Services (“LFS”) provides investment management services, mutual funds and retirement plans to its customers in the East and Midwest regions. LFS serves its customers through the following channels:

Call Centers50%

Branch Services35%

Website 15%

LFS operates three call centers, located in Chicago, Boston and New Jersey. The Chicago call center handles 20,000 calls on average, twice that of the other two locations combined (approx. 5,000 respectively).

Call Center Process

LFS customer calls are routed through an Interactive Voice Response (IVR) unit that separates them into 2 groups: “Customers” (70%) and “Brokers” (30%). The average service time of these calls is 8 minutes (including talk-time and follow-up).

The Chicago call center handles all Quickline calls. Quickline callshavean average service time of 2 minutes. Non-Quickline calls are routed to a call center based on region.

New Jersey Chicago Boston

A total of 170 agents are employed among all call centers. Agents work 40 hours per weekly, 75% of which are spent “in the seat” answering calls.

Career-Pathing and Training

Newly hired agents are required to take a training program, work for 6 to 7 weeks as a customer Quickline agent, and then work as a customer service agent. After an additional 1 to 6 months, they have the option to participate in a training program to become a broker agent, which has higher compensation. Agents have a variety of employment histories although a large segment comes from the financial services and insurance industries.

Evaluation of Systems

Problems with the Current System

Staffing costs account for 70 percent of all operating costs for the company. As a result of the current queuing system, LSF is overstaffed. The average call-answer time exceeds the 20-second objective by 26 seconds resulting in 15 percent of callers hanging up before service.

LSF hired the Customer Solutions Group (CSG) to address these concerns and to reduce the rising costs of the call center while integrating technological advancements into the system.

The primary objective of Andy Carr’s, lead consultant for CSG, proposal is to reduce the operating costs through system automation, co-location and employee management reform. While these changes will improve agent productivity and economies of scale, CSG’s proposal fails to sufficiently account for their effects on customer satisfaction. Our proposal differs in that we view that the purpose of the call center is to provide superior customer service. Our proposal’s objective is to maximize first-call satisfaction with a system designed to be efficient and effective. Customer satisfaction is broadly defined by the speed, quality and consistency of service. The following set of operational metrics provides a standard by which to judge our proposals’ consistency with this stated goal.

  • Wait Time/Queue Length: Increased time spent waiting for service is directly correlated with customer dissatisfaction.
  • System Time: The actual duration of the call once answered. Customers indicate that the shorter the call providing problem resolution, the higher the level of satisfaction given the assumption that the representative will continue to talk only as long as necessary and as long as required to solve the problem.
  • Quality of Service: Customer satisfaction broadly stated as resolution of problem upon completion of first call. The larger the percentage of callers who do not have to call back, the greater the level satisfaction.
  • Abandonment Rate: Currently, 15 percent of callers hang up before being served. A lower rate would indicate a shorter queue length and wait-time and therefore better service.
  • Working Time (in seat): The amount of time a representative is available to actually take a new call is positively related to customer satisfaction. As amount of time spent on call follow-up is minimized, working time is maximized.

Our Proposal: A Comparison with CSG

Call Center Configuration

Similarities

  • All agents with be physically consolidated at the Chicago location. Each customer will receive a PIN number that they will be prompted to enter by the IVR, providing the agents with up-front information about the caller. Customers will be able to opt for an automated service to perform basic tasks, which will handle approximately 20% of all customer requests. The expectation is that all calls handled by the automated system will only reduce the volume of Quickline calls passed on to agents.

Differences

  • Agents will be consolidated into only two pools: a Quickline pool and a combined customer/broker service pool. This greatly simplifies agent scheduling and call routing, and provides for the lowest possible wait times for callers. Both pools will be staffed to account for 1.3 times the expected call volumes for their respective types of calls. If a Quickline call arrives and all Quickline agents are busy, the call will automatically be passed on to the service agent pool. Service agents will receive prompting on their computer screens identifying the caller as a customer or a broker indicating the appropriate blueprint to be used.

Recruitment and Training

Similarities

  • Average education level and average years of relevant experience of agents will be lowered. This will reduce the percentage of agents in higher wage categories. The training program will emphasize “rule of thumbs” to all incoming calls, and more detailed blueprints for a variety of standard call types.

Differences

  • Customer Service and Broker Service agents will be consolidated into one pool. This will reduce recruitment costs, the number of agents overall and further improve process standardization.
  • Develop cross-training program to help new/retained Broker/Customer Service agents to provide differentiated offerings while maintaining a consistent level of service.

Compensation and Career-Pathing

Differences

  • The average wage rate will be reduced from $17 per hour to $14 to better reflect new skill and experience requirements of agents. This will reduce the total agent costs per hour from approx. $838 to $741 (see graphic below).

Total Agent Costs per Hour

  • Dual Career paths will be created for both Quickline and Broker/Customer Service departments (see graphic below). This will enable agents with Quickline specific skill sets (e.g., efficient, detail oriented) to develop within that role.

Career Paths in LFS Call Centers

Dual Career Paths

Measuring Call Center Performance

Differences

  • Average Speed of Answer (ASA): Reducing wait time and queue length for entire system and all call categories.
  • Agent Utilization: Total handle time divided by total payroll hours. This does not necessarily reflect any measure of customer satisfaction. As we witness utilization approaching 100% under Andy Carr’s plan, we see the queue length approaching infinity.
  • Average Talk Time and Average Handle Time: Reducing average handle time improves productivity potential. First priority, however, is to ensure that calls are sufficient in length for the first-time resolution of customer concerns.

Similarities

  • Average rate of call recurrence: These figures are compiled per customer, as they are identified in the automated system. Reducing the average rate of call recurrence increases the rate of customer satisfaction and is inversely related to the decrease of average talk time.
  • Error Rate: The occurrence of incorrect data entry. By instituting standardized processes we eliminate variation and unpredictability including the occurrence of error.
  • Call Monitoring Scores: To increase customer satisfaction and agent productivity. Agents will be judged by adherence to a process emphasizing consistent and efficient service. Supervisors will use a call monitoring score sheet and the center will be “shopped” by managers.

In addition to these suggestions as outlined by Andy Carr, an opt-in automated survey will be offered to every customer at the completion of all calls. While the self-selecting nature of this sample may result in a bias, there must be a shift toward gathering and acknowledging customer opinions as process and employee training is reformed.

Estimated Comparable Results

Current System / Consultant Proposal / Our Proposal
Number of Employees Per Hour / 59.76 / 49.28 / 47.8
Total Agent Costs Per Hour / $1,015.92 / $837.76 / $669.20
Total Agents / 170 / 141 / 151
Average Number of Customers Waiting in Line (hour) / 2.39625 / Infinite / 3.11
Average time waiting in line (minutes) / 3.0225 / Infinite / 0.9978000

Our analysis of these alternatives shows that our recommendations allow LFS to reduce costs and improve productivity while improving customer satisfaction. By restructuring the call pools, instituting standardized processes and monitoring employee performance by these standards, we create a more efficient organization. We achieve a decrease in costs and overhead by consolidating the three cost centers, downsizing the staff and lowering the wage rate. The table below quantifies the differences between our proposal and CSG’s proposal.