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CCL’s managing director, Simon Rustom, believes that, “Failure demand results in more costs for the business because of the time and resources spent in responding to additional customer enquiries and complaints as a result of processes that do not work.
“Not only are these costs hidden within the operating costs of the contact centre but they mask the real problems that the organisation is facing in not meeting customers’ wants and needs first time,” he said.
“Organisations find it hard getting to grips with this area of wastage. In fact, the only way is to carry out a ‘root cause analysis’, which discovers facts about the real causes of unnecessary contact and the resulting costs of failure demand.”
Failure demand occurs where an organisation fails to deliver clear and timely information – be it about a product or a service – to a customer. That failure generates a demand for customer service. Often that demand is registered via the organisation’s customer contact centre.
Ever responding to new requirements, contact centres tend to evolve. Consequently, their staff tend to undertake complex tasks and operate non-standard processes using multiple technology platforms.
All of this can prevent contact centres integrating smoothly with the rest of their organisation’s business.
For example, a product doesn’t get to a customer on time, or the customer’s bill is incorrect – and so the customer telephones the supplier to query what has happened. Or, maybe, a ‘standard’ letter sent to a customer does not reflect the content of an earlier telephone conversation – so, again, the customer telephones the supplier.
Some customer contacts occur because of the need to comply with industry regulations and staff’s reluctance to act purely on telephone discussions. Nonetheless, this process can be time consuming, thus irritating customers and creating extra work for company staff.
“In my experience, an average of 40 per cent of all calls to a contact centre could be prevented.” believes Brian Jopling, CCL associate director. “Saving 40 per cent of the costs of a contact centre and, as a consequence, producing more satisfied customers is a key goal for any company with a contact centre – especially for companies which employ several thousand people.
“These savings could be achieved if companies took a strategic approach, got back to basics and rethought how they do things,” he said.
“In practice, the way we reduce failure demand is to identify the root causes and eliminate them. This often affects other departments outside the contact centre and so requires a strategic approach – enlisting Board level backing – to achieve success.
“Contact centres are always under pressure to reduce costs, especially in today’s economic climate – and, as in any recession, there is currently a tendency to meet challenges with ‘knee jerk reactions’,” he continued. “Yet – despite any short term indications to the contrary – the level of phone-based customer contact activity is likely to grow during the next period.
“So, the challenge for any organisation with a contact centre is how to grow those contact centres to respond to this trend when, currently, 40 per cent of the activity shouldn’t be happening.
“If nothing is done about this, in a few years’ time, contact centre staff numbers will have doubled – and so will the inefficiencies, along with tangible and intangible costs!”
In Jopling’s view, not only does this state of affairs have adverse effects on customers, it also produces adverse effects among contact centre staff. He explained, “Knowing that 40 per cent of what you do is unnecessary, it wears you down, staff morale and engagement levels fall - causing rising human resources-related costs.”
About Customer Consulting Limited (CCL)
Customer Consulting Ltd (customerconsulting.com) is a specialist customer and change management company. It helps organisations to optimise their return on investment in customer management - especially contact centres and customer-orientated information and technology.
Its vision is to demonstrate that a best practice approach to customer management delivers sustainable business growth. CCL aims to deliver a combination of insight, intellect, wisdom and pragmatism - combined with a real understanding of people - to achieve commercial results that are beyond the norm. Using a joint project team approach, CCL offers advice and support to help companies develop and implement customer strategies that produce results.
With its 100 consultants averaging 20 years experience, CCL helps business leaders and their teams – including those at Aviva, BUPA, South West Trains and Orange – to activate their internal resources and ensure measurable success.
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