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August 2007

REVIEW · Recommended Reading

Workforce Optimization: The Strategy Defined

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By Rick Luhmann Workforce optimization is a fluid strategy that takes its shape from the goals and mission of the contact center and enterprise. In this excerpt from his new book, Customer Centricity through Workforce Optimization, Bill Durr defines the key components. What is workforce optimization? You can search through many documents about workforce optimization without ever encountering a succinct definition. This is typical for a term that rightly describes a strategy rather than products or technologies. Yet, many definitions are offered by various interested parties, such as contact center vendors, enterprise software vendors and industry analysts. Many of these definitions are arbitrary and reflect the bias of the defining organization. At minimum, they all suffer from being parochial and narrow. As an example, analysts suggest that workforce optimization is nothing more than the convergence of the four foundation contact center applications: workforce management, quality monitoring, e-learning and performance management. But that view doesn't do the term justice any more than the assertion that one can define a person by discussing the four chemical base pairs that constitute his or her DNA. At the risk of drowning in metaphor, let me offer this thought: Workforce optimization is like water. Water has no intrinsic shape. It takes the shape of the container it finds itself in. Water has no intrinsic taste. It can acquire flavor based on its ability to dissolve almost anything. Water has no color. We see right through it, although it does tend to magnify. Water is essential to life. Nothing alive survives for very long without it. When it is in short supply, organisms struggle, are stunted and never reach full potential. Similarly, workforce optimization has no intrinsic shape. Its shape arises from the overarching goals of the enterprise and the specific mission of the contact center. It has no particular taste because no single source is its wellspring. In its totality, workforce optimization is realized through tools and processes from a wide variety of disciplines. It has no color because workforce optimization concerns processes as much as it does people, and most processes are invisible. And finally, workforce optimization is most like water because the enterprise and the contact center need it to thrive. There are two common misperceptions about workforce optimization. The first is that workforce optimization is exclusively aimed at the employees. Workforce doesn't just refer to the employees who actually accomplish the work. Workforce is a term that includes all employees, including team leaders, supervisors, managers and executives. In a contact center context, while supervisors don't ordinarily handle customer calls, they do perform important work. Some would say that the

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BY BILL DURR

Bill Durr is a Principal Global Solutions Consultant at Verint Systems. He is the author of Building a World-Class Inbound Call Center and Navigating the Customer Contact Center in the 21st Century. Bill has been published widely in industry journals, and is a frequent speaker on productivity and quality process topics at contact center industry events. He can be reached at [email protected]

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· Long-range strategic planning and budgeting · Sourcing, recruiting, assessment, hiring and training · Forecasting, scheduling, shift and rotation design, vacation planning · E-learning, ongoing training, coaching · Activity tracking, adherence, quality monitoring · Performance management, goal setting, incentives, corrective action · Employee longevity and morale programs, attrition reduction

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supervisor is the most important role in the contact center. Their work largely consists of directing and developing the employees in their charge. This work requires optimization, too. Some would argue that the work of supervisors and managers needs optimization to an even greater degree than that of the agents. There is a growing awareness in contact center management that the skills and knowledge of the frontline management team is the real driver for agent retention and customer satisfaction. Yet, in many respects, frontline management teams are often neglected when it comes to training and support tools. Workforce optimization offers tools to empower the front line, but there's more. The second most common misperception is that workforce optimization is mainly focused on boosting performance. Well, yes. It does that. But workforce optimization is also very much concerned with process. According to Michael Hammer, author of Beyond Reengineering, the difference between a task and a process is similar to the difference between a part and a whole. A task, he says, is a unit of work, a business activity normally performed by one person. A process, in contrast, is a related group of tasks that together create a result of value to a customer. A process that creates customer value will always be comprised of multiple sub-processes. Hammer asserts that the problems that afflict modern organizations are not task problems -- they are process problems. Handling a call is a task. Generating a set of agent schedules is a sub-process. Performing quality monitoring assessments is a sub-process. Creating customer value through customer service for the enterprise is a process. At its most elementary level, workforce optimization in the contact center involves having the best human resources on hand to meet customer transaction demand and create customer value while getting the biggest return for your total investment in people. Having the best human resources at hand at any given time is not an easy task. It requires attention to an amazing variety of details and implementing many sub-processes that have to work hand-in-hand. Many of these activities in the contact center are ones you are familiar with. They include:

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Workforce optimization is a combination of these processes and software tools that ensure the greatest return on your investment in people, whatever the mission statement or objectives for your center may be. For contact centers, where the cost of labor often exceeds 65 percent and can approach 80 percent of the total operations budget, this makes fundamental good sense. Workforce Optimization Elements Workforce optimization is comprised of a variety of components that have different time lines, different foci and different dependencies, but which share two commonalities -- the employees and, ultimately, the customers. Over time, various decision aids, tools and processes have been developed to help the contact center operations team manage employees efficiently and effectively. Recently, analyst firms have correctly identified a market consolidation of previously disparate and separate point solutions into a more holistic solution of software and services addressing all aspects of people management. Whether integrated or standalone, the general model for the components of workforce optimization is depicted in the illustration (on previous page). Workforce Management Vs. Workforce Optimization Looking at the variety of processes and software solutions in the figure on page 2, we notice that many of them dramatically impact the issue of "workforce preparedness." But isn't this just "workforce management"? If so, why create a new term? The contact center industry has utilized the term "workforce management" to describe solutions that enable people to deal effectively with the complexities of demand forecasting and staff scheduling. While these systems can increase efficiency dramatically, they are only one part of a more comprehensive solution that increases the productivity and performance of your customer-facing employees. While each of these individual processes and solutions lends itself to great savings and improvements in productivity, the full potential is unrealized unless used in conjunction with other systems and seen as part of a larger context. When these different processes work together in a synergistic way, the workforce is transformed into a mission-critical element of corporate strategy. This synergistic set of processes and software solutions is workforce optimization.

Workforce management processes in the contact center today tend to result in a relatively myopic view of the management task -- i.e., it is limited to demand forecasting, staff scheduling and tracking adherence to schedule. This myopia is evidenced by the disturbing realization that forecasting and scheduling systems will help to ensure that the agent team you currently have is deployed as effectively as possible -- not that you have the best team. You will never achieve best-in-class performance if all you ever do is optimally schedule a mediocre team.

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Why a New Term Is Necessary Could "workforce optimization" be the defining term for the first decade of the 21st century? And why is a new term really necessary? Call centers have been around for more than a quarter-century. For a long time, their daily operational problems have remained constant. Calls come into the center in random bursts of more or less predictable patterns. But not all calls are created equal. Some are more important or valuable to the company than others. Call processing engines (i.e., ACDs and PABXs) provide rules-based logic to connect calls with agents. The agents sit in cubicles, facing PC screens, wearing headsets as fashion accessories. They have access to the necessary information that enables them to carry out most transactions, but it frequently resides in separate systems. An effective agent is a person who has learned to listen intently, think along several tracks, type, navigate computer screens and speak in conversational, relaxed, confident, friendly and helpful tones -- all at the same time. Even with all the basic tools available, delivering consistent quality interactions at acceptable service levels remains a real challenge on a daily basis. A common lament is that the contact center is largely a reactive environment. Another is that contact centers are regarded as cost centers, or are viewed as being tactical rather than strategic. How do we overcome this challenge to provide consistently high levels of service? There are essentially only three basic strategies that any organization can pursue: Product Leadership, Operational Excellence and Customer Intimacy. Companies can be mapped onto this three-axis chart (see the illustration on page 3). For example, a mapping of a company like Intel Corporation would likely nearly cover the axis for Product Leadership, but would barely cover Customer Intimacy. On the other hand, an organization like Walmart would likely cover Operational Excellence, but barely touch Product Leadership. These basic strategies can be applied to contact centers, as well. For the past 25 years, the vast majority of contact centers have been pursuing a strategy of Operational Excellence. In the quest to lower operations cost, workforce management tools emerged. And while a key focus of forecasting and scheduling is on deployment of existing agent resources, which is certainly important, the nature of the contact center mission demands more. A huge concern today is how to develop the contact center workforce into a team of performers that can deliver what business executives are increasingly asking for: Customer retention. Increased revenues. Improved loyalty. Customer intelligence. You don't get these kinds of results because you connected a caller to an agent in less than 13 seconds. And they don't come about simply because you can hear the smile in the agent's voice (although that's not a bad start). Business conditions today require a shift from pure Operational Excellence to Customer Intimacy. Clearly, we can't afford to become intimate with every customer, so there will always be a requirement for Operational Excellence to keep costs under control. But what is equally clear is that we can see real value in treating our better customers...better. How? By spending more time with them. By gathering more information about them. By remembering them. By understanding their needs and problems more effectively. That's the core of the allegedly dead CRM movement. Did you ever notice that strategies are usually fairly simple, but it's the execution that is usually the problem? Take the strategy for becoming rich in the stock market: Buy low, sell high. It's simple to articulate; tough to execute. Likewise, consider the strategy for successfully providing customer intimacy through call centers: Develop gold-collar agents. Simple to articulate; tough to execute. A gold-collar agent is one who produces real, measurable financial results. Gold-collar agents have many soughtafter capabilities. They can easily multitask. They learn quickly. They have engaging personalities. They intuitively make the correct decisions. They have the magic. Where will you find such agents? The first place to look is within your existing team. Perhaps you'll be lucky enough to recognize them. More likely, they will be "diamonds in the rough." You'll have to discover who they are, and they will need shaping and polishing. Enter workforce optimization. Customer Centricity through Workforce Optimization is published by ICMI Press (www.icmi.com).

(#15353) Reprinted with permission from the August 2007 online edition of Call Center Magazine. Copyright 2007 CMP Media LLC.

Verint Systems Inc. 330 South Service Road Melville, NY 11747 USA

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[email protected] 1-800-4VERINT www.verint.com

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