| Many companies have used the call centre as a solution for a particular business unit. The department could set up a direct telephone service with little involvement from the IT department. These call centres have transformed the way in which companies have done business and have typically paid for themselves many times over - either through cost savings or through the increased service they have been able to provide to their customers.
However, many companies have woken up to the fact that they now have three, four, five, ten or even thirty call centres across the company or constituent Business Units. The call centres may vary in function from customer contact centres to smaller, perhaps informal help desks.
While all of these centres may be offering a service to their customers, the level of service offered may vary considerably across the group and may also be accompanied by variations in the cost per call.
These companies are now looking optimising these call centres. This may be in the form of rationalisation, achieving efficiency savings or consolidation.
Optimum Size
So why consolidate call centres at all? The answer lies in the fact that many smaller call centres are less efficient than larger call centres. Because of the random nature of incoming calls it is always necessary to over-staff the centre to provide the level of service and the time to answer that the customers demand. In a small centre the level of over-staffing, as a percentage, is typically very high. The larger the centre the better the overall efficiency. When a number of sites are taken into consideration the combined level of inefficiency becomes quite noticeable. The smaller centres, while offering good levels of customer relationship, also suffer from very variable service levels, particularly at busy times of the day.
Service levels can be inconsistent across different countries. This is becoming a particular problem for companies trying to support their multi-national customers. I recently did some work recently for a major computer manufacturer. One of their largest customers in the UK had recently acquired a smaller business in Eastern Europe. While the customer received great support from the UK call centre, their Eastern European business arm received poor call centre service. Their customer wanted a consistently high level of service across Europe. In this case a pan-European call centre was proposed to meet service targets, rather than for cost saving reasons.
Very large call centres can become inefficient. Above 300 agents management issues become a problem. The call centre adopts the feel of a voice factory with a correspondingly high agent churn rate. In Europe, personal experience has shown that the optimum size of a call centre is typically between 150 to 350 agents.
The Pan-European Call Centre
Multi-national companies have typically grown on a country by country basis. This has commonly resulted in an autonomous call centre in every country, which has suited the needs of the local market, but has produced problems of its own when viewed at a group level. The relatively small number of agents in every country is inefficient, provides variable service levels between different countries, and there are difficulties in providing out-of-hours coverage.
The case for looking at some form of call centre consolidation is strong. In terms of consolidation there are number of major models that could be considered.
· One pan-European centre. In this model all calls are routed to one central location where all calls can be handled in their native language. With all calls routed to one location, the call centre it is more likely to have reached the critical mass for an efficient centre.
· Regional hubs. The approach of a pan-European centre is taken, but on a much smaller scale. For example, a Nordic centre could cover all of the Scandinavian countries.
· Product centres. Similar to the pan-European model, but here each major product line has its own centre. This will typically be located next to a development centre, where third level support is available.
· Major and minor markets. Typically the result of existing operations where larger countries, for example UK, Germany and France have their own centres. The other countries have not yet reached this critical mass and one call centre serves the smaller countries.
· Country centres. A different call centre is kept in every country. Networking techniques enable the sites to be linked together to form a larger pool of agents.
· Follow the sun. This is where call centre consolidation has been tackled on a global basis and a number of worldwide centres have been chosen. Typically three main locations based in Europe, America and Asia the centres are open during normal business hours. The centres being in different time zones are able to provide 24-hour service by routing calls to the appropriate location.
Which option is the best? This depends upon a number of factors specific to the business. A fundamental driver is whether enough calls can be concentrated into the call centre to enable it to reach critical mass. The in-country centre is often kept in place because although there may be significant benefits from consolidation the internal politics, particularly from strong country managers, tend to work against consolidation.
Networking of call centres
One of the easiest forms of call centre consolidation is to simply network sites together. This enables calls to be passed to an available agent irrespective of where they are located. The main benefit of this is that it helps to fill in the peaks and troughs in call volumes received at individual sites.
Key |
Meeting service levels |
Just below service levels |
Poor service levels |
Figure 1: Networking helps to smooth out the peaks and troughs across the day.
Figure 1 shows the call volumes for a typical banking application. It can be seen that Manchester cannot comfortably deal with its call volume whereas in Glasgow the service levels are consistently high and have spare capacity to deal with calls from other sites.
If the three sites were networked together there could be an overall improvement in the service levels (time to answer) in addition to a lower number of agents required to meet the service level. In this case, the saving in the number of agents at any one time can be in the region of 7 agents, but by the time the 24 hour shift patterns are taken into account this worked out to be 18 full time equivalent agents. The savings could be in the region of £300,000 per year.
The main advantage of networking is that it enables a larger pool of agents to be available to answer calls, without incurring the restructuring costs to consolidate sites. Networking does, however, fail to address the underlying problems of call centre inefficiency, and in many ways can exacerbate them. Call Centre Managers are often reluctant to face up to the problems of accepting calls from other sites. Efficiency savings on one site can often be swallowed up by calls overflowing from a less efficient site. Unless senior management tackles these problems the underlying efficiency can still be left in place.
Business Case
In order to carry out any form of call centre consolidation a solid business case is needed. The impact of consolidation can have strategic implications for the company, as well as significant restructuring issues and costs.
The business case can often be compelling. The potential savings and improvements in service should be significant, but building the case is not an easy task. The main barriers to the business case include: -
· Being able to clearly demonstrate the savings or improvements in customer service
· Convincing management that the savings are achievable
· Political infighting between the call centre and business managers
· Not reaching a critical mass of call volumes in the consolidated centre
Many organisations have found that observation techniques to gather empirical performance data, coupled with the use of external consultants for an objective appraisal of the situation have been expedient to getting the business case approved.
Call centre observation can produce the much-needed underlying data to support the business case. An evidence-based business case has a greater likelihood of success. It is easy to say the call handling process can be improved by 10%. It is much more difficult to justify to senior management without base information. The use of internal benchmarking between sites can be used to help prove what could happen if internal best in class processes were adopted.
Summary
The case for call centre consolidation is often compelling. It can help to improve service levels and consistency of service, while at the same time reducing cost. The impact in terms of restructuring of the organisation and the technology required, need to be carefully considered.
Call centre consolidation typically fails as a result of the lack of a clear and convincing business case and board-level backing. It is at this point where consolidation succeeds or fails and careers paths are enhanced or dashed.
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