Are You Doing Right by Your Customers?

Investments in self-service applications have skyrocketed during the past two years, with companies large and small building or enhancing self-service solutions. Several companies have called me to ask for assistance in building a zero-footprint call center. This is an interesting concept—a customer service environment without any live agents to help customers.

Four enterprise-centric trends are driving companies to invest in self-service automation, either to eliminate or minimize the need to employ live agents to assist their customers. These trends are:

1. the need to reduce call center operating expenses to improve the company’s margins and bottom line;
2. the desire to automate as many servicing tasks as possible prior to moving call center activities offshore;
3. the need to replace self-service applications that are either reaching their end of life or becoming too expensive to maintain; and
4. the current generation of self-service Web and voice portal technologies and solutions that can deliver high-value applications not previously available.

Five additional call center departmental trends are pushing even the most quality-conscious managers to consider self-service to eliminate or dramatically reduce their need for live agents. These trends are:

1. the ongoing agent attrition problem;
2. the challenge of finding qualified agents;
3. the increasing cost of agents;
4. poor service quality and bad public relations associated with offshore outsourcers; and
5. increasing gas prices, which are exacerbating many agent-related issues.

While all of these enterprise and call center-centric issues need to be addressed, some offsetting factors and situations require executives and call center managers to provide live agent support. At the highest level, a customer-centric organization must use service as a strategic differentiator throughout the customer life cycle. Live agents with appropriate skills are uniquely capable of leveraging a service call to sell more products, retain customers, and build loyalty.

Enterprises must find the right balance between live-service and self-service automation. Unfortunately, many companies are repeating an industry-wide mistake from the early 1980s, when interactive voice response (IVR) systems were first introduced. At that time, many managers believed that if customers were forced into an IVR, then they would readily use it. These companies neglected to ask their customers what they wanted to do in the IVR and, even worse, didn’t allow them to choose how they wanted to be served. Instead, they channeled all customers into the IVR, and, all too frequently, did not give them a way out. This led to a lot of very unhappy customers and, consequently, lost business.

The industry should have learned its lesson about forcing customers to use self-service applications, but current financial pressures to reduce call center and general customer-service expenses are leading too many companies to make this same mistake again. Fortunately, customers now have recourse. Unless they are captive to the provider (which happens when there is a monopoly), customers can defect to another company. They can also make sure that other customers are aware of the poor service the company is providing. Using a variety of community forums, such as bulletin boards, blogs, complaint sites (i.e., Complaints.com, Aircomplane.com, Measuredup.com, and MSN’s Consumer Action Forum), and many other social networking tools (i.e., Yahoo! Answers, Facebook, MySpace, Ning, and Epinions), they can share their experiences with other consumers. Companies like Dell, Sprint, Comcast, and AOL that didn’t take notice and failed to listen to their customers ended up in an industry "hall of shame," where their poor service was widely publicized on the Web and often ended up in news reports.

Finding a Balance

The new generation of self-service applications for the Web and IVR is excellent. Many of these tools are easy to use and enable enterprises to build systems to address a wide variety of customer issues, whether informational or transactional. (These solutions are being offered on either a licensed, hosted, or managed service basis.) Web self-service environments can automate most activities, from basic informational questions to the processing of sophisticated orders that previously required the assistance of agents. In most cases, the only limiting factor is security, and even that can be addressed today.

IVRs are a different situation. While speech-enabled IVRs are much friendlier than touch-tone-based systems, they do not have the cognitive capabilities of live agents. Activities that do not require decision-making, such as balance inquiries, order status requests, changes of address, credit requests, initiating trouble tickets, and password resets, can be easily handled via an IVR. (Again, the security issue must be addressed.) However, certain functions and situations require the assistance of a person, such as when the wrong dollar amount is taken out of a person’s account, or when a misunderstanding involving a number of departments in a company occurs. There are also situations when customers want the reassurance of speaking to an agent, as often happens when a complicated order or fraud report is involved.

At times, enterprises benefit from having a live agent handle a call instead of a self-service application, even if it costs more. Instances exist when an agent could convert the call from an expensive customer-service transaction into a profitable incremental sale or could convince a customer who is about to close an account to remain with the company. Enterprises should use analytics solutions to critique all calls and identify inquiry types that are most likely to be highly profitable sales or retention opportunities. These calls should be made available to live agents, if possible. (Keep in mind that some callers really prefer self-service and would be angry if they initiated a self-service transaction and were sent to a live agent instead.)

We all hear about bad customer service experiences, an increasing number of which involve poorly implemented selfservice solutions, particularly IVRs. In the majority of situations today, the technology is not at fault. The underlying voice-portal solutions used to power these environments are excellent and flexible, but they are too frequently used for transactions that should not be put through to an IVR, or they are poorly scripted and seemingly designed to frustrate customers. Enterprise management is clearly to blame for poor self-service solutions; customers should do everything they can to make their opinions known, as this is likely to be one of the only ways to get these problems fixed. Consider Dell’s situation, when the backlash against its poor service was so strong thatthe computer manufacturer’s bottom line suffered and Michael Dell returned to manage the company. Companies that lose sight of their customer service needs are placing too much emphasis on short-term cost reductions while sacrificing the long-term value of their customer relationships.

It is easily 200 percent to 300 percent more expensive to have a live agent handle a call than an IVR. It typically costs 25 cents or less for an IVR interaction versus $5 to $7 for an agent. However, in most situations, it is much more costly for a company to lose a customer than to use a live agent to respond to inquiries that require the human touch.

An increasing number of companies are using speech-enabled IVRs inappropriately to reduce servicing costs. This includes any self-service program that makes it difficult for a customer to exit an IVR to speak to an agent. Fortunately, quite a few best practices have emerged for identifying appropriate uses of automation in self-service applications.

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Donna Fluss is the founder and president of DMG Consulting, a provider of contact center and analytics research, market analysis, and consulting. She is the author of The Real-Time Contact Center, The 2008 Contact Center Executive and Management Briefing, and many other industry reports on contact center hosting, speech analytics, performance management, workforce management, surveying and analytics, and quality management/liability recording. She can be reached at donna.fluss@dmgconsult.com