Training and ROI

By Rosanne D'Ausilio, Ph.D.
July/August 2004

Statistics consistently reinforce that the biggest challenge in today's contact center environment is agent training.  Turnover continues to be high; new hire costs are on the rise -- $6500 per agent!  At the same time, losing clients because of poor service negatively affects your bottom line.  What can you do?  How do you justify the training expenditure?

Research has been making a case for how spending in human performance areas such as training translates into bottom-line growth.  Accenture's study (www.accenture.com), "Running Training Like a Business," on the impact of training on ROI has some interesting results.

First, in the area of recruitment, training opportunities were among the top three criteria people considered when deciding where they want to work (the others are the opportunity for advancement and a good benefits package).

In the area of productivity, as a result of training, employees were: 

• 17% more productive

• 20% higher performance levels relative to their peer group 

• Stayed with the company 14% longer

In the area of retention, employees who had access to the training were: 

• More than two times more likely to expect to be with the company in two years 

• More than six times more likely to think the company is a 'great place to work'

• More likely to think they are fairly compensated

Dollar figures associated with Accenture's statistics for one fiscal year report the annual per person net benefit of $25,324.  They multiplied this number by the company's 50,000 employees yielding a companywide benefit of training of $1.26 million.  By dividing the benefit by the cost of one year of training ($358 million), researchers concluded that the ROI (at Accenture) is 353%.

Negative Customer Service Experiences

How many of you know and track what percentage of your calls are bad experiences?  Hopefully, you do know the numbers and they're in the low single digits.

In a recent study, participants were asked, "Based on any negative experience, would you stop using this company and go to the competition?"  The results were: 

             Source: 2003 Purdue University/BenchmarkPortal.com

As you can see, there is a strong correlation between participant's age and his or her tendency to stop using the company after a bad experience.  Notice that younger participants were less tolerant, more likely to go to the competition, and those over 65 are more demanding that those in middle age.

Therefore, it's very important to take great care of your clients' younger callers to maintain loyalty – the clients' loyalty to you and the callers' loyalty to your clients.  Callers over age 36 have more of an 'emotional bank account' with the company they're dealing with.  They probably had some good experiences and are more willing to 'forgive' a bad one.

If you know your percentage of bad experiences, put a dollar amount on that call and then total it out for the year.  I think you'll be very surprised at the amount of lost revenue for your client.  Now if you have a 1% improvement, because of a training initiative for example, the amount of recovered revenue for your clients is very encouraging.  This will improve client retention and reduce client churn.

Caller Satisfaction Driver Number One: We all know first call resolution is the number one driver for caller satisfaction, with best practices reported at 86%.  However, if your center is at 86%, this means that 14% of callers are contacting you more than once to resolve an issue.  This not only frustrates your agents and the callers, but your clients as well.  Repeat calls are costly not only to operations and to the bottom line, but they negatively influence customer satisfaction and ultimately, caller and client loyalty.

How do you define first call resolution?  How do you calculate it?  Research shows that there is no common measuring method.  However, what gets measured gets managed, and what gets managed gets done better.

In a recent study by the Ascent Group, more than 90% of companies measuring first call resolution reported improvement in their performance.  Another study by callcentres.com reported a dramatic fall in call volume – identifying that a minimum of 20% of all calls were repeat calls from callers needing an answer or help they didn't get.  Further, they found that the absence of first call resolution was found to account for a minimum of 30% of a call center's operational costs.

The bottom line is to invest in your agents.  Give them the training, the tools, and the authority to get their job done right the first time.  After all, call center agents are the interface to your clients' callers.  One of the foremost methods to boost customer satisfaction and improve first call resolution is to consistently and continuously train your agents in world-class customer service skills.

Rosanne D'Ausilio, Ph.D., is President of Human Technologies Global, Inc.  For more information, contact Rosanne at rosanne@human-technologies.com.

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