Contact Center Solutions Featured Article

Research Finds Labor to be Significant Cost in Contact Center

June 10, 2008

In the contact center industry, the greatest cost driver is the amount of labor necessary to perform operations. People are necessary to drive processes, manage interactions and supervise the center. Recent research has supported the fact that labor represents the lion’s share of the contact center budget and a significant portion of overall operating costs.

No matter the size of the corporation, all organizations are advised to invest in technology and other resources that enable the contact center staff to increase efficiency. Such implementations can increase the effectiveness of each agent and each interaction, allowing the contact center to increase volume without increasing people.

International Customer Management Institute (ICMI) recently conducted research that comprised models for small, medium and large contact centers based on a compilation of data from various sources including surveys and benchmarking studies.

Small centers were defined as those having 50 staff in one location, medium as 200 staff in three locations, and large consisted of 350 staff in six locations. These centers had an annual growth of 2.5 percent, 5 percent and 7.5 percent and operated 8 hours/5 days/week, 10 hours/5 days/week plus half days on Saturday, and 24/7, respectively.

In its research, ICMI found that labor represented 90 percent of the contact center budget and two-thirds to three-quarters of the overall operation budget. The study’s author recommends focusing on staff productivity and investing in technology that would reduce call handling time.

Bomgar is one example of an appliance-based remote support software that offers corporations a unique opportunity for technical support staff to handle more calls in less time on several fronts. Customers have reported reductions of 20 – 90 percent in total call times, call escalation to second tier support by up to 90 percent, and first call incident resolution is increased by 20 to 85 percent.

ICMI also discovered in its research that technology spending ranges between 2.6 percent and 5.9 percent of the overall budget. With 90 percent of call center budgets and 60 percent to 75 percent of the overall budget going to call center labor, money spent on help desk support software and other technology that increases personnel efficiency can have a significant impact.

Due to its findings, ICMI also recommends that companies make spending decisions based on the long term rather than tactical so that immediate budgetary concerns do not compromise long term goals. Cost comparisons on solutions such as those from Bomgar have proven to have significant financial advantages both in the short and long term.
Susan J. Campbell is a contributing editor for TMC and has also written for Market Drive News. To see more of her articles, please visit Susan J. Campbell’s columnist page.