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Contact Center Performance Management Guide

Contact Center Performance Management Guide

Contact Center Performance Management Guide

What is it? What does it accomplish? And should you be using it?

By Donna Fluss
Callcenter Magazine

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Contact center performance management (CCPM) is an analytical approach to managing and improving the effectiveness, quality and overall experience provided by the contact center. It is a process that uses goals, key performance indicators (KPIs) and metrics to measure the performance of the contact center, its agents and the department’s success in delivering to enterprise goals. This quantitative management approach removes imprecision and subjectivity from rating how well a contact center or individual is executing.

Performance management has been around for more than 20 years. It got its start in finance organizations and has slowly spread throughout the greater enterprise. The value proposition and benefits of CCPM suggest that this application should be considered essential for most contact centers. However, after four to five years of market growth, the penetration rate of packaged CCPM applications is very low.

According to DMG Consulting, approximately 1.03% of contact centers, representing 7.4% of agent seats, have adopted CCPM as of the end of 2006. (These statistics are based on North American contact center numbers. Anecdotal evidence suggests that the penetration rate outside of North America, with the exception of the U.K., is substantially lower.)

Obviously, there is a huge gap between the proven value of CCPM applications and market perception and penetration. The adoption rate is not helped by the cost and time required to successfully implement most CCPM solutions. It’s interesting to note that the adoption rate for enterprise or business performance management was not rapid during its first 5 to 10 years, despite the high value and contributions of these applications to companies that did make the investment.

CCPM Defined

The market is still trying to agree on a definition of CCPM. In DMG Consulting’s 2007 Contact Center Performance Management Report, released in January 2007, each vendor interviewed had a different definition of CCPM. The lack of consensus is not helping the market, as it’s confusing to potential customers. Developing a standardized definition will facilitate market adoption without limiting innovation. Vendors need to deliver a number of modules that perform similar functions, albeit with various approaches, in addition to offering functionally differentiated modules.

DMG Consulting suggests the following definition of contact center performance management:

At a strategic level, contact center performance management provides a framework for aligning the goals of the contact center with those of the corporation.

At a tactical level, the performance management process uses goals, KPIs, metrics, data sources and balanced scorecards for capturing and reporting how well the contact center delivers to its objectives in order to identify the actions necessary to address areas of weakness or strength.

At a practical level, it streamlines and simplifies contact center reporting, enabling managers to use a carefully selected set of KPIs, metrics and reports to manage their operation, instead of the numerous reports and hundreds of measures previously required. (DMG Consulting first issued its definition of contact center performance management in 2003 and enhanced it in 2006.)

Benefits of CCPM

The benefits of performance management extend far beyond the scorecards and dashboards used to measure agent performance, as seen in Figure 1. Performance management should be used to motivate contact center staff to meet or exceed enterprise, sales/marketing and departmental goals and objectives.

Contact center performance management streamlines the reporting process, providing a balanced view of the department’s achievements. The performance management application replaces the need to consult dozens of reports from numerous systems, many of which contain conflicting results for the same KPIs.

Instead, a CCPM application consolidates information and provides balanced scorecards and dashboards for the contact center, its staff and each of the other departments supported by the contact center.

Performance management systems enable contact center management to rapidly identify agents, supervisors, sites or operational areas that require assistance. It’s a cost effective method for identifying and focusing on areas of strength and weakness.

The better performance management applications allow managers to drill down from the high-level KPIs included in reports and dashboards to the actual transactions involved. This results in quantifiable improvements in productivity, quality, revenue generation, training, the overall customer experience and the enterprise bottom line.

The Vendor Landscape

DMG Consulting has estimated that the number of contact center performance management implementations was 641, as of September 2006. While this number is small, it represents a 434% increase in two years and a compounded annual growth rate of 131%.

These numbers are impressive, even off of a small base. DMG Consulting estimates that the growth rate of CCPM in 2006 was at least 47.5% and expects the rate of growth to be a minimum of 27.5% in 2007.

Due to strong market projections and proven success in 2006, many additional vendors want to enter the CCPM market. The three primary vendor categories are:

Reporting Vendors: Business Objects, Cognos, Hyperion, SAS and SPSS

Corporate/Enterprise Performance Management Vendors: Oracle, Pilot Software and SAP

Contact Center Performance Management (CCPM) Vendors: AIM Technology, Aspect Software, Enkata, HardMetrics, Informiam, Latigent, Merced Systems, NICE Systems, VPI, Verint Systems and Witness Systems.

The CCPM category consists of three groups. The first are stand-alone performance management vendors who have created stand-alone solutions. The second are the QM/recording suite (workforce optimization) vendors who provide quality management, recording, speech analytics, surveying, coaching, eLearning and, increasingly, workforce management, in addition to performance management. The last is a contact center infrastructure vendor that has extended its suite to include a variety of management capabilities (QM/recording, WFM and performance management). (See Figure 2.)

All of the solutions in this market produce scorecards, dashboards and reports, but this is where the similarities end. Most of the products in this market offer classic performance management and provide data on a next-day basis. A couple of vendors specialize in real-time performance management, concentrating on intra-day monitoring and responding to day-to-day activities. Other vendors offer solutions that address both classic and real-time performance management. A few vendors are considering making enhancements to their products to add either the real-time or classic component so that they can address both sets of needs.

A number of the vendors demonstrate their strong business intelligence orientation and heritage. Others have invested in building or incorporating a workflow management capability and a couple go beyond the basic collection and movement of information to sophisticated automation of identified business challenges.

Homegrown CCPM Applications

Homegrown solutions are the primary competition for the packaged application providers in this market, and this is expected to continue for the next few years. There are several varieties of homegrown applications. In some companies, contact centers have built a manual process to address the CCPM challenge. Other end users download reports from contact center systems, including the ACD, dialer, IVR, WFM, QM/recording, surveying, email response management, etc., into a third-party reporting package and custom design all of their reports.

A third group of contact centers uses one of their primary contact center systems, such as the ACD, as a data consolidator. Yet another group has extended the capabilities of an existing corporate performance management application into the contact center. The predominant approach for CCPM is the “sneakernet,” wherein contact center analysts, supervisors and managers invest a great deal of time manually collecting and entering data from reports produced by their many contact center systems and applications into their consolidation vehicle (e.g., Excel).

Why Managers Should Seriously Consider CCPM

CCPM is an immature market with an increasing number of competitors. While the market currently lacks a standardized set of functional capabilities, many of these systems have already made a dramatically positive impact on contact center operations.

The payback on CCPM investments has been 6 to 18 months for companies that have made careful selections, checked references and were willing to invest the time and resources required to enhance their existing operational processes as part of the implementation.

Not only does CCPM reduce operating costs and management complexity, it improves the customer and staff experience by empowering both agents and line managers to manage themselves and take corrective action. Most people want to do a good job. CCPM empowers staff to perform. Accompanying a CCPM implementation with appropriate awards and recognition yields outstanding results for the contact center.

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