FCR Improves Contact Center Performance
FCR Improves Contact Center Performance
First Call Resolution As a Very Powerful Metric
By Donna Fluss
Contact center performance management (CCPM) is an analytical approach to managing and improving the effectiveness, quality and overall experience provided by the contact center. Contact center performance management provides a framework for aligning the goals of the contact center with those of the corporation. CCPM uses goals, KPIs, metrics, data sources and balanced scorecards to capture and report how well the contact center delivers to its objectives, in order to identify the actions necessary to address areas of weakness or strength. It provides action-oriented output that can be used to streamline and simplify contact center reporting, enabling managers to use a carefully selected set of KPIs, metrics and reports to manage their operation. This quantitative management approach improves the precision and objectivity in rating the performance of a contact center or individual agent. A well-defined CCPM program provides targeted and actionable recommendations that can be applied on a timely basis to improve the center’s performance.
Defining and Calculating First Call Resolution
Call center managers have many productivity, quality and customer satisfaction metrics available to evaluate their performance. The challenge is to select a limited set of KPIs that provide insight and are actionable.
First call resolution is a KPI that is widely regarded as one of the most effective tools for improving performance. Call center managers have discussed the concept of “one and done” for decades, as it has always been a priority to resolve/answer an inquiry during the first contact. Customers in all industries — financial services, insurance, telecom, retail, energy, travel and hospitality — greatly appreciate having their issues resolved completely the first time they call. When an inquiry is resolved to the customer’s satisfaction, the likelihood of extending the relationship significantly increases. As a business matter, resolving an inquiry during the first contact avoids the expense of follow-up calls, which range in cost from $2.50 to over $20.00, depending upon the time and resources required.
First call resolution, which measures the percent of calls resolved during the first contact, is useful for evaluating the overall effectiveness of a call center. It addresses productivity, efficiency, quality and customer satisfaction. The calculation for FCR is:
FCR = Total number of calls resolved during first contact / total number of first calls.
First call resolution concentrates on measuring the way agents handle first calls; its weakness is that it ignores all follow-up activities. Agents are trained and often highly motivated to deliver to departmental goals, including FCR. They are rewarded and recognized for exceeding these goals, which can drive them to look for loopholes to help them beat the system. Because FCR concentrates on first calls only — which are the vast majority of calls in most call centers — agents who are too driven to exceed goals may choose to focus their energy on first calls at the expense of follow-up inquiries, where they are not going to get “graded.” This practice, called “agent gaming,” can be easily avoided by measuring both FCR and the overall “call resolution rate” (CRR). It is important to measure CRR to gain insight into agent performance for all interactions, regardless of whether they are first-time or follow-up. The calculation for CRR is:
CRR = Total number of calls resolved / total number of calls.
(Note: FCR can also be used to measure emails and chat sessions.)
Using CRR in conjunction with FCR forces the organization to address 100% of calls, not just first calls. The remaining challenge is to determine accurately which calls are fully resolved.
When is a Call Resolved?
The major difficulty in calculating FCR and CRR is determining when an issue in a customer transaction is fully resolved. Managers have debated this issue for as long as there have been call centers. Figure 1 displays a number of methods for calculating call completion.
Source: DMG Consulting LLC, June 2007
The best technique for identifying call completion would combine two of the methods described in Figure 1. Automation would be used to evaluate whether or not an inquiry was resolved. Then, an FCR module would analyze the agent’s activities within the servicing application to determine if all necessary steps were taken to resolve the inquiry. This approach, which is relatively new, will become a best practice in call centers for identifying resolved inquiries, as it is automated, objective, accurate, and eliminates the 1-3 seconds agents must dedicate to wrapping up each call.
Framework for Building a Successful First Call Resolution Program
The success of an FCR program depends upon getting buy-in from the staff — agents, supervisors, managers, trainers and quality assurance specialists — and then using the program to identify and reward outstanding performers. FCR provides a balanced view that encourages changes in internal processes and agent behavior. FCR and CRR, when rolled out as part of a performance management program, yield both internal and external benefits. The steps below are useful for developing a first call resolution program.
- Set up steering committee: The FCR steering committee should consist of influential staff members from all call center constituencies, agents, supervisors, managers, trainers and QA specialists. Any affected external departments, such as operating areas, sales or marketing, should also be invited to participate. It is important to include staff members who are leaders and can positively influence other team members.
- Define program goals: The steering committee should define short-term (1-6 months), intermediate-term (7-18 months) and long-term (18+ months) program goals and desired outcomes. For example, an FCR improvement rate should be specified by call center site or call type. The committee should specify the areas where FCR can improve performance and customer and agent satisfaction.
- Obtain senior management support: A successful FCR program will require changes throughout the enterprise. It’s essential to obtain the support of all senior managers and colleagues throughout the enterprise who may be impacted by the program.
- Communicate with staff: All staff members should be informed about the new program in order to build department-wide support and alleviate any concerns. Ongoing communication is essential.
- Conduct a baseline analysis: Analyze current performance, using manual calculations, before implementing the FCR program. This is critical for measuring the success of the initiative and to identifying and rewarding outstanding performance.
- Define call completion: Work as a team to establish a standard approach for measuring call completion for FCR and CRR. Test these definitions to ensure that they yield the desired results.
- Select application: Define functional and technical requirements for all constituencies inside and outside the call center to drive the FCR application selection process.
- Implement application: Work with IT and all relevant groups to implement the FCR application.
- Define rewards: The steering committee should define a new reward system that incorporates the new FCR goals. FCR should also be incorporated within the quality assurance program and annual/semi-annual reviews.
- Train staff: Make sure all staff members understand their individual, team and departmental goals.
- Create ongoing FCR project team: This team, which should include constituents from the call center and all impacted operating areas, is responsible for applying the results of the FCR program. This involves identifying and implementing all required changes to procedures, systems, policies, training programs, QA programs and operating areas on a timely basis.
- Implement the program: Roll out the program in phases. Start with a pilot team and make adjustments based on the results of the pilot. Build on initial successes to introduce the program to different teams throughout the enterprise.
An FCR program can be implemented without an application, but automation is necessary to institutionalize it, ensure consistency throughout the enterprise and achieve the greatest benefits.
Benefits of First Call Resolution
The benefits of a successful FCR program fall into many categories and cross functional lines, extending far beyond the boundaries of the call center. For agents, FCR provides a fair and objective approach to measure performance; this improves agent retention and reduces training costs. For managers and supervisors, FCR reduces the volume of complaint calls they have to handle, freeing them to spend more time assisting agents. It also gives them the information required to identify and fix broken processes inside and outside the call center. For the call center overall, FCR reduces operating expenses by reducing the volume of unnecessary and often angry callers. This improves the customer experience and market perception and increases customer loyalty.
The benefits of FCR outside the call center are substantial. For sales and marketing organizations, FCR increases revenue and up-sell/cross-sell opportunities. It also enhances the brand, improves customer retention and creates a growing base of highly satisfied and loyal customers who are more likely to recommend the company. When supported by the other operating areas, FCR programs rapidly identify ineffective and negative policies and procedures that impede the organization’s ability to provide an outstanding customer experience.
For the enterprise in general, FCR has a quantifiable impact on the bottom line by reducing operating expenses, increasing revenue and reducing customer attrition. It also gives the organization a strategic differentiator. FCR also delivers many benefits directly to customers. It identifies and eliminates frustrating roadblocks that prevent resolution of inquiries on a timely basis. This improves the perception of the company and brand. It also makes customers more receptive to new opportunities to extend their relationship.
Customers want and expect their inquiries to be resolved during the first contact. When this does not happen, customers are disappointed and alienated. FCR is a highly useful mechanism for evaluating call center performance because it measures a criterion that is essential to customers at the same time as it assesses the performance and effectiveness of the call center down to the agent level. Call centers have hundreds of KPIs and dozens of reports, but a surprisingly small amount of actionable performance data that can be applied on a timely basis. FCR, in conjunction with CRR, gives managers an objective and straightforward tool to identify and resolve performance issues at all levels of the call center. Call centers of all sizes, in all industries, can realize significant internal and external benefits from an FCR program.