Helping your IVR Realize its Potential
Helping your IVR Realize its Potential
By Donna Fluss
Voice self-service solutions are considered mission-critical by business managers in most North America-based contact centers with more than 150 agents, and they are growing in importance in India, Western Europe and other parts of the world. These solutions have a clear, simple and highly profitable value proposition when interactive voice response (IVR) applications are well designed, implemented and maintained, they automate anywhere from 20% to more than 90% of incoming calls. Many enterprises would face a major financial hit if they had to employ agents to handle the calls that are automated by their IVRs.
Despite these facts, IVRs are often neglected and under-resourced. Too many companies have IVRs that were implemented years ago and are enhanced only when something breaks or there is a major change in business requirements. DMG estimates that more than 80% of IVR users around the world would be able to improve their automation rates and increase customer satisfaction if they invested in routine optimization of their IVR solutions. Another way to look at it: If an IVR was installed more than 3 years ago and has not had an overhaul of its script or voice user interface (VUI) since then, its time for a full health check.
Scenario: IVR at Work
The following example proves the point. A financial service organization receives 1 million calls per week. This organization has an IVR that automates 60% of their calls, 600,000 weekly. Their non-fully loaded (variable) cost per agent handled call is $5.50. If they automated as little as 2% of the remaining 400,000 calls per week, they would displace an additional 8,000 calls from agents. This would save them $44,000 per week or $2,288,000 per year. At the same time, their service quality would increase and complaints would decrease.
Of course, there are additional factors to consider. By automating some of the easier calls, agent average handle time is likely to increase for the remaining calls by an average of 2 to 3 seconds. Assuming a 200-second average handle time, this will increase the cost per call by approximately 1%, although this gain could easily be offset by a corresponding reduction in average handle time due to a decrease in customer complaints about the IVR. Additionally, there is also the cost of the optimization project to consider, which runs from approximately $50K to $150K, depending upon the resources required. The payback period from an IVR optimization, with a cost of $150K for the project and a 1% increase in the cost per call, was less than one month. (It saved the organization almost $1.9 million during the first year.)
What is Holding Back Investments?
Given these returns, one would expect many organizations to jump at the opportunity to enhance their IVRs. There are three primary reasons why end-user organizations are not making investments, all of which are based on fear: (1) Vendors scare away prospects by pushing them to make major investments in expensive speech recognition-based platforms; (2) Enterprises do not have the appropriate resources available in-house and are trying to avoid using expensive professional services for an uncertain return; and (3) end users do not see a compelling enough reason to take a chance on disrupting what they consider to be a highly effective solution.
IVR is perceived as a dependable core contact center application that runs without requiring a lot of attention. Most contact center leaders would prefer to invest in new solutions, like speech analytics, rather than in their old and dependable IVRs. The catch is that the right investment in IVR is likely to result in major cost savings. DMG recommends that any organization that has not optimized their IVR application in the past three years undertake an IVR assessment to identify ways to improve their existing system. If, as we believe, IVR optimization would be highly beneficial, find a vendor that can help deliver savings on an ongoing basis. IVR optimization should not be a one-time exercise. Leading IVR users continuously strive to enhance the performance of their solutions; its part of their annual budget and their corporate culture. If the necessary resources are not available in-house, find a hosted/managed service IVR provider that can help enhance the operating environment with little up-front investment and risk. The world of IVR has changed dramatically in the last five years, as have many business requirements.