When exactly did the humble telephone become cus-tomer relationship management (CRM) tool? The precise moment of metamorphosis is hard to pin down, but it was probably shortly before the call centre became the contact centre (the new name reflects the fact that “calls” are as likely to be received via email as over the phone) and while it was en route to its new status of profit centre.
Of course, that telephone is no longer so humble. It’s now backed up by and integrated with CRM software, measurement systems and, increasingly, ERP (back office) systems. Along with tools like direct marketing, account management, loyalty schemes and the customer database, the contact centre is key weapon in the CRM armoury.
So do businesses have handle on the potential of the contact centre? “No way,” says Stuart Ekdahl, solutions architect at Pyxis, which recently acquired call centre software reseller CallTime Solutions.
“But let’s not be unfair, it’s moving target.” He believes that if more than 25 percent of the business conducted over the phone can be done in call centre, the centre is strategic asset. And in some industries as much as 50 to 75 percent of the business falls into this category.
Small wonder, then, that marketers are taking greater interest in what goes on in their contact centres. Although CRM systems demand major investment and technologies change with depressing rapidity, the business benefits of call centres – the return on that investment – increase as companies build more and better information about their clients.
What’s needed is practical approach that balances resources with results.
First up, warns Tony Bullen, managing director of CRM vendor StayinFront, contact centres should have strategic reason for existence. “You don’t add channel without clear idea of who it’s serving.”
Such reason might be to support brand position (“always available”, for example), or to reach market segment that other communication methods don’t, perhaps because of geographical barriers, income barriers, or convenience factors.
Lowering the cost of selling to, or supporting low-value customers, is another justification, one that is often overlooked, according to Amanda Flynn, business development manager at outsourced call centre provider SalesForce, which runs Fly Buys’ call centre.
She suggests that not enough companies use the call centre as an alternative sales approach for some market segments.
For example, while low-value customers may be the least desirable according to the 80:20 rule of profitability, she points out that, “Companies can’t afford to lose them.” And the contact centre is often the most cost-effective way to sell to those customers. SalesForce claims to offer good management of lower-value customers by telephone, thus retaining and growing that base.
Expanding scope
It’s important, but not always easy, to identify which customers are going to use the contact centre and how. From the company’s perspective, outbound call centres are likely to be used for customer acquisition and retention, as an extension of the sales force. Inbound centres are used for loyalty programmes, support and administration.
“Companies often get the scope of the contact centre wrong,” says Bullen. “They [establish] it for sales follow-up, but the customers ask billing questions, and the business doesn’t have the integration with the finance system to answer them.
The first job is to understand what the customers want, then how your business will benefit, then measure the outcome.”
Another common omission is failing to take the opportunity to use the contact centre to cross-sell or up-sell customers who phone in – even contact centre whose obvious mission is customer service should be considering how to build sales into the process.
Dunedin-based printing company Wickliffe has benefited from improvements to its contact centre on two fronts – lowering the cost of sales, and improving service to its clients. The company acts as contact centre and fulfilment house, as well as printer, for clients such as banks and ACC. Those clients were demanding detailed reports of the service their customers received via the Wickliffe call centre, so the company used CRM integrator UCMS to upgrade and customise its contact centre systems. The resulting improvements cut the time taken to produce those reports from week to just few hours.
Wickliffe is increasingly using the contact centre to service its accounts. “We used to have quite large sales force, but now we’re doing more [sales activities] via the call centre,” says information technology manager Warrick Dodds.
The people factor
With CRM being one of the most-hyped terms in information technology, it’s easy to overlook the fact that the technology exists merely to support the “real” customer relationship management – the business of getting closer to customers.
“CRM is purely business strategy about how you want to engage with customers, it’s not software,” says Russell Just, managing director of outsourced call centre provider Sitel.
“Most companies have the right intention, but they focus too much on the technology, rather than on people,” Flynn comments.
“As far as we’re concerned, the database doesn’t manage the customers, you manage the customer by building the relationship. You need to invest in people along with technology to get results.”
That holds true for Vodafone, which employs 360 people in its call centre, operating 24/7.
“The key thing about Vodafone is the culture. The processes and the technology are secondary to the passion of the people involved,” says Neil Porteous, director of customer operations. He describes the contact centre as “absolutely critical” to the company’s customer relationship strategy. “Our customer service representatives are the face of Vodafone. The contact centre will become more and more important because the solutions [we sell] are becoming more and more complex.
We’re really trying to change the drive of the call centre from service to sales and service function. If customers call in, we’re taking the opportunity to identify needs and meet those needs. We aim to add value at each contact.”
Staff training is something of an issue in the industry. When contact centre staff are trained to use software properly, trained about the products and services they’re discussing with customers, and made aware of the how the contact centre fits into the business strategy, they add measurable value. But call centres have been dogged by allegations of poor staff practices, low pay, low morale and high turnover. Now that institutions such as Manukau Institute of Technology offer general and tailored training courses for call centre staff and managers, improvements are likely.
“Contact centres have bad reputation for working staff too hard. That’s now changing, they’re trying to make it better environment,” says Ken McWilliams, manager of sales specialisation at TelstraClear, which claims 13 percent of the local market for its outsourced call centre service. He estimates call centre staff wages have risen 15-23 percent recently across the board.
In or out?
New Zealand businesses have good understanding of the benefits of call centres, in theory at least, says Russell Just. “But is everyone executing to best practice standard? We’d say no.”
In part, that’s because the capital investment required to establish top level contact centre is hard to justify in the New Zealand market. Just also believes companies don’t properly identify payback on high-end CRM systems. “The contact centre is often not seen as capital priority.” Outsourcing becomes popular option when there is competition within an organisation for capital expenditure.
TelstraClear’s McWilliams agrees that outsourcing makes sense in our local market, “where people are cautious about spending money. And it’s the course of least re
