Sometimes it's not rocket science....

Now that Christmas is over (and now the bills many will be arriving for many), it seemed appropriate to comment on the CCF agent compensation survey published earlier this month.

This survey had the shock finding that cash, namely salary, rather than the Human Resources buzzword of 'total reward package' was the top motivator for attracting agents. I can't pretend I was surprised that relatively low paid, often young workers found it better to have cash to spend on their own choices than HR offering them a menu of cash substitutes.

It's noticeable that a pleasant place to work was also rated highly by agents, and that is something that salary can't buy. Work conditions, though, really depend on the quality of management. This is something that I've touched on in my posts on reporting ("Reporting - Having your cake & eating it").

My view is that while you might need good pay to attract the best agents, retaining them (and tackling the industry's appalling churn rate) will be done by work conditions. It may seem cheaper to pay a good salary than to provide a pleasant, well run organisation, but investing in the environment agents experience will be cheaper than letting HR try to get discounted gym memberships.

Happy Christmas

Unlike many call centres, this blog will not be working over the Christmas period.

If you are phoning any business during the holiday season, do spare a thought for those working to answer your call during the holidays.....

Posting will resume after Christmas.

Reporting - Having your cake & eating it

Coincidentally (given yesterday's post on reporting) I was reading a long article today on CCF, "Have your call centre cake and eat it ". The article is primarily about metrics and how they can distort call centre performance.

I suspect the article is a bit long, but the basic point is that agents do what you pay them to do. If the metrics the agents are paid on don't align with the board's strategy, then don't expect agents to sacrifice pay, read the annual report and work against their interests.

The point I think it misses is that reporting is about getting the information to manage your contact centre, it is not a substitute for management itself. Get the right information and you can make the right decisions. It does puzzle me to hear one of the examples cited,

"....one client where there was a call handling time limit of 300 seconds and staff who consistently missed the target were put on a disciplinary. At one stage, 35 per cent of the workforce were on disciplinary, and because the operation was struggling, they asked the staff to do more cross- and up-selling, while slashing the handling time to 270 per cent. Attrition was 230 per cent."

I know I've encountered dysfunctional organisations (and in the past was an agent in a call centre like that), but this still seems extraordinary. If the details are accurate (and I've no reason to doubt them), then the cost of failing to manage change was far higher than the original problems. It also seems amazing that management continued to push on with the plan when they saw results.

In short, however good your call centre reporting, you do need management to do something with that information for it to be worthwhile.

Reporting - some thoughts

I've realised that while I've written previously on Workforce Management ( Workforce Management - is it only for high end call centres? & Workforce Management - Part 2 Vendor Selection ), I've missed the major pre-requisite of reporting.

Reporting on a call centre or a contact centre's activities is the most important first step in managing such a complex organisation. One of the peculiarities of call centre is that because of the early technology it was built on it was possible to report on agents work in great detail. The PBX (Private Branch Exchange) and ACD (Automated Call Distributor), which together manage all incoming telephone traffic, could provide detailed information on each call, such as duration and the agent availability. Initially these reports were pretty user unfriendly, but driven by management demand, call centre reporting developed in complexity and detail to an extent that was unmatched in the work activity reporting in any other business area. Even in a transaction orientated environment such as a bank branch, staff are not monitored in anything like the detail that is possible in the call centre. The result is that in call cente there is a lot of data that can be reported on.

The crucial thing to remember with reporting is to differentiate what you can report on from what you need to report on. As an example, it is very easy to report on agent availability and measure how long each agent is unavailable. How useful this is as a stand alone metric might be more debatable, as it may be that agents have to do a lot of complex work with the CRM system after each call. In other words, although a good measure of contact centre efficiency, with that metric you may be measuring the poor quality of a CRM GUI and workflow rather than measuring your agents ability. Similarly, if you report on average call time, you may incentivize agents to handle more calls, but may also encourage agents to end calls before customers want to so the agents meet their targets. You would then have customers calling back, which doubles (at least) your call traffic even while you are meeting your average call time metric.

This type of distortion has led to a tendency to report on less telephony based metrics and more on CRM based metrics, such as '1st call resolution' or 'completed steps in the customer management process'. This is useful (as it is measuring a business outcome), but can risk loosing the sort of reporting 1st line management and team leaders found useful for operational management.

I would argue that contact centres should be reporting differently to each level of management. Team leaders and first line managers need real-time statistics on their group of agents performance. The higher the level of management above that, the less real-time/ operational reporting they need and the more business oriented the information needs to be.

This is one of the things I like about Cisco's acquisition of Latigent. Latigent provides the opportunity for mashups and the construction of executive dashboards from multiple data sources. For more operational reporting, as used by team leaders the existing reporting tools are adequate, but the Web 2.0 aspects of Latigent (RSS feeds) offer a lot of interesting options for more complex report creation. There's a good podcast with about Latigent here on cisco.com.

Ofcourse, others in the industry have offerings with a range of capabilities. Avaya have always been strong with their CMS product. Aspect has always had good reporting on the telephony environment (as you would expect from their ACD heritage) and have moved up into workforce management. I'm not convinced that reporting should be considered synonymous with workforce management (at least for large centres, I feel there's a case for best of breed selection for what are two very separate functions), but it has been reasonably successful for them. Genesys too provide a reporting and a workforce management product, but given the large, highly complex environments they tend to be deployed in, I feel there is again a case for best of breed for reporting and a separate best of breed workforce management product.

In short, when thinking about reporting the most important thing is to establish what metrics you need to report on and for whom in your organisation. It's also important to distinguish between reporting (which is collection, tracking & presentation of data), analytics (getting meaning out of data) and workforce management (using information to drive agent performance). These are discrete functions for separate purposes, even if one solution might meet your needs for all of them.

Dimension Data/ Cisco Speech survey

I'm in Frankfurt this week and it's always good to catch up with colleagues and partners.

I mentioned the Dimension Data/ Cisco survey on Speech automation in a previous post ("For a Friday - why are contact centres so disliked?"), but it was good to hear today Tim Pearce, one of the survey authors present the findings.

You can find the Dimension Data/ Cisco survey on CRMxchange as a webinar and it's worth watching.

The big thing for me is the difference between what vendors and consumers think of speech automation. Vendors, for example, tend to underestimate why consumers will accept automation (such as to avoid offshore). They also overestimate things like the ability of speech automation to partially meet callers needs and underestimate its ability to meet all needs for some callers. Some good research and well worth a look whether you implement telephone automated service or are considering it.

Financial Services Branches, IP and Contact Centre

One of the blogs forums I read regularly is Finextra, the financial services community forum. The UK financial services sector is such a major user of call centre technology that this is an excellent place to explore the environment that contact centre technology needs to interact with.

A good example is Michael Goldman's post on extending IP convergence to branch. His perspective is not that of the technologist (who have long argued for this) but that of the business person looking at processes and customer experience. I'm pleased to see that he's in favour of more IP convergence, but it's a different perspective from the technology vendors.

It's an area that I'm very interested in as consistent service across channels means (re)-joining the branch and contact centre. I say 're-joining', because historically the branch did manage the telephone channel and it was in response to consumer needs like 24hr service and the difficulty of queuing calls at branch that led to banks to moving the telephony channel from the branch to a centralised service point. This also allowed innovations with 'branchless' and single channel banks, like First Direct in the UK, long before the internet.

Technically, delivering contact centre functionality to branch (where appropriate) is very interesting as it allows a business a lot more flexibility in how it constructs the customer experience. It's an area where Cisco has perhaps a slight advantage from the scale of our IP Telephony deployments, but where Genesys, Nortel and Avaya also have interesting developments. It's probably a subject for further posts as something I'm doing a lot of work on at the moment.

Outbound, an explanation of the technology

I've had a number of requests from my previous post ("Outbound - industry reputation, branding and regulation"), for a better explanation of outbound technology. Some readers had assumed the silent calls were an accident or a technical failure rather than a deliberate business practice.

Unfortunately, the silent calls are actually a business decision based on how you set up your outbound dialler.

A dialler is simply a piece of hardware (or sometimes software) that can place an outbound call from a computer based list (usually a database). It may be obvious, but for the call to work there needs to be a connection at both ends, so the outbound call needs to be answered and then the dialler needs to hand the call to an agent or a pre-recorded message. It's a further small step to appreciate that many numbers dialled will not connect. The number may be engaged, no longer exist, or be for fax machines and when it receives the appropriate tone, the dialler will then not pass the call to an agent. Beyond this signal based intelligence, smarter diallers can recognise answer phones and voicemail

Generally speaking, a dialler can be set up in three modes:

• Preview Dialer - This allows phone agents to view the call information prior to the outbound dialler calling. The agent can decide not to initiate the call and when they do, the number may not be answered.


• Progressive Dialing - This passes the call information to the agent at the same time the number is being dialed by the phone dialer. The agent usually has a few seconds to view the call information, but cannot stop the call process. This method avoids engaged tones and (usually) fax machines, but will not avoid voicemail.


• Predictive Dialling is more sophisticated because the phone dialer automatically calls several numbers and only passes a call to an agent when a person has been contacted. This eliminates busy signals, answering machines, etc.
  

The important thing to note is that the first two result in the same number of outbound calls being made as agents. The third option means that more calls are placed than agents. How many more depends on some fairly complicated algorithms based around predictions of calls that will get an engaged tone or otherwise be unavailable. Ofcourse, this algorithm is not necessarily that accurate and that plus the error level (i.e. the number of calls placed successfully greater than available agents) are what result in silent calls.

The prime industries generating these calls (according to the UK government regulator, Ofcom) are telemarketing, market research, financial services (including debt recovery) and number scanners. The last group, which may not be familiar to readers, is where numbers are dialled at random to check which work, so that a list of 'clean' numbers can be sold to other telemarketers.

The problem these outbound businesses generate is that while cold calling may be unwelcome (and silent calls especially so), the outbound technology has beneficial uses that can get lost in the regulation. Getting a call back, rather than waiting in a queue or being pro-actively told information by a company are all much more positive uses. As so often, the problem isn't the technology itself but the uses is can be put to.

Outbound - industry reputation, branding and regulation

If you mention you work with call centres you can sometimes (!) expect a negative response, and you almost guarantee that this will be because the other person has been on the receiving end of an unwanted automated call.

It's an irritation that I understand and share.

My particular hatred is for the silent calls and the automated message calls. I'll explain the technology in a separate post, but these experiences are because of business decisions made by the calling companies, not because of technology limitations.

In my view, if the company concerned wants to treat customers like that, then I will not give it any business. If you are called by human it at least suggests that there is some effort on the companies behalf to value my business and make an attempt to engage with me. you get none of that with an automated message. Yet brand damage is perhaps not a sufficient deterrent, as most of the companies doing it are debt-consolidators, low-cost telecoms providers and other industries where brand is not a primary concern.

I would argue that companies which keep doing outbound calling on a lowest cost basis have already damaged the reputation of the call centre industry. Consumer pressure has already forced governments to act. In the UK in March last year (Ofcom, the UK communications regulator) increased the fine for silent outbound calls tenfold, to a maximum of £50,000 per instance. It also introduced three other new rules:

• Abandoned call rates must be below three per cent of all calls made in any 24 hour period for each campaign.
• All abandoned calls must carry a short recorded information message identifying the source of the call.
• Calling line identification (CLI) must be included on all outbound calls generated by automated calling systems. CLI allows people to dial 1471 and access the telephone number of the person or organisation calling them.

Already in the UK consumer can ask the TPS (Telephone Preference Service) to add them to a 'do not call' list but it is clear that this is not enough for many consumers. In the end the industry either needs to make consumers happy to risks further regulation. The pity in all of this is that legitimate and useful uses of outbound, such as companies calling to alert their customers of problems with (say) their bank account, or a delayed product shipping, may well be restricted. I

Offshoring and mainland Europe

I have to admit that most of my discussion of offshoring has been around the UK and Ireland experience, in posts such as: "Offshore - why I would go for South Africa over India".

Today I saw some research in TelecomPaper, "Spanish call centre staff numbers to fall 4% in 2007" that looked at the impact offshoring to Latin America was having on the Spanish market. This might seem a startling percentage drop for a single year, but there's some good insight on this at TMCnet giving figures from ACE, the Spanish call centre trade association. Part of the reason for the percentage shift is that compared to the UK or Ireland there are not that many call centres in Spain. In 2006, the number of call centers outside of Spain serving the Spanish market rose from 9 to 20, but more than 225 call centers remained in Spain. As TMC comments, and the UK's experience confirms, Latin America might win business initially on price and cost of labour, but they will have to meet quality expectations if they want to keep that business.

Of course, like India for UK companies, the physical distance between Spain and Latin America creates management difficulties. These aren't technology difficulties (an IP network can let you route calls anywhere in the world) but rather relate to the challenge of flying managers out and keeping expats overseas to manage the offshore operations. Interestingly, here the French have a distinct advantage. With much of North Africa having some French, many French companies have located in Morocco. This has the huge advantage of only being a few hours flight from France and in the same timezone. As long ago as 2005, Africa Investor had identified Morocco has having 55 French call centres with 6,500 employees. Today, numbers are harder to come by, but with major companies like France Telecom and SNCF having Moroccan operations and a dedicated annual trade show (SICCAM), the local industry looks fairly robust.

In other parts of Europe language will probably prevent widespread offshoring for voice (even in eastern Europe, German is not that widely spoken, for example), but I think e-mail may be another story. Without the need for a high standard of both accent and fluency, the non-time sensitive aspect of e-mail may lend itself to offshore management, but that is probably another post.

Contact Centre and the Environment

My attention was caught today by an article on the CCF website ("Contact Centres Going Green"). In many ways this struck me as a long overdue area of comment. Given the increasing focus of the European Union on the Environment, I'm sure that green issues will soon become a high priority for European Contact Centres.

My colleagues who specialise in data centre have been working on green issues for a while and their part of the Cisco website has a whole series of free videos on demand about energy efficient data centres. Similarly Cisco provides some good white papers on the use of technology for energy efficient facilities management. Interestingly, the knowledge for both these areas has come from Cisco's own efforts to reduce carbon footprint and you can find out more on Cisco's environment page.

Of course, datacentre has particular issues with power consumption, heat and hardware disposal that are not always directly applicable to contact centre. The CCF article rather highlighted this, by illustrating that unlike data centre most green initiatives involving the contact centre are enterprise wide initiatives. Even more interestingly, Voice over IP was highlighted as one of the key technologies, with up to 82% of respondents expecting to adopt VoIP and 83% looking to adopt workforce management tools. This highlights one difference between contact centre and data centre, there is a lot of scope in contact centre to become greener by using people more efficiently (through better workforce management and call centre virtualistion through the use of IP Convergence).

This confirms one of my suspicions, namely that for achieving green objectives in contact centre the focus should be on changing business processes and while IT should not be ignored, it should not necessarily be the starting point for change. My starting suggestions would be:

• Virtualise - By moving to an IP contact centre (and using a technology like Cisco's ICM) you can divide work more efficiently between call centres, which means fewer people and workstations.
• Location - It's traditional to locate contact centres in remote areas (cheap land prices). I've blogged previously on why this may not always be ideal ("City Centre Call Centers - A European quirk?"), but specifically on green issues, remote areas tend to require the workforce to drive while a city centre location allows shift workers to take public transport.
• Thin client - Delivering applications through a browser reduces your dependency on PC hardware for performance. Although you may still need to upgrade servers, that is usually a lot greener than replacing hundreds (or even thousands) of PCs.

Of course this is just the start of a list and I'm sure there are many more things to put there. Suggestions welcome.

Why is the agent desktop so often neglected in call centres?

I saw this interesting looking Calabrio Webinar ("The power of the unified desktop") coming up on CRMxchange, and it go me thinking. Why is the agent desktop so often neglected in call centres?

Speech technology, agent skill management, routing and so on are all perhaps seen as more exciting. This may be so from a technology perspective (though I'd argue that SOA has made things a lot more interesting when it comes to delivering applications to the desktop) but in terms of agent performance, the desktop remains crucial.

It seems obvious that agents can no perform no better than the information they are given. Developing this further, as well as data, the ease of navigation, integration of work flow and other aspects of a good agent desktop can make a big difference to both agent efficiency and the customer experience. Given that about 70% of a contact centres operating cost is agent costs. the desktop would seem an easy area for improved business efficiency.

Admittedly, the operating cost of an agent is partly why there is such interest in IVR and automating transactions. Yet the number of call centres with an integrated desktop still surprises me.

Part of the problem is running applications on the agent's PC or other client based framework is not appropriate for many legacy applications (such as 3270 and older) and a browser based portal environment is not always suitable either.

Especially for the smaller contact centre this can represent a real problem. A small contact centre may only have 70 agents, but it may be generating large sums of money in a B2B sales environment and may also have multiple back-end systems to use. Even something as simple as payments and shipping information can require multiple systems if the call centre has been grafted onto an existing business. Yet because the call centre is a small area of the business, it doesn't get the corresponding IT investment to do that level of integration. One of the things I like about the Cisco Contact Centre Express is that there is the option to include a desktop environment and one that integrates with the workforce management tool.

Yet I suspect that many of the problems are not that IT neglects the call centre (though it can do) or because of technology platform issues, but that many senior managers do not understand what their agents do. This lack of understanding could be a lack of focus on the customer experience or no real knowledge of the detail of the agent workflow (e.g. just how much does the agent have to do manually, such as data capture?) . The result, though is that simple areas like the agent desktop or virtualising telephony are neglected and more complex solutions are imposed that deliver less.

SOA - bringing CRM, telephony and business together? part 2, voice portals

It was a big subject that I tried to cover last Friday ("SOA - bringing CRM, telephony and business together? part 1") and of necessity I only covered it a high level, despite the length of post!

The main point to take away was that SOA can (in theory) be done at a number of levels in the contact centre. In theory, starting at the back end with SOA process choreography or data model rationalisation is as valid as starting at the front. In practice, though, starting at the front with either the agent desktop or the voice portal is much easier.

There's a number of reasons for this, but the main ones are risk (the voice portal technology is relatively proven compared to some other SOA approaches in call centre), scope (self-service can start with a relatively finite number of services) and benefits (even small increases in automation can lead to big cost savings).

The portal works for the voice channel in the same way as a traditional browser based portal provides a view for the internet channel. Obviously information has to be presented differently (sequentially for voice compared to concurrently for web) but the concepts are the same. In this environment it makes a great deal of sense to componentise services (such as identity and verification) and then make the same service available to web and voice channel. The benefits of a common ID&V service are not just efficiency from the re-use of code, but also a consistent customer experience, a consistent process regardless of channel and a better security system with easier management.

In my view Cisco Voice Portal (CVP) is the leader here with Genesys and Avaya not too far behind. It's not a view Gartner share but I feel they didn't fully appreciate the value of some of the deployment options CVP provides. A real strength of CVP is that it offers both centralised and distributed deployment options, allowing a business to provide self-service locally (in a branch or retail outlet) and thus queue calls at the edge of network before routing them anywhere in the enterprise that they want. Alternatively, there is option to deploy CVP in the datacentre or at the call centre. Video is another area of CVP strength. While video calls may be some way off for the mass market, a CVP based video call centre called Significan't is up and running here in the UK so that deaf and other sign-language users can access government services via a video based call centre.

I also find the Cisco tooling (which was Audium) very good for service creation and suited to SOA development as it is based on the Eclipse platform. This is not unique to Cisco (Avaya Voice Portal also uses Eclipse as its development environment) but the combination of CVP deployment options and open standards works well for the clients I've worked with.

In short, if you are going to bring SOA into the contact centre environment it makes a lot of sense to start in area of discrete functionality that can be re-used in other channels and to do so with a product which gives you the most deployment options.

UK Agent Attrition

An interesting article on silicon.com about UK contact centre agent attrition increasing for the 5th year in a row.

I actually wrote a post on the survey (and HSBC's response to agent attrition) last week "The contact centre agent experience - First Direct", but the silcon.com article has a good quote from the analysts Contact Babel.

"Steve Morrell, principal analyst at ContactBabel, said in the report: "The lack of growth in agents' salaries is certainly a major factor in producing high levels of attrition. Businesses should be working to move low-value interactions onto web and phone self-service channels, and to use the savings created to pay higher salaries to their agents. This will attract and retain high-quality staff, a move which will immediately and permanently benefit both the business and the customer base.""

All very much thoughts this blog has been discussing in terms of moving from call centre to contact centre and making contact centre part of a multi-channel strategy. I'm not sure, though, this will necesaarily translate into higher UK salaries as I see high-skill offshore like South Africa being a significant factor in the market.

I've always stressed the importance of moving to converged IP because it makes managing multi-media in a multi-channel environment so much easier. Silcon.com aren't making the connection as explictly as I do, but they do produce the quite interesting statistic that:

"...pure IP infrastructure will be commonplace in most UK call centres within the next two years, with 41 per cent of respondents saying their operations will be fully IP-architected by the end of 2009.
Currently only 17 per cent of call centres have an full IP infrastructure, with a further 28 per cent using a hybrid IP/TDM network."

I suspect that one of the other big drivers to IP (besides multi-media management) is the ability to virtualise across borders. I know this is a message Cisco has pushed strongly, and I think it's the right messge for many enterprises. This is especially true in Europe where the continuing integration of the EU offers many opportunities to distribute work more efficently and more widely. Agent jobs (especially in areas like e-mail, where language skills and accent are not so crucial) will go to areas where the work represents a higher salary and on-shore will be left with higher skill, higher value agents.

SOA - bringing CRM, telephony and business together? part 1

It's a Friday, so perhaps time for thinking a bit further ahead.

One of the interesting things about the contact centre (and before that call centre) is that it has three areas that have rarely had more than a passing acquaintance with each other. By areas I mean the the three core functions of telephony (so that you can deal with customers remotely), CRM (which here means the delivery of data and interactions, rather than a specific packaged application) and business process (which is what the contact centre is built to handle and why customers call).

Traditionally self service, or IVR (Interactive Voice Response unit) has high-lighted this separation. It is probably more familiar as "...press 1for..., press 2 for...., etc..." and is the source of enormous customer frustration. This is mostly because it has come from the telephony world (which focused on scalability, responsiveness, routing, etc... ) rather than the IT or business world. As a result traditional IVR tends to be good at managing telephony but rather poor at integrating with CRM, business processes or being customer specific. Similar disconnects between needs and functionality can be highlighted in CRM or all those manual work-arounds in business processes.

It's into this world that SOA enters.

For those not familiar with IT trend, SOA stands for "Service Orientated Architecture". The idea is to build IT systems out of small components of functionality ("services") that can be put together by business processes to perform tasks. These services are not applications as we know them (though they could be) but are much smaller units of business functionality, such "calculate mortgage interest rate" or "identify & verify customer" and can be used by many different functions. These components can be part of existing applications (which increases efficiency from re-use of existing IT) or even come from third parties outside of the enterprise.

In call centre SOA has arrived first (and perhaps surprisingly) in the self-service environment of voice portal. A key factor was that the development of IP convergence meant that voice could be manged in the IP protocol world of the IT industry. A voice portal is not the the traditional IVR unit and from the proprietary telephony world. Instead is more part of IT and can be thought of an internet portal that presents information by voice rather than by speech. The SOA part of this is that if you have services for any channel (branch desktop, web, etc...) then you can present them in the voice portal. So for example, if you greet customers with a personal message when they log into your web site (e.g. "Welcome Mr. Smith, your most recent order shipped this morning"), the voice portal lets you do the same for the telephone channel. It also lets you present information both on a personalised basis and dynamically, which can dramatically increase your customers' use of self-service.

What voice portals are forcing is a coming together of telephony and CRM and SOA is the most sensible architecture for doing so in a way that aligns with business processes. Cisco, Avaya and Genesys are the clear leaders for voice portal, but in my next post I'll try and explain how things like tooling and service management make for big differences between what the vendors offer amd are critical to being successful with an SOA approach.

The contact centre agent experience - First Direct

There's a good overview on the BBC News website of what it's like to be an call centre agent at First Direct (the telephone and internet banking arm of HSBC). What's also interesting is that it shows how First Direct deals with the problem of agent attrition and under-motivated staff. All very relevant when at the start of the month the UK Contact Centre Operational Review found that agent attrition was up for the 5th consecutive year and now stands at an average of 32%. The idea that you loose a third of your staff in the year in which you hire them would not be sustainable in any other industry. If your brand depends on telephone service (and the staff that provide it) then it is not affordable and the BBC article shows what can be done to retain good staff and hence maintain the quality of customer experience.

I find First Direct very interesting as an example of what can be done with the contact centre. First Direct actually dates back to the pre-interent age and were set up by HSBC as experiment in telephone only banking. It was extremely successfully and has since then led a number of developments such as migrating transactions to internet and introducing fee based retail banking to the UK.

The thing that most struck me about the work environment was not the technology, but the focus on the agents. Once you've migrated simple transactions to the Internet channel, the phone becomes predominantly the channel for complex interactions. I've discussed this a little before why the people matter so much when offshoring ("Offshore - why I would go for South Africa over India") and when looking at e-mail ("e-mail in contact centres, process driven or response driven?" & more fully in "Call Centre to Contact Centre... or why worry about e-mail when the phone's ringing?"), but I think it's a topic I'll need to return to in more detail.

In the end, technology is critical for handling basic interactions and being efficient, but it's how the people in the contact centre use that technology that will determine the customer experience and the perception of the brand.

Speech market share - the role of non-European langauges

Some very good comments on the "Speech Market Share" posting I did in October, especially from Martin on Telisma and why they might have achieved such a large growth in European marketshare.

I was particularly interested to see that Telisma support Hindi and are working on another 18 Indian languages (including Indo-Arayan and Dravidian). This could be very interesting for a couple of reasons.

Firstly it's the established capability developed for the domestic market that I see as crucial for successful offshore operations. This is partly why in previous posts ("Offshore - why I would go for South Africa over India"), I've tended to rate South Africa ahead of India as a location for off-shore contact centres. If India can build a domestic capability then it's ability to take on offshore work will also improve. Also, and perhaps further off, the skills developed by Indian software developers working on speech for the Indian market could be very helpful for South Africa with its eleven official languages develop speech for its domestic market.

The second, and perhaps more unexpected use of speech is to serve migrants in Europe. These groups can be significant demographic segments and well worth offering higher service for. For example HSBC launched a UK Islamic bank in 2003 and it is easy to envisage it offering multi-lingual support for its customers. Perhaps further ahead is Canada. When I worked there I was expecting English and French telephone banking, but was surprised that Scotiabank telephone banking was available in not just English and French (as you would expect), but also Cantonese and Mandarin. It turned out that these languges gave them a competitive edge for winning business in the SMB market segment.

Given my experience of working with Canadian call centres, I am surprised that UK banks have not moved further with multiple language support. This may be a cost issue (given how cost concius the UK is) and perhaps the ability to offer automated support will change that.

Workforce Management - Part 2 Vendor Selection

I was interested to see that yesterday's posting got quite a bit of interest. One question that seemed to crop up regularly was "when should you buy a Workforce Management solution from your CTI vendor ...and when shouldn't you?"

The short (and unsatisfactory answer) is that "it depends on your circumstances". That said, here are some suggestions as to what you should consider.

• How strategic is your CTI supplier? - If you route calls on a relatively simple basis then you probably have a lot of freedom in your choice of WFM provider. If your CTI supplier is a critical part of your business (e.g. many, many skill groups, all overlapping spread across multiple sites) then it makes sense to take a WFM solution where you can export your skill categories straight from CTI into WFM.
• Are you wanting to monitor workforce skills, education and interaction quality? - If so, then you are probably looking to go the level beyond Workforce Management, which is referred to as Workforce Optimisation. This is best from a specialist provider, (like IEX or Calabrio) rather than your CTI provider.
• Where are you deploying your WFM solution? It may seem obvious, but unless it is localised, it will be difficult to use for non-English speakers. So for example in Europe, Calabrio (which supports English, French, Spanish and Portuguese, and should support German and Dutch by year-end 2007), Holy-Dis (very strong in the French market) and Teleopti (very strong in the Nordics) all have to be considered ahead of some of the large, but not localised US providers.

I'm sure there's plenty of other things to consider (all suggestions welcome!) but that should get you started....

Workforce Management - is it only for high end call centres?

Looking back at my posts I notice that I've written a lot on speech and self-service, a bit on CRM and a bit on e-mail. I've written nothing, though, on one of the major contact centre application areas of workforce management.

For those not familiar with it, workforce management is primarily about managing staffing levels so that they handle call volumes efficiently. What might appear a straightforward calculation becomes much more complex when call volumes peak and trough dramatically, calls can only be handled by agents with the right skills (in financial services, for example, this is a regulatory requirement) and the workforce (with these multiple skill types) might be spread across several sites and perhaps timezones.

For many call centres (especially the smaller ones that are the majority in Europe) the single largest workforce management tool is Microsoft Excel. This has great advantages in being familiar to most managers, relatively easy to use and a simple tool.

Once you get above 100 seats, or have a high degree of complexity in what your agents are skilled to do, I feel that workforce management tools become essential. As an example, a small stockbroker might have 100 seats. On Monday they need 70 or so of those seats to have trading skills to handle the call volume for market opening. Tuesday needs only 40 seats to have trading skills, but 50 seats need to be have qualified financial planning skills and 30 need to have trade settlement skills. Once you have multiple skilled agents (as in this example) it is good for the business, but it can quickly become very difficult to manage, especially where holiday planning and exceptional events need to be built into shift patterns.

The big players that I've worked with are Calabrio Work Force Management , Genesys Work Force Management and Aspect Workforce Management. What I find quite interesting is that the Aspect and Genesys offerings are traditionally pitched at the very high-end call centre, e.g. not the stockbroker in my example where a few agents handle a very complex possible set of interactions, but more the retail banking model where thousands of agents handle a smaller, though still complex set of interactions. Admittedly this high-end is Aspect and Genesys' heritage and where demand for management tools came from but I'm not sure it's the future, especially once multi-media traffic is added to the traditional voice traffic mix. I suspect that as Genesys has always positioned itself for highly complex call routing in very large centres there is a natural market for Genesys Work Force Management plugged into Genesys CTI. The problem for most European centres is that they are not large enough to need the Genesys scale of solution, but are too complex for a simple switch or a PBX and ACD.

One of the interesting things I've found in my work is that small call centres (especially in the B2B environment) can be highly complex and handling very large value transactions and are not just small call centres for small companies. As an example, I worked with a very large cosmetics firm who managed all their European wholesalers from a 70 seat call centre. That (small) call centre ran over 100 product lines, several $B of business a year and did so in six languages. In terms of European call centres, language is obviously a key agent skill and scheduling the right mix of languages is crucial before any other skill can be considered. It might have been a small call centre but it was highly complex.

One of the things I like about the Cisco Contact Centre Express is that it's restrictions are mostly around scale rather than function and there is the option to buy with built in Workforce Management. As an OEM from Calabrio it has a nice look and feel for the user and avoids a lot of the integration issues that happen for any call centre solution when a 3rd party workforce management application is used. There's a good overview here with some screen shots. Importantly, it addresses a call centre market segment (small but complex) that has traditionally been required to either take an over-engineered solution designed for larger customers or a simpler solution for small users that didn't meet their needs.

Is cost a contact centre issue or a symptom?

One recurrent theme in contact centres is that of cost.

Mostly, the complaint is that contact centres cost too much. I would argue that this is because the cost is calculated for the contact cnetre operations alone and with little reference to the value that the contact centre might bring for the wider enterprise. I've touched on the idea before that cost is not only operational metric to consider (mostly in the post "Offshore - why I would go for South Africa over India") and that doing the same function at lower cost is not going to solve many of the bigger and more expensive problems. I would argue that cost is only a symptom of problems in the wider enterprise, a symptom that is shown in call centre.

The CMP magazine is taking another approach and trying to change perceptions by having an award ceremony to recognise the top 50 call centers in the UK. The difference here is that the adjudicators will be customers rather than industry peers, and so recognition will be based on absolute customer service outcomes with no reference to the cost of achieving those outcomes.

This seems worthy, in terms of understanding and demonstrating how much contact centres can achieve. It also go me thinking, though, about something I've seen for a while. What often shows up as cost in the contact centre is actually a problem in a completely different part of the organisation. For example, it's obvious that badly made products lead to returns and complaints. The call centre of the organisation making those products would therefore have to be quite large, yet the problem isn't the call centres' ability to handle calls efficiently, rather it is the products that generated those calls. Similarly in financial services if a product is too complex for its target market that will generate extra service traffic. The problem there is not the cost of handling calls, but of insufficiently well designed products for a given market.

The cost conscious retort might still be "so what?". The products were sold, the revenue was booked, why worry about handling the calls on any level other than cost? Two good reasons come to mind immediately, but I'm sure readers will have many more. The first is that the cost of handling customer complaints well is far less than the cost of reputational risk and brand damage. Compare call centre costs with the marketing costs to rebuild a troubled brand and the sums are heavily in favour of good customer service. The second point is more subtle, but is about the ability of the organisation to adapt. If an organisation can understand what customers think of it in real time (that would be the contact centre that does that) then it can adapt and change in response. The cost savings from withdrawing a product or altering an internal process that is causing problems can be far larger than the cost of the call centre.

In short the value of the contact centre is in its ability to make the organisation responsive. That and the brand value it adds are key yardsticks against which to measure its cost.

Skype, Contact Centre & Banking

I've set myself the task of covering three big topics in a short post today.

At first glance, Skype may not seem very relevant to either banking or contact centre but let me explain.

Skype represents a new channel for customer interactions and one the most organisations cannot currently support. Now there are views that Skype will collapse because of its lack of revenue and because it has no network (as most recently argued in The Register). I accept the point made specifically to Skype, but even if Skype fails, VoIP arriving via the web channel is something organisations have to adapt to. Similar to my previous entries on e-mail as process driven or response driven, VoIP is a communication medium that some key demographics are adopting and organisations need to be able to support it.

This is where banks come in as some of the largest users of contact centres. One of the first to introduce Skype based contact management has been ABN Amro. The VoIP function is built in (with chat bots for IM and avatars) to a site targeted at a younger technically oriented user. This has been followed by Rabobank with a similar site, functionality and target market. Why the Dutch market should be so far ahead of (say) the UK I'm not sure, but it is interesting to see a trend being taken up.

Will Skype or VoIP replace traditional voice? Hardly yet, I suspect that the amount of VoIP voice traffic the banks are expecting is relatively low. The real significance (as discussed in my post on e-mail) is that we are moving to distinguishing communications not by the communication medium, but by whether they are synchronous or asynchronous. In this world the contact centre becomes an essential part of managing the increasingly interactive customer.

Pour le weekend - un site tres interessant

You'll have spotted that, so far, the blog has been in English.

There's also a bit more spoken in Europe than English and as it's the weeked and I'm working in Paris on Monday, let me point you towards a very good French site. I admit it's not contact centre specific, but I still find it useful so I've added a button to it on the blog. If you need the web link then you can access Cisco diaLog here.

My view of the site?
Je l'aime beaucoup. C'est un site interessant et j'aime le podcast parce que c'est plus interactive. Jerome et Francois discute les actualite high tech avec un grand perspective.

That's probably enough of my French, but it will improve and when it does there may be more.

Speech Market Share

A few days ago I wrote a post entitled "Technology Firms, Europe and Speech Recognition" that was really rather well received. In it I made the rather obvious point (to me anyway) that if you don't offer speech recognition in local languages, you are going to stuggle to get it adopted.

One thing I should have mentioned (and didn't) was that despite their limited languages both IBM and Microsoft had gained significant market share in overall speech shipments, at least according to Gartner's figures for 2006. The highest growth was from Telisma with over 200% growth. Worldwide IBM was looking at around 50% growth and Microsoft had growth respectably in the teens.

Of course, worldwide is not so useful when no languages is truly worldwide. More relevant for this blog is EMEA, where Gartner see Nuance, Talisma and Locquendo as the big players. Interestingly, EMEA is the only region (out of North America and AP) where IBM was not one of the top three vendors. I think this still proves my original point that language support is critical to getting market share, but perhaps I'm underestimating the power of brand and salesforce.

Offshore - why I would go for South Africa over India

From previous posts you might have concluded that I'm against offshoring.

I'm not.

What I am very against is the offshoring school of thought that is 'your mess for less' or just aims to reduce all service levels to an absolute minimum. To me this misses the point that offshoring provides many opportunities to do far more than reduce cost.

My feeling (and it's only an impression) is that at least for the UK market, India sold itself very successfully on cost. That was a successful strategy to win business, but ignoring service quality (or being too low cost to deliver it) has been bad for keeping the business. A YouGov survey earlier this year found that over half of UK respondents' biggest gripe was dealing with overseas call centres. It wasn't just xenophobia or an objection to offshore, it was that only 4% of respondents reported getting good service.

UK companies have begun to realise that while contact centre operating cost can be cut dramatically by going to India, that cost saving is nothing compared to the news cost to your brand reputation and the cost of increased customer churn. It also can allow your competitors to gain market share at your expense (see Nat West bank's advertisements stressing their UK call centres) and the examples of companies like Powergen which last year closed its Indian operations and brought them back to the UK specifically because of customer service.

By contrast, South Africa (from what I have seen) has approached the market very differently. I was impressed with what I saw at the UK's Call Centre Expo a few weeks ago where the focus was on stressing South Africa's better service levels, native English, shared timezone to the UK and developed infrastructure. The infrastructure is an important point, particularly the IT infrastructure. Large South African firms like Old Mutual, Anglo-American and Telecom SA have all run sizeable IT operations and although skills are not in oversupply most technology skills are available. The local economy is also sufficiently advanced for there to be significant call centres serving the local market. Crucially this means that South Africa can look at providing more than just first line customer support and take on technical support, internal IT support and elements of back-office processes. Cost reduction is a key part of the value proposition to UK organisations (have a look at Cape Province's figures and references) but it is cost in relation to the higher value of the work that can be taken on. Similarly in Gauteng, IBM have grown substantially providing these type of service to European clients and Dimension Data also run substantial operations under the banner of their Merchants subsidiary.

Encouragingly, I don't think South Africa represents a large threat to UK call centre market and may well ending up complimenting it. I suspect we're likely to see processes split between countries with parts of work being handled onshore and parts going to South Africa.

Of course that requires companies to be able to manage data and voice traffic seemlessly across continents, and that's where Cisco has some very good technology. We have a number of customers using technology like our ICM product to deliver virtualised call centres across national borders and this seems to be a trend that is increasing. You can also get a good graphic of ICM in action here. There is a clear trend in multinational companies that if you are going to manage customer service properly, you should do it with all parts of your enterprise, regardless of where they are located and do it well. The capability exists to do it anywhere, but that decision should not be driven by cost alone.

e-mail in contact centres, process driven or response driven?

One of the interesting things I'm seeing around e-mail in the contact centre is debate on how to manage it.

With a phone call, things are relatively straight forward - you answer it. You might need to queue it, or gather some intelligence for routing but fundamentally you are talking about something that is real-time and a synchronous form of communication and contact centres handle that well.

By contrast, e-mail is not real-time and is an inherently asynchronous method of communication. It can be answered at an agent's convenience and an agent can handle multiple e-mail sessions concurrently. Furthermore, the agent can be given a lot of prompting and guidance (even scripting) from knowledge sources to help them respond. Furthermore, the text based nature of the medium makes it much easier to integrate content into other applications.

To date, most of the focus on e-mail management for the contact centre has come from specialist players like Kana and eGain. These applications provide the necessary functionality for e-mail, usually provide chat and often web co-browsing. My personal preference is for the eGain suite (and not just because Cisco OEM parts of it), but for Genesys users Kana has a number of attractions, not least that execs at one have often worked at the other. In my view the first phase of e-mail management is almost over and the niche vendors are starting to align with the CTI (Computer Telephony Integration) vendors. This may be quite a loose alignment (e.g e-Gain and Kana can be paired with a whole range of CTI applications), but none the less the debate is largely over as to whether e-mail should be managed as a stand alone application or integrated with the telephony control application.

The second phase that I suspect to be just beginning is the debate whether the CTI or CRM system manages e-mail. Most CRM systems today have an e-mail capability and try to integrate e-mail with the wider CRM process. By contrast the CTI systems focus on the process of finding the right person to answer the e-mail, getting it there and monitoring how long the agent takes to write the answer.

I suspect that both approaches will prove complimentary, but there is sufficient overlap to make it unclear as to which application will eventual dominate the e-mail space.

Ofcourse, there is a wildcard in the form of SOA. If it becomes more prevalent as an architectural approach in the contact cnetre, then talking about applications 'controlling' functionality will be redundant. But SOA would be a third phase and although I see signs of the foundations being laid now, it is not yet a reality.

For a Friday - why are contact centres so disliked?

I suspect that by the time you've read the title, you have already begun your list! You may also have decided that it's so obvious it's not worth writing about.

I'm sure you already have:

• Being stuck in a queuing system
• Not being able to speak to a human
• Not getting any help when you do get a human being
• Cold calling
• Dealing with people who don't speak your language

...but I'm not actually that interested in a list of gripes, however long and valid. These are symptoms rather than causes. What I'm interested in is why do companies spend money on contact centres, if all the contact centre generates is dissatisfaction?

Now the cynics will cheerfully say that I've not understood what's going on, and that companies are only interested in having the appearance of customer service, and are not interested in the reality unless it is cheap. I would argue that customer service is seen to be failing because it has not managed to keep up with changing customer expectations or what the rest of the business expects contact centres to do. There is some truth that customer service is seen as a cost centre and a necessary evil in some organisations but I would argue these organisations are passing up on a lot of opportunity.

The first thing is that today's contact centre is a world away from the relatively simple functions that the first call centres were set up to do. For example, in banking the first call centres provided balance enquiry answers or specialised in an individual product. Today the simple functions (like balance enquiries) have moved to the web or the telephone self-service environment and everything that is left for the contact centre is complex. Many organisations have not appreciated that if their contact centre traffic is going to become increasingly complex, then agents need the systems that can handle them. Too often I see a very basic CRM system and some link to a legacy back office system as the agents' main tools. Knowledge databases, the ability to ask an expert, workflow and all sorts of other things that could help the agent are often not present.

Secondly, and a pet gripe of mine, is that a lot of telephone automation is done badly. Being presented with nine options to choose from at the first menu, and then many more as you work down a menu-tree hierarchy may help with call routing but it is an expensive way of irritating your customer. This is especially true if none of this information is then passed to the agent so that when you finally speak to a human, you have to start everything again. With the current voice portal technology being mature and stable, most organisations should at least look at moving away from the ugly aspects of the traditional IVR (Interactive Voice Response unit). Rather than working in the menu-tree world of IVR, a voice portal works like a portal (or web browser if we're not being too fussy) in terms of how it presents information. A voice portal uses Java and vXML, web technologies, to present information rather than the proprietary environments of IVRs. What this means is that even if you don't want to provide speech, a voice portal can still provide a far higher standard of customer service than the traditional IVR and generally do so at a lower cost.

Incidentally, if you are interested in speech automation for voice portals then I'd encourage you to look at the Dimension Data/ Cisco survey on CRMExchange. There are some very interesting points that highlight how users can be much more enthusiastic about speech self-service than most IT organisations appreciate. It also highlights how users' priorities and expectations can differ from those of the implementing organisation and how you can tackle some of these to have a higher level of customer acceptance. The more customer acceptance means not only a lower cost to serve but also the more usable information you can capture.

For many organisations the contact centre represents an opportunity to learn more about customers and better understand how they interact with the company. Relatively simple things, like marketing campaign response tracking can pay significant dividends as can analytics on the data the contact centre generates. Again, as an example, working out which is your most troublesome product for which demographic is information that can help improve both marketing spend and product design. These are areas of significant spend and the better the customer experience the more information you are likely to be able to gather.

In short, contact centres often aren't delivering a good user experience because their technology has prevented them adapting as fast as their customer's requirements have changed. In turn the business has often not understood the value of the call centre and so has not invested.

In short if you're on the receiving end of really bad service, remember "Never attribute to malice what can be adequately accounted for by stupidity", consult Dilbert, the ultimate authority on disfunctional organisations and take your business to an organisation that understands the value of customer service.

Call Centre to Contact Centre... or why worry about e-mail when the phone's ringing?

In terms of hype, the move from call centre (deals with telephony) to contact centre (deals with all remote contacts, telephony, e-mail, etc...) is probably one of the most hyped things in the industry.

Gartner's hype cycle research paper ("Hype Cycle for CRM Customer Service and Field Service, 2007") is one place where the tends are dissected, but I'm not sure I agree with all their conclusions. My main objection is that Gartner are looking at technologies like e-service suites and IP-based contact centres and pronouncing them 'in the trough of disillusionment and stating that it will be 2 -5 years before they mature. I think they are underestimating the pressure from consumers that will come onto organisations to adopt these technologies.

The two big factors I see driving this are the increasing sophistication and pervasiveness of mobile devices and the increasing speed of broadband into the home. Both of these things mean that consumers will find it increasingly easy to contact organisations by e-mail, SMS, instant messaging, etc... and will expect to be able to do so. You only need look at the demographics for things like Facebook and IM users to see that these are what today's youth and tomorrow's consumers are adopting rapidly.

That said, at the moment many of the organisations I work with want to improve their telephony service, and they view multi-media capability as something they need to build into their telephony improvement plan. The view I've often encountered is that while they only need to enable 10% of agents for e-mail now, they need to be able to change that fast and have built an environment that can support any change.

In this context the choice is to look at an IP based contact centre that integrates multi-media or to look at a hybrid integration option. There is a third possibility, but I'm not convinced anyone worried about multi-media would look at TDM for their telephony.

Obviously, as someone who works at Cisco, I believe that IP is the way forward. Putting as much of the intelligence at the network level as possible seems highly desirable in the call centre. The alternative architectural approaches (putting the intelligence at the application layer or splitting it between application and network layer) seem to me to add an unnecessarily level of complexity. Of course, complexity equals cost and when I worked on a couple of Genesys and Kana integrations, and it was the cost of doing all this at the application layer (especially the cost of professional services) that could cause problems. I don't pretend that the IP based approach removes the need for services, but it does reduce the complexity of some aspects of the project, and it can make future functionality extensions easier. As an illustration, it is worth looking at the capabilities of the Cisco ICM (Intelligent Contact Management) product to see just how much enterprise-wide routing can be done at the network level.

In this context, I think Gartner are underestimating how quickly organisations might move to IP and how much this is driven by a need to be ready for multi-media in the contact centre, even if all that functionality is not being implemented today.

City Centre Call Centers - A European quirk?

The prevailing wisdom in the call centre industry is that you build your call centre somewhere with cheap land prices and somewhere with cheap labour. Compared to labour costs, telephony is not nearly as expensive, so remoteness of location is only restricted by the availability of the labour supply.
This then is the prevailing wisdom and is valid for a lot of the customers I work with.

Yet it is far from universal and a very significant minority go against this prevailing wisdom and locate in city centres and pay above market wages.

At first sight this might seem an indulgence or a sign of inefficiency such as owning rather than leasing office buildings that then means the buildings have to be filled to be justified. In fact it is actually a well thought out business strategy with some very powerful justifications and may point to the way parts of the contact centre industry are going to be in future.

The companies who mostly locate their call centres in the heart of cities are financial services sector. They have a need to provide 24 hour service and do with relatively highly skilled agents. These agents are expensive to train (4 weeks +), expensive to recruit (all the background checks for anti-fraud) and carry out high-value transactions (because so much in financial service is automated with IVR/ Voice Portal or has moved to the web). You have to pay above market rates for these people and you have to be in an area where you can recruit them. It sounds obvious, but this is not recruiting from the majority of unemployed and means financial services companies' call centres need to be in area where there is a critical mass of talent. The final key factor for the agents is that they need to be able to get to work. Again, it sounds obvious, but out of town sites don't necessarily have public transport 24hrs a day and even if paying above market wages, you start restricting your labour pool (and your shift flexibility) considerably if you require employees to have a car.

The result is that in Europe quite a number of higher end call centres can be found in city central areas. The most striking for me was an international bank that ran its call centre covering eleven countries from a square in one of Spain's most expensive cities. This was pure economic decision because what they lost in terms of (much) higher property rents, they gained by being able to tap the multi-lingual, highly flexible student population of the city.

Of course, as IP Contact Centres evolve, things like homeshoring and community call centres (as announced today for Nottingham) may will end the tradition of large sheds in remote areas but even without the technology there are sound business reasons for Europe having city centre call centres.

How Call Centers vary across Europe

One of the things I find interesting about my work is seeing how call centres vary so much across Europe. The European call centre business is often simplified into a north vs. south situation but is actually it's much more complex than that.

It could as easily be seen as a west vs. east or even a split by language groups and the culture that each has. The simplified view is that the northern nations (the UK and Ireland, the Nordic countries and the Netherlands) were early adopters of call centre technology and the culture of the country is comfortable doing business on the telephone. The southern nations (especially Spain, Italy and Greece) are much slower adopters and have cultures that prefer doing business face to face.

As with all simplifications there is some truth in it, but it hides significant variations and the market has changed quite rapidly over the last few years. Within the northern nations, the Nordic countries are often much earlier adopters of technology than the UK. A smaller, more technically enabled population means that integrating the web and telephony channel is often higher on the agenda in the Nordics (where there is high penetration of broadband) than it would be for UK decision makers. Similarly, with a smaller, more homogenous population to serve, Nordic companies can implement newer technologies more easily. Also in northern Europe telephony has generally been cheaper for consumers, making the telephone a more attractive channel for business. For the UK, scale and cost are two major concerns. UK call centres are large (often only surpassed by those in the US) and the telephone represents a major customer facing channel for the financial services sector, telecoms and utilities. Although UK customers are less than happy about the levels of service at some companies the telephone is still used extensively for complex interactions, while simpler interactions have often moved to the web or e-mail channel.

In southern Europe, face to face still remains a cultural preference for many transactions, but the rise of the web channel is changing this. One of the things I'm seeing is that organisations in these countries are building call centres as a channel to support the web, rather than as an existing to channel to which the web was added. Perhaps unexpectedly, mobile telephony has also brought about a growth in call centres as it has made the telephone cheaper and more widely available than when it was the monopoly of the state owned Telco's. The mobile operators need call centres for their customers, but other organisations have then had to respond to the sudden increase in telephony traffic this has brought about.

The final significant variation is between west and east in Europe. Generally speaking (...and this is very 'generally'!) labour costs in eastern Europe are substantially less than those in western Europe. There is also no legacy of contact centre investments from before the 1990s. As a result, while in western Europe contact centre is a mature part of most organisations with an existing telephony infrastructure, in eastern Europe many contact centres are greenfield implementations but, with EU accession, greenfield in an advanced market. With no concerns about telephony migration and transitioning from TDM to IP Telephony, it's been very interesting to see how this market has adopted IP Contact Centres. Obviously, as I work for Cisco, it's something I've seen quite a bit of and am enthusiastic about, but for the contact centre operators it means they can approach the contact centre business in entirely new ways. As an example, many traditional management structure for contact centre have evolved because all agents need to be within (approx) 200yrds of the ACD. In an IP world that physical restriction does not exist and it then becomes a matter of choice as to whether concentrating all your agents in one place is a suitable business strategy.

The changes in the call centre industry is a subject I'm sure I'll be covering more of in the future, but that's probably enough for now on the high level trends across Europe.

Onshore still growing - Lloyds TSB

I'm determined to cover more than the onshore/ offshore argument, but I couldn't resist commenting on this story.

Lloyds TSB (one of the UK's big four banks) is looking today to hire 150 people for its Glasgow call centre. The Glasgow operation is already a 1,000 seat centre and even if these are seasonal hires, it's still a significant investment.

The financial services sector has been one of the big generators of off-shore stories (see regularly HSBC in the UK or ABN Amro for the Netherlands), so good to see the alternative being represented.

Technology firms, Europe and speech recognition

One of the fascinating things for me is the gap between the US and Europe.

I don't mean hostility, but rather the cultural gap relating to how business is done and what is required. Cultural issues, selling techniques and so on are probably for another post, as are labour laws, but this cultural difference tends to be most apparent in technology.

I've worked with a lot of technologies and in call centre it can be a major problem if it doesn't fit local requirements. Obvious examples are data privacy requirements, out oubound dialling and do not call lists and so on.

Yet what I find bizarre is that one of the most obvious areas (speech recognition technology) is one where there is often very little localisation from major vendors. Microsoft Speech Server is a good case in point - only available in US English. IBM similarly offer Websphere Voice Server in fourteen languages, five of them European . That's better, but most of the European languages are only on the older platform (v4.2 on AIX) and doesn't cover many common European situations (e.g. Belgium, where you need French and Dutch or ideally Flemish). It's no wonder then that Nuance have such a large market share by comparison when they offer 44 languages & dialects, and 24 of them are European. Even more importantly, localisation extends (for example) to three types of German and so cover Swiss and Austrian German as well as the accent of the Federal Republic.

Now I don't wish to suggest that Nuance are masters of this, in my work with them, I've found there are things they could improve, but they have got one simple idea built into their strategy. If you don't do customer service in the local language you haven't a hope of even attempting to solve the softer cultural issues.

Put it another way - would you try to sell to major US firms in any langauge other than US English and expect to be successful?

On-shore Call centres in decline.... is that the whole story?

It is very easy to think that call centres in high-cost Europe are an endangered species. Very easy, that is, if you read only the more sensational media.

A good example is this week's story 'Call Centre Jobs Under Threat' from the Sunderland Echo, Now this isn't to say that the prospect of 150 job losses isn't a very real threat for those on receiving end and it certainly isn't good news for a poorer region to loose jobs, but that isn't the whole story.

It's important to appreciate that this is 150 job out of 1,000 in the call centre. It's also that this is a home catalogue shopping business where the amount of business coming in from the telephone is static or reducing while the amount coming in from the web is generally increasing. The BBC has a decent overview of the challenges mail order companies have faced, and estimate that Littlewoods probbly now gets 33% of their traffic from the web rather than post or telephone.

These jobs aren't going offshore (at least as far as I can tell), instead they are probably going because of either better automation or because the company has got better at serving it's customers (that industry measure of 'first call resoloution'). This is partly because one agent can handle several e-mail concurrently, but that sort of multi-tasking is not such a good option for telephony. It's also important to bear in mind that Littlewoods is a company that has very tight margins in it's chosen market, the lower end of mail order. Crucially though, bad news makes headlines.

By comparison, 'beCogent wins House of Fraser Deal' may only mean 30 extra call centre jobs in Scotland, but it is a clear example of a retailer (as is Littlewoods) recognising the value of on-shore service. It's also not a bad news story, so gets much less coverage.

In the end, service will remain on-shore wherever there is a requirment for it to do so, and that includes language, value, branding and a whole range of other factors beyond cost.