THE CALL CENTRE

REFERENCE BIBLE
© Niftecs 2018

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Contents
1. Industry Analysis ....................................................................................................... 7
1.1. Current Industry Landscape ................................................................................. 7
1.2. Analysis of Market Conditions ............................................................................. 7
1.3. Need for a Call Centre ........................................................................................ 8
1.4. Key Factors that Influence Call Centre Success ...................................................... 9
1.5. Kenyan Market Analysis .....................................................................................10
SWOT Analysis for Kenyan Market .............................................................................. 11
2. Services, Objectives and Size ..................................................................................... 12
2.1. What Services to Offer ....................................................................................... 12
2.2. Contact Centre Services. ..................................................................................... 13
2.3. Planning for a Call Centre Implementation ......................................................... 15
2.4. Setting the Objectives......................................................................................... 15
2.5. Sizing the Call Centre ......................................................................................... 17
3. Call Centre Technology and Equipment ................................................................... 20
Automatic Number Identification ........................................................................... 20
Dialed Number Identification Service (DNIS) .......................................................... 20
Dynamic network routing ...................................................................................... 20
Automatic Call Distribution ..................................................................................... 21
Predictive dialing .................................................................................................... 21
Interactive Voice Response systems ......................................................................... 22
Headset ................................................................................................................ 22
Automatic Call Recording .................................................................................... 23
Call monitoring (process not equipment) ............................................................... 23
CRM technology ................................................................................................... 23
Computer Telephone Integration (CTI) .................................................................. 24
IP contact centres ................................................................................................... 24
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 SIP in the contact centre ......................................................................................... 25
4. Call centre Staff ....................................................................................................... 27
a. Call Centre Advisor/Agent/Customer Service Representatives ................................ 27
b. Team Leader ........................................................................................................ 27
c. Call Centre Manager ............................................................................................ 27
d. Head of the Call Centre ....................................................................................... 28
e. Customer Services Director ................................................................................... 28
f. Operational Manager........................................................................................... 28
g. Trainer ................................................................................................................ 28
5. Call Centre Operational Metrics .............................................................................. 29
5.1. Operating budgets ............................................................................................ 29
5.2. Cost centre versus profit centre ......................................................................... 29
Cost per contact ...................................................................................................... 30
Cost per customer ................................................................................................... 30
Cost per resolution .................................................................................................. 30
Total revenue generation ........................................................................................ 30
Revenue per contact ............................................................................................... 30
Revenue per customer ............................................................................................. 30
5.3. Performance Drivers: Managing the Results ........................................................ 31
5.4. Examining performance drivers .......................................................................... 31
5.4.1. Contact-oriented metrics ................................................................................ 32
i. Contact length .................................................................................................. 32
ii. Conversion per contact ..................................................................................... 32
5.4.2. Accessibility ................................................................................................... 32
a. Service level...................................................................................................... 32
b. Average speed of answer .................................................................................. 32

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 c. Abandonment rate ........................................................................................... 33
5.4.3. Agent professionalism and ability ................................................................... 33
5.4.4. First-contact resolution................................................................................... 33
5.4.5. Policies and procedures .................................................................................. 33
5.5. Setting Performance Targets .............................................................................. 34
5.5.1. Accessibility/service level ................................................................................ 34
5.5.2. Abandons ...................................................................................................... 35
5.5.3. Call length ..................................................................................................... 35
5.5.4. Occupancy .................................................................................................... 35
5.6. Call Centre Performance Metrics ....................................................................... 36
5.6.1. Agent Performance Measurement................................................................... 37
5.7. Resource Management Tasks and Concepts ....................................................... 37
5.7.1. Forecasting .................................................................................................... 37
5.7.2. Scheduling ..................................................................................................... 37
Full-time equivalent .......................................................................................... 38
Real-time management of resources .................................................................. 38
5.8. Assigning Staff and Creating Schedules That Work .............................................. 38
5.9. Managing Operational Costs ............................................................................. 39
5.10. Making your Call Centre Future Ready ........................................................... 39
6. Call Centre Operations Management ....................................................................... 40
6.1. Human Resources Management ........................................................................ 40
Staff Training.............................................................................................................. 40
Career Progression ....................................................................................................... 41
Staff Retention ............................................................................................................ 41
Compensation and Benefits ......................................................................................... 42
6.1.1. Minimizing Staff Costs .................................................................................... 42

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 6.1.2. Staff Rostering and Scheduling ........................................................................ 42
6.2. Business Continuity Planning ............................................................................. 43
7. Project Financials ..................................................................................................... 44
7.1. Start‐Up Expenses and Funding ......................................................................... 44
7.2. Implementation Schedule .................................................................................. 46
7.2.1. Outsourcing Costs | Call Centre Pricing ....................................................... 46

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1. Industry Analysis

1.1. Current Industry Landscape

With more and more companies turning to superior customer service as a means to stand out
from their competition, the call centre industry is growing. As the economy becomes tough,
companies are looking to outsource customer handling to third party vendors who specialize in
the call centre business. Call centres can be broadly classified into two types – captive call
centres and third party call centres. In a captive call centre, the agents handle only one
organization’s customers. It is usually set up as a subsidiary of the parent company and
functions as a cost centre. The main objective of such a call centre would be to optimize the
operational cost while offering superior customer service. A captive call centre’s business grows
in direct proportion to that of the growth in the parent company.

In the case of third party call centres, the call centre may serve multiple clients either in the
same industry or varying industries. Here the growth can happen either when the client’s
organization grows, or by acquiring new call centre clients. The operations of a third party call
centre are run as a profit centre and the focus is on improving the revenue billing as well as
profits of the company.

1.2. Analysis of Market Conditions

The call centre industry is fragmented in nature, and market players vary widely in terms of call
volumes handled and services offered. While some players focus on a specific sector, others offer
services across a wide variety of industries. Some players only offer call centre services
while others handle end‐to‐end customer service including reverse logistics. In the initial days,
companies had their own call centres. However, today the trend in call centres is skewed
towards outsourcing. Call centre operations are outsourced typically to English speaking third
world countries where cost of operations would be only a fraction of the cost that you may
incur in the United States or any other developed country.
 An inbound call centre is usually used for offering additional services to customers such as
complaint handling, and information on products and services. An outbound call centre typically
focuses on lead generation for sales. They can also be used to conduct customer satisfaction
surveys and for campaign management activities.

1.3. Need for a Call Centre

A call centre can provide several benefits to an organization. That is why a well‐planned call
centre has a high chance of being profitable.

Reasons why organizations opt for call centres.

• Industries such as financial services, where there is a high volume of transactions with the
end customers, would benefit from a call centre by helping to reduce transaction
costs. The majority of simple transactions can be carried out by the caller himself with
the help of a simple IVR system.

• In addition to lowering the transaction costs, call centres also offer convenience to callers
who may not have the time for, or access to, the branch network or client organization
for a face‐to‐face transaction.

• The company is relieved of the duty of attending customer calls, and answering their
queries. With this job delegated to the customer service call centre, the company can move
on to concentrating on other jobs which are its core competencies. With the focus of the
company at its core competencies, the overall efficiency and productivity of the company
increases.
• The next benefit is that the amount of capital and investment required by the company
reduces. The company does not have to develop an in-house call centre for customer
management, and thus it does not need any capital or investment for the same. This
company can be used by the company for other purposes, like marketing of the company
and its products and services, introducing new technologies in the production and
distribution channels of the company to increase their productivity, etc.
• The company gets access to specialized skill. The company offering customer outsourcing
service would have staff working for it, which has been provided with all the necessary
training in customer service. On the other hand, if the same job is to be done in-house, the
 company would have to hire additional staff, spend time, money and energy on training
them, and monitor their activities on a constant basis. By outsourcing customer service, the
companies are save themselves from all this trouble, and get instant access to well trained
and specialized personnel for the job.

1.4. Key Factors that Influence Call Centre Success

The call centre industry has a high entry barrier, as clients do not wish to change the call centre
to which they have outsourced their operations due to the significant switching costs associated
with changing partners. The learning curve of agents is also quite steep, as they need to
learn the business processes and products of the clients being serviced. Intense competition
among call centres makes it difficult to increase billing to clients. Therefore, the operational
costs have to be kept as low as possible. Given below are some of the key success factors for a call
centre:

1. A robust technology framework that can accommodate year on year business growth
2. A well‐trained and motivated staff who would strive to achieve quality and productivity
goals
3. A diverse clientele which would reduce dependence on a single client for revenue and
margin

These are some things you’d expect to see in a contact centre that isn’t working
properly:
• Long delays for customers to get through to “the next available agent,” or long response
time to an e-mail
• Frequent shuffling of customers from agent to agent
• Customers often left on hold for extended periods of time
• Customer issues that frequently require multiple contacts before they are resolved
• Low employee morale and high turnover
1.5. Kenyan Market Analysis

A 2016-report by A.T. Kearney looked at Business Processing as a Service (BPaaS) and noted that
ongoing rollout of the fibre optic cable across the country, would see new call centres started at
remote locations that will become new sources of income and linkages between poor communities
and the outside world.
The survey looks at low wage countries with the best mix of skills, scale and IT and voice
infrastructure to deliver a service at the lowest cost for multinationals that want to grow their
business via downsizing-cum-expansion model.
The BPaaS model also seeks to create a win-win approach to corporate responsibility where
multinationals outsource back office services to call centres located in low wage countries.
India and China lead the rankings due to their highly developed infrastructural facilities across their
countries where skilled workers continue to provide innovations as well as operate call centres.
Kenyan market players include:

i. Virtual skillset Inc

ii. New Age Telecommunications Limited
iii. German Laptops
iv. Dynamic Systems
v. Syntax Communications
vi. Meru Homes Ltd
vii. Computer Revolution
viii. Horizon Contact Centers
ix. Kencall EPZ Ltd
x. Call Centre Africa EPZ Ltd
 SWOT Analysis for Kenyan Market

Strengths Weaknesses

-Price of the service is low 1. Costly IPLC Connection

-Skill labour always on feet 2. Less amount of skill employee

-100% security of data 3. Unskilled management

-Quality services 4. Kenya is not a brand name

4. Unskilled marketing

Opportunities Threats

#Other Companies offering call BPO services

1 . Hug e Labor force
#Asian countries that do BPO
2 . Cheap Labor Cost
3. Cheap Office Rent
4. Low Electricity Bill
2. Services, Objectives and Size

A key step in starting a call centre is preparing a business plan. This must cover
aspects such as what services you would offer and which customer group you would like
to target. Both of these decisions depend on two key factors – the competition and your
skill set. You can be successful if you can identify a profitable niche without a great deal
of competition, that can be well‐served with your skill set.

2.1. What Services to Offer

Call centres face competition from players all across the globe. The industry is fragmented
in nature with several small firms catering to small organizations, while some of the
bigger players cater to large clients such as GM, Citi and Amex. Since the competition is
intense, it is difficult to get good rates by offering plain vanilla solutions. If you can offer
services catering to high‐end niches such as legal services or medical services, then you
will have better margins.

Market penetration is challenging unless you are a captive call centre with assured
business volumes. This is because contracts are usually awarded to firms with a
reputation for high quality services. One way to break through the barrier is to have
industry veterans with good professional networks in your top management. The other
step to take is to opt for quality certifications for your operations, which can act as an
assurance of your professionalism to potential clients. As a new player, you would also
need to participate actively in industry forums that will act as a means to introduce your
services to potential buyers. By keeping operational costs as low as possible, you would
be able to give better rates to clients that will go a long way in winning new business in
this price sensitive industry. In the initial stages, you must also be willing to offer
customized solution packages for your clients in order to capture market share. It is best
to have at least a couple of contracts under your belt before you start setting up your
call centre. This will help to assure revenues from day‐one of operations.
2.2. Contact Centre Services.
Once call centre services are outsourced , a team of skilled, trained, and enthusiastic
professionals will efficiently assist with all your call centre needs. Right from providing
consistent customer support to generating quality leads and making sales calls; agents help
with everything.
Some of the major services offered by a call centre include -
1. Inbound Call Centre Services
Focused on maximizing business and profits. Our agents have sufficient domain expertise
and excellent call handling capabilities. Helps clients in attaining increased client
satisfaction by decreasing the call abandonment rate. Some of the major inbound contact
centre services offered are -
• Product Information Request Services
• Phone Answering Services
• 800 Answering Services (Toll free)
• Order Taking Services
• Claims Processing Services
• IVR Services
• Virtual Receptionist Services
• Up-selling and Cross-selling Services
2. Outbound Call Centre Services
Agents not only specialize in making sales calls, but they are also skilled to send consistent
follow-up mails and test unknown market to make a business a success. Some of the key
services offered are -
• CATI (Computer Assisted Telephone Interviewing)
• Database Development & Management
• Lead Generation Services
• Market Intelligence Services
• Telesales & Customer Acquisition
• Customer Satisfaction Surveys
 • Appointment Setting Services
• Disaster Recovery Services
• Direct Mail Follow-up Services
3. Telemarketing Services
Telemarketing is one of the most common ways used for contacting potential customers.
These services also help one increase the number of their existing customers by tapping
the right lead. Telemarketing helps one in increasing their revenue by efficiently following-
up and closing sales. Following are the services provided:
• Cold Calling Services
• Up-sell/Cross-sell Campaigns
• Product Promotion
• Telemarketing Lead Management
4. Technical Support Services
Providing technical support services can be tricky as it often requires agents with sound
technical knowledge along with great communication skills. Needs agents that are adept
with all the technical knowledge to provide quick and efficient technical support services.
The technical support services include:
• Toll Free Customer Support
• Post-sales Support
• Remote IT Support Services
• Enterprise Technical Helpdesk Services
• Customer Sales and Support
• Managed Technical Support Services
• Pre-sales Support
5. Multi-channel Contact Centre Services
Multi-channel contact centres are gaining tremendous popularity, as it enables businesses
to serve their customers through a medium of their choice. The multi-channel contact
centre services include -
• Phone Support
• Live Chat Support
• Video Chat Support
 • Support through Social Media
• Email Support
6. Data Entry Outsourcing
All organizations, whether big or small, have data entry requirements. Data entry
outsourcing can be divided into -
• Online data entry – These includes services such as compilation of data
from websites and e-books, updating online catalogs, and creation of
databases
• Offline data entry – These include services such as offline data capture,
fillings of forms, forms processing, data entry from one format/version to
another, MS Word document data entry, etc

2.3. Planning for a Call Centre Implementation

Proper planning is an essential step in determining the success of call centre implementation
and operation. A well laid out business plan is a key factor in ensuring that the call centre is
aligned to the objectives of the parent organization and has a profitable and cost effective
operation. The business plan should also include key service level requirements for operations,
key considerations that shall be kept in mind while sizing the call centre, selecting the right site
for operations as well as the extent of change management and process re‐engineering needed
for the implementation. A period for key activities shall also be drawn out so that the call centre
is operational without undue delays. The business plan should also provide the organizational
and financial reasons for choosing to set up the call centre.

2.4. Setting the Objectives

Before deciding on the infrastructure, enablers, technology, and staff needed for the call centre, it
is essential to lay down the business objectives of the call centre. The choice of infrastructure,
technology, and number of staff and their skill levels all depend on the objective of the call
centre. This should be set forth before any procurement or hiring activity is commenced. The
objectives should be as narrow as possible as this will help to procure the ideal technology and
staff mix to serve the needs of the call centre.
 Some of the key objectives of why organizations opt for setting up a call centre are given
below:

i. Improve customer service levels and offer 24*7 support for customers
ii. Reduce the number of customer complaints received
iii. Cost reduction of transactions without affecting service quality
iv. Revenue generation includes everything that leads to revenue — sales, upgrades,
customer retention, collections, and winning back previously lost customers.
v. Efficiency refers to cost-effective operations for the organization — whether this
relates to the operation of the contact centre or to getting work done for the
organization.
vi. Customer satisfaction is really long-term revenue generation build customer loyalty
and keep them doing business with you. Contact centres should make things easy for
the customer. The contact centre is available when the customer needs it and has
access to all the information. Necessary to answer customer questions or solve
customer problems.
Call Centre Objectives

Goal/Objective Measure What It Tells Us

Customer • Post-contact • Are our agents providing good

satisfaction satisfaction service?
scores • Are we answering contacts quickly
• Contact • enough? (Hanging up is one form
abandonment of
rate • customer feedback!)
• Average speed
of answer
Cost control • Cost per contact • Are we handling contacts in an
• Cost per efficient manner?
customer • Do customers have to contact us
• Cost per case too often?
• Cost per order

Revenue • (Net) revenue • Are we making money?

generation per customer • Are we maximizing sales and
• Revenue per upselling
contact • opportunities?
• Are we growing the business?

Employee • Employee • Do our employees feel valued and

satisfaction opinion survey respected?
• Retention rate • Do they like working here?
• Employee
referrals

2.5. Sizing the Call Centre

Arriving at the right size for the call centre is extremely important. You can start this process by
collecting data pertaining to the calls that you currently receive or you are expecting to receive.
The following data points need to be collected and analyzed to determine the call centre’s size:

1. The number of calls currently received/expected to be received.

2. Call duration metrics – average duration of call, minimum and maximum duration of calls,
bucketing of calls into various buckets in terms of
duration
 3. Metrics related to nature of call – bucketing of calls into inquiry calls, service calls,
complaints/escalation calls.

Once this data is collected, it should be corrected to account for the likely increase in calls when a
dedicated call centre is introduced and customer awareness about the option increases. You must
also collect data related to competitor’s call centre size, if it is publicly available.

Other factors that can influence the size of the call centre
include:

1. Time spent on data processing activity – pre and post call.

2. Likely availability of staff (leave policy and absenteeism)

3. Potential gains to be achieved if the right expert is made available to answer the call, so
that multiple calls can be avoided. This needs to be measured both in quantitative terms
of agent time saved as well as qualitatively in terms of improvement in customer
satisfaction and brand perception

4. Variations in peak traffic at different times of the day as well as between weekend and
weekdays

The growth plans of the parent organization should also be considered. Thus, if the parent
organization plans to expand geographically, then you would need staff capable of handling
language and cultural requirements of the new geography. Similarly, if the organization is
planning to enter into a new product line, then the call centre staff should be technically capable
of handling queries related to the new product.

In general, sizing an inbound call centre is more challenging than sizing an outbound call centre.
In the former case, the organization cannot control the call volumes or the variation in peak
traffic. While a huge organization may hire external consultants to arrive at the size of the call
centre, a simple process of sizing the call centre is shown below:
 1. Arrive at the inbound and outbound call volume

2. Arrive at the average time for each call and related processing time for each call

3. Arrive at the actual work hours of an agent

The average time of each call should take into account only the actual time that is spent talking on
the telephone. The processing time includes all paper work and data analytics work associated
with a call. Typically, if you consider an eight‐hour shift, the productive time or actual work hours
for an agent is likely to be six hours or 360 minutes.

Once these numbers are estimated, the average customer time can be calculated as
follows:

• Average customer time (in minutes) = Average call time + Average processing time

• Average number of calls per agent per day = 360/average customer time

• Staff required = Total call volume expected/average number of calls per agent per
day

If the sizing of the call centre is correct, then it goes a long way in ensuring that the human
resource management of the call centre is a success. Sizing should also consider the levels at
which agents need to be hired as well as the recruitment and promotion policies of the call centre.
Once call centre sizing is complete, the output should be a staffing plan, which includes the
following elements:

1. Number of agents initially required as well as year on year growth plan for the next 3 years

2. Identify the organizational structure and determine skill levels needed for each role
3. Develop the recruitment process and the timelines

4. Design the induction training for initial hires

3. Call Centre Technology and Equipment

Based on the level of sophistication needed for the call centre as well as call volumes and the
budget available for setting up the call centre, the choice of technology can vary widely. The
various technologies at hand are as discussed below:

Automatic Number Identification

Automatic Number Identification (ANI) transmits the customer’s telephone number and delivers
it to your contact centre’s telephone system. In residential service, ANI is often referred to as
caller ID.
ANI can be very valuable because the calling number information can be used to identify
customers and look up account information before an agent even says hello. You can use this
information to give the caller special treatment — your very best customers might be routed to
an elite group of agents, for example, Special routing is a great way to boost customer
satisfaction and revenue per customer.

Dialed Number Identification Service (DNIS)

A contact centre probably has several different incoming numbers — depending on the various
services or products you offer — it’s important to know which of those numbers the customer
called. Through Dialed Number Identification Service (DNIS) the telephone network provides
you with the number that the customer dialed. This information tells the telephone system how
to route the caller.

Dynamic network routing

This service goes by a number of different names, but the basic concept remains the same. Some
contact centres have a computer that is directly connected to the telephone company’s switching
office. This computer enables you to control the routing of your customers’ calls at the network
level — before they hit your telephone system.
For example, when call volumes peak beyond a level that can be serviced in your centre, you can
redirect calls to other centres that you have overflow agreements with. Calls can be routed based
on a number of different criteria, such as a predetermined percentage allocation to each office.

Dynamic network routing also gives you one method of providing call-prompting (press 1 for
English, 2 for Spanish, for example) right in the telephone network.

Automatic Call Distribution

Think of Automatic Call Distribution (ACD) as the heart of the contact centre. When customer
calls arrive, they are delivered to the ACD — a phone system that routes a large volume of
incoming calls to a pool of waiting agents. It’s different from other phone systems in that it
makes use of telephone queues instead of extensions. (A queue acts as sort of a waiting room for
callers.)
ACD has a number of important capabilities:

• Announcements (delay messaging): This is the record- in that says, “Thank you for
calling; all of our operators are currently busy . . .” or whatever polite message you want
to convey.
• Music on hold: Music on hold plays between delay messages. Again, the main objective of
music is to encourage customers to wait for the next agent.
• Skills-based routing: As a variation on routing to queues, most ACDs have the ability to
route to skills instead. As the name suggests, skills-based routing is used to match each
caller’s needs with the agent who has the best skill set (of those available at the moment)
to service those needs.

Predictive dialing

A predictive dialer is a device used to manage and launch large volumes of outbound calls. The
dialer increases agent productivity by placing more outbound calls than the available number of
agents. The dialer then sorts out answering machines, busy signals, and other non-human
interactions before delivering live calls to the agents.
Predictive dialers can also be a great boon for contacting a customer base with information
about new products or services, or to provide reminders about appointments.

Predictive dialing can increase agent productivity by 300% or more over manual dialing by
removing list administration from the agent and reducing agent wait time between live calls. If
implemented properly, customers won’t even know that they are being contacted through a
predictive dialing system. The best systems deliver outbound calls to agents immediately when a
customer answers, without a bothersome delay that can cause a customer to hang up.

Interactive Voice Response systems

Interactive Voice Response (IVR) systems are known by several names, such as Voice Portal or
automated attendant. The concept behind such systems is that the customer is presented with a
series of choices from which he or she can choose. The choices made at any point in the call
dictate the choices next presented.

The idea behind automated response is to provide a quick, efficient way for the customer to get
the information needed.

For instance, whenever you’ve called your bank to determine your credit balance and used the
automated account lookup, which reads your account balance in an automated voice, you’ve
used an IVR system.

Automated Response Systems are very cost-effective. The cost of a service provided by IVR can
be less than 20 percent the cost of providing the same service using a live agent. The payback on
investing in an IVR can be very fast — well under a year.

Headset

A headset is a microphone and listening device for call centre employees. A headset is used
instead of a traditional phone receiver for comfort and convenience. A call centre environment
can become very noisy with the constant calls attended by agents who may be seated very close
to each other. Noise reduction headsets go a long way in increasing the productivity of agents as
well as improving the customer call experience, as it increases call response time as well as post
call‐processing time. Since agents would be using the headsets for a long time every day,
lightweight, comfortable headsets are the optimal choice.

Automatic Call Recording

Call recording software is a type of software used in call centres to monitor the quality and
success of calls. The recording software allows for later listening to evaluate a specific call. Call
recording software is commonly used with VoIP systems. If the call centre is handling sensitive
customer information or if you operate in a sector or geography where there is likely to be a high
percentage of disputes, then it may be a wise idea to invest in automatic call recording
equipment. This will help to record the call transcripts, which can be used for resolving disputes
as well as for training agents on how to handle specific situations. It is important to keep in mind
that if you use call‐recording equipment, then you need to inform customers that their calls may
be recorded and provide them the option of either hanging up or being excused from the live
recording. You must have your legal team address the privacy related regulations that you will
need to comply with while using call recording.

Call monitoring (process not equipment)

Call monitoring is the process of a supervisor or manager listening to a call to evaluate the
success of operator. Call monitoring can be done through using call recording software or a
hardware system that allows monitoring in real time.

CRM technology

Customer Relationship Management (CRM) is a business term that refers to the process of
relating to your customers to maximize the length and value of that customer relationship. It
involves data collection and analysis to better understand your customers’ needs and wants. It
also includes customized strategies for addressing unique customer needs. The whole point of
CRM is to get new customers, to keep the customers you’ve got, and to maximize the value of the
relationships you have with those customers.

The core of any CRM strategy is to create a philosophy and plan on how you want to treat your
customers, what you want to get from your customer relationships, and what you plan to give
customers in return. The execution of the CRM strategy requires careful advance planning and
evaluation. With such planning and evaluation, you can improve your customer relationship
management and your business results.

CRM applications can help a contact centre totally shift their focus to the customer in ways never
before possible. If your CRM applications are meaningfully integrated within your infra-
structure, then your customers’ experience is enhanced and operations effectiveness is
improved.

Computer Telephone Integration (CTI)

Today, Interactive Voice Response systems are used mostly by inbound call centres to automate
many activities, which callers can handle by themselves. For a financial services call centre, this
would mean providing details of the last five transactions or the current balance in the account.
However, this would require the IVR system to be linked to the underlying IT system and
customer database for authentication of the caller and data retrieval. This is achieved through
CTI, which also allows the agent to view the transactions and customer information related to
the caller as soon as the call is routed to him/her. The flip side of CTI is that it can be extremely
expensive depending on the features chosen, and typically only very large call centres would
have a full‐fledged CTI system. In a CTI system, agents typically have headsets, and separate
telephone equipment such as handsets is not required.

IP contact centres

VoIP is the transmission of voice conversations over an IP- based data network. It represents a
fundamental shift in the way that voice messages are handled when compared to traditional
circuit-switched phone systems. IP telephony is the collective set of software-based voice
applications that transport voice via VoIP.
For several years, businesses large and small have been saving significant amounts of money by
converting traditional voice systems to VoIP solutions. The savings is realized primarily through
a simpler network infrastructure (a converged voice and data network) and avoiding costly toll
calls by carrying the majority of traffic on that network. Savings are also realized through
significantly simpler maintenance — moves, adds, and changes are done in minutes instead of
hours or days.

SIP in the contact centre

SIP, or Session Initiated Protocol, is making its way into the con- tact centre. Using the concept of
presence, agents can instantly see who is logged on and what work state each expert is currently
in, putting your enterprise at the service of your customers. This facilitates an agent being able
to quickly invoke the help of another agent, a supervisor, or expert elsewhere in the enterprise
to help with an answer for the tough questions — leading to fewer transfers and faster call
resolution.
Reports used in managing a call centre

Agent performance reports. Typically, available from your ACD system, agent performance
reports provide statistics on each individual agent: how long the agent took to service calls, how
many calls were answered, the amount of time that the agent was logged in, and when they
logged in.

Queue performance report. A queue is an answering group — it represents service provided

and received by a universe of callers with similar needs. Separate queues are usually set up in an
ACD system for callers with different needs, such as different languages. Queue reports tell you
how many people called, how fast you answered the phone, how many customers hung up, how
long it took to service the average call, how many agents were logged in to the system, and so on.

Trunk performance report. Reports about incoming telephone lines, or trunks, are helpful to
ensure appropriate facility sizing and line utilization. This report, available through an ACD or
predictive dialer, is great for deter- mining how many lines you need to lease from your phone
company.
 IVR reports. Automated response system reports. An IVR unit provides reports on calls
received, options customers selected, the length of time customers spent using IVR services, and
when they used voice response services
Avoid getting caught up in the maze of contact centre reports and reporting. The best solution is
to combine data from the various systems to create meaningful information about your
customer’s experience, your drivers, and your business performance.
4. Call centre Staff

Within a call centre there are common roles: Centre Manager, Team Leaders and Advisors.
There are also other functions such as HR, Trainers or Operational Management. The size of the
centre will determine the number of Team Leaders and additional support roles.

a. Call Centre Advisor/Agent/Customer Service Representatives

This role is to handle telephone calls on behalf of an organization, to fulfil customer requirements.
This generally involves customer calls coming into the contact centre, which are known as
inbound calls. However, an Advisor may also contact customers themselves, maybe for market
research purposes or perhaps to sell them something. These are known as outbound calls.
In addition to phone calls, Advisors often communicate with customers via email, web chat and
post.

b. Team Leader

A Team Leader, often known as a Supervisor or a Team Manager, is responsible for managing a
team of Advisors/Agents.

The Team Leader’s role is to ensure individual Advisors are performing against targets, while
reviewing their performance and coaching them to do so.
Team Leaders are also expected to meet on a regular basis with their Manager, both to provide
feedback and to receive instructions or actions.

c. Call Centre Manager

This is the person who is ultimately responsible for the overall performance and budget of the
centre. They will make decisions regarding the people, the processes, the technology and the
customers that are part of the call centre and the future strategy and development of the centre.

In addition to this, the Call Centre Manager is usually the person who liaises with other
departments such as HR, IT, and, especially if it is a sales centre, Sales and Marketing.
 d. Head of the Call Centre

Contact Centre Heads lead contact centre operations of various sizes. Typically, this is a fast-paced
area of business that is challenging and changing continuously.
Someone in this position would be expected to shape the future of the contact centre operation, to
improve the customer experience through each available channel.
Typically, the Head of the Call Centre would report to the Customer Services Director or Managing
Director and would be held accountable for the performance of all call centre teams

e. Customer Services Director

The Customer Service Director is a key strategic and operational leadership role. Whoever is in this
position will be responsible for the development, continuous improvement and delivery of
customer service.
In addition, the Customer Service Director will be accountable for the strategic development of
operational requirements, processes and technology, with aim of delivering key service outcomes
for customers in either a B2B or B2C environment.

f. Operational Manager

As a support role in larger centres, the Operational Manager would tend to look after the
operational elements of the contact centre.
A person in this role would also be expected to liaise with the Team Leaders and the Call Centre
Manager regarding performance management information, and they would usually be the link with
the IT department or technology suppliers.
So an Operations Manager would have to be good with statistics and technically minded, while
communicating with all levels of the contact centre.

g. Trainer

Some centres have trainers as part of the overall team because of the high volume of induction and
ongoing training that is required.
They are responsible for preparing and delivering training to the agents in the centre.
5. Call Centre Operational Metrics

Business objectives are the desired outputs of the contact centre — what the corporation needs
from the contact centre by way of revenue generation, cost management, and customer
satisfaction.

Ways of measuring whether your contact centre business objectives are being met will be here
by highlighted.

5.1. Operating budgets

The operating budget is the sum of all the costs associated with running a contact centre for a
given period, usually a year. The largest cost in the contact centre budget is typically labor. In
traditional contact centres, it is not unusual to base budgets on common assumptions, such as the
number of contacts that the centre will receive, how long those contacts will last, and what it
takes to achieve resolution on the contacts. These assumptions are used to determine staffing
needs and to anticipate other costs.

By understanding the factors that go into the budget, one can play “what if” with those factors to
see the bottom-line effect. Being able to do a quick calculation on the impact of changing the
drivers goes a long way to motivating management to find ways to make improvements.

5.2. Cost centre versus profit centre

Many times management views a contact centre as a burden- some expense for the corporation.
This may not be a fair assessment, however, because many contact centres turn out to be profit
centres — they help create customer loyalty and generate sales that may otherwise have been
lost.

Attention can be paid to a number of measurements on the cost side of any equation, including
the following:
 Cost per contact. Calculated by dividing the total costs to run the contact centre for a period
of time by the total contacts responded to in the same period.

Cost per customer. Calculated by dividing the total cost of running the contact centre for a
period of time by the average number of customers for the same time frame.

Cost per resolution. Divide total costs for the period by the cases resolved, looking for
improvement over time.

These are obviously very simplistic measurements, and will suffice for some contact centres.
Others use more complex measurements that either build on or entirely replace these simplistic
ones. Many of the measurements are provided by the management applications used at your
site; make sure you review what is available and determine which measurements fit best with
your needs.

On the profit centre side of the coin one can utilize entirely different measurements, such as:

Total revenue generation. Your finance or marketing department will calculate total
revenue generated.

Revenue per contact. Divide total revenue generated during a period of time by the number
of contacts for the same period.

Revenue per customer. Divide the total revenue generated for a period of time by the
average number of customers over the same time frame.

If one can constantly reduce cost per customer and increase revenue per customer, then you’re
looking the good life right in the eye.
One way that one can help decrease costs — while still handling more volume — is through the
implementation of self- service technologies.
5.3. Performance Drivers: Managing the Results

Performance drivers are variables that have an impact on your contact centre’s business
objectives (see Part II for more detail). They’re called performance drivers because, like a person
who manages the controls of a car, or like the
programs that make computer equipment work, drivers are things that make other things go. In
this case, performance drivers make business objectives go.

5.4. Examining performance drivers

A key component to controlling and manipulating outcomes is to designate responsibility

throughout the organization — most importantly to the contact centre agents, because each
agent is a microcosm of the operation.

Table below show how to track and improve results on the agent level. Individual agent
improvement pulls up improvement in overall average agent performance, which in turn drives
over- all improvement in the contact centre.

Measures at the Agent Level

Contact Centre Drivers Agent-Level Drivers

Cost per hour of agent time Wage rate

Agent utilization Schedule adherence
Call length Call length

Contacts per customer First-Call Resolution

First-Call Resolution

Occupancy N/A

Conversion per contact Conversion per contact

Dollar value per conversion Dollar value per conversion
5.4.1. Contact-oriented metrics

Any number of performance drivers may be related to calls or other contacts. You can get a better
handle on them by examining the measurements related to contacts. The following sections detail
some of the more common contact-oriented metrics.

i. Contact length
Contact length is one of the most powerful measures in the contact centre. It’s a little
controversial in that some believe too much focus is put on length without appropriate attention
to other measures. However, customers want the same thing that contact centres do — a quick,
accurate, and complete resolution. In general, shorter times mean everyone is happier.

A longer call can be a wonderful thing if it brings more rev- enue per minute. For example, if a
customer gets a question resolved quickly and is so pleased with the service that he orders
more product, the extra minute of tender loving care the agent provides may well result in one-
call resolution and repeat business.

ii. Conversion per contact

A contact is any time you say hello (via the phone, self-service, e-mail, chat, whatever).
A conversion is any time you generate or save revenue on a contact. Conversion per contact
affects total revenue generated and other revenue objectives.

5.4.2.Accessibility

Accessibility means how easy it is for a person to make contact — it’s how fast you’re answering
the phone, e-mail,or letter. It’s important because it has an impact on customer
satisfaction and cost control. Here are three common measures of the many used to calculate
accessibility:

a. Service level: Refers to the percentage of callers whose calls are answered within a
defined time.
b. Average speed of answer: Also known as ASA, this refers to the average amount of
 time your customers waited in queue before an agent greeted them.
c. Abandonment rate: The percentage of callers that hang up before an agent responds to
their contact attempt.

5.4.3. Agent professionalism and ability

Agent ability is probably the most important requirement in achieving customer nirvana.
Whether calling a contact centre or shopping for new shoes, most customers expect the same
thing of customer-service people: Know what you’re talking about, and be nice! Customer
satisfaction surveys can help in this regard.

Through the surveys, customers can tell you about the agents who aren’t nice or who can’t do
their job. When you ask the right questions, customers will also tell you specifically how your
company needs to improve.

Many contact centres have people listen to agent calls to determine whether they are
professional and capable; this is frequently referred to as “call assessment” or “call monitor- ing.”
The evaluator scores the agent calls against a template of key call behaviors.

5.4.4.First-contact resolution

First-contact resolution (FCR) refers to the percentage of cus- tomer inquiries completed on the
first attempt. If customers have to reinitiate a contact once or many times because the contact
centre did not resolve their inquiry or concern the first time, then FCR will decline — and so will
customer satisfaction.

The benefits of tracking FCR are significant. Improving this measure has an impact on customer
satisfaction. It also improves cost control — improving FCR reduces the load
on a contact centre as the number of repeat calls decreases.

5.4.5.Policies and procedures

The drivers listed so far in this part aren’t the only ones that influence your operation. A large
part of your analyst’s job is learning how to identify and manipulate these and other driv- ers of
contact centre performance. After she has identified the variables that contribute to
performance, she’ll look to your company and contact centre policies and procedures to
understand the process behind each driver.

5.5. Setting Performance Targets

Setting performance targets is extremely important. People work better with very specific
targets, whereas vague targets create vague results. When setting performance targets, you first
have to figure out what’s the right thing to target. You then have to determine what level of
performance to expect for that target. This section provides some ideas that can help you set
appropriate targets for some of the most important contact centre drivers.

5.5.1. Accessibility/service level

Here are some examples of methods you can use to set performance targets for service level:

I. Do what everyone else does. The default level of service for answering phone calls tends
to be 80/20 (80 percent
II. of calls are answered in 20 seconds or less). E-mail and chat don’t seem to have generally
accepted standards, perhaps because of their relative infancy.

III. Go with the industry direction. A number of industries are self-regulated or even
government-regulated in terms of how fast contact centres must answer the phone.

IV. Develop a business case. Do a cost-benefit analysis to determine your service-level

objective. Evaluate each of your customer segments for tolerance levels for waiting in
queue. For example, you may notice that for your premier customer group, the number of
abandons spikes sharply after 15 seconds, whereas the tolerance level for a general help
line is much higher. If you do this analysis well, you can find the break-even point
between the cost of providing faster service and the benefit of answering calls before
potential customers get tired of waiting and hang up.
5.5.2.Abandons

Abandons are defined as customers who try to contact your business, but fail to reach an agent
for one reason or another.

The most common type of abandon is a customer who hangs up before an agent is available to
answer the call. Abandons also occur in other contact methods (e-mail, chat, and so on), but are
easiest to track on phone contacts.

One way that some companies have helped decrease abandons is to implement a self-service
system that answers the most common customer queries, without the need to involve an agent.
Self-service does away with the necessity of placing
a customer on hold, so customer satisfaction can be improved even while abandon rates are
dropping.

5.5.3.Call length

Coming up with the proper benchmark for call length is difficult because there are too many
variables that go into the mix. Product complexity, system capabilities, responsiveness, working
environment, information collected via self-service, training, and a host of other variables can
affect call length. Identifying the one right call length is nearly impossible.

What you can — and should — do is try to understand as much about your own centre’s (or,
more accurately, each of its own individual campaigns’) call length as possible. Of
course, you can also attempt to make call length as consistent as possible. Ideally you also need
to measure the impact of a call. For instance, does a longer call result in more revenue for the
company? If so, then the agent should not be penalized for longer call lengths.

5.5.4.Occupancy

Occupancy — how busy your agents are with current contacts — is an important measure of
whether you are effi- ciently using agents. If your agent occupancy is consistently very high, you
could be causing agent burnout. On the other hand, if occupancy is too low, this unused agent
time is adding significantly to your costs.

When your actual service level is too high above the target, it’s costing you too much in labor. If
it’s too far below the target it’s costing you customer satisfaction, revenue, and other expenses.
Cost control is balanced when service level is right on the target.

5.6. Call Centre Performance Metrics

It is important to focus on quality and productivity from the first day of operations. Thus, it is
important to identify the key performance metrics that you would track regularly and the levels
that you aim to achieve. These metrics also have a direct impact on the kind of technology
infrastructure that you would select as well as the skill levels of agents that you would hire. Both
internal productivity measures as well as caller satisfaction measures must be tracked and
monitored regularly. A recent Gartner study has identified the following industry standards for
key metrics in the call centre:

✓ Average call wait time: < 20 seconds

✓ % of calls answered within the average call wait time: > 80%
✓ Call drop rate: < 5%
✓ Agent availability: >99%
✓ First call resolution: > 95%
✓ % of time spend on calls: 83%
✓ Average call duration: 187 seconds
✓ Staff turnover: 22%
✓ Average length of service of agents: 27%
✓ Agent: Team Lead Ratio : 13:1
✓ Average Training Time: 27 days per year

Depending on your capabilities as well as client requirements, you must set your own goals for
each of these parameters and monitor your performance against these on daily, weekly, monthly,
and quarterly levels. Comparing your performance against industry benchmarks would help to
identify areas of improvement.
Key Performance Indicators measure the effectiveness of handling calls, which translate to
service delivery excellence. In addition to these KPIs, you must also monitor the cost per
transaction as well as the earnings per agent as this would help you price your contracts
effectively.

5.6.1. Agent Performance Measurement

Often agent performance is measured quantitatively in terms of the number of calls per hour,
average call time, average processing time and so on. However, it is important to review the call
records in order to identify areas of improvement for the agent in terms of quality of client
handling.

5.7. Resource Management Tasks and Concepts

5.7.1. Forecasting

Forecasting refers to predicting the future — specifically, how much work the centre is going to
have. The key is to accurately determine your workload and when you’ll have it, so you can
match resources to demand.

Don’t assume that the time it takes to process calls, e-mails, or Web chats is always the same. It
makes sense that a very simple customer inquiry is likely to take much less time to process on
average than a complicated, high-level technical support call. Contact length typically fluctuates
over time, as does call volume.

5.7.2.Scheduling

Scheduling is the process of assigning resources to meet your demand. Where forecasting
provides the “how much” part of resource management, scheduling answers the “who, what,
where, and when” parts. An important part of managing the contact centre is providing
schedules that are workable and help achieve business objectives. Some centres go so far as to
measure schedule adherence, which reflects whether agents adhered to the schedule that was
implemented.
 • Full-time equivalent

Usually referred to by the short form FTE, full-time equivalent is a way to express how many
people you need to schedule.

Staffing requirements are expressed in terms of the number of people working full-time hours.
For instance, one FTE may equal 7.5 paid hours. So, if call demand required 750 total paid hours
to get the work done for a day, this would equate to 100 FTEs.

• Real-time management of resources

As the name suggests, real-time resource management refers to making the necessary ongoing
changes from your original schedule based on real-life, up-to-the-minute changes in call volume
and staff availability so that your contact centre achieves the best possible results each day.

5.8. Assigning Staff and Creating Schedules That Work

Sooner or later you get to the point where you need to attach the names of the agents who will
work the shifts. The easiest way is for you to simply pick names and assign them to a schedule
— if, that is, you really don’t want people to like you.

Probably the safest (and fairest) way, especially in larger con- tact centres, is to post the
schedules and allow staff to bid
on the available shifts, giving bidding priority to senior staff members.

Some contact centres use alternatives to shift bids. These might include rotating staff through all
shifts (essentially, sharing the pain), working around employees’ personal preferences,
assignment by employee performance, or fixed permanent shifts.
Regardless of the approach, you’re bound to have less than desirable shifts. This can be
somewhat demoralizing for staff, considering that the majority of folks would rather be working
9 to 5, Monday to Friday. Some things you can do to ease their angst include:
Re-bidding: Redoing the schedule from time to time is a good idea. It enables your staff to
move up the chain and get more-desirable shifts, and can really improve team motivation.
Shift-trading: Give your employees a mechanism for trading their shifts — “You work my 9 to 5
and I’ll work your 1 to 9.” It’s usually done on a one-day-at-a-time basis.
 Time bank/flex time: Allow employees the option to bank extra hours they work and take
them as time off at a future date. This approach works well if it’s administered and tracked
carefully.

5.9. Managing Operational Costs

Once the call centre is operational, it is essential to be aware of any unplanned cost escalations,
which can set the project financials in disarray. It is essential to put aside a contingency fund to
ensure that the cash flow is not squeezed should such events occur. Some of the operational
events that can have an unplanned cost impact are listed below:

• Cost of client acquisition – this can soon spiral into a very large number, especially for
third
party call centres
• Manmade or natural disasters than require the business continuity plan to be set in motion
• Unexpected system downtime
• Relocation or expansion due to sudden growth in client base

5.10. Making your Call Centre Future Ready

Call centre architecture needs to be future‐proofed. Changes in the underlying technology can
prove to be costly in terms of the effort, time, and money spent on change management,
technology enhancements, and re‐skilling agents. You need to be aware of the latest
developments in the call centre industry as well as your client industry in order to make your
call centre future ready. For example, most financial institutions today offer customers the ability
to conduct transactions through multiple remote channels such as mobile, fax, web, and ATM, not
to mention the call centre as well as the branch itself. The call centre would be increasingly
expected to take over some of these remote service channels and effectively manage them in
future.
6. Call Centre Operations Management

Good operations management practices are an essential element in achieving the objectives of
the call centre. The diagram below depicts the key aspects of operations management in a call
centre, each of which is discussed in subsequent sections:

6.1. Human Resources Management

Staffing is the highest operating cost of a call centre. So, it is imperative to incorporate
structured growth paths as well as retention strategies for agents and management staff in the call
centre. As part of the operations management of the call centre, it is essential to have documented
and well-laid out processes and policies for the following HR activities:

1. Recruitment
2. Training
3. Staff Welfare – Health and Safety, Leave and Benefits
4. Compensation Structuring
5. Promotions and Career Paths
6. Separation
7. Staff discipline

Motivation and retention strategies should also be well thought out based on a scientific cost
benefit analysis. It is essential to recognize the importance of agents and managers in helping the
call centre achieve its stated objectives and goals. Some of the key areas are listed below:

Staff Training

Staff training is an essential part of call centre success, as callers perceive the agents as the face of
the parent company. Therefore, allocating adequate budget and time for staff training is essential.
Some of the key areas of training can be:

• Technical Skills and Product Knowledge

• Call Handling Etiquette
• Communication Skills
 • Negotiation and Sales Skills
• Stress Management
• Use of IT systems
• Familiarization of the policies and processes of the call centre
Team leaders and managers need to be trained on aspects such as quality assurance, monitoring
of performance metrics, and staff management.
Training plays a key role in improving agent performance, and there should be a planned
induction‐training program for all agents who join your call centre. You must budget for annual
training costs in your staff plan and financial projections.

Career Progression
In order to maintain the quality levels and service standards of the call centre, it is important
that you have a documented career progression plan for agents to move to the level of team
leaders based on a list of skills that they need to acquire. A competency based assessment and
performance management system needs to be designed and implemented in line with the
objectives of the call centre. Some of the key metrics that can be measured include call
quality, understanding of business processes and keyboard speed. You must also train team
leaders to provide immediate feedback to agents rather than waiting until the formal appraisal
period. A well‐defined career progression path should be designed and communicated to
agents, so that attrition rates can be minimized.

Staff Retention

Staff retention has been a major challenge in call centre operations all across the globe. Hence,
you need to pay special focus on this aspect while creating your call centre business plan. Often,
the lack of career progression, the monotonous nature of work, and the odd work hours have
been cited as top reasons for high staff turnover.

To avoid the monotonous nature of work the following aspects need to be taken care of
while recruiting and training staff:

• Provide job rotation between customer facing and back end operations
• Provide job rotation between different types of activities
• Train staff to be multi‐skilled
Compensation and Benefits

While designing the compensation and benefits package of staff, make sure that you
include performance‐linked incentives so that agents are encouraged to consistently achieve
high quality performance. Bonus payouts should be linked to the performance metrics that
the call centre targets to achieve. Team leads and managers should also be offered variable pay
based on these parameters, so that the organizational objectives as well as the individual
objectives are in perfect alignment. One key aspect to keep in mind while designing the
compensation and benefits package is that it should not only encourage individual excellence, but
it should also motivate agents to work together as a team.
Creating a fun environment at work is an important factor to retain agents. You may want
to set aside a fixed monthly budget for conducting staff wellbeing activities such as
celebrations and motivational events.

6.1.1. Minimizing Staff Costs

In order to minimize staff costs, you may also consider hiring temporary employees to handle
peak loads. This is especially relevant for call centres where there is a huge variation in peak
load. It will also help to have a plan in place to absorb high performing temps into the
permanent roles of the company. The recruitment and selection strategy should be designed
in such a way that you minimize attrition rates among staff, which will directly result in
cost savings in the area of recruitment and training.

6.1.2. Staff Rostering and Scheduling

While preparing the business plan for your call centre, pay close attention to the staff rostering
and scheduling aspects. You need to decide on whether you plan to offer remote working options
(which translates to lower infrastructure costs), what percentage of staff would you want to be
temps, and whether you want to operate in shifts to cater to your client operations in remote
locations or different time zones. Studies have shown that shorter shifts are directly proportional
to
increased agent productivity. For example, if you operate a six‐hour shift, then you need not
allocate time for lunch and coffee breaks, unlike in the case of an eight‐hour shift. Weekend
 work should ideally be scheduled with temp staff, thus allowing permanent staff a more
balanced work life.

If you plan to have a call centre with more than fifteen to twenty permanent agents, then it
would be a good idea to invest in workforce management software to help prepare staff rosters
after taking into consideration all the relevant variables. This would help to save the team
leader’s and manager’s time that would otherwise be spent on creating manual rosters which
need frequent tweaking based on leave and load variations.

6.2. Business Continuity Planning

One of the key success factors of a call centre is the ability to offer continuous service.
Business plans should have enough redundancy built in at various levels to handle service
disruptions due to factors such as technology failure or staff absenteeism, not to mention
unforeseen events such as environmental disasters or fire.

A separate business continuity plan needs to be developed to ensure continuous service

delivery. One of the expenses related to business continuity planning is the establishment of an
alternate site that can be used during normal periods as a training centre. It can also serve as a
secondary call centre to which calls can be routed in the event of an unexpected increase in
call volumes. The primary site should also have redundancies in the telephone and IT equipment.

One of the most cost effective ways to ensure staff redundancy is to have a pool of temporary staff
that are well trained in all operations and can be quickly deployed to the alternate site
when a disaster occurs.

It is also important that the business continuity plan is regularly tested and kept up‐to‐date
to match with the growth of the call centre. Simulation tests to check the effectiveness of the
business continuity plan need to be conducted regularly to make necessary changes.
7. Project Financials

A call centre may have a service focus or a sales focus or it may be a combination of both. No
matter what the nature and size of your call centre, prudent financial management is an
essential factor for the success of the call centre. It is essential that sufficient thought is spent
in arriving at the financials for at least the first three years of operations. It is ideal to have a
monthly financial projection for the first year of operation as that is crucial in terms of any
course corrections that you may want to make. The key elements that contribute to the
project financials are your sales plan, your personnel plan, and your technology roadmap.

According to a study by the Gartner group, a typical call centre would spend almost 65% of its
operational budget on staff costs, 18% on network costs, 8% on equipment costs, and 7%
on facilities.

7.1. Start‐Up Expenses and Funding

The first step in arriving at the project financials is to calculate the startup expenses and initial
funding availability. Startup expenses include infrastructure expenses as well as cash needed to
sustain operations until the call centre generates sufficient operational revenue. Initial funding
can be in the form of founders’ equity capital, bank loans, or funding from private investors

Cost Break Down (Equipment, Software and Set Up)

Particulars Amount
Licenses, S/W, H/W and Implementation 5,000,000
CRM Licensing Cost 1,000,000
Server Cost 800,000
IPLC Cost and Multiplexer 1,800,000
Networking Cost 500,000
Furnishing Cost 800,000
Computer and hardware 900,000
Ups and Generators 700,000
Training Cost 500,000

Total 12,000,000
• Working Capital is 1.5 times of months expenses

Working Capital (WC)= Ksh. (1.5*1.4)M=2.1M

• CRM cost is based on the requirement of the expected client
• Except the client work station and training, other costs are all guideline values.
• Square feet required per agent: 60 square feet.

PRE OPERATION EXPENSES (For the months indicated)

Months Monthly Expenses Amount Per Year

Expenditures
IPLC Cost 1 500,000 500,000 6,000,000
Rent 3 80,000 240,000 960,000
Salary 2 660,000 1,320,000 7,920,000
Travel 3 33,333 100,000 400,000
Electricity 3 40,000 120,000 480,000
Repairs & 4 25,000 100,000 300,000
Maintenance
Staff Welfare 3 40,000 120,000 480,000
Telephone 5 30,000 150,000 360,000
Office maintenance 5 25,000 125,000 300,000
Advertisement 3 100,000 300,000 1,200,000

Total 1,533,333 3,075,000 18,400,000

Salaries
Category Nos. Monthly Salary Total Salary p.m.

Operators 20@25000 500,000 6,000,000

Executives 4@40000 160,000 1,920,000

Total 7,920,000

***Pre-operative Salaries (2 months) 1,320,000

 Cost of Project

Item Ksh.
Equipment/Software and Set Up 12,000,000
Pre-Operative expenses (as per months above) 3,075,000
Margin for WC 2,100,000
Total 17,175,000

7.2. Implementation Schedule

The machines are can be availed within two weeks period. The project can be implemented
within one month.

7.2.1. Outsourcing Costs | Call Centre Pricing

Call centre pricing might be the single most important factor in the whole outsourcing process.
There are many variables involved in outsourcing costs including: skill levels, type of work,
location, and duration of the application. Here are some general guidelines to call centre prices in
our industry:

1.) Inbound
Inbound call centre services tend to be priced in three main ways:
o Shared – “Shared Inbound” is defined as services in which a pool of agents answer calls for
1-3 dozen clients. The client then pays only for the time used on a per minute basis. These
rates range from Ksh.35-45/minute at low cost international agencies to Ksh.75-90/minute
in the US/Canada. Shared Services are ideal for applications with wild volume swings or low
overall activity.
o Dedicated – This type of service involves a dedicated group of agents that handle calls
exclusively for one client. Our call centres typically price this service on a per hour basis.
These rates range from Ksh.800-1500 internationally to Ksh. 2200-2800 in the US/Canada
for “normal” agents. Dedicated Services are ideal for complicated applications or when
volume is significant and predictable.
o Monthly – This type of call centre pricing is basically a subset of “dedicated”…simply
compiled into a monthly rate instead of an hourly rate. Many low cost international call
centres offer this type of pricing. However, it is rare to find it in North America or Europe.
2.) Outbound
Outbound call centre services are typically priced as follows:
o Hourly – This is the “normal” call centre price structure for outbound sales, lead generation
and appointment setting. In general, rates vary based on the location of the agency. Smaller
agencies in India or The Philippines normally charge from Ksh.600-1000 per hour.
Furthermore, call centres in Eastern Europe or Latin America normally feature rates from
Ksh.900-1400/hour. Finally, call centres in mature western countries (like the US, UK,
Germany & Canada) typically charge Ksh. 2200-3200. Very specialized, high level agencies
in these countries can occasionally be hired for Ksh. 3500-5000 per hour.
o Commission – On certain sales or lead generation applications, a full commission structure
makes sense for both parties involved. The amount of commission is completely dependent
on the situation. However the amount earned per hour by the call centre should provide at
least a 10% to 20% premium over their normal hourly rates to account for the additional
risk to the call centre.

o Hourly + Commission – This might actually be our favourite call centre pricing structure
for sales programs. Just like you pay an internal salesperson in this manner, a combination
structure provides that both parties have “skin in the game” and often works quite well to
maximize performance.

3.) Location
The single largest outsourcing cost variable is location. Therefore, selecting a call centre located in
the US or Europe versus India or Latin America will have a huge impact on costs. Here is a general
guideline to outsourcing costs by geographic location:
o United States/Canada: Ksh. 2200 – 3500 per hour
o Western Europe: Ksh. 4000+ per hour
o Eastern Europe Ksh. 1200 – 2500 per hour
o Australia: Ksh. 35 – 5500 per hour
o Africa/Middle East: Ksh. 1500 – 2000 per hour
o Latin America: Ksh. 800 – 1800 per hour
o Asia/Philippines: Ksh. 800 – 1400 per hour
o India: Ksh. 500 – 900 per hour
o Pakistan: Ksh. 600-1000 per hour
We’ll use the locational charging criteria and peg the amount at Ksh. 1000/hour at 100% utilization.
−Installed capacity of the proposed Call Centre is 20 seater.
−Income per seater per hour is Ksh.1000 at 100% utilisation. The unit works for 12 hours a day
and 300 days per annum.
The annual income works out to :

Ksh: 800x12x300x20=57,600,000
• Salary is estimated at Ksh. 7.92 Million per annum.
• Rent is provided at the rate of Ksh. 960,000 p.a
• Electricity charge is estimated at Ksh. 960,000 p.a. at 100% utilisation.
• Repairs & Maintenance is estimated at Ksh. 300,000 p.a
• Depreciation is calculated on WDV method.
• Selling, General & Adm. Expenses is Ksh. 2.4M p.a.
• Income tax is provided at 30% on taxable income.
• Office maintenance is projected at Ksh. 300,000 p.a

COST OF PRODUCTION & PROFITABILITY STATEMENTS

Years 1 2 3
Income p.a 57,600,000 63,360,000 66,240,000
Utilization 60% 70% 80%
Income p.a 34,560,000 44,352,000 52,992,000
Electricity 480,000 556,800 640,320
Salaries 7,920,000 9,912,000 12,348,000
Rent 960,000 1,017,600 1,088,832
Repairs/Maintenance 300,000 315,000 330,750
Depreciation 2,200,000 1,870,000 1,589,500
Cost of Production 11,400,000 12,084,000 12,809,040
Admin. & General expenses 2,200,000 2,266,000 2,379,300

Total 25,460,000 28,021,400 31,185,742

Profit Before Tax 9,100,000 16,330,600 21,806,258
Provision for tax 2,730,000 4,899,180 6,541,877
Profit After Tax 6,370,000 11,431,420 15,264,381
Add: Depreciation 2,200,000 1,870,000 1,589,500
Cash Accruals 8,570,000 13,301,420 16,853,881