In the world of retail, an industry term known as “shrinkage” is frequently used as a reference to lost inventory that is never sold (i.e. theft).
There are an increasing number of industry experts who use the term “shrinkage” when referring to contact center operations. Instead of inventory, what is being lost to shrinkage in the contact center is the employee’s time. Simply put, contact center shrinkage is time when a Conversational Marketing Expert (CME) is getting paid but not taking calls. At Incept, we refer to the two most common influences on shrinkage: variance and schedule adherence. Poor variance and schedule adherence have negative impacts on the CME, the company, and its clients.
For Incept the concept of shrinkage is more cut and dry. Notwithstanding planned meetings, such as Employee of the Month, paid breaks, and coaching sessions, we want the CME to be on phone calls or available to take phone calls for the entire time they’re clocked in. When an employee is supposed to be taking calls, but is not, we call it variance at Incept. At the CME level, variance represents the potential for lost appointments, fewer Lifesaver points, and a smaller bonus.
Since I am a numbers guy at heart, I would like to take a brief mathematical look at two hypothetical groups of CMEs to showcase the organizational impact of variance.
- Group 1: Scheduled 26 hours, 5% variance
- Group 2: Scheduled 26 hours, 10% variance
Let’s assume that, in a given week, Incept requires approximately 2,800 hours of phone time to complete the required work on the Saves/Outbound side of the business.
- Group #1: 26 hours, less 5% variance = 24.7 hours of phone time.
- 2800 hours of required phone time – 24.7 hours per Group #1 CME = 113.3 CMEs needed
- Group #2: 26 hours, less 10% variance = 23.4 hours of phone time.
- 2800 hours of required phone time – 23.4 hours per Group #2 CME = 119.7 CMEs needed
From an organizational perspective, the difference between 5% variance and 10% variance is an increase in labor requirement of 5.6%. This percentage may seem small, but extrapolated over the course of an entire year, it adds up. In addition, the extra infrastructural costs such as additional computers and dialer licenses have to be taken into account as well.
It should be clear that some variance, even in addition to what is minimal (i.e. your break) is understandable. We don’t expect employees to delay going to the bathroom until their meal or break periods. However, there are certain things that all of us as a team-minded organization can do together to accomplish these variance and schedule adherence goals.
Step #1 – Be personally accountable for variance.
Maintaining variance within permissible levels is a measure of your job performance, just like your % to goal or your CQ scores are. Typically, once an employee accepts accountability, their variance improves.
Step #2 – Consult with Contact Center Results Management to monitor your variance.
Personally, I love it when CMEs take an active role in understanding and working to improve upon the statistics that measure their performance. If you think you had a very good variance day, ask a member of management to look at the percentage to confirm it for you. Seeing your efforts to reduce your variance bear immediate results is an end in itself.
Step #3 – Honestly examine behavior that is driving up your variance.
Only you can make an honest examination of the things that drive up your variance. Imagine a CME who has a variance of 8%. Variance of 8% is equivalent to almost 40 minutes of time off of the phone in a shift of 6.25 hours. How much of that time is truly necessary? How much of that time is essentially an extra unauthorized, paid break?
Following these three steps can result in great improvements in variance. This will have a positive financial impact for both the CME and company while generating superior customer service and results for our valued clients.
What else need to be said?