Decline of Call Center Service

I am reprinting the following from the Peppers & Rogers "1to1 Weekly," June 30, 2008 --

THE DECLINE OF CALL CENTER SERVICE
By Kevin Zimmerman, Senior Editor

The 10th annual "Call Center Benchmarking Report" from Dimension Data paints a somewhat negative picture of where that industry segment seems to be headed -- though not everyone agrees about what the survey's implications are.

Dimension Data surveyed 300 call centers in 36 countries across five continents. The research shows that from 1997 to 2007, key performance metrics indicate a significant deterioration of quality of service in contact centers. Call abandon rates, due to long hold times, increased during the 10-year period by nearly 127 percent, while the average time to answer a call rose by some 70 percent, from 23 to 39 seconds.

In addition, the percentage of calls that were answered in less than 10 seconds decreased by nearly 12 percent from 72 percent of all calls to 64 percent, while callers on average abandoned a call after waiting for 45 seconds in 2007, compared to 53 seconds in 1997.

Steve Loring, business development manager for customer interactive solutions at Dimension Data, attributes these performance drops to changes in the market and customer service dynamic over the past 10 years.

"The access of information is more of an open commodity now," Loring says, citing increased competition between businesses and the array of channels with which customers and businesses can interact (email, Web, phone) as factors that have made customer interaction much more complex.

"There has also obviously been a move toward more self-service," he adds. "A customer faced with being on hold may abandon the call and try to solve the problem on his own."

The report also states that contact centers are finding it increasingly difficult to retain employees. During the 10-year period, annual agent attrition rate rose by nearly 93 percent, increasing from 14 percent to 27 percent.

Loring maintains that the difficulty in retaining employees could be related to the increased outsourcing of agent seats. The survey found a 220 percent increase in outsourcing, with 16 percent of agent seats outsourced in 2007 compared to 5 percent in 1997.

"If you were to ask me to guess what the outsourcing rate was, I'd never guess a number as low as 16 percent," avers Peppers & Rogers Group cofounder Martha Rogers, Ph.D. "So while, yes, it's an increase of 220 percent from 10 years ago, it's kind of: so what? That's still a surprisingly tiny percentage."

Strategic issues behind the numbers
Nevertheless, Rogers says, the issue remains an important one. "At the heart of the problems we see at call centers is that they're hiring the wrong people or they're not doing the right things to keep them," she says. "They've created cultures that are basically sweat shops, where people who can do anything else, will. They view it as a temporary place to make money until they can get a 'real' job. So you're putting your customer relations in the hands of people who just want to get out."

Ian Jacobs, senior analyst at Frost & Sullivan, adds that the same situation is now being repeated in call center hubs like India and the Philippines. "Ten years ago being a call center rep was viewed as a career, but that's no longer the case," he says. "Countries with maturing outsourcing operations are seeing an explosion in turnover, and almost by definition that has a negative impact on the customer experience."

Corporations that view contact centers mainly as cost, rather than profit, centers are missing the boat. "The talk about improving the customer experience is still aspirational for the most part," Jacobs says. "When companies want to cut costs, they still look at the call center first."

Rogers agrees, but warns of the strategy. "Using the call center as a quick way to make your quarterly numbers is a stupid thing to do," she says. "Focusing on first-call resolution rather than on length of call increases customer satisfaction scores enormously. Proper training, and encouraging people to treat customers as they themselves would like to be treated, reduced turnover by 20 percent in the first year [it was implemented] at FedEx."

So why don't more companies do that? "You got me," she says. "Things trickle down from upper management, and sometimes upper management got there by doing it the quick, ruthlessly efficient way, and it's hard to break those habits. But done right, like at Costco, you see increases in customer loyalty, employee retention, and shareholder value."

Rogers adds that a new book co-authored by Amazon's former vice president of customer service has done "a great job of delineating many of the problems companies have with the proper use of their call centers." Peppers & Rogers cofounder Don Peppers wrote about it in a recent blog entry, Must-Read New Book: The Best Service is No Service.

Natural Order Vers. 9 Enhancements

Natural Solutions has announced the following enhancements to Natural Order, its flagship direct commerce order management and fulfillment application:

Third-party Interfaces:
* Commerce V3 – Shopping Cart import, product information export, product availability export
* Auric Systems International
* Trevance Interface for batch and on-line processing
* CN!Express Interface for batch and on-line processing

Version 9 Enhancements:
* Credit Card encryption using strong native Microsoft SQL encryption techniques (Triple DES, AES-128, AES-192, AES-256)
* Order Import - more formats: CSV, tab-delimited, fixed record
* Order Import can be called by other programs, with email of success or failure information
* Fact Sheet - easy Order Entry access to a Word Document, webpage, PDF file, etc. - used to describe a product
* Automated email templates for Order Confirmation, Order Shipped, Credit Card declined
* Expansion to Purchasing Information screen to include:
- Product Sales
- Returns
* Product Group Discount Schemes - BOGO, buy 3 on this group of items and get free shipping, and similar marketing techniques
* By security user group, allow/disallow specific payment methods, shippers, order comment types, order hold codes
* Ranking - user-defined ranking (A/B/C) technique for rating products by sales
* Allow or disallow display of substitute when the substitute is out of stock
* Gift Recipient Messages can be pre-defined for easy selection of common phrases (such as Merry Christmas, or Happy Holidays)
* Pick Batch History
* Additional searches for products by SKU alternates, Catalog Aliases, Keywords, Product Types (and Ranking)
* New import for Gift Recipient Lists
* Assemblies can now be modified (different components), with history log
* Add-Ons can be associated with their "parent"; i.e., a chocolate sundae has an optional add-on of a cherry on top - so, if the destination and/or shipper of the parent is changed, the add-on will also change; if the parent is removed, the add-on can be automatically removed as well
* Enhanced bulk to pickable replenishment for case quantity movement
* Enhanced SKU order replacement

Chase Paymentech Issues PCI DSS Alerts

According to an announcement from Chase Paymentech, merchants need to know about significant changes to the Payment Card Industry Data Security Standard (PCI DSS) required network scans. Effective July 1, 2008, the PCI Security Standards Council (PCI SSC) is requiring Approved Scanning Vendors to change from version 1 to version 2 of the Common Vulnerability Scoring System (CVSS). This change impacts all Approved Scanning Vendors (ASVs) and the scans they perform for their customers.

This change impacts the way certain vulnerabilities are scored. Some vulnerabilities that were deemed less significant under version 1 will receive heighten scoring in version 2. Such vulnerabilities may now result in a failing PCI network scan score. This will result in a merchant being non-compliant with the PCI DSS until the vulnerability can be addressed.

Merchants are strongly encouraged to contact their ASV and discuss the impact of these changes. Many ASVs are allowing merchants to perform “preview scans”. Preview scans allow the merchant to scan their environment using the new CVSS v2 scans before the July 1, 2008 effective date. This provides merchants with an opportunity to assess the impact of CVSS v2 prior to performing their next required scan.

Chase Paymentech urges merchants to immediately undertake preview scans of their environment. Trustwave is already offering preview scans to their customers and Chase Paymentech has arranged with Trustwave to provide preferred pricing to its merchants.

Penetration Testing

In addition, merchants will want to know that the PCI SSC recently provided clarification about penetration testing requirements under PCI DSS Requirement 11.3. The penetration testing required by Section 11.3 is different from the vulnerability assessments required in Section 11.2. Vulnerability assessment simply identifies and notes vulnerabilities. Penetration testing attempts to actively exploit them.

The penetration testing requirement was previously interpreted as an external test only. The PCI SSC has now defined the requirement to include both internal and external testing. It should include application and network layer testing as well as controls and processes around the networks and applications. The scope of the testing is the cardholder data environment and all systems and networks connected to it.

Penetration testing may be performed by a qualified internal or external party. Any resource used must be a trained and experienced penetration tester. Internal staff performing the test must be organizationally separate from the management of the environment being tested. Methodology and results of the test must be documented, and follow-up on identified issues is required. Both Black-box and White-box testing are permitted.

Penetration testing should be performed AT LEAST annually, and any time a significant upgrade or modification occurs (for example systems component upgrades, new network creation, or new server deployments). "Significant" is specific to a given environment, but can be defined as upgrades or modifications that could impact or allow access to cardholder data.

Ecometry Version 10

Escalate Retail has announced the following enhancements in Version 10.0 of Ecometry Commerce Suite, its flagship multichannel order management solution.

Enhanced Discounting Capabilities
Historically, Ecometry has managed all marketing promotions through Offers. This new enhancement is a change to that premise and will allow you to apply special marketing events for special shipping, discounts, and/or products to orders regardless of the Offer code. These marketing events can be qualified by company/division, ship method, pay method, and/or membership status.

Product Cost and Price Maintenance by Percent
This new Pricing/Costing module enables you to maintain vendor costs and offer product prices based on a specified percent of products price. Additionally, you can group products together by a brand, price group, or cost group enter and update the price and/or cost percents more efficiently.

Inventory Sharing
It will now be possible to pick and choose which companies and divisions have the option to sell items. This will eliminate the requirement of linking an item to either one company/division or having it shared.

Customization Filters
For those using customization within Ecometry, there has always been a need to build a response list (instead of just the blank fields) that would assist in the completion of a product’s customization input; therefore, Escalate Retail is providing a new response list functionality in the Customization set-up screens. This enhancement will allow for a faster as well as a more accurate order entry process.

One-Time-Only Offer
Ecometry now allows you to offer a “one time only” promotion, which, when used during Order Entry, is validated against a buyer’s source code to ensure it has not been used on previous orders.

Promotional Insert Program
Flexibility has also been added in the ability to insert promotional products and/or order comments during Order Processing based on a large range of qualifying criteria options (offers, prices, number of orders, pay type, order type, customer type, and more), based on tables created in the new Promotional Insert Program module.

Company and Division Sort for GL Report
The Product Sales and Product Returns Balance reports now include the option to sort and subtotal Company and Division that owns the inventory reported.

Multiple Credit Cards for Batch Entry
Batch Order now permits you to use the multiple credit card pay method (MX), with up to three credit cards per order.

Suppress Prices on Collates
You can now suppress prices on all collates (pick/pack slips), including reprinted collates and collate extracts.

Affiliate Marketing by Division and Membership Status
You can now offer Affiliate Marketing programs within a specific Company and Division combination or across Company and Division combinations. Additionally, you can now restrict Affiliate Marketing program offerings based on a customer’s membership status.

RBS Lynk- Royal Bank of Scotland
This enhancement enables the processing of credit cards through the vendor RBS Lynk for Classic View Order Management, ESM Order Management, Ecometry Online, and Batch Order, using the Ecometry Credit Card Portal (CC Portal). The interface with RBS Lynk is made through a secure HTTP URL for both batch file transmission and online authorization.

Optional Modules:
WMS Interface
A new WMS alternate product number enables Ecometry to store a custom product number for each product and pass this product number to the WMS Interface in lieu of the Ecometry product number. In addition, a new Exchange Flag & Return is now available that enables you to pass non-RA Exchange returns through the WMS XML interface.

Inline Shipping
New functionality within this module allows for a truck ID to be passed to Ecometry from the automated shipping station.

MS Upgrades Dynamics/AX

With two Direct Commerce Order Management Systems now on the Dynamics/AX platform (Junction Solutions and Omnica), it is worth noting that Microsoft has begun shipping Microsoft Dynamics AX 9000, a new release of the vendor's ERP application suite with new globalization functionality and tools for tailoring the applications' interface for specific user roles.

Also offered in Dynamics AX 9000 is a new compliance center that provides a single view of internal controls, KPIs and other information needed to comply with company policies, local legislation in 36 countries, and such regulations as Sarbanes-Oxley. The software also provides more support for companies that operate multiple sites within a single country and across multiple countries.