How Contact Centers Can Lower the Cost to Serve


  • A precision approach is needed to achieve the biggest cost savings in the shortest time. Contact center benchmarks are the most effective tool to identify underperforming areas that offer the greatest cost savings opportunities.
  • Technology is a prerequisite to customer service efficiency and sustained cost savings. Modern CRM software platforms offer a portfolio of tools to drive cost reductions.
  • Business process design is a prerequisite to technology process automation. When the two work together the contact center drives operational excellence that lowers cost while at the same time delivers increased value to customers.
Johnny Grow Revenue Growth Consulting

How to Achieve the Biggest Call Center Savings

There is no shortage of methods used to eek out cost reductions in the contact center. The Customer Service Excellence Report found a high number of programs that delivered (often temporary) incremental cost reductions and a short list of methods that delivered the biggest cost takeout.

The three factors that drove the most significant and sustained cost reductions were technology automation, business process improvement and staff productivity. Interestingly, these efforts are extremely symbiotic. The research found that when they were pursued together, they achieved greater cost reductions than when pursued individually.

The research also found that savings from technology often pursued a twostep process. Step one is getting the right platform foundation. For some this meant a new CRM system. For others it just meant a proper or upgraded configuration of their existing CRM.

For the latter group, the research found a high percentage of CRM systems that were focused on technology goals. To step up their performance, the goals and the CRM configuration needed to shift to agent, customer and company business outcomes. Until that happens the CRM system will underserve the users and any future cost takeout initiatives.

Business process improvement (BPI) was interesting because it dictated how the technology would be used to streamline processes. Without BPI the technology simply automated inefficient processes.

Benchmarks Prioritize Cost Takeout Opportunities

Investing time and money into already efficient processes does not achieve much improvement or cost takeout. However, most managers are not really sure where they are efficient. They rely on anecdotal observations, limited experience and some semi-educated guesswork.

It's a hit or miss strategy that fails to prioritize the biggest cost takeout opportunities and delays results. That's why contact center benchmarks are the starting point for cost reductions. Industry benchmarks show where the call center is already efficient and should limit or avoid more investment and where it's weak and will therefore most benefit from time and investment.

Inbound Call Cost Benchmark

Customer service benchmarks remove guesswork and bring objectivity to prioritize cost reduction opportunities and accurately forecast cost savings. Below is a sample cost savings plan built on benchmarks.

Customer Service Cost to Serve

See a plan to reduce call center cost to serve customers - built on customer service benchmarks.

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The most strategic and sustained cost savings occur when the relationships among customer service programs are integrated and synergistic. When we aid clients with call center cost savings programs, we use customer service dashboards such as the one below to show how improvements in any particular area impact other areas.

Customer Service Predictive Analytics

This visibility and predictive analytics in the above dashboard show us exactly where to focus to achieve the desired results.

Technology is a Prerequisite

Contact center technology brings automation, information and scale to customer support processes.

The customer system of record is the CRM application. It provides the case management processing, performance dashboards, workflow processing and information reporting. Market leading CRM software such as Microsoft Dynamics 365 and Salesforce Service Cloud are platform-based systems which offer supplementary tools and partner ecosystems to aid cost reduction pursuits. The research found that the most effective software technologies to lower contact center costs included the following.

  • Customer self-service channels absorb the high volume of low complexity calls and drive down cost per contact and total labor costs. The research found that the Best-in-Class pushed an average of 42 percent of cases to self-service channels and while cost per contact varied by industry, the average self-service channel cost less than 10 percent of the average live channel. Research from Gartner delivered some similar findings, showing that live support channels such as telephone cost an average of $8.01 per contact, while self-service support channels cost an average $0.10 per contact.
  • Omni-channel customer support can shift certain types of cases from higher to lower cost channels. For example, channels such as live chat and messaging apps use text-based communication, so agents can engage multiple customers concurrently and contact centers can achieve agent economies of scale. Agents in chat typically handle 2 to 5 simultaneous customer sessions unlike calls where agents are limited to one customer at a time.
  • Speech and text analytics use technology to increase coverage and lower the cost of call monitoring and compliance verification. This saves hundreds of hours quarterly.
  • Contact center analytics highlight cost variances and bring near real-time visibility to cost improvement opportunities. As increased costs are seldom the result of a single factor, analytics detect anomalies, patterns and the combination of factors that result in rising costs.
  • Artificial Intelligence (AI) adds value to most other call center technologies. It works best when paired with agents. It aids agent productivity with guided service delivery, next-best-action recommendations, suggested knowledgebase articles, case resolution responses and personalized offers.

AI can also facilitate proactive customer support, which prevents or resolves customer issues without being prompted by the customer, and thereby reduces or eliminates inbound support calls. AI is also effective in analyzing cases and detecting root causes. Resolving cases at the source prevents those cases from being repeated multiple times over.

The upside of technology is that when properly implemented it serves the joint goals of performance improvements (which saves money) and increased value to customers (which grows revenues.)

Improve Agent Productivity

Our mantra at Johnny Grow is that everything that gets repeated gets automated.

System automation accelerates process cycles, reduces errors, increases efficiencies, improves service levels, reduces costs and facilitates scale. It also allows agents to spend less time on entering and fixing customer and case data, and more time using that data to better serve customers.

Staff productivity is enabled with technology, but not achieved with technology alone. Business process automation ― which is the result of business process design or business process improvement ― is synergistic with technology to increase agent productivity.

Without process improvement, any new or improved technology is just replicating old processes or creating a new place to enter the same data.

Business Process Automation

The goal isn't to give users a different place to enter case data, but instead to engineer better user, customer and business outcomes that are enabled with the technology.

If you are not well versed with BPI exercises, the best method for the effort is often Agile Value Stream mapping. It's particularly effective in shifting process design from doing things right to doing the right things.

It's also effective because it doesn't just improve your existing processes, it measures the value of what you do in order to eliminate non-valued added steps and activities, and redefine business processes to be directly mapped to customer and agent outcomes.

Agile Value Stream Mapping for Customer Service

Effective process redesign streamlines processes so they are both efficient and effective.

Agent productivity and efficiency are complimentary but distinct. Becoming highly productive in low value or non-essential tasks does not drive value or eliminate costs. Pursuing productivity measures focused on efficiency without a focus on outcomes is a losing proposition.

However, when the two are pursued in concert, work steps are eliminated, and agent time can be reallocated from low to high value actions. This is why BPI should be done in tandem with a CRM technology implementation. Without BPI you are left automating inefficient processes.

This business process improvement method is highly effective because it identifies both incremental improvement and work elimination opportunities. It works because it can identify and eliminate steps or processes customers don't care about or aren't willing to pay for. And if your processes don't create value that customers appreciate or are willing to pay for, it may not matter how efficient, fast or cheap they are.

Highly efficient repeatable processes also become your intellectual property.