CALL CENTER STAFFING: USING JOB TRYOUTS AND BIG DATA TO SAVE MILLIONS

CALL CENTER STAFFING: USING JOB TRYOUTS AND BIG DATA TO SAVE MILLIONS 1

Call Center Staffing: Using Job Tryouts and Big Data to Save Millions Scott Goodman, Shaker Consulting Group Contact centers are a multi-billion dollar industry and growing. Since their start in the mid 1900s, they have seen relentless growth. Along the way, they have adopted many new technologies in the constant drive to deliver services faster, better, and cheaper. While technical advances can still add efficiencies and cost savings, the additional benefit of adopting new technologies do not provide the same means of differentiating that it used to new technologies are often copied quickly and with continued decreases in the cost of technology, call centers must continue to seek new ways of differentiating. One clear trend is providing differentiated service as a means to increase customer loyalty and satisfaction. Call centers are seeking to ensure their staff emulates the service delivery models of their clients demonstrating the same kind of customer focus, product knowledge, and service delivery etiquette as a full-time employee of that client. Last year, Deloitte published the results of a global contact center survey. Among the trends reported are: 77% of contact centers are expected to maintain or grow in size in the next 12-24 months with expansion plans being driven by the need to improve service and/or to support business; 62% of organizations view customer experience provided through contact centers as a competitive differentiator; 40% of organizations have dedicated customer experience resources; 82% of organizations recognized accuracy and quality of information as the most important customer experience attribute; and Turnover is a problem and large, outsourced contact centers have the highest turnover rates. These trends point to a few noteworthy conclusions. First, contact centers continue to grow in size and strategic importance. Second, customer experience is very much a competitive differentiator. Third, contact centers suffer from very high annual turnover rates among their representatives. Fourth, contact center staffing is more important than ever and many contact centers face the challenge of hiring people who just aren t a good fit. Providing Differentiated Customer Service It s About The People The current effort to provide differentiated customer service ultimately comes down to people. While almost every person is capable of using a telephone, not everyone has what it takes to succeed in a contact center environment where multiple and shifting technologies need to be used, where work is often closely monitored and measured, and where a high focus on productivity and efficiency are paramount. Hiring the wrong agent is a significant drain on customer satisfaction, customer loyalty, productivity (including sales), team morale, profitability and brand delivery, to name a few. 2

What Leads to Success as a Contact Center Agent Superior contact center performance is achieved through a complex amalgam of knowledge, skills, attributes and other variables such as fit with organizational culture. A number of characteristics have been linked to success in call center environments, such as: Quickly and accurately entering data Splitting one s attention between two tasks simultaneously Understanding and drawing conclusions from information pertaining to the caller Responding to callers in a service oriented, brand building way Computer know-how Customer service orientation A dutiful history of work behavior (i.e., good attendance, reliable, and dependable) Comfortable being monitored Ability to cope with pressure Persistent Resilience Results oriented Persuasive Optimistic Strong work ethic Resumes: Not The Predictive Tool We Wish They Were Today s methods for posting jobs and harvesting resumes generate an avalanche of responses that need to be managed to identify those who are most likely to be successful. Research on the usefulness of resumes for identifying future successful employees shows that resumes are at best marginally useful to ascertain job fit. They add almost no predictive value. The biggest challenge with resumes is the fact that they afford applicants the opportunity to share specific experiences and achievements they deem important, which may or may not be meaningful in your environment. Resumes are not an objective form of measuring capabilities and are not consistent from one applicant to the next. Further, sifting through resumes is labor intensive. While the use of technology enables faster searching capabilities, the resume is still very much a one-way information exchange, where the candidate tells you what he/she wants to. The argument can be made that resumes are an exercise in creative writing where achievements are easily exaggerated or key information omitted. So, how does one ensure the right fit when hiring contact center agents? Unfortunately, when it comes to talent acquisition there is no magic bullet. Not all contact centers are created equally. They can vary by kind (inbound, outbound, both inbound & outbound), call types (sales, service, tech support, collections), and key performance metrics (AHT, ACW, transfers, first call resolution, callbacks, NPS, etc.). Qualities that make for success in one contact center are in fact often not the secret sauce in another. A contact center agent s long-term success depends more on job fit factors than on experiences and product knowledge. Often recruiters and hiring managers hone in on resumes and experiences as a means to ascertain fit for their environment. This is a logical, but limited approach. For example, an agent with multiple years of contact center experience may have cemented certain habits from their previous work that will be detrimental to delivering service excellence in your environment. Hiring managers and recruiters look at experiences because they hope something about those experiences will equate to success in their environment. In reality, looking at these past experiences and resumes are proxy or substitute measures. They can t measure exactly what they want/need (i.e., will the person be successful here), so they measure what they can (i.e., where did they work previously). This is similar to the person in a parking lot at night looking for his/her lost keys in the area where the only available lamp is shining knowing full well the keys were lost in another part of the lot but because the light is here, that s where he/she looks. A Better Approach: Scientific Assessment Scientific assessment of candidates capabilities helps employers hire better contact center agents who will stay longer. Decades of research across thousands of companies shows valid pre-employment assessments produce a clear return on investment when used to assist staffing decisions. These types of pre-employment assessments systematically evaluate candidates capabilities and help employers make smarter, more informed hiring decisions that drive business results. 3

These assessments are used to measure a variety of attributes ranging from personality traits, motivations, specific skills and abilities like computer knowledge and problem solving, and job fit tests or simulations. The latter often provides candidates with realistic job previews of the contact center work environment and a sampling of agent job tasks. In other words, applicants get to roll up their sleeves and tryout aspects of the role, albeit virtually. It is not uncommon to find contact centers that are not using effective screening tools ending up effectively providing a work sample assessment unfortunately, they do so with a new hire as they attempt to onboard and often lose new hires in their first 90 days an expensive way to provide a work sample assessment! Effectively identifying high-potential candidates requires a more sophisticated approach than resume reviews. Past experience does not convey the full story. Companies that go beyond experience to assess candidates competencies experience doubledigit percentage improvement in sales, productivity, retention, and other key contact center metrics. Contact Center Staffing: Best Practices Multi-Method Measurement There are a number of pre-employment assessment tools available to assess candidates capabilities. Research has shown that a combination of assessment types during the hiring process provides a more comprehensive assessment of candidates compared to using a single test. Realistic Job Previews: It s Never Too Early to Show Candidates the Reality of the Job Embedding job preview elements into the staffing process has been shown to positively impact turnover. The goal of the job preview is to present candidates with a realistic view of what the job and work environment entails so they can make an informed decision. It is far better for someone to say no thanks at the job preview stage rather than after time and money has been invested in training that person. Painting a realistic picture of the company, the call center environment, the work hours, management style, and performance expectations will help people self-select out if they perceive this isn t for me. Data Driven Decisions Incorporating data-driven methods to evaluate candidates during the staffing process is critical. This is particularly the case for high population jobs such as contact centers where an organization hires hundreds of employees and likely sees thousands of candidates. Using multi-method assessment to evaluate candidates creates a data rich environment where statistical analysis and predictive modeling add rigor to decision making. As convincing as he or she might be, a senior executive with a strongly voiced opinion is not a reliable substitute for evidence-based staffing practices. People often a have a common sense view of what is happening that isn t really true. Having good data is important. Rigor in decision-making is essential. As such, a good staffing solution begins with defining success and how to measure it. Measurement implies capturing data, and this requires an investment in systems that can link recruitment inputs to business outputs. Business processes such as accounts payable, sales, and production have long benefited from strong systems for data capture, analytics, and reporting. An employee staffing process is no different. Data is the foundation for creating a business case and documenting return on investment. Without data, there is no analysis. Without analysis, there can be no insights. Big data is important. Use of Job Tryouts or Simulations: Not Just Tests Success as a contact center agent depends on an intricate combination of knowledge, skills, attributes, and other variables. The best way to identify whether an individual has what it takes to thrive in a contact center environment is to observe them performing the complexity of the work. This gives insight into both their behaviors (what they do) and outcomes (what they achieve). This can t be accomplished via an interview. While interviews have their place in the staffing process, they are not very reliable when it comes to assessing things like problem solving, data entry, multitasking, and recalling key points from a customer interaction. 4

One option is to hire the person and let the individual demonstrate whether he/she can actually handle the job demands. This is a true job tryout or work sample, and while it can be very effective in determining who has the wherewithal to thrive in your environment, it is not a very practical approach to staffing. A better option is to obtain a work sample from the candidate prior to extending an offer of employment. This is the premise of the Virtual Job Tryout or customized simulation. These whole-person, day-in-the-life assessments put candidates in the role. It is analogous to test driving a car before buying it. For applicants, a Virtual Job Tryout could be a fun and engaging experience that provides a realistic preview of the job and company. They experience firsthand the various job related tasks they will be required to perform if hired. These include handling simulated customer calls, data entry, problem solving, and multi-tasking. At the same time, recruiters and hiring managers get to learn about the candidates capabilities, not by searching for key words or experiences in a resume or application, but by immersing the candidate in the role and actually having him/her perform key duties. Recruiters and hiring managers are able to base decisions on consistent, objective data. A custom profile of candidates capabilities eliminates guesswork and time spent on poor fit applicants. Benefits to the company include better service, stronger results, reduced turnover, increased consistency in hiring, and decreased legal/compliance risk. Simulations or Virtual Job Tryouts are particularly beneficial in that they provide insight into candidates broad capabilities. Recruiters, Hiring Managers, HR Directors, and Operations Directors, want to know which candidates are ready to perform as agents. What better way to ascertain candidates capabilities than to have them perform activities that mimic key job responsibilities? In addition to achieving the goal of hiring superior performers, job tryouts enhance the recruiter experience, the engagement and brand message of the candidate experience, the legal defensibility of the assessment, and fairness. The diagram below details the differences between a typical pre-employment test and a Virtual Job Tryout. 5

Return On Investment When it comes to investing in a staffing process, there are three avenues where companies can expect a return: 1) administrative efficiency, 2) reducing waste, rework and defects, and 3) reducing performance variation. Administrative Efficiency Over the years, a great deal of automation has been introduced and implemented within staffing processes. The most expensive elements of the staffing process are those which involve human effort in activities such as sorting and reviewing applications and resumes, story telling and selling the opportunity to candidates, and interviewing either via web, phone, or face-to-face. The use of technology delivers efficiency improvements with regard to sorting and reviewing applicants and candidate story telling. Applicant tracking systems reduce the time and effort required to manage candidate flow. Technology enabled realistic job previews educate and engage candidates, and allows companies to cast an extremely wide net thereby reaching many people with minimal effort. Using well-developed pre-employment assessment and selection science helps recruiters and hiring managers to interview only the most qualified candidates. Costper-hire, time-to-fill, and interview-to-hire ratio are a few metrics that can be tracked to demonstrate administrative efficiency. As an illustrative example, one call center introduced a customized, pre-employment simulation based assessment with an embedded realistic job preview. They compared candidate flow and hiring statistics pre-and post-implementation. They found that 24% of candidates learned something throughout the process that caused them to self-select out without the need for a human touch point. They were able to conduct 18% fewer phone screens and interviews, and hire more qualified people with less effort. Reducing Waste, Rework, and Defects Any process may produce waste or defects and thus require rework or repair. This certainly applies to staffing. New hires that are separated within 90 days of starting can be viewed as staffing process defects or waste. The total investment in sourcing, recruiting, onboarding, training and wages paid, can be calculated to determine the cost of a staffing defect. Rework is then required to replace or repair defects and waste. Replacement hires must backfill the new vacancies, doubling the cost and time to finished goods (i.e., proficient performers). Significant savings can result from reducing staffing waste. For example, KeyBank was faced with excessive turnover and had spent millions of dollars in recruiting, onboarding, and training tellers and contact center associates. These contact center associates play a critical role in the KeyBank s client relationship strategy. In every interaction they have the opportunity to create impactful client experiences and enduring relationships. With this in mind, KeyBank turned its attention to recruiting and selection. In partnership with Shaker Consulting Group, a highly engaging, interactive, multi-media experience was developed to identify top talent. The experience allows candidates to learn about the organization and experience the job through interactive scenario simulations. Recruiters leverage candidate assessment data in the form of a competency profile and dynamically generated interview guides to prioritize candidates and conduct targeted interviews. Recruiters spend additional time only with candidates that are a good fit for the role. Turnover numbers decreased significantly, and remained below levels prior to implementing the staffing solution. KeyBank realized a $1.756 million USD cost savings in teller turnover for one year, simply by making better hiring decisions, reducing training costs, and increasing the quality of hire. In the contact center space, they reduced 120- day turnover by nearly two-thirds. Taken together, this resulted in KeyBank receiving an Electronic Recruiting Exchange (ERE) award for recruiting excellence. Reducing Performance Variation The enemy of quality is off-spec production. When it comes to staffing, reducing hiring decisions that allow poor performers into the organization can have significant economic impact. In essence, this means reducing the performance variation by screening out anyone who would emerge as an underperformer. Of the three possible ROI streams, real economic impact comes from addressing staffing waste as illustrated in the KeyBank example above and from reducing new hire performance variation. 6

The cost to train a new employee is often thousands of dollars. Performance variation can cost tens of thousands or even millions of dollars per hire depending on the role. These numbers may seem high; however, analysis often turns up surprisingly large opportunity costs related to variation. For example, in one industrial sales organization, average sales territory was $1 million USD. The top 80% of sales representatives had average sales of $1.5 million USD. The bottom 20% had average sales of $300,000,000 USD. With every hiring decision, there was $1.2 million USD at play in possible performance variation. Quantifying the impact of performance variation reveals vital business insights. Just like there is variation in your current workforce, there is variation in the candidate population. In high population jobs such as contact center agents, it is possible to deliver candidate evaluation methods that objectively differentiate performance potential in an economically meaningful manner. In our consulting work, we have documented the difference between candidates performance on simulation-based assessments (i.e., work samples) and on-the-job performance. Agents who score higher on the assessment perform at higher levels when it comes to Service Excellence, Operational Excellence, Net Promoter Score, Call Monitoring, Sales Revenue, Rankings, and Penetration, ACW, AHT, Transfers, First Call Resolution, Dials, and Talk time, to name a few. Performance differences are typically in the double digits. This is consistent with other research documenting the value of an above average versus below average performer. For example, Spencer and Spencer (1993) estimate 48% to 120% more output for an above versus below average sales representative. The premise is simple reducing performance variation (i.e., the lower tail of the performance distribution) results in an increase average new hire performance. The table below presents the on-the-job performance differences as defined by a Pareto Analysis of assessment results. In these examples, individuals who scored in the bottom 20% of the assessment achieved measurable and meaningfully different levels of productivity. Armed with this rigorously calibrated information, recruiters can objectively and reliably make choices about which candidates should be considered for an interview. In each of the examples below, the recruiting team was able to invest time with better candidates, reduce the interview-to-hire ratio, and increase the quality of hire. 7

Conclusion Hiring for contact center jobs is challenging. The majority of costs associated with operating a contact center are labor costs. Recruiters, Hiring Managers, HR Directors, Operations Directors, and other decision makers want to know which candidates can perform the job, will stay in the job long enough to be productive, will provide a return on the initial recruiting and training investments, and will have the greatest impact on key contact center metrics. Finding ways to hire better quality contact center agents is clearly a top priority by senior management. However, the way that many companies hire today has its flaws. The Internet has fostered resume spam. It has become so easy to apply for a job that corporate career site databases are overflowing with applicants. Recruiting teams are challenged to identify best-fit candidates and resumes offer limited value due to their highly subjective and unstandardized nature. The costs of getting it wrong are massive. There are tangible costs such as staffing waste, lost wages, and reduced productivity as well as intangible costs such as damage to customer satisfaction and loyalty, reduced employee morale, and tarnishing the organization s brand. On-the-job performance is driven by a complex set of variables. It is well documented that multimethod assessment is mandatory for predicting job-fit across a range of performance criteria. While the hiring decision will always be an act of personal judgment, pre-employment assessment provides robust data to compare and contrast candidates and support effective hiring decisions. Employers have turned to science for hiring help and science produces results. Whole person, day-in-the-life simulations provide candidates an opportunity to tryout the job. This coupled with data and analytics discerns performance potential among candidates. Job tryouts plus big data equals big financial impact. About Shaker Consulting Group Shaker Consulting Group is an industry leader of custom simulation pre-employment tests and developers of the innovative Virtual Job Tryout candidate evaluation process. The Virtual Job Tryout is an engaging, web-based, interactive, multi-method experience that offers candidates an opportunity to test drive the job in a manner that produces work sample-based data that helps recruiters make more accurate decisions about their candidates, which in turn builds a workforce that delivers superior results. Contact Information Email: Scott.Goodman@shakercg.com Tel: 216-825-2041 Web: www.shakerconsultinggroup.com 8

CALL CENTER STAFFING: USING JOB TRYOUTS AND BIG DATA TO SAVE MILLIONS 9