At Lombard Direct, attempt is to provide prompt service for which they use automated service for filtering out the customers from the queue and routing the call to the customer’s desirable team. This can be an asset as well as drawback as long queues will make customers listen to the music and wait in the queue especially on Monday, when the call flow is the highest.
Changes can be attained with enthusiastic and high spirited team of Customer advisors.
3.2 Resources
The key resources are:-
- Customer advisors
- Technology
- Telephone systems and software
- Space (buildings, desks etc)
- Database and information
3.2.1 Resource Utilization
There is an efficient usage of resources:
Customer advisors are the prime resource for Lombard direct. 250 full time equal CAs indicate that there can be more than 1 part time associate available for 1 full time CA. There is also a possibility that 180 CAs are available during a certain shift considering part time nature of the job and the entire capacity of 200 is being used completely. This may occur on Mondays or the peak times when call flow is high. This capacity also involves seating arrangement for the managers and support units. According to this view, during certain days, the entire capacity can be used. Scheduling is not evident with certainty from the case but must be efficient to manage the roaster and to handle forecasted call volume. Therefore, space is also utilized very efficiently
Technology is used quiet well as there are modern and sophisticated systems available for CAs. So, there is a good balance of equipment and staff. Scripts are helpful in abiding by any legal obligation and to safeguard legally.
Scripts act as an effective tool for an efficient call handling. But, there can be disadvantages of excessive usage of the scripts. This has already impacted in the cross selling and does not allow flexibility.
Effective usage of resources along with an efficient customer service is visible with Lombard direct. However, Customer service levels can certainly be improved in comparison with RU.
4.0 Existing System Structures
1) The present system structure is :
V- Resources C- Customers O- Processing
In the current inbound centre, customers need to wait until they reach the automated systems and then reach the next available customer advisors. Customers wait in the queue to speak with the advisors. This structure only reflects until the band allocation for loan.
2) In certain situations, the structure may be:
This case is possible when customers are in queue, waiting for resources and resources are also waiting for the customers. For example, during the holidays or Christmas vacations, customers first wait to choose the option from the automated system. So, here the customers are lined up to speak with the customer advisors. On the other hand, CAs also waits to speak with the customers due to low call volume. In this way, both customers are customer advisors are waiting. This is not a very efficient way with respect to customer service and resource utilization.
5.0 SWOT Analysis
Strengths
- Quality is a constant focus
- Customer service is a primary objective.
- Usage of sophisticated telephone and customer systems
- Efficient training system to train new CAs and ensure personal developmental plans for the existing CAs.
- Team building and events reflect healthy environment to motivate people.
- Sean is involving managers and his team to work on changes. There is an adoption of the new approach against top down thinking.
Weakness
- Scheduling needs to be done considering available capacity.
- Emphasis on, “control” within the organization.
- No clear and visible mission statement
- Less focus on cross selling
- Hiring part time employees affects over usage of support units including Hiring, Training etc.
- Technology contingency planning is essential.
Opportunities
- Lombard Direct as the first choice for loan offers amongst the competition.
- Expanding business to even become an outbound center dedicated purely to selling.
- Promotional offers to capture more consumers e.g. 0% loan transfer for six months. This is also considering the increase in the rate of personal debt.
- Expansion in the business leading to expansion in no of CAs and infrastructure.
- Technological advancements leading to quick turnover for the customers reducing wait time.
Threats
- Competitive market is the biggest threat.
- Debt market may change and there can be chances of decline in sale of loan. Hence diversification in other products becomes important.
- Lack of qualified trainable new hires.
- Legal rules and regulations can act as a constraint too.
- Failure of technology and information system can be the biggest threat being the lifeline of a call centre.
6.0 Key Operating Issues
Sean’s management team has to ensure customers are satisfied as without them a call centre cannot exist. The second key objective is efficient use of resources.
- Lombard Direct targets the personal loan consumers considering the economic condition where consumers are happy to take debt to fund the short term finances. Diversification of selling into their other products would help e.g. only one percent increase in insurance contributes half a million pound. Another sector to target can be industrial loans..
- The reason for Lombard’s existence now is loans for which scripts are used. Scripts are essential as per the financial laws to protect consumers and banks both. But, word for word adherence does not allow much discretion to understand the customer’s needs. It does not result in good customer service too. Flexibility is at stake when boundary is defined. This measure can be tweaked to attain better results.
- Most of the employees are part-time in Lombard Direct hampering the culture of the organization. It can lead to less commitment from the employees. Part timers also have no obligation to stay with the company for long leading to wastage of training and other support systems.
- Operations imperative is to ensure good quality calls. Hence, the call analysts randomly analyze the calls which are related with hike and permanent employment of customer advisor. Although, it is a good measure to provide a helping hand in the beginning before getting accustomed to tools and calls. But, strict implementation may result in a, “controlling culture” and usage of unethical ways to meet the quality standards. Quality is connected to experience and learning curve of each advisor.
- Scheduling may be a challenge in the present case. Customer advisors and space are being used quite efficiently. But, preparing a roaster with forecasted calls and part time employees may become complex. E.g. if for a particular shift, 50 full time advisors are required, due to part time nature 100 or 150 may need to be scheduled.
- Part time jobs also result in data loss and being a bank data protection act is essential to be followed.
7.0 Policy Change described in the case
The first change Sean targets is alteration of the policy related to the nature of providing service by changing the culture to a more enabling one. At the present moment strict adherence to the script does not allow any discretion to be interactive and understand customer’s needs. Although scripts are essential but little flexibility will lead to an opportunity to cross sell too. Sean is aware that this system does not let change happen.
Permanent contract for all the CAs is another proposed change. In the case, it is dependent on the quality assessments to monitor adherence of procedures. Higher level for two consecutive assessments gives a level up to a CA essential to get permanent. It takes six months before advisors become permanent.
Also, another policy is that customers call up and then automated call management software routes them to the available CA. This results in queues and customers wait to speak with the agents. This affects the customer service and business too. This policy should definitely undergo a change.
7.1 Recommended Change and course of action
- First step is to have a mission statement which is missing here. Mission depicts the vision and objective of Lombard Direct clearly articulated to all.
Mission Statement can be:
“Providing for needs of the community and profit for the stakeholders” or
To promptly and profitably deliver loans and other banking products with high quality customer service meeting the financial needs of the community” or
To understand our customer requirements and needs and offer state of the art services.
It is essential to create and manipulate demand.
- To achieve the above mentioned statement, it becomes important to have an efficient training system for cross training the existing associates and updating information about other banking products. Simultaneously, soft skill training is also essential to understand the customer’s needs and be more interactive.
- Focus on Quality with competitions like sales king of the day can also motivate the teams to make more sales.
- Stringent quality checks as per the identified nine different skills do help in initial call handling. However, it may also impede and not allow much flexibility for the CAs.
- Permanent employment from the beginning leads to less wastage of resources and drive commitment of the employee. But, Sean needs to plan for the attrition rate too
- Lombard Direct is an inbound call centre. This center can have a part for outbound to identify potential customers. It can lead to increase in sales target.
- At this moment customers call up and then the automated software routes them to the available CA. It results in queues and customers wait to speak with the agents. This policy should definitely undergo a change by adopting technology advancements
- Actions and Affect of the changes in the area of:
8.1 Customer service
Wright, N. J., and Race, P (2007) suggest that knowing exactly what customer wants in terms of specification, price and timing without any conflicting interests with stakeholder is Customer Service. Being a call centre, customer service over the phone is quite a challenge in comparison with in person.
Basic need of the customer is to be able to get the desired loan amount. Dependence on scripts does not allow customer advisors to understand the needs of the customer in detail. Tweaking the script in a way that it complies with the financial laws as well as allow some flexibility to the associates would be ideal. Training system needs to be efficient to incorporate these limitations by improving communication skills. e.g. using scripts in a natural flow. Also, It takes long to connect to a human being in the centre. Especially, on Mondays this queue can be longer. Technological advancements can assist in reducing this existing system (discussed in resource utilization). This will reduce abandoned call rate too.
8.2 Resource Utilization
- Technological advancements by usage of systems like virtual queuing with usage of speech recognition software allowing computers to handle first level of customer support can be an an efficient way of reducing call wait and hold times. Virtual queuing allows customers to receive call backs instead of waiting in a queue. This is like a prompt and fast way of not even dissatisfying the customers and using resources effectively. Customers who choose a call back are prompted to enter their phone number and a virtual placeholder reserves their place in the queue. Once the CA reaches the customers position, he/she calls him back for further discussion. This way is quick and does not lead to customer’s unhappiness due to long hold music.
As the centre heavily relies on technology, business continuity plan for the contingency backup should also be present.
This also leads to proposed structure as:-
This will be the best and efficient structure with no wastage of resources
- It has also been pointed out that at the present moment, CAs asks lot of questions to establish the credit worthiness of the customers. Also, it’s mentioned that there are Customer Relationship Management software to provide up to date information about the customers. But, this can get solved with an example. HSBC uses the credit rating and behavioral score assessed by an external company called Experian. This way, when the customers call for loan, it becomes quite handy to establish their eligibility criterion.
- Coen, D., (2001) reflects that two necessary ingredients for a business to respond and adapt to market conditions are flexibility and the ability to think out of box. The method to achieve this is to create is the creation of business culture (place and people) that allows, encourages and fosters employee development at all the levels of business.
- Hiring the right customer advisors also becomes very imperative. This way customer advisor will be able to identify right needs of the customers and make easy sales related to products like insurance etc. Other measures may include on the floor coaching, budding up with an experienced advisor to learn ways and sharing best practices can help in increasing the skill set of the advisors leading to diversification in other banking products.
- (Butler, 2004) points out that culture of any organization includes both physical and psychological spaces. A positive business culture is not easy to create and once created can be undermined quickly in the early development stages of a business. To create an enabling culture, Sean has to make sure that his management team creates self- motivated and engaged team members. On Mondays, with the peak call load management team might take calls themselves to support their teams. Manager needs to, “get dirty” with the employees.
- A flat organization structure with less visible difference in positional hierarchies can transcend from the controlling culture to a more enabling one. A policy of equal respect for all employees must be practiced. For this, it will be helpful to have permanent employees from the beginning.
- Incentives related with Quality can be an effective measure for maximum performance initially only. This affects the revenue and is a cost adding factor. The best way is to only ensure right culture where employee is motivated to work benefiting both the centre and creating a win-win proposition.
- Ellis and Hawk (2002) talks about ,”Developing a wider range of success measures allows call centre to reap dual benefits- top management views them as a more critical part and they are able to motivate the staff”. Measuring metrics by the managers should be done in an efficient way. To achieve a goal and the highest return on investment, it is necessary to have numerous measures throughout the organization.
- Sean and the management team must have clear goals that are achievable, a roadmap to get to the goals, benchmarks along the way, a set time to reach the goals and the ability to measure when the goals have been achieved. Cline (2002,p.27) implies that the hired agents should have:
Cognitive ability (can do), Planning (can do), Interpersonal (can do) and motivated (will do).
8.3 Capacity/ Space
- There are 200 desks available which may get reduced with the change in policy to permanent contract of the employees from the beginning. This would result in spare desks which can be used for a small outbound centre for further cross selling. And there will in turn be a team dedicated only for selling. There can be a ratio of 75% full time to 25% part time. Part time can be used for high call volume days. They may be called as and when needed. The proposed structure also may require more capacity.
- Identification of core work which can be done in advance is also part of capacity planning.
8.3 Scheduling
- With the change in nature of employment to permanent for the customer advisors, scheduling and resource planning has to be done very effectively. Considering expected trends, forecasting may not be absolutely correct. Seasonal trends can surely determine the call volume. Once the pattern is known, it can be used to fill the gaps.
- Effective roaster should have 60% experienced staff and 40% new recruits. This will ensure less idle time on hold and calls can wrap up quickly. In the case of less queues, experienced agents can also floor walk to support the new recruits with any queries.
- Scheduling can be done considering queue discipline-preferably first in first out, service times- leading to less idle time for wrapping up the call.
We need to identify customer intensity and then schedule the agents:-
For example, average handling time (service time) of a call is 10 minutes which is calculated by the service level agreed in advance and the inter arrival time is on average eight minutes customer intensity will be:-
10/8= .80 Thus .80 is the probability for the customers to wait to talk to an advisor.
- It is also essential to have overlap in the timings. For example, if 40 full time advisors are working for 8 hrs i.e. 8a.m to 4:00p.m. The shift for the next 20 can begin at 1:00p.m so that with the change in the shift and the first 40 are about to leave, there is an availability of advisors handling the calls. So, the overlap will be an effective way of scheduling too.
- With the new policy change of call backs, we may still be limited due to capacity availability. In this case, if the manager is unable to have sufficient resources available, then there can be a conflict.
- Swapping of the advisor from inbound to outbound can bring change in the nature of work and break monotony
8.4 Quality
- Quality is efficiently monitored during the call analysis. However, they should not act as too controlling a mean. Quality measures need to be altered situation ally. Although, they can act as a guidebook but quality representative can use their discretion to take decisions for every situation. This will lead to an enabling culture and advisors probing more questions to the customers and being interactive.
- Call satisfaction form triggered to the customer at the end of every call can also help in judging the service standards. CSATS (satisfied customers) and DSATS(dissatisfied customers) should impact performance and quality scores
- Incentives can act as a push but quality should be related to the performance development of each advisor. This way they can chart the path to their career in Lombard Direct
- Total Quality culture can be created if top management sells the vision to the teams.
Other strategies include:
- Communicating the vision and defining clear goals
- It is necessary to identify the 4P’s- people, process, purpose and performance
- Create a shared vision of enabling environment, gain acceptance of the plan by the management team.
- With new situations, reviewing business policy options to provide competitive advantage should be done at regular intervals.
- Also, further more operation strategies can be devised by Sean and the management team to allow the business to meet objectives of the policy change.
- Daily team meetings to understand the economic condition of the market can also help
- Effective training systems to empower the workforce and reshape corporate culture top engender a commitment in the employees.
No organization can afford to be complacent. Change is constant and change management needs to be prepared with any eventuality. The change can be painful as advisors now will have to have presence of mind to react to customer queries and will not have a ready script available to read but will surely have return on investment.
9.0 References
Wright, N. J., & Race, P. (2007). The Management of Service Operations. London: Thomson Learning.
Coen, D. (2001) Building Call Centre Culture. Tarzana, CA:DCD Publishing
Butler, D.(2004), Bottom-Line Call centre management .U.S.A. Elseveir Butterwoth Heinemann.
Ellis, C.M., and E.J Hawk (2002). Improving call centre performance. Call centre sgent motivation and compensation. Annapolis, Call centre press.