The Economics of Customer Service Excellence

I’m preparing for tomorrow’s Webcast, “The Economics of Customer Service Excellence: Critical Improvements for Tier 1 and First Contact Resolution,” and wanted to share some of the data I’ve come across in my research.  Obviously in a down economy (and for all the talk about recovery I’ve yet to hear any service execs getting budget increases) there is a big focus on servicing customers as cost effectively as possible. But in this case, reducing support costs is a win:win–not only does resolving more issues at Level 1 lower operating costs, but customers are much happier when issues are resolved more quickly, and by the first person they speak to.

The economics are simple:  the longer a support incident is open, the more it costs.  If you escalate an issue from Level 1 to Level 2, the cost doubles.  Everyone asks about incident costs, and based on member surveys, here is the data I quote:

B2C/Consumer Support
Level 1 resolve: $15
Level 2 resolve: $40
Level 3 resolve: $75
Onsite resolve: $225

B2B/Enterprise support
Level 1 resolve: $45
Level 2 resolve: $80
Level 3 resolve: $150
Onsite resolve: $450

Clearly, resolving as many issues at Level 1 as possible is key. But unfortunately, our TSIA benchmark data shows that average issues handled per shift at Level 1 has declined, as has first contact resolution and percent of issues resolved within 24 hours:

First Contact Resolution and Incidents Resolved within 24 Hours Declining

Clearly complexity is playing a major role here, with rapidly increasing incident volumes concerning problems that are harder to solve. So how do companies reverse this trend? Approaches include:

  • Knowledge management: better capture and sharing of information to help support techs resolve problems, and enable customer self-service.
  • Agent training: new approaches to help deliver just-in-time knowledge to support techs, as product release cycles shrink and classroom training no longer applies to today’s increasingly remote workforce.
  • Partnering with development: I think a major change is having support working closer with development to make sure new products and versions are more intuitive, and helping prioritize bugs and enhancement requests that most impact customers and/or are the most expensive to resolve.

In tomorrow’s Webcast, we will have a presentation from CORPTAX, the TSIA’s 2009 Support Staff Excellence Award Winner, about their success in assisted support deflection and SLA achievement. I hope you all can tune in to hear their story–clearly they have overcome the odds and reversed the trend.

Thanks for reading, and hope to see you on tomorrow’s Webcast!

Explore posts in the same categories: Best Practices, customer experience

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One Comment on “The Economics of Customer Service Excellence”

  1. Client relationship development is a long term process and can allow a company to build trust and a strong bond with the customer long after the initial sale has taken place.

    If the organization does not see this area as a strategic component of their business, it will struggle to maintain long term clients and be pressed to find references for new opportunities.

    Gravity Gardener

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