The ROI of Knowledge: It’s Not What You Expect (It’s Much More!)
This Thursday I am moderating a webcast on the ROI of KM, “The ROI of Knowledge: It’s Not What You Expect (It’s Much More!),” based on a white paper I am co-authoring with Consona Corporation. In the paper, I use TSIA industry benchmarks for average metrics, as well as actual business results TSIA members have received from knowledge management (KM) implementations, to construct some real-world ROI calculations to show why investments in KM pay off…and can pay off fast.
There are lots of business impacts when you implement a new KM program, including talk time, first contact resolution rate, escalation rates, resolution times, and training time. This last area—reducing training time—was the first big impact of KM we felt during my time as a technical support manager at JCPenney. In fact, our amazing success with KM is what fueled my move to Silicon Valley in 1995 to work for the first KM startup building tools for support. I’ll share an anecdote with you that was cut from my upcoming book, Lessons Unlearned.
All JCPenney stores must go through a physical inventory process each year, and it is a nightmare for the stores and the Store Systems Hotline, the group which supports all the point of sale (POS) equipment and application used in JCPenney retail stores. Every JCP store in the world does inventory over the same three day period, and some stores are closed for the process. It is a huge effort: All merchandise must be physically counted, with tallies for each item entered into an accounting system.
At the Store Systems Hotline, we picked a dedicated team to handle inventory questions, and put them through several days of training. Since store employees only used the inventory applications and the inventory merchandise scanners once a year, there were always lots of questions, huge volumes of calls, and big backlogs of time-sensitive inventory-related incidents. The first year that we implemented a knowledgebase, we took great care in documenting knowledgebase articles for every inventory question we received. It was a lot of work, but when inventory rolled around the next year, we were ready.
Instead of pulling a big group of senior techs off the phone for inventory the second year, we brought in a group of temps. Instead of training them on the intricacies of the accounting and inventory applications, we taught them how to search the KB. And it worked. These untrained temp agents handled over half of all incoming inventory questions using the knowledgebase, and if the issue was too complex, we had a few seasoned experts available to take over the call. But having that documented library of question/answer scenarios was so powerful that unskilled agents were handling questions like seasoned professionals.
That is the power of the knowledgebase.
In the webcast, I will reveal the KM spending numbers for 2012-2013 (spoiler alert: the numbers are huge–the largest I’ve seen for KM since becoming an analyst), and walk through the metrics needed and how to calculate three key savings from KM: reduced resolution time, reduced escalations, and increased adoption of self-service (deflection). These aren’t trumped up numbers either, these are actual savings TSIA members are receiving, as documented in dozens of STAR Award applications for Best Knowledge Management Practices and Best Online Support. I will also explain the correlation between improving KM practices and rising CSAT and loyalty scores.
And, all attendees will receive a complimentary copy of my research report, “Calculating Business Benefits of Knowledge Management: Metric Improvements and Cost Savings Using Real-World Data and Examples,” to be published May 1st. Please go ahead and register for the webcast, even if your calendar is full on Thursday. We’ll send you a link to listen to webcast recording, as well as all the webcast slides. And, you will automatically be sent a copy of the ROI report for registering!
Thanks for reading, and hope to see you online Thursday!Best Practices, knowledge management, Technology comment below, or link to this permanent URL from your own site.