Building the Contact Center

By Elizabeth Judd

Effective integration of telephone and e-mail response capabilities will be required as customers embrace electronic messaging.

Bankers made a lot of progress during the last decade up-grading the efficiency of their call centers. Now they need to devote equal attention to improving the integration of the telephone and e-mail systems in those centers.

Right now, an estimated one-third of all e-mail sent to U.S. banks goes unanswered, according to TowerGroup Inc., a Needham, Mass.-based research company. In other cases, online responses are either woefully late or inadequate. That's a big problem for an industry that has elevated customer service to a top strategic priority.

Rising to the challenge, banks are transforming their call centers into "contact" centers that can handle e-mail as well as telephone inquiries from customers. Brad Adrian, senior research analyst at Gartner Financial Services in Durham, N.C., estimates that among banks with at least $1 billion in deposits, 80% have taken significant steps towards building multi- channel contact centers. Indeed, 57% of the 226 banks responding to a survey last year by the American Bankers Association and Frontline Group, a Nashville-based consultancy, said they expected their call centers to evolve into contact centers.

Following through on this vision can be an exceedingly complex exercise, however, and that's why careful planning is required. In theory, a contact center performs two functions for a financial institution: it strengthens relationships by addressing customers' multi-channel service needs and it also promotes cross-selling opportunities.

To fulfill the first function, managers need to decide who handles e-mails within the contact center. Some institutions employ "universal agents," or service reps able to field both telephone and online inquiries. While this system helps provide more seamless service, it's difficult to implement since the skills required for verbal and written communication are quite different. For that reason, other institutions hire individuals to handle just e-mail.

To cross-sell effectively, representatives must be able to access the detailed customer information that most banks house in their data warehouses. Progress has been slow on that front, however, since many institutions lack an information system that's fully integrated across all channels.

At the strategic level, there's the question of what purpose a contact center actually serves; clarifying this issue determines incentive and compensation schemes for managers and employees alike. Is the primary purpose to enhance service levels and generate some revenue through cross-selling? This strategy tends to be expensive since it's driven by customer satisfaction metrics. Alternatively, an institution might view its contact center as part of an effort to reduce overall service delivery costs, which puts the emphasis on efficiency metrics and usually results in a search for automated solutions.

Whichever strategy is selected, integrating telephone and e-mail capabilities is essential. While the telephone remains the most important call center channel, the use of e-mail is growing rapidly. The contact center of the future will need to serve customers effectively in both channels.

Technology Islands

The industry shift from call center to contact center can be seen at First Citizens Bancshares, Raleigh, N.C. About two years ago, the nature of telephone calls to the bank changed fundamentally, according to vice president Jeff Ward. In contrast to the usual requests for account information, "We started getting callers who said, 'I'm calling about an e-mail I sent you regarding an online bill.'"

Up to that point, the $11 billion-asset First Citizens had assigned e-mail inquiries to an Internet-dedicated group separate from the call center. Since August 2000, all inquires have been handled by two contact centers with 80 employees between them. Most of these employees handle either calls or e-mails exclusively. There are 10 workers, however, who do both while focusing solely on questions regarding online banking.

Even with greater e-mail traffic, eight of every 10 customer inquiries at First Citizen still arrive by phone, according to Mark Coble, senior vice president and customer contact center director. This underscores an important truth about contact centers: the e-mails supplement but do not replace telephone calls.

Even a branchless bank such as Atlanta-based NetBank Inc. still fields far more telephone calls than e-mails. Last September, for example, NetBank received more than 125,000 contacts — 64% by phone, 24% through secure e-mail from existing customers logged onto their accounts, 7% by regular e-mail, and 5% through online chat, according to Virginia Johnston, executive vice president of customer care.

But the e-mail component of customer contact volume is likely to grow. TowerGroup estimates that e-mail transactions are growing 15% annually and will comprise one-fourth of all U.S. retail bank call-center transactions by 2003. Long-term, says senior analyst Jerry Silva, that percentage could rise to one-half of all transactions.

Some institutions have already noticed a surge. According to a recent report by Incoming Calls Management Institute in Annapolis, Md., 65% of centers handling e-mail indicated their workload had grown (with 16% saying they have at least one-fifth more work). This experience is not universal, however. Robert "Book" Booker, senior vice president for customer care at SunTrust Inc., says the number of e-mail messages received at his company — about 40,000 a month — has remained flat for the past year despite steady growth in the online banking customer base.

Whatever the volume, financial-service executives must integrate these e-mails into the contact center menu while providing a consistent level of service for everyone. On top of that, some institutions hope to generate some effective cross-selling from their contact centers. Both of these activities require an integrated customer information system. Contact center reps must be able to access a customer's entire transaction history, regardless of whether inquiries are made at the branch, by phone, or by personal computer.

"We don't want to create islands of technology where the e-mail group is on some system that is isolated from telephony and Internet chat," says Christopher Moreira, director of the product strategy group at WebTone Technologies, Inc., an Atlanta-based call center vendor. "All that history needs to be shared."

Banks understand this concern. When asked to name the top technology priority for their call centers, 30% of banks in the ABA/Frontline Group survey selected computer/telephone integration. A TowerGroup report notes that most bank call centers today can legitimately be described as "multimedia contact centers," since they handle customer inquiries arriving via telephone, e-mail, fax, and in a few cases, wireless and video. However, adds TowerGroup, these "newer, lower-volume contact points generally are not integrated technically or organizationally" with the predominant telephone-based channel.

Universal Agents

Beyond the issue of systems integration, contact center managers must deal with new challenges in the area of hiring and training.

Financial institutions are already struggling just to maintain adequate staff for telephone response. Since pay is relatively low and the work typically considered unrewarding, employee turnover is endemic to the call-center industry. In fact, many workers quit after only 18 months on the job, says Anton Kritzinger, executive consultant at Compass America, a Mississauga, Ontario-based consulting firm.

Asking these overtaxed reps to assume the new and difficult tasks presented by e-mail magnifies the challenge. Some institutions have hired "universal agents" — basically people who can do it all: man the phones, respond to e-mails, and conduct Web chat sessions. The advantage of universal agents is that they can provide seamless service to customers. The person who takes the call or e-mail can stay with the customer until the problem is resolved. There's nothing that angers customers more than being bounced around from person to person.

The downside of using generalists is a lack of expertise in the e-mail function. The former First Union Corp., now part of Wachovia Corp., found that universal agents saved the bank money, but at the expense of
customer satisfaction, according to Steve Boehm, general manager of Wachovia's 12 contact centers.

The basic problem is that offering a warm and helpful response to verbal inquiries and constructing a clear and grammatical e-mail message require different aptitudes. It may not be realistic to expect that an employee whose starting salary is typically around $12 an hour will perform well on both the telephone and the word processor. "What matters in e-mail is the tone. It's easy to create misunderstandings," says TowerGroup's Silva.

Maggie Klenke, director of contact center consulting for Getronics Business Solutions in Nashville, Tenn., says poorly-written or incomplete responses to e-mail inquiries can elicit a volley of further customer interactions, driving up the institution's costs. TowerGroup estimates that handling an e-mail message is from two to four times as costly as fielding a telephone call.

Underscoring this point, the ICMI report found that written transactions take considerably longer to complete than those by phone. For example, 30% of e-mail transactions took 10 minutes or longer to complete, while agents were able to handle three-fourths of telephone transactions in under five minutes.

Wachovia has migrated to the alternate system of assigning reps exclusively to either the phone or to the Web. The one exception involves the most upscale clients, says Boehm, who often prefer to deal with a single rep, whether by phone or by e-mail.

SunTrust, which is based in Atlanta, also employs dedicated reps. Of its 635 contact center reps, 35 respond solely to e-mail. These individuals are asked to furnish a writing sample during the hiring process. The messages they subsequently send on the job are spot-checked for accuracy, comprehension and grammar, and whether they fully answer the customer's question, Booker says.

Raising the Bar

The manner in which an institution organizes and manages its contact center ultimately depends on its strategic goals. Is the unit's mission to help reduce overall expenses by shifting transactions out of the branches? Is it to boost revenues through cross-selling efforts? Or is it simply to retain existing customers by providing sterling service across all channels?

Many institutions would answer: all of the above. The ABA/Frontline Group survey, published late last year, found 65% of institutions describing their call center as a "cost center," while only 22% labeled it a "profit center." Another 24% chose the category "cost-reduction center." When asked how they gauge success, 35% of the responding institutions cited customer satisfaction as the most important metric; 35% chose business goals; and 26% said they were focused on statistical service metrics.

In any case, compensation and incentive systems must be aligned accordingly. Contact centers focused on service need to keep their customer satisfaction metrics high. Those aiming for cost reduction are introducing automated systems to respond to the more routine telephone and e-mail inquiries, which constitute the majority of those received by the typical bank. At the old First Union, for example, roughly 100 million inquiries last year were handled by the automated telephone system (compared with 30 million handled by live agents, via e-mail, and all other channels), according to Boehm.

While internal voice response systems have long been used to deal with telephone calls, institutions are just now beginning to experiment with various technologies for automating e-mail response. Most of these systems are designed to handle the simplest inquiries, freeing the live representatives to deal with more complex questions, such as account statement errors. Silva estimates that a top-quality automated system can manage half of the e-mail volume at a typical institution.

SunTrust is now installing an automated system that it expects will be up and running by April. "We need to find a way to make e-mail more self-serve," Booker says. Even so, given the complexity of many of the inquiries, he does not anticipate the automated system will be able to handle more than 10% of the bank's e-mail.

The consequences of such technology gaps will continue to grow as e-mail volume and customer expectations increase. First Citizens' Coble recalls that in the summer of 2000, banks usually took two days to respond to a customer's e-mail; today, the industry standard is closer to six hours. Getronics' Klenke imagines an even more exacting world: "In the not-too-distant future, we're going to be handling e-mail at the same speed as we do phone calls."

Ms. Judd is a freelance writer based in Washington, D.C.

Copyright © 2003 by Banking Strategies, published by BAI.

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