Improving Agent Performance through Monitoring, Coaching and Just-in-Time Training

Case Study of Bank of Oklahoma Financial Corporation

by

Dr. Jon Anton Purdue University Center for Customer-Driven Quality

and

Scott Davis Director of Product Validation BenchmarkPortal, Inc.

Content Editor John Chatterley

This case study is reprinted with permission from How Technology Enables Profitability, by Jon Anton, Ph.D. and Scott Davis, published by BenchmarkPortal. The focus of the book is how powerful new technology solutions specifically designed for call centers allow imaginative executives to initiate sales and service strategies that could not have been successfully implemented until now. Dr. Jon Anton has selected specific best-of-breed solutions, and documented the before and after impact of these solutions on such important business elements as revenue generation, cost savings, return on investment, and ultimately, earnings per share. The goal of the research team that Dr. Anton heads at Purdue Universitys Center for Customer-Driven Quality and BenchmarkPortal is to help operating managers improve the performance of their centers, and to provide the tools to help them measure that improvement. From Cost Center to Profit Center is the first-ever compendium of product validation case studies. It promises to be an important source of fact-based information that will be used by many managers to assess and acquire the solutions they need to excel in the future.

Purdue Research Foundation, West Lafayette, IN 47907 Used pursuant to license. All rights reserved. Copyright 2003, BenchmarkPortal, Inc.

This report may not be copied, scanned or reproduced without the written permission of BenchmarkPortal, Inc. Additional copies may be purchased at a reasonable price by e-mailing Information@BenchmarkPortal.com or by calling (805) 614-0123, ext. 10.

WP24-031003

Table of Contents
Acknowledgements ............................................................................................................................................ 3 Executive Summary ............................................................................................................................................ 4 Introduction to Our Product Validation Research .......................................................................................... 5 Ideal Components of an Integrated CSR Monitoring and Coaching System for Call Centers ................... 6 Research Project Background ........................................................................................................................... 9 Research Project Methodology ....................................................................................................................... 10 Brief Background of Bank of Oklahoma .......................................................................................................... 11 General Business Conditions that Prompted a New Strategy ................................................................... 12 The Monitoring Process Was Time Consuming .............................................................................. 12 The Monitoring Process Was Incomplete ........................................................................................ 12 The Monitoring Process Was Subjective .......................................................................................... 12 The Coaching Process Had Limited Options ................................................................................... 13 KPIs Before Implementation of the Click2Coach System ............................................................................ 14 Specific Features of the Click2Coach System ................................................................................................ 15 Effects of the Enabling Technologies ............................................................................................................. 16 Effect of the Click2Coach System on Call Workflow Processes .................................................. 16 Effect of the Click2Coach System on Key Constituencies ........................................................... 17 KPIs After Implementation of the Click2Coach System ............................................................................. 19 Financial Analysis of the Economic Impact ..................................................................................................20 Economic Value Realized From the Improvements in Call Center Performance Metrics .......20 Financial Impact on Net Operating Income ................................................................................20 Conclusion and Recommendations ............................................................................................................... 22 About the Sponsor ........................................................................................................................................... 23 Glossary of Terms ............................................................................................................................................ 25 Authors Biographies ....................................................................................................................................... 26

List of Figures
Figure 1. Primary methods used to monitor live CSR call handling ........................................................ 7 Figure 2. Answers to the question: What percentage of your customers give you a perfect score for caller satisfaction? ........................................................................................................................... 7 Figure 3. Correlation of CSR monitoring with CSR turnover ........................................................................ 8

List of Tables
Table 1. Financial Impact of Click2Coach System ........................................................................................ 21 Table 2. Impact of Click2Coach Program on Shareholder Value ................................................................. 21

Improving Agent Performance through Monitoring, Coaching, and Just-in-Time Training

Acknowledgements
We wish to thank the BOK Financial Corporation, whose story appears in this study, and thank their managers and staff whose cooperation and support enabled us to produce our findings. We also want to express our gratitude to Envision Telephony, Inc. for their sponsorship of this landmark research study.

Executive Summary
The goal of our research was to evaluate the impact that the BOK Financial Corporation (hereinafter, the Bank) experienced following their implementation of Click2Coach (hereinafter, the Click2Coach System). The Click2Coach System is an integrated monitoring, coaching, and e-learning system for customer service representatives (hereinafter, CSRs) developed by Envision Telephony, Inc. (hereinafter, the Sponsor). Specifically, we wanted to determine if CSR monitoring and coaching, followed by e-learning training delivered directly to the CSR desktop, positively affected his/her skill-set and performance. Our objective was to measure and quantify the improved performance levels that CSRs realized after using the Click2Coach System, and calculate the corresponding financial benefit to the Bank. The highlights of our research findings are summarized below. The background and details of this executive summary form the basis of the remainder of this case study.

Our Most Important Findings

After installing the Click2Coach System, the Bank experienced the following changes: 1. Revenue from up-selling increased more than 28% immediately, and has been sustained at this higher level 2. A 388% return on investment (hereinafter, ROI) in its first year, paying back the initial investment in less than 3 months 3. Productivity, defined as calls handled per CSR per logged-in-hour, increased by 13% 4. CSR quality monitoring scores improved 14% 5. CSR attendance improved 13.6% 6. CSRs competed for top performance honors 90 days after completing their initial training 7. Supervisors have 30 hours per month more time to spend coaching and motivating their CSRs 8. Supporting the rollout of a new approach to handling customer calls was accomplished without any degradation in performance

Improving Agent Performance through Monitoring, Coaching, and Just-in-Time Training

Introduction to Our Product Validation Research

Powerful technology solutions designed specifically for call centers allow imaginative executives to initiate sales and service strategies that could not have been successfully implemented until now. Through these innovative call center solutions, businesses are better able to: 1. Meet customer needs 2. Increase satisfaction 3. Increase market share 4. Increase revenues 5. Reduce transaction costs 6. Improve CSR retention 7. Acquire new customers 8. Retain existing customers 9. Increase profits and earnings per share Our researchers have developed a scientific method to determine the impact that such enabling technologies have on leveraging a call centers ability to achieve all of the above. Our case studies tell a compelling story. We have found astounding ROIs, with paybacks of less than four months in some cases and less than 12 months in most cases. Because of our focus on revenue generation, and/or cost reduction, our quantitative product validations stimulate the imagination of executives, who have their eye on bottom-line profits. It is an unfortunate fact that, in almost all cases, the financial impact of call center improvement initiatives are not adequately measured, and therefore, the success stories are never told. This is a loss for both the vendor providing the improvement solution, and the companys champion who could take full credit for the financial gains, if only someone would do the research. It is our conviction that documenting these success stories will engage the imaginations of business leaders and call center professionals to reach out and embrace the power of enabling technology for call centers. This unique case study documents another such financial success story.

Introduction to Our Product Validation Research

Ideal Components of an Integrated CSR Monitoring and Coaching System For Call Centers
An ideal integrated CSR monitoring and coaching system should: 1. Provide timely and accurate performance feedback to the CSRs 2. Develop a CSR performance improvement plan, including individualized reinforcement training for each CSR 3. Conduct digital call recording on a scheduled basis, and store the calls for easy playback and scoring 4. Connect with the automatic call distributor (hereinafter, ACD) to identify when a CSR is logged in and available for recording 5. Integrate with the workforce management systems to schedule call recording during times when CSRs are handling calls 6. Ensure that a pre-determined number of calls are recorded for each CSR each month 7. Capture CSR desktop screen displays associated with each call for later playback of the conversation between the CSR and the caller, and the CSRs navigation of the desktop screen 8. Provide on-screen performance evaluation forms, which allow the supervisor or quality assurance professional to score the call and enter comments and suggestions 9. Send recorded calls and performance evaluations to the CSR desktop electronically, allowing the CSR to self-coach, as well as to prepare for an upcoming coaching session 10. Support the creation of on-line, computer-based, e-learning vignettes that can be accessed by CSRs from their desktops, allowing for personalized e-learning to be delivered in quick training bites 11. Provide a management reporting system that tracks individual CSR performance, and e-leaning vignette utilization Todays astute call center managers understand the importance of CSR monitoring and coaching. According to our latest research statistics, the vast majority of call centers (over 95%) are monitoring calls, in some fashion, to measure call quality. Figure 1 shows the different types of monitoring and their percent utilization.

Improving Agent Performance through Monitoring, Coaching, and Just-in-Time Training

Desktop Recorders (Manual) 13%

Automated Recording System 36%

Live Side-by-Side Monitoring 20%

Remote Monitoring 31%

Figure 1. Primary methods used to monitor live CSR call handling

Without Monitoring Systems 44%

With Monitoring Systems 56%

Figure 2. Answers to the question: What percentage of your customers give you a perfect score for caller satisfaction? In a recent survey of call center managers with and without monitoring systems in place, we asked the question, What percentage of your customers give you a perfect score for caller satisfaction? Our research shows a strong correlation between CSR monitoring and caller satisfaction as shown in figure 2.

Ideal Components of an Integrated CSR Monitoring and Coaching System for Call Centers

With CSR Monitoring 38% Without CSR Monitoring 62%

Figure 3. Correlation of CSR monitoring with CSR turnover Figure 3 shows the results of our research into differences in CSR turnover between call centers with monitoring systems, and those without. The results clearly show a positive impact of CSR monitoring and coaching on turnover. Other key performance indicators (hereinafter, KPIs) that CSR monitoring and coaching systems should positively impact include: 1. First call resolution rates 2. Up-sell and cross-sell conversion rates 3. Cost per call 4. Average call talk time 5. Average after-call work time 6. CSR utilization 7. Training costs

Improving Agent Performance through Monitoring, Coaching, and Just-in-Time Training

Research Project Background

We performed a thorough and comprehensive study to determine the changes in performance of CSRs who used the Click2Coach System over a period of 18 months. We measured CSR performance improvements and quantified the financial impact during this time period. In our research project, working closely with the Banks professionals, we achieved the following: 1. Edentified the KPIs that apply to CSR quality monitoring and coaching 2. Collected baseline performance data before implementing the Click2Coach System 3. Collected baseline performance data after the implementation of the Click2Coach System 4. Analyzed the data collected to quantify CSR performance improvements 5. Analyzed and processed the data collected to quantify the process improvements realized by the Bank 6. Identified changes made in the call monitoring and coaching process resulting from implementing the Click2Coach System 7. Identified changes made in the call workflow processes resulting from the implementation of the Click2Coach System 8. Identified changes in management processes required to support the Click2Coach System 9. Identified the effects of the implemented Click2Coach System on other key constituencies 10. Computed a return on investment (ROI) for the Click2Coach System at the Bank While we certainly expected to find some impact on CSR performance, no guarantees of the outcome were given to either the Sponsor or the Bank. Whatever conclusions we made were driven and supported by the data we gathered during our study.

Research Project Background

Research Project Methodology

We followed an iterative discovery process with the Bank consisting of: 1. Telephone interviews with key executive manager and operational staff 2. Preparation of a list of major KPIs 3. Analysis and interpretation of the data provided 4. Development and review of preliminary conclusions 5. Validations of the data to ensure our conclusions were accurate Our primary interviews were with the Bank team comprised of James Morris, Senior Vice President of Consumer Banking, and members of his staff. In our first interview, Mr. Morris outlined the following: 1. The business challenges that prompted the Bank to acquire the Click2Coach System 2. The call quality monitoring and monitoring process changes his team implemented to take full advantage of the Click2Coach System 3. The features of the Click2Coach System that were leveraged to produce the Banks impressive improvement results Mr. Morris and his staff gathered and submitted their performance data to our research team. We then conducted a series of meetings to drill down on the data provided to ensure its accuracy and consistency. Our primary concern was to make sure that we understood the differences in the processes that had been in place before and after implementation of the Click2Coach System. The Bank management team was able to provide us with accurate data for the following: 1. KPI measurements of CSR performance 2. Up-sell and cross-sell conversion rates per CSR 3. The value of new accounts 4. costs, pricing, and staffing changes 5. Click2Coach feature uses 6. the technical support required for initial setup and ongoing support of the Click2Coach System We used this Bank data to construct the financial models, and to conduct a before-and-after benchmark of the Click2Coach System. The Bank team was very cooperative with us in furnishing and validating the data provided. Our ROI analysis and conclusions are based upon a combination of actual financial results and financial forecasts furnished by The Bank.

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Improving Agent Performance through Monitoring, Coaching, and Just-in-Time Training

Brief Background of Bank of Oklahoma

The Bank of Oklahoma Financial Corporation is a multi-bank holding company based in Tulsa, Oklahoma, with total assets of $11.9 billion. The company provides: 1. Commercial and consumer banking 2. Investment and trust services 3. Mortgage origination and servicing 4. An electronic-funds transfer network across six states James Morris oversees 24-Hour Express Bank, which is the commercial name of the Banks customer care call center. The call center handles over 100,000 sales and service calls each month. The call center splits its CSRs into two groups. 1. The Customer Service Group, which handles most of the service calls. These inbound calls range from simple transactions, such as providing account maintenance and balance information, to answering complex questions about taxable earnings, callable CDs, investment strategies, and credit issues. 2. The Sales Group, which handles all sales calls. These inbound calls range from handling loan applications, opening new deposit accounts, and supporting current bank promotions over the phone. An interactive voice response unit (hereinafter, IVR) routes a caller to the appropriate CSR group. In addition to satisfying the callers needs, the Bank wants its CSRs to determine if the caller is an upsell or cross-sell prospect for other Bank products and services, such as: 1. A term loan (i.e., auto and home-equity) 2. A new deposit account (CD, college savings account, etc.). The service CSRs transfer interested and qualified callers to the sales group, or to the callers local branch, as the caller directs. If the caller signs up for additional products or services, the call center is given credit for an up-sell, or referral.

Brief Background of Bank of Oklahoma

11

General Business Conditions that Prompted a New Strategy

Monitoring for call quality has always been important for the Bank. Prior to the implementation of the Click2Coach System in January of 2001, each supervisor would silently monitor at least four calls per month for each of the 12 to 16 CSRs reporting to them. The following are the key issues that prompted the need for a new strategy:

The Monitoring Process Was Time Consuming

The manual process being used by the supervisors was inefficient and time consuming. For example: 1. Supervisors were spending over 30 hours each month listening to and evaluating live calls 2. Most monitoring sessions began with supervisors selecting a CSR who was handling a call already in process, waiting for the CSR to complete the call, and then waiting for the next call to arrive 3. Once they had a call to evaluate, the supervisor was required to make and record his/her evaluations immediately after the call was completed, as there was no opportunity to listen to the call a second or third time 4. If the supervisor was interrupted during a monitoring session, he/she would have to find another call and start all over, losing time already spent 5. When call volume was light, a supervisor could wait several minutes for a call to reach a CSR before monitoring could begin

The Monitoring Process Was Incomplete

Supervisors were not able to observe the CSRs interaction with the computerized customer record system while monitoring the call. Supervisors had no way to evaluate and answer the following questions: 1. Was the CSR navigating the screens effectively? 2. What changes in screen navigation could the CSR make to improve the quality of the callers experience?

The Monitoring Process Was Subjective

Mr. Morris had no effective way to calibrate the standards used by each of his supervisors, and therefore, a wide variance existed between the call evaluation scores produced by the supervisors. Their monitoring and coaching process generally proceeded as follows: 1. At the conclusion of the live monitoring session, the supervisor would complete the assessment forms. 2. Later, the supervisor would meet with the CSR to review their assessment of the calls monitored.

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Improving Agent Performance through Monitoring, Coaching, and Just-in-Time Training

3. If supervisors were uncertain that they had interpreted the call correctly, they had no opportunity to listen to the call again, since it was not recorded. 4. If a CSR disagreed with or didnt understand their supervisors evaluation of a call, there was no process in place for the supervisor to replay the call or provide backup support. This had the effect of reducing both the credibility of the evaluation and the value of the coaching. 5. In a typical workday, a CSR would handle close to 120 calls. The likelihood that the CSR would remember the four calls their supervisor monitored was effectively zero. 6. Some CSRs worked for supervisors with tougher standards than other supervisors, giving the CSRs a sense that the process was unfair.

The Coaching Process Had Limited Options

Often the call evaluations would lead to the conclusion that the CSR required more training on a particular product or skill-set. Limited training options were available. For instance, here are a few examples: 1. A trainer could tutor a single CSR, but this was a very inefficient use of scarce resources; 2. A training session could be held for several CSRs, if enough needed the same refresher course; or 3. The supervisor could provide the tutoring, even though they did not necessarily have the training skills to perform this task effectively. Knowing that coaching was essential to ensure quality customer service and expand customer relationships, and further, knowing that their approach to monitoring calls and coaching could be improved, Mr. Morris and his team decided to find and implement an effective call monitoring and coaching system. In the fall of 2000, following an extensive investigation of vendor products, the Bank selected the Click2Coach integrated monitoring, coaching, and e-learning system from Envision Telephony. They began using the Click2Coach System to support their CSR monitoring and coaching process in January 2001.

General Business Conditions That Prompted a New Strategy

13

KPIs Before Implementation of the Click2Coach System

The KPIs listed below were used in the study to measure the performance improvements, perform the ROI analysis, and calculate the added economic value resulting from the implementation of an integrated CSR monitoring, coaching, and e-learning system. The study consisted of analyzing the call center KPIs before and after implementation of the Click2Coach System. At the beginning of 2001, the situation at the Banks call center was as follows: 1. CSRs were handling 89,000 calls per month 2. CSRs were averaging a talk time per call of 155 seconds 3. CSRs were idle an average of 77 seconds between each call 4. CSRs were averaging 15.17 calls handled per hour 5. The service CSRs were referring approximately one call per 1000 handled to the sales CSRs 6. The sales CSRs were converting almost 4 calls per 1000 handled into a new deposit account 7. The supervisors were spending 30 hours per month monitoring and evaluating calls

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Improving Agent Performance through Monitoring, Coaching, and Just-in-Time Training

Specific Features of the Click2Coach System

Specific features of the Click2Coach System pertinent to the Banks implementation were: 1. Digital recording of the call (CSRs and callers voice), and CSR screen activity during the call 2. On-line capture of the quality teams monitoring scores of the call, and suggestions regarding the CSRs performance 3. Delivery of recordings and monitoring scores to the CSRs desktop via a customizable, browser-based window 4. Creation and delivery of e-learning vignettes for viewing by CSRs at their desktop, and for classroom training 5. Recording and playing audio through standard telephone lines to eliminate the need for multimedia devices or moving voice files over the LAN or WAN 6. Web-based interface and knowledge portal for CSRs to review training, call evaluations, call records, real-time contact center statistics and miscellaneous information directly at their desktops 7. Automated scheduling and recording to capture random call samples according to a rulesbased schedule that supervisors set in advance 8. Ability to share recordings and training content throughout the entire contact center directly to CSRs desktops or via e-mail 9. Customizable evaluation templates to grade agent performance based on the companys own unique metrics

Specific Features of the Click2Coach System

15

Effects of the Enabling Technologies

Effect of the Click2Coach System on Call Workflow Processes
Beginning in January 2001, Mr. Morris changed the performance goals to place a heavier emphasis on: 1. Up-sell and cross-sell referrals by the customer service group 2. CSR availability (time spent logged into the system and ready to take calls) Supervisors monitored and coached for the behaviors needed to meet these new goals. The Bank realized an immediate increase in referrals and new deposit accounts opened. In the fall of 2001, the Bank implemented a new sales and service system in the call center. The system calls for a more consultative approach to handling customer calls in order to meet all of the customers financial needs. The Banks CSRs and supervisors had to learn new skills and behaviors to support the program. Extensive training took place in October and November of 2001. The Bank made several management changes to support the new service and sales approach, including: 1. Developing a new monitoring process to support the assessment of CSRs performance in achieving the new goals 2. Creating and filling the position of quality assurance specialist to monitor and score calls, freeing up the supervisors to focus on coaching, and ensuring a consistent use of standards in the evaluations 3. Sending the recorded calls and the quality assurance specialists evaluations to both the CSR and their supervisor electronically, for their independent review 4. Scheduling a coaching session between the CSR and supervisor to review the call evaluations, and determine what, if any, action should be taken 5. Holding weekly supervisor meetings to review behavioral and sales goals and identify activities for the week to reinforce desired behaviors The Bank actively uses the e-learning component of the new Click2Coach System. Since implementation in January 2001, Mr. Morris and his team have developed 27 training vignettes which: 1. Are used for new-hire training 2. Are accessible by CSRs from their desktop for refresher learning 3. Average four to five minutes in length 4. Address topics such as: a. product and service offerings b. the proper steps for completing transactions c. stop losses d. changing a PIN number e. ordering new checks
16 Improving Agent Performance through Monitoring, Coaching, and Just-in-Time Training

f. communications skills g. role-playing Because of the Click2Coach System, Mr. Morris needed no additional staff to develop and support the e-learning vignettes. One of the first e-learning vignettes developed was a refresher course on handling IRS 1099 calls. Every January, Morris had required each CSR to attend a 30-minute refresher training class. Now they get their refresher training via a nine-minute e-learning session at their desktop. By reducing the amount of CSR time to take the training, Mr. Morriss created enough capacity to handle an additional 412 calls.

Effect of the Click2Coach System on Key Constituencies

Strategic technology initiatives impact many different constituencies. An analysis of this impact on several constituencies at the Bank follows: 1. Customers: Call quality scores improved 10%. The Banks customers are receiving better services. Greater attention is being placed on identifying and serving each customers financial service needs. 2. Experienced CSRs: Many of the CSRs on staff did not respond positively to the changes when the new call monitoring, coaching, and e-learning practices were implemented. Turnover actually increased following implementation. For the six months ending June 30, 2002, the performance of only six CSRs (out of seventeen CSRs who were on staff on January 1, 2001) ranked in the top half. Implementation of any new system, especially a CSR monitoring and coaching system, within an existing call center environment, should always be accompanied by a change management program aimed at assuaging the fear of change and eliciting the buy-in by CSRs to the value the new system brings to them. By positioning the system for the CSRs as a tool to help them do their jobs more effectively, and not as a big-brother means of measuring their performance and limiting their growth, unintended negative consequences such as higher turnover and lowered performance can be substantially avoided. 3. New Hires: Within 60 days after initial training, new hires exceeded the average performance of the experienced CSRs, and were competing for top honors. For example: a. The performance of three of the four CSRs, hired in January 2002, ranked in the top 50% through June 30, 2002. b. The average rank in call quality scores of these four was 19 out of 53. c. The increased attention, performance feedback, coaching, and easy access to refresher elearning, all had a very positive impact.

4. Supervisors and Managers: The addition of a quality assurance specialist in the fall of 2001 eliminated the 30 hours per month supervisors were spending listening to and evaluating calls. Mr. Morris wanted his supervisors to use this excess time to better organize and plan their coaching activities. In the past, they had to fit in coaching when they could find the time. To help them manage this newly found time, Mr. Morris established standards for coaching activities.
Effects of the Enabling Technologies 17

Supervisors continue to monitor calls, but for specific reasons requiring performance feedback more frequently than once each month. Examples include: a. b. when an individual CSRs performance is below acceptable standards; and when a new marketing campaign or call center contest is in progress.

5. Trainers: Because of the Click2Coach System, the e-learning training modules Mr. Morris and his team developed have reduced the training preparation required, both in time and effort, and have improved training consistency.

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Improving Agent Performance through Monitoring, Coaching, and Just-in-Time Training

KPIs After Implementation of the Click2Coach System

The Banks reported performance metrics (KPIs), as of June 2002: 1. The call center is now averaging 97,000 calls handled per month, an 9% increase in calls handled since Click2Coach was implemented 2. The average talk time per call is 155 seconds, which matches the average talk time KPI before Click2Coach was implemented 3. The average wait time between the conclusion of one call and the receipt of the next call is 49 seconds, a 44% drop from January 2002 4. CSRs are handling 17.26 calls per login hour, approximately 2 more calls per hour than were handled before Click2Coach was implemented 5. Service CSRs are referring 4.6 calls per 1000 answered to the sales CSRs, an six-fold increase in the up-sell and cross-sell referral rate of CSRs before Click2Coach was implemented 6. The sales CSRs are converting 5.81 calls per 1000 handled into a new deposit account, a 58% increase over the rate before implementation of Click2Coach 7. Supervisors have an additional 30 hours each month to spend coaching their CSRs, twice as much time as they had prior to implementation of Click2Coach

KPIs After Implementation of the Click2Coach System

19

Financial Analysis of the Economic Impact

Economic Value Realized From the Improvements in Call Center Performance Metrics
To demonstrate the impact of the Click2Coach System, we isolated and quantified the value of the KPIs that moved as a result of the Click2Coach System, as follows: 1. Increased referrals per 1000 calls resulted in a 28% increase of new deposit accounts opened (this was the result of improved CSR monitoring, coaching, and e-learning) 2. An increase in calls per CSR per login hour of 13% (this was the result of better monitoring and coaching, improved attendance, higher CSRs availability, and less time spent in non-productive states). To determine the amount of credit to award the Click2Coach System for the Banks increase in sales, we compared referrals and new deposit accounts per 1000 calls for the first 7 months of FY2001, immediately following the implementation of the Click2Coach System, to the same period of FY2000. We determined that the: 1. Increase in referrals was driving the opening of one additional new account for every 1000 calls, which equates to $378,000 per year in additional gross margin to the Bank, a significant bottom-line improvement 2. Increase in the calls handled per CSR per login hour by two calls, allowed the Bank to service their caller demand with five fewer full-time equivalent CSRs, saving $110,000 per year in operating expense, a top-line improvement We then offset the increase in operating income, and savings in operating expense (identified in a. and b. above), with the implementation costs and increases in operating costs associated with the new Click2Coach System. We accomplished this as follows: 1. The implementation costs associated with the project were approximately $100,000 2. On-going support costs (hardware, software, and people) amounts to approximately $70,000 per year

Financial Impact on Net Operating Income

The following table shows the impact on net operating income in the first, and subsequent years, following implementation of the new Click2Coach System.

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Improving Agent Performance through Monitoring, Coaching, and Just-in-Time Training

Table 1. Financial Impact of Click2Coach System Financial Impact to the Bank of the Click2Coach System
Value of one additional new account per 1000 calls Value of two additional calls per logged-in hour Total annual value created Initial cost of the Click2Coach System Value created in first year First year ROI Payback in months Ongoing annual expense Annual increase in net income Year 1 $ $ $ $ $ 378,000 110,000 488,000 100,000 388,000 388% 2.5 388,000 Subsequent Years $ 378,000 $ 10,000 $ 488,000

$ $

$ $

70,000 418,000

The Click2Coach System yielded a payback on the initial investment in two and one-half months. Going forward, it will add over four times its initial investment to the Banks net annual income each year. While $418,000 is only a small percentage of the Banks $10 billion dollars in assets, it has a rather interesting impact on shareholder value as the following chart demonstrates. The numbers used in this analysis include the total number of shares outstanding at the end of 2001, based upon the Banks annual report and the price earnings multiple of the Banks stock at 10/31/02. Table 2. Impact of Click2Coach Program on Shareholder Value
Impact of the Click2Coach System on the Banks Shareholder Value Year 1 Subsequent Years $ 388,000 35% $ 137,365 $ 250,635 52,731,791 $ 0.005 11.3 $ 0.54 $ 2,832,176

Annual increase in net income Effective Tax Rate Estimated Taxes Increase in net income Fully diluted outstanding shares @ 12/31/01 Increase in earnings per share Price Earnings @ 10/31/02 Project impact on share price Project impact on shareholder value

$ $ $ $ $ $

418,000 35% 147,986 270,014 52,731,791 0.005 11.3 0.058 3,051,159

We calculated that Banks investment in the Click2Coach System has added approximately $3,000,000 to its overall shareholder value.

Financial Analysis of the Economic Impact

21

Conclusion and Recommendations

Delivering coaching, monitoring feedback, and e-learning to CSRs at their desktop in bite-size learning vignettes, during periods of low call volume, is a very effective way to enable CSRs to gain, reinforce, and maintain the knowledge and skills necessary to improve their performance. Setting clear performance goals, identifying the skills and behaviors needed to meet these goals, and coaching to meet these goals works, when coupled with integrated CSR monitoring, coaching, and elearning systems such as the Click2Coach System. By increasing the up-sell rate by just one sale per 1000 calls and increasing calls handled per CSR per log-in hour by two calls, the Bank created millions of dollars of shareholder value. Some CSRs are reluctant to embrace changes, as demonstrated by the higher turnover and lowered performance results the Bank witnessed with their seasoned CSRs when the Click2Coach System was introduced. However, over a relatively short period of time, the new-hires raised the performance bar, and their results speak for themselves. As successful as the introduction of the Click2Coach System by the Bank was, proper anticipation of the negative reaction of the seasoned CSRs could have produced an even more dramatic result. Implementation of any new system, especially a CSR monitoring and coaching system, within an existing call center environment, should always be accompanied by a change management program aimed at assuaging the fear of change and eliciting the buy-in by CSRs to the value the new system brings to them. By positioning the system for the CSRs as a tool to help them do their jobs more effectively, and not as a big-brother means of measuring their performance and limiting their growth, unintended negative consequences such as higher turnover and lowered performance can be substantially avoided.

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Improving Agent Performance through Monitoring, Coaching, and Just-in-Time Training

About the Sponsor

Envision Telephony, Inc. develops software solutions for contact centers. Since its founding in 1994, Envision has focused on improving the effectiveness and performance of contact center agents. Click2Coach, Envisions patented, agent development solution goes well beyond traditional quality monitoring to manage and evaluate agent-customer interactions and provide personalized e-learning vignettes to develop more effective agents. It integrates quality monitoring, evaluation, and e-learning tools in one seamless solution, and delivers it directly to agents desktops. This ongoing feedback and e-learning allows contact centers to develop, motivate, and retain top-notch agents who provide superior customer service. Today, Click2Coach is still the only solution to deliver coaching directly to the agents desktop. This new coaching approach has opened the door to e-learning in the contact center and has been recognized by industry analysts for its overall impact on improving the quality of customer interactions. Envision was the first to talk about and deliver solutions for coaching, the ongoing process of providing agents with the personalized e-learning, objective feedback, and information they need to perform at their best. Contact center executives are now focusing on agent development tools for the first time and including it as part of their CRM (Customer Relationship Management) and contact center strategy. Envision has expanded its award-winning Click2Coach product line to include a solution for organizations with multiple contact centers. Click2Coach MultiSite includes all the power of the Click2Coach product suite - including integrated quality monitoring, evaluation, and e-learning tools - and expands those capabilities to connect all contact centers into a single virtual organization for global management, administration, coaching, and reporting. With Click2Coach MultiSite, multiple contact centers act as one for the sharing of information, best practices and e-learning vignettes, so supervisors can universally develop well-trained, knowledgeable agents who deliver a consistent and predictable experience for customers. Customer requirements are the driving factor in the development of Envisions solutions. The companys customer-focused approach has resulted in a number of innovations. Envision Telephony was the first developer to offer a Windows NT-based quality monitoring solution, the first to offer Computer Telephone Integration (CTI), the first to introduce a browser-based agent desktop, and the first to integrate an authoring tool to create e-learning vignettes on the fly. No other company in the industry today can provide a system that is as sophisticated, yet easy-to-use. Envision also offers the commitment to a well-managed, predictable implementation and high quality of support. The company has a dedicated group of technical and experienced implementation and support professionals who can quickly address an organizations business needs. Since the companys inception, Envision has had tremendous growth. The privately held company has experienced a growth rate that has more than doubled in the last few years. Additionally, Envision was named as one of the nations fastest growing private companies by Inc magazine two years in a row, ranking #107 on the 2002 prestigious Inc 500 list. This recognition by Inc magazine comes in the midst of impressive momentum across all business sectors with the success of its Click2Coach product suite. The company is led by its founder and CEO, Rodney Kuhn, a pioneer in the field of CTI and call center technology. Kuhn helped develop computer telephone standards while developing CTI-enabled voice
About the Sponsor 23

messaging products for Active Voice, a leading manufacturer of voice processing systems. The product has since received several industry awards, including Product of the Year and Editors Choice distinctions, and provides the technology behind some of the most customer-focused call centers in the nation. In addition to providing companies with effective and innovative contact center solutions, Envision strives to align itself with technologically advanced partners who will improve the performance, experience and implementation of solutions for the entire contact center. Forming strategic alliances with leading companies, such as Aspect, Edify, and Cisco, allows Envision to set new performance standards for the contact center industry and create new ways to improve the effectiveness of agentcustomer interactions. Click2Coach is certified for Aspect, Intecom, Rockwell, Avaya, Nortel, Concerto, and Siemens platforms. In addition, Envision supports standard hardware manufacturers such as Compaq, HewlettPackard, Dell, and IBM.

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Improving Agent Performance through Monitoring, Coaching, and Just-in-Time Training

Glossary of Terms
ACD: Automatic Call Distributor. A device that forwards incoming calls to the next available TSR or answering position. : After Tax Net Income (Earnings): Net Income before taxes minus income taxes. Automated Self-Service Options: Refers to system features that permit a caller to obtain service response without being connected to a live CSR; For example, request a Fax, obtain account information, place an order, etc. through an automated system. Automated Voice Recognition: Technology that enables a caller to verbally speak to an automated voice response system (IVR) instead of using a phone keypad; for instance, to ask questions, make requests, respond to questions, etc. CTI: Computer-Telephony Integration refers to the linkage of a telephone switch (ACD, PBX) and computer systems to enhance call processing. Common applications include screen pop, simultaneous voice and data transfer, and IVR. Earnings Per Share: After Tax Net Income (Earnings) divided by the total number of shares outstanding. Gross Margin: Revenue minus the cost of goods and services sold (also known as gross profit). Integrated CSR Desktop: Refers to a CSR workstation that is configured to provide ease of navigation to CSRs across multiple application screens and windows as part of a CTI system. IVR: Interactive Voice Response. Technology that allows a caller making an inbound call to interact with the data systems by responding to a menu of options. Responses are typically entered by pressing the keys on the telephone keypad; however, voice recognition is becoming more commonly integrated into the process, thus providing a more useful tool. Net Income (Earnings) Before Taxes: Net Operating Income minus interest and other non-operating expenses. Net Operating Income (NOI): Income before deducting non-operating expenses such as interest and : income taxes. To calculate Net Operating Income, subtract operating expenses (sales and marketing expenses + research and development expenses + administrative expenses + other operating expenses) from Gross Margin. Revenue: The total dollar amount collected for goods and services provided. Skills-Based Routing: A feature of an ACD permitting incoming calls to be routed to specially skilled CSRs based upon the type of call, type of caller, type of product or service, etc. Web Chat: A Web site feature that allows for interactive keyboard communication with another person or persons, i.e., an interactive written correspondence.

Glossary of Terms

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Authors Biographies
Dr. Dr. Jon Anton (also known as Dr. Jon) is the director of benchmark research at Purdue Universitys Center for Customer-Driven Quality. He specializes in enhancing customer service strategy through inbound call centers, and ebusiness centers, using the latest in telecommunications (voice), and computer (digital) technology. He also focuses on using the Internet for external customer access, as well as Intranets and middleware. Since 1995, Dr. Jon has been the principal investigator of the Purdue University Call Center Benchmark Research. This data is now collected at the BenchmarkPortal.com Web site, where it is placed into a data warehouse that currently contains over ten million data points on call center performance. Based on the analysis of this data, Dr. Jon authors the following monthly publications: The Purdue Page in Call Center Magazine, Dr. Jons Benchmarks in Call Center News, Dr. Jons Industry Statistics in Customer Interface Magazine, and Dr. Jons Business Intelligence in the Call Center Managers Report. Dr. Jon has assisted over 400 companies in improving their customer service strategy/delivery by the design and implementation of inbound and outbound call centers, as well as in the decision-making process of using teleservice providers for maximizing service levels while minimizing costs per call. In August of 1996, Call Center Magazine honored Dr. Jon by selecting him as an Original Pioneer of the emerging call center industry. In October of 2000, Dr. Jon was named to the Call Center Hall of Fame. In January of 2001, Dr. Jon was selected for the industrys Leaders and Legends Award by Help Desk 2000. Dr. Jon is also a member of the National Committee for Quality Assurance. Dr. Jon has guided corporate executives in strategically re-positioning their call centers as robust customer access centers through a combination of benchmarking, re-engineering, consolidation, outsourcing, and Web-enablement. The resulting single point of contact for the customer allows business to be conducted anywhere, anytime, and in any form. By better understanding the customer lifetime value, Dr. Jon has developed techniques for calculating the ROI for customer service initiatives. Dr. Jon has published 96 papers on customer service and call center methods in industry journals. In 1997, one of his papers on self-service was awarded the best article of the year by Customer Relationship Management Magazine. Dr. Jon has published eighteen professional books: Offshore Outsourcing Opportunities, The Anton Press, 2002 Optimizing Outbound Calling: The Strategic Use of Predictive Dialers, The Anton Press, 2002 Customer Relationship Management Technology: Building the Infrastructure for Customer Collaboration, The Anton Press, 2002 Customer Obsession: Your Roadmap to Profitable CRM, The Anton Press, 2002 Integrating People with Processes and CRM Technology, The Anton Press, 2002 Selecting a Teleservices Partner, The Anton Press, 2002 How to Conduct a Call Center Performance Audit: A to Z, The Anton Press, 2002
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20:20 CRM A Visionary Insight into Unique Customer Contact, The Anton Press, 2001 Minimizing Agent Turnover, The Anton Press, 2001 e-Business Customer Service, The Anton Press, 2001 Customer Relationship Management, The Bottom Line to Optimizing Your ROI, Prentice Hall, 2nd Edition, 2001 Call Center Performance Enhancement Using Simulation and Modeling, Purdue University Press, 2000 Call Center Benchmarking: How Good is Good Enough, Purdue University Press, 1999 Listening to the Voice of the Customer, Alexander Communications, 1997 Contact Center Management by the Numbers, Purdue University Press, 1997 Customer Relationship Management: Making Hard Decisions with Soft Numbers, Prentice-Hall, Inc., 1996 Inbound Customer Contact Center Design, Dame Publishers, Inc., 1994 Computer-Assisted Learning, Hafner Publishing, Inc., 1985 Dr. Jon is the editor for a series of professional books entitled Customer Access Management, published by the Purdue University Press. Dr. Jons formal education was in technology, including a Doctorate of Science and a Master of Science from Harvard University, a Master of Science from the University of Connecticut, and a Bachelor of Science from the University of Notre Dame. He also completed a three-summer intensive Executive Education program in Business at the Graduate School of Business at Stanford University. Dr. Jon can be reached at (765) 494-8357 or at DrJonAnton@BenchmarkPortal.com.

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R. Scott Davis is the Director of Product Validation Studies at BenchmarkPortal. An industry pioneer, Scott first began working with call centers in 1971, when he was instrumental in the development of an operator scheduling system for McDonnell Douglas Automation Company. This system was the genesis of EDSs Visual FMS, which is still widely used today. In April 1976, Scott co-founded the Affinitec Corporation in St. Louis. Affinitec delivered the first computer-based call center management reporting system, the Force Analyzer. Under Scotts leadership, Affinitec became a major supplier of Work Force Management Systems. Among its many accomplishments, Affinitec was the first company to offer comprehensive CSR performance reporting which merged a) productivity data from the ACD with b) quality data derived from CSR monitoring and c) schedule adherence data. Affinitec was the first company to offer real time CSR adherence displays. Affinitec products were deployed in hundreds of call centers including AT&T, American Express, Wachovia Bank, Maritz, New Zealand Telephone. The products integrated with leading ACDs manufactured by Lucent, Rolm, Northern Telecom, Aspect, NEC, and Rockwell. Scotts passion is identifying and quantifying the case studies of the ROIs realized by organizations who create innovative sales and service strategies taking advantage of call center technologies and management practices. Scott often lectures at leading call center conferences on topics such as: 1. Developing a Contact Center Performance Improvement Roadmap, 2. Measuring the ROI of Contact Center Performance Improvement Initiatives, 3. Benchmarking Your Contact Center, 4. Balancing Technology and Management in Call Centers, and 5. Employee Measurement and Motivation. Scotts education includes a BA in Mathematics from Vanderbilt University, and a fast-track executive education program in Business Administration from Columbia University.

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Improving Agent Performance through Monitoring, Coaching, and Just-in-Time Training

John Chatterley is International Call Center Certification Director at BenchmarkPortal, Inc. In this capacity, he is in charge of working with multi-national companies to benchmark and improve their call center performance up to a level where they can attain the coveted Purdue University Certification as a Center of Excellence. Mr. Chatterley also specializes in benchmarking certification, best practices, facilities design, site selection, and offshore outsourcing for the customer contact community. John is a Purdue Certified Contact Center Auditor, Certified AT&T Call Center College Instructor, BenchmarkPortal Certified Benchmarking Instructor and Analyst. John has edited and published numerous research reports, customized benchmarking reports, and white papers, including a report on the power utilities industry. Mr. Chatterley is the author of a study entitled Improving Contact Center Performance through Optimized Site Selection. Mr. Chatterley is also the content editor of a recently published book entitled Selecting a Teleservices Partner, and coauthor with Dr. Jon Anton of a new book entitled Offshore Outsourcing Opportunities. Prior to joining BenchmarkPortal, Mr. Chatterley was Director of Site Development and Facilities Management and Call Center Manager for MicroAge Teleservices, a Fortune 500 call handling outsourcing company. Mr. Chatterley designed, implemented, staffed and managed three 500+ seat call center sites in Arizona, Nevada, and California, and has extensive call center operational management experience. Johns professional career spans more than 20 years of experience in call center technical customer support and service. He has first-hand experience at all levels of a call center including technical support CSR, supervisor, team lead, analyst, designer, call center manager, operations director, and facilities designer. Johns professional education was in Engineering & Computer Science at Southern Utah State University, and subsequently at the University of Utah.

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www.envisiontelephony.com