Customer Support Metrics 101: What’s the Big Deal About First Call Resolution?

We know the definition. We know some ways to measure it. But why bother? Isn’t this a lot of work?

Well, we could just say that customer satisfaction usually increases. And employee satisfaction as well. But the bottom line is…..the bottom line. A poor first call resolution rate translates into a decreased bottom line.  A great first call resolution rate translates into an increased bottom line. And you could never guess how big the financial impact is.

Decrease Costs of Operation

 Well, that makes sense, doesn’t it? Each call fielded costs a certain amount. If more than one call is needed to resolve an issue that could have been solved in only 1 call, that means operating costs are pushed up by extra unnecessary calls. 

In fact,  Dr. Jodie Monger, president of Customer Relationship Metrics, has an excellent illustration of just how much those extra calls can cost you. Here is the formula:

(# of Calls by Customer) X (% Total Problem Calls) = # of Additional Calls

(# of Additional Calls) X (Cost per Call) = Revenues Lost in timeframe

If your cost per call is $5.00, you have 200,000 calls to resolve each quarter, and repeat calls add up 138,000 extra calls, that’s $690,000 per quarter. That is over $2.75 billion annually.

Even scarier: deceasing customer satisfaction can hit the bottom line 5-10 times more than that.  Can you afford that? How can anyone is this economy or any other survive annual losses of $13.75 billion or more?


Improve Customer Satisfaction

The metric with the biggest impact on customer satisfaction is first call resolution. According to the SQM Group, there is a 1:1 correlation between the two. For every 1% increase in FCR there is a corresponding 1% increase in customer sats.


Increase Opportunities to Sell

If you fix the problem, especially the first time, you have a much greater chance to sell that customer something more. In fact, if the customer’s issue is not resolved, you really haven’t earned enough trust to even think about hinting to them to buy anything else from you. Put yourself in the customer’s shoes. And no, don’t say, “I don’t suppose you would like to buy something else?”. Yes, I have actually been asked that.

They have a problem with your product. Customer Service couldn’t fix it. And NOW you want them to buy something else from you? Are you crazy?

Fix it first, then you have a 20% greater acceptance of your cross-selling efforts. Don’t fix it and try to sell to them anyway and you get a very irritated, and possibly former, customer.

Improve Employee Satisfaction

Handling that second or third call from an irate customer with a problem that should have been resolved the first time is extremely stressful. How many times can an agent do this in a day and still like his job? How could he even imagine coming back tomorrow? Absenteeism and turn-over, thy name is Low FCR Rates.

High FCR rates = higher employee satisfaction rates which translate into higher customer satisfaction rates.



Reduce Customer Loss

SQM research has shown that only 1% of customers are at risk of defecting to a competitor if the issue is resolved on the first call. As opposed to 15% of customers at risk to leave you if their issue is not resolved at all. 

This type of customer loss has the biggest impact on the contact center’s revenues. If you have looked above at the math, you will be way ahead of the pack in knowing how much that is costing annually.

Hope those numbers didn’t completely fry your circuits. Next post, we get more into the how’s of increasing FCR, some of the tools and practices to put in place, and a collection of links to more resources.

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