By Peter DeHaan, PhD
In retail, the term “shrinkage” euphemistically refers to stock which “disappears” before it can be sold. It is product that the retailer bought, but can’t sell because it is has been stolen or lost. In the call center, the inventory is labor and shrinkage is agents who are being paid but not working. Three metrics help track, explain, and understand agent shrinkage:
Adherence measures the time agents are scheduled compared to the time they actually work (logged in time divided by scheduled time). Since schedules are developed to match traffic projections, when the schedule is not fully followed, the result is under staffing. Ideally,staff should adhere 100% to their schedules; in reality, this is not the case. Most call center managers are shocked to discover their adherence rates. It can represent a huge unnecessary cost,as well as contribute to lower service levels.
Several factors account for low adherence levels. The first is scheduled breaks, lunches, and training. This is the only acceptable contributor to adherence discrepancy. Depending on the length of breaks, the best resulting adherence will be around 90%. The second consideration is absences, late arrivals, and early departures. The third area is unscheduled breaks or agents leaving their positions. Typical call center adherence rates are around 75%, although well-run operations can be in the low 90s.
Availability measures how much of that time agents are ready, or “available,” to answer calls. It is calculated by dividing time available (also called “on time,” “in rotation,” or “ready”) by logged in time. Agent availability is strictly within the control of agents, determined by their willingness to be ready to answer calls. Although the ideal goal of 100% availability is achievable, 98% to 99% is more realistic.
Occupancy is the percentage of time agents spend talking to callers compared to the time they are turned on or available (talk time plus wrap-up time divided by agent “on” time). One hundred percent occupancy means agents are talking to callers the entire time they are logged in. To achieve this, calls must continuously be in queue. The resulting efficiency is great, but caller wait time can be lengthy. Therefore, 100% occupancy does not produce quality service, plus leads to agent burnout and fatigue.
Interestingly, ideal occupancy rates vary greatly with the size of the call center. Smaller centers can only achieve a low occupancy rate (perhaps around 25%) while maintaining an acceptable service level. Conversely, large call centers can realize a much higher occupancy rate (90% and higher) and reach that same service level.
Call centers with poor adherence, availability, and occupancy rates can literally spend twice as much in labor to produce the same service level as a comparably sized well-run call center. Calculate your center’s adherence, availability, and occupancy numbers– and then take steps to improve them. Don’t let agent shrinkage lead to expense explosion!