Banks and other financial businesses implement call centers for one simple reason: profits. Call centers automate the most basic exchanges, like requesting an account balance or making a deposit, so that agents can devote more time to making sales or providing customers with more personalized service. This helps to secure customers loyalty, ensuring that their individual needs are met by an automated system or a live agent as quickly as possible.
Maintaining customer loyalty is vital to banks and financial institutions, especially as the continued trend toward mergers in the finance industry and the rise of new businesses on the Internet diminishes the available customer base. Since most financial firms provide teleservices, it is often at the call center where customers decide how much money theyll spend at a given company or if they will continue to buy anything at all. Agents are under increased pressure to sharpen their job performance and need to operate within the best possible work environment.
Toward that end, companies in the finance industry are collectively spending more money to improve their call centers with additional staff and with new hardware and software. Datamonitor, a research and management consulting firm, estimates that the number of agents working at call centers for banks and for retail financial businesses will rise from an estimated 183,000 agents in 1998 to 215,000 by 2003. Datamonitor estimates that labor accounts for 64% of the cost of running a call center, leaving managers with only the remaining 36% to work with when purchasing new equipment and meeting any additional overhead costs.
As financial businesses expand their call centers, they must work within their budgets to create the most reliable systems possible. Theres a number of strategic issues in designing a call center, says Alison C. Hills, an analyst at Datamonitor. First and foremost is cost-effectiveness, then improving the quality of customer interactions. Hills confirms that more bank and financial call centers are going beyond customer service to introduce a more sales-oriented approach. The more banks know about customers, the more profitable each exchange can be. [Banks] can immediately identify more high-profile customers, take them off the queue and introduce a new sales opportunity.
But setting up a low-cost call center is a challenge in itself, let alone designing one that enables agents to make sales effectively. Typically, the startup cost banks pay for a very basic call center is about $2 million, estimates Brad Adrian, a financial research analyst for GartnerGroup, an IT research and advisory firm. The basic call center that Adrian describes accommodates ten to 12 agents and only has the capacity to receive and route calls. Most retail financial businesses necessarily pay more than this for their call centers to assist large numbers of customers each day and fulfill their requests.
Adrian projects that banks will have spent a total of $835 million on call center products and services by the end of 1999. He predicts that they will spend $1.07 billion this year and $1.35 billion in 2001; he also sees parallel trends in other financial services sectors like insurance and brokerage firms. Although these estimates indicate a rapid rise in call center budgets for the financial industry, Adrian suggests that spending wasnt accelerating as much as it could due to Y2K concerns. He still remains optimistic and adds that banks wont regard efforts toward guaranteeing Y2K compliance as a long-term obstacle in upgrading their call centers.
Half of the banks we contacted said that [their call center technology] spending was affected, says Adrian. Instead of implementing new things, they validated current systems or spent the money on their IT budgets. He notes that the amount banks spent on optimizing their call centers diminished during the final months of 1999 and will rise again after the first few months of the year 2000. During that transitional period, Adrian predicts an increased demand for staffing at these call centers; customers will be more wary of receiving automated responses and will want reassurance from a live person that their funds are in order.
Banks spend increasing amounts of money on call centers to keep pace with businesses in other fields. Financial service providers like brokerage firms or credit unions are under the same pressure that banks are to improve their own call centers. Customers who are used to live service on the phone now demand that ordering stocks or mutual funds should be as painless as ordering a pizza. This is no small challenge, but it is one that banks and the finance industry on the whole must accept.
e-closer.coms On-line Customer Service Operation
The latest trend that call centers are following to ensure rapid customer service is to route and answer e-mail messages along with phone calls. As on-line trade becomes increasingly popular, you can expect more centers to follow the direction that San Diego, CA-based e-closer.com has already taken. The company brokered mortgages for consumers directly from its Web site under the former corporate name, AltusMortgage, before it began to focus on serving business customers in 1998. e-closer currently assists banks with securing mortgages for their customers. The company evolved as an Internet-only option, explains Tom Deutsch, president of e-closer.com.
Agents at e-closer.coms call center help most customers from the companys Web site, but they also receive calls if customers request live service over the phone for detailed transactions.
Establishing a call center for e-closer.com was no easy task at first. We started in May 1997 with an internally-developed e-mail system that I designed and I very quickly realized that [programming] was not my calling in life, recalls Deutsch. The issues we faced were keeping up with customer demands and our quality of service; we needed an industrial-strength system to help us do this.
He eventually decided to use Silknet Softwares (Manchester, NH) eService. The software places incoming e-mail messages in a queue and prioritizes them by each customers request. Agents who receive e-mail messages also view customers histories from pop-up screens. Deutsch says that he hasnt needed to implement a formal training regimen at the call center because eService is easy for agents to use and it provides them with the information they need to assist customers.
The staff at e-closer.coms call center consists of 11 agents, one of whom also acts as a supervisor and sometimes coaches the other agents or monitors their e-mail correspondence. Agents answer an average of 200 to 300 e-mail messages a day or as many as 1,000 during April and May, when more people are buying houses. The center operates from 6:30 am to 7:30 pm Pacific Standard Time. Customers who send e-mail during off-hours receive an automated response to confirm that their messages arrived at the call center successfully and that agents will help them by the next business day. Deutsch asserts that despite the size of the centers staff, employee burnout hasnt been a problem and that turnover has been remarkably light. He says that because the company has saved money by offering on-line customer service, it can afford to hire qualified employees at a very competitive rate.