Customer Service Benchmarking

Transcription

1 FMEA Utility Education Trade Show Days Customer Service Benchmarking How Does Your Utility Rate? October 18-19, 2011 Presenter: Ken Buckstaff Managing Director First Quartile Consulting

2 Agenda Methods for Benchmarking Customer Service Measures and Metrics of Interest Trends and Best Practices Benchmarking in general Customer Service benchmarking Summary and Questions 2

3 Uses of Benchmarking Benchmarking has many applications Strategic Identify strengths and weaknesses Set direction and targets Highlight focus areas for improvement Track long-term progress Operational Drill down to specific areas of emphasis Highlight best practices for adaptation and use Understand demographics and their impact on performance results 3

4 Measures of Interest for Customer Service Metrics Mean Q1 Expense Customer Service Cost (Including Write-offs) per Multi-Counted Account $40.29 $22.43 Customer Service Cost (Excluding Write-offs) per Multi-Counted Account $34.74 $19.10 Contact Center Expense per Multi-Counted Account $10.23 $6.61 Field Service Expense per Multi-Counted Metered Account $8.07 $4.71 Meter Reading Expense per Multi-Counted Metered Account $7.61 $4.36 Billing Expense (Excluding Postage) per Multi-counted Account $3.19 $1.69 Payment Processing Expense per Multi-counted Account $4.60 $1.22 Credit Office Expense (Including Write-Offs) per Multi-Counted Account $8.47 $2.87 Write-Offs As A Percent Of Revenue 0.34% 0.17% Service Level Penetration Of Self-Service (Web And IVR) 32% 44% Service Level Including Abandoned Calls Using A 30 Second Target But Without IVR Calls: Blended Meter reading errors experienced 0.078% 0.017% Estimated bills - Percent of Total 0.571% 0.026% Billing Accuracy errors as a % of bills issued 0.081% 0.016% Percent of customers 60 days or more past due 4% 2% Safety OSHA Recordable Incident Rate - CS OSHA Lost Time Incident Rate - CS Note: Metrics drawn from the 2009 APPA Customer Service Benchmark Study 4

5 Functional Drill-down Framework Customer Service Contact Center Field Service Meter Reading Billing Payment Processing Credit & Collections Cost Category Cost Category Cost Category Cost Category Cost Category Cost Category Normalizing Factor Normalizing Factor Normalizing Factor Normalizing Factor Normalizing Factor Normalizing Factor Local Office Credit Manual Channel Order Type (Process) Technology Channel Channel Process Customer Type Activity Customer Type Payment Type Customer Type Process Technology 5

6 Understanding the Data - Demographics Understanding comparisons across multiple companies requires understanding of the differences that drive results. Average Min Max Contacts per Multi-Counted Account per Year Percent of Customers that are Residential 87% 75% 92% Customer Density - Accounts per Square Mile Meter Reader Average Hourly Wage Rate $18.06 $13.50 $23.14 Field Service Orders per Multi-Counted Account Customer Count (Single count) 164k 14.3k 592.5k Number of Metered commodities (E, G, W) offered Number of All commodities/services offered Data from 2009 APPA Customer Service Benchmark Study 6

7 Comparison by Commodity Contact Center Total Annual Contact Center Expense per Contact Cost per contact is increased when multiple commodities are offered, probably due to the complexity of the calls. Total Annual Contact Center Expense per Contact Data from 2009 APPA Customer Service Benchmark Study 7

8 Identifying Opportunities and Direction Comparison: Billing Method to Payment Method Benchmarking data can lead to strategic decisions on practices to employ to make significant improvements. Opportunity to promote level pay plan Opportunity to promote electronic payment Canadian Utilities Opportunity to promote electronic billing Opportunity to promote electronic payment While there are opportunities to promote electronic transactions with all companies, focusing on those customers who are already using one electronic method and promoting the other electronic method has significant possibilities. 8

9 Identifying Best Practices Best practices can be identified through many different means Almost all involve learning from others somehow Detailed research efforts Large-scale benchmarking processes Small-scale benchmarking studies, focused on very narrow niche Investigations/discussions with a few companies (site visits, information exchanges) Conferences and industry meetings Vendors providing tools, services, equipment A few can be developed through genuine pioneering Henry Ford and the continuous production line Recognizing the best practices isn t always easy A measureable difference in outcomes Better service, lower cost, higher customer satisfaction Something just obviously better Mobile data versus manual dispatch for field service workers 9

10 Cost Impact of automated contacts Contact Center Expense per Multi-counted Account A comparison of Contact Center Cost per Customer to % of Completed Contacts handled by IVR/VRU and Internet shows that utilities with more automation perform better on costs. Contact Center Expense per Multi-counted Account Data from 2009 APPA Customer Service Benchmark Study 10

11 Penetration of Self-Service (Web & IVR) The APPA panel is achieving similar results to the IOU panel. IOU Data from 2009 APPA Customer Service Benchmark Study 11

12 Implementation is the hard (and most important) Part You can t simply adopt. You have to adapt first. Every utility is unique in some important way Individual functional departments are different from other companies similar functional departments External circumstances (local economy, service territory demographics, etc.) are different Differences mean you have to implement new practices in your own way, to fit your circumstances and capabilities Fit your existing IT systems Fit your electric system configuration Fit within your corporate strategy and vision of where you want to be in the future Understanding the demands of your specific customer base You can learn from the experiences of others, but you still have to make your own plans AMI Implementation (smart metering) Oncor and Austin Ownership by the line organization is critical to ultimate success Can t be just a product of a staff organization 12

13 Trends and Best Practices in Benchmarking There are multiple avenues to improved performance through benchmarking Large-Scale Industry Surveys Example: APPA Customer Service Cross-industry Focused Studies Example: Purdue study of Call Center Operations Focused Consortium Studies Example: EUCI Credit studies Individual Utility-Driven Best Practices Study Examples: Many examples annually companies using benchmarking as a way to learn and adapt better practices. Typically includes site visits. 13

14 Trends and Emerging Customer Service Practices Trends we ve seen through large-scale benchmarking studies Growing use of customer self-service Web transactions Electronic payments IVR call handling A focus on first-contact resolution Not just in the call center, but also in the other customer-facing groups A move toward viewing multiple functions as an integrated whole Meter-to-cash process, not individual organizational silos Expanded use of mobile data and supporting processes to handle field service, as well as a growing amount of Distribution work Requires system implementation and integration Changes the role of supervisors and schedulers 14

15 Example of Meter-to-Cash Dashboard One example of a Meter-to-Cash dashboard tracks metrics for the individual areas and rolls them up to a dashboard that highlights areas needing improvement. 15

16 Summary Benchmarking, done right, leads to long-term improvements Measureable performance results Demonstrably better practices in place and operating As with any other improvement technique, its conceptually simple Very understandable steps Straightforward process Doing it well is harder than it looks Subtleties of the techniques Selection of appropriate metrics and peer groups Getting, and keeping, management attention Ownership by the line organization 16

17 Contact Information Feel free to contact me about this presentation, or any questions you may have about benchmarking and its application to Customer Service for utilities. Ken Buckstaff Managing Director T F Continental Blvd. Suite 600 El Segundo, California California 400 Continental Blvd. Suite 600 El Segundo, CA (310) Maryland 3 Bethesda Metro Center Suite 700 Bethesda, MD (301)