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< The power of online ratings in the battle for customers | In with outsourcing in water >

Matching demand for customer service to human resourcing

Written by: Simon Morris | 29 January 2010

Balancing act: it's not easy to predict how many staff to have on when

Forecasting demand for customer service and engineering staff can cut operational costs and boost service, says Simon Morris.

Competitive markets and strict regulation have rightly led customers to expect excellent service. Delivering a positive customer experience, however, depends on the performance of assets that require expensive maintenance. Given the need to keep customer bills down, utilities are left performing a balancing act.

What utilities need to do is find the optimal operational balance between customer service staff capacity and workload. Few achieve a sustained balance because it is hard to do: a large part of the service workload is reactive, triggered by customer calls.

Anglian lesson

Anglian Water learned this lesson the hard way. In the decade from 1995, service levels fell from outstanding to less than satisfactory. Customer service representatives operated in separate regions and a lack of visibility of the company's overall team resources against demand meant management could not accurately predict, and therefore meet, customer service obligations. On the flip side, a lack of efficient processes led to periods of resource inactivity, which served only to increase the cost of servicing customer requirements.

Poor customer service is often linked to issues that raise operational cost. Some of the most prevalent are:

  • reactively fighting short-term fires;
  • not aligning customer services to demand;
  • not effectively prioritising customer work;
  • engineers arriving with the wrong parts or skills to get the job done first time.

There is no way to predict when a specific customer call will arrive, but there are ways to predict the most likely composition of the workload for the next day, week or month. Workload demand forecasting can enable organisations to use budgets and resources more effectively so that customer service levels can be improved across the "service supply chain", from the asset through to the customer. A number of companies have changed their operating models to tackle such issues.

In June 2005, Anglian embarked on a large customer service transformation programme. Four years later it sits atop Ofwat's overall assessment table for its customer service and recently won an award at the 2009 National Customer Services Awards. Iain Fry, change programme manager at Anglian, says: "What we have learnt through this exercise is that the cost of good service is less than the cost of bad service." Work backlogs were 95 per cent cleared and overtime costs fell by 11 per cent. Simply driving better routes yielded savings in fuel. The internal measurement of customer service showed an improvement of 33 per cent.

SSE scheduling

Scottish and Southern Energy has demonstrated similar success. Before October 2007, 120 engineers processed 550 jobs a day and were scheduled by 24 full-time employees. Two years later, 350 engineers process 2,000 jobs a day with 25 schedulers. The labour cost of dealing with customer service issues has gone down sharply and service levels have risen. Engineer productivity has gone up 25 per cent and each scheduler can now process 350 per cent more work each day.

At Scotia Gas Networks (SGN), where customer service is critical to safety, the company has been reporting 97 per cent attendance within an hour to emergency calls. It has also won a contract with National Grid to manage the replacement of 100,000 household meters a year in its regions. This business is worth upwards of £15 million annually and winning the contract was largely due to SGN's demonstrable ability to service customer requirements efficiently.

Achieving these sorts of returns requires upfront investment, but by balancing forecasting and planning, accurately predicting future workload and intelligently planning resources, initial costs are quickly accounted for with a potential for huge cost savings year on year, and of course improved customer service.

Simon Morris is the vice president of marketing at ClickSoftware.

Tags: Anglian Water, customers, maintenance, Scottish and Southern Energy

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