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Callcentres.net: Budgetary Constraints Replace Staff Churn as the Top Challenge Facing Contact Centre Operators in 2009

Research finds contact centre growth flat but expected to improve over next 12 months
  • 25 August, 2009 16:05

<p>Sydney, 25 August 2009 - Budgetary constraints or an expectation of doing more with less and change management have replaced staff turnover and recruitment as the top two concerns facing Australian contact centre operators in 2009. This was a key finding of the callcentres.net 2009 Australian Contact Centre Industry Benchmarking Report, which also highlighted some of the biggest challenges facing the contact centre industry over the next 12 months. These included reductions in contact centre budgets and IT spend and an expected decline in the number of contact centres.</p>
<p>There are about 260,000 front-line contact centre agents working in Australia. Full-time contact centre agent turnover reduced from 49% in 2008 to 28% in 2009, while part-time agent turnover reduced from 59% to 40% over the same period, according to the research. Furthermore, 66% of contact centres researched claim that the global financial crisis (GFC) has had no impact on their staffing levels. In contrast, 30% of centres believed there had been an effect.</p>
<p>Over the past 12 months, 51% of those staff who left the contact centre industry resigned their positions. A further 24% were transferred to other parts of the business, 16% were retrenched or dismissed, 5% did not renew their contracts and 1% retired.</p>
<p>The research, completed in August 2009 by specialist research, consulting and news organisation, callcentres.net, and sponsored by RightNow Technologies and Salmat, is based on interviews with more than 144 contact centre executives, representing 275 contact centres in Australia.</p>
<p>Contact centre growth stagnant</p>
<p>There were an estimated 190,927 seats at 3,821 contact centres operated by 1,806 companies in Australia during 2008, having grown at 6% since 2007. Growth has reached a plateau, with the number of contact centres and contact centre seats growing at 1% between 2008 and 2009.</p>
<p>“The number of contact centres is expected to drop by 1.1% following downsizing or consolidation activity in 2009,” said Dr Catriona Wallace, Managing Director, callcentres.net. “However, the industry is still strong with an expected 7% growth in the number of seats between 2009 and 2010.”</p>
<p>Focus on profit generation</p>
<p>The contact centre industry in Australia generated over $49 billion over the last 12 months, which is a 7% increase since 2008. This includes 79% of revenue that was generated from inbound calls and 21% of revenue that was generated from outbound calls.</p>
<p>A growing proportion of contact centre interactions are currently focused on profit-generating sales activities with 13% of all interactions being inbound sales and 8% outbound sales, according to the research. This compared to 58% of contact centre interactions attributed to providing customer service.</p>
<p>The average outbound conversion rate for campaigns over the last 12 months was 24% and the average inbound conversion rate for up-sell or cross-sell campaigns was also 24%.</p>
<p>“In 2008 we predicted that the contract centre industry would remain robust during the GFC due to it being the most cost effective service and revenue channel for organisations. As evidence of this, in 2009 more than half (57%) of the contact centres undertaking revenue-generation activities indicated that the GFC had not affected the amount of revenue earned by their operations. This is a positive sign that the industry has not been hit too hard,” said Dr Wallace. “Only 27% indicated that the GFC had contributed to a revenue decrease while 17% said revenues had actually increased due to the GFC.”</p>
<p>Budgets cut, tech spend down</p>
<p>Contact centre budgets decreased by 5% from $6.1 million in 2008 to $5.8 million in 2009. Research respondents spent 69% of their available budgets on human resources, including salary, benefits, recruitment and training costs. Respondents spent 11% of their budgets on technology, 10% on telecommunications and 4% on rent. Of all the budget items, 15% of contact centre managers indicated that the GFC has had a negative impact on their HR budget.</p>
<p>Contact centres plan to spend an average of $421,476 per centre on technology over the next 12 months, a decrease of 20% on 2008, according to the research. The drop is primarily due to a 63% reduction in spend for the purchase of new technology from $336,731 in 2008 to $124,378 in 2009. Conversely, budgets for upgrading and replacing technology have increased by 57% from $189,412 in 2008 to $297,098 in 2009.</p>
<p>Over the next 12 months, 28% of contact centres plan to invest in customer relationship management (CRM) tools while 22% of respondents indicated that they had invested in SMS technology inside their contact centres, 8% in web chat and 1% in biometric identity verification.</p>
<p>Brett Waters, Vice President Asia Pacific – South, RightNow Technologies, said, “With budget constraints and the ‘more with less’ expectation, now is the time for organisations to focus on fixing those areas that drain resources. They need to reduce call centre complexity and improve agent productivity. Another win will be to exploit proven methods of call and email reduction by opening up robust self-service channels that move routine questions away from the call centre leaving agents freer to deal with the higher value, transaction-based interactions, which then deliver measurable value back to the business.”</p>
<p>Outsourcing</p>
<p>Outsourcing is now a key strategic imperative for three in ten Australian organisations. In 2007, this figure was just over one in ten organisations. Outsourcing is becoming an important part of organisational strategy.</p>
<p>About 12% of contact centres in Australia are entirely outsourced. In addition to totally outsourced centres, approximately 16% of the in-house contact centres researched outsource some or all of their functionality, down from 17% in 2008. Three of the most common functions to outsource were after-hours calls (30% of respondents), customer service enquiries (30%), and technical support (30%). In the coming year, 6% of respondents planned to outsource additional functionality, 6% were unsure and 88% had no plans.</p>
<p>Most customers satisfied</p>
<p>According to responses from the managers of the 71% of contact centres that measure the customer experience, an average of 85% of people who use contact centres indicated that they were satisfied with the service.</p>
<p>Contact centres face several additional challenges over the next 12 months. Budgetary constraints, or the expectation to do more with less rated highest as indicated by 36% of respondents. Change management was second (27%), followed by inadequate headcount to meet business requirements (26%), training/agent development (23%) and workforce management (21%).</p>
<p>Proposed B2B Do Not Call Register</p>
<p>The Do Not Call Register, which is managed by the Australian Communications and Media Authority, is designed to reduce the number of telemarketing calls people receive by preventing telemarketers from calling registered home phones or mobiles. It currently covers primary business, emergency service and fax numbers. Proposed changes, unveiled in the recent Federal Budget, would include all business and fax numbers.</p>
<p>According to the study, about two in ten contact centre executives expected the extension would impact revenue and head count. About 28% were supportive of the B2B Do Not Call Register.</p>
<p>About the 2009 Contact Centre Industry Benchmarking Study</p>
<p>The 2009 Contact Centre Industry Benchmarking Study was sponsored by RightNow Technologies and Salmat, produced by callcentres.net and endorsed by the ATA, the Customer Contact Management Association and the Australian Direct Marketing Association.</p>
<p>The study provides detailed information to help organisations better manage their contact centre operations and benchmark their performance against the contact centre industry in areas such as contact centre operations, technology, human resources, key performance indicators, budgets, seat costs, quality assurance, customer satisfaction and the significant challenges facing the industry. The study has been conducted annually since 1997. www.callcentres.net</p>
<p>About callcentres.net</p>
<p>Established in 1998, with offices in Sydney and Singapore, callcentres.net is the central portal for the Australian and Asia-Pacific contact centre industries, providing research, benchmarking studies consulting services and up-to-date news and information. www.callcentres.net</p>
<p>About RightNow Technologies</p>
<p>RightNow delivers the high-impact technology solutions and services organisations need to cost-efficiently deliver a consistently superior customer experience across their frontline service, sales and marketing touch-points. Approximately 1,800 corporations and government agencies worldwide depend on RightNow to achieve their strategic objectives and better meet the needs of those they serve. RightNow is headquartered in Bozeman, Montana, the United States.</p>
<p>For more information, please visit www.rightnow.com</p>
<p>About Salmat</p>
<p>Salmat is a unique Australian owned company that, through strategic use of different communications channels, online technology, demographic insight and detailed data management, engages consumers in cost effective one to one communication on behalf of our clients - individually in small groups or on a mass scale.</p>
<p>For more information, please visit www.salmat.com.au</p>

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