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Overview of Call Centers
Types of Systems
A major decision concerning call center systems is how the software will be hosted. Software can be installed on an office server in what is known as a managed system, it can be hosted in the cloud, or it can be hosted by a third-party hosting company. The hosting system you opt for can make a big difference in cost, but it's not just a matter of looking at subscription fees. While a third-party hosting system tends to have more expensive subscription fees than a self-hosting one, having someone else look after the software means you need little if any in-house technical support.
- Self-Managed Systems. While self-managed systems seem like the simplest solution-just install the software and run the system yourself-they can be the most difficult when you factor in your own time. On the positive side, you have full control over the system. The downside is that you have complete responsibility for keeping the system running. Any errors or problems fall to your in-house staff to put right. Although many providers of self-managed systems offer some support, it might not be what you need when you need it. If having your call center operating efficiently is essential to your profits, be sure to consider the costs of maintaining the system, not just the base price of hosting it.
- Cloud-Based Systems. To avoid in-house servers and all the hardware and software headaches that come with them, more and more call centers are now self-hosted on the cloud. The cloud is just another way of saying that the system is hosted online. Self-hosted means that you're the one who set it up on the cloud, and you're responsible for keeping it operating. Your cloud host provides space for you to do your thing, but usually offers no support beyond providing reliable storage. The drawbacks of cloud hosting are latency (running slowly) and security (vulnerability due to being online). But as more and more cloud-based systems are emerging, these problems are disappearing. Most cloud services now offer redundant backups and data encryption.
- Third-Party Hosting. For a complete, no-headache solution, third-party hosting is favored by many call centers-particularly large ones. While annual hosting subscriptions tend to be much higher than both self-managed and cloud-based systems, the initial costs are incredibly low. Essentially, you don't have any capital expenses with a hosted system, and the cost savings in operation and support can be truly significant. In addition, you also have a partner that's handling all the complexities of running your software system, enabling you to take advantage of their expertise. However, the depth of experience can vary from vendor to vendor. One problem with third-party hosts is the need to get your hosting partner to understand your needs, challenges, and preferences.
Once you've delineated your basic needs and have decided on the type of hosting you require, you'll want to specify the added features you'd like to have. Try to identify those you definitely require, those that will be advantageous but not critical, and those that are unnecessary.
Some basic features can make a big difference when it comes to running a call center, such as being able to measure the time operators spend on calls or which operators take the most calls. Here are some of the most useful and common features available in call center systems:
- Automatic Call Distribution (ACD). A form of ACD is now a must for a typical call center. Having a system in place that automatically routes callers to relevant individuals cuts down on wasted time and resources. ACD systems distribute calls according to user-specified criteria, such as sending the call to a phone that is idle, or sending calls about billing to the accounting department, etc. Nearly all call center systems have some form of ACD. They vary from simple push-button virtual operators to those that use caller ID or voice recognition.
- Call Center Monitoring and Analytics. This is an essential feature for most call centers. Being able to scrutinize call durations, costs, and other useful metrics can help supervisors and managers make informed decisions on issues such as employee performance and staffing and training needs. Some of the best systems allow real-time statistics, letting you know what's going on in the call center second by second. Historical reporting allows you to compile hourly, daily, weekly, monthly, and annual statistics for detailed long-term analysis.
- Call Recording. Useful for training and monitoring, call recording allows supervisors and operators to record and store phone calls as audio files on the server. However, the storage requirements for call recording can be quite large. Third-party hosted systems and cloud-hosted systems are better suited for this function because it's easy to upgrade the size of your storage space without buying new hardware.
- Call Transfer and 3-Way Calling. Being able to transfer a caller to another department, or permit access to a third party, is essential for virtually all call centers. Few systems are sold without this feature, but it's worth checking just in case.
- Contact Management. These systems enable different calls to be tagged and stored with relevant information attached to the call file. This permits better management of customers, as it provides historical records of all calls by an individual account holder.
- Computer Telephony Integration (CTI). CTI systems use desktop PCs as telephone systems. These software packages enable a desktop computer to serve and display all call-related functions-from providing caller information, routing calls to other workstations, and controlling the phone system. Most call center systems utilize some form of CTI. Usually a simple USB headset is all that's required to turn a standard PC that's running CTI into a complete call center workstation.
- Workstation Recording. Understanding the needs of your operators is another way of streamlining a call center and making it run more efficiently. Workstation data recording enables you to make a movie of what's happening on an operator's screen. The recording can be analyzed to learn how operators are using the system, what tricks they know that could help others, and what problems they're having that could be addressed.
- Interactive Voice Response (IVR). IVR uses voice-recognition software to allow callers to route themselves to specific departments. IVRs vary in sophistication-from the very basic, which enable simple routing functionality, to systems that allow customers to access their accounts. At the high end, IVR empowers customers to serve themselves, reducing the workload on human operators.
- Live Call Coaching. This allows a third person to interact with an operator without the caller hearing, thereby enabling training and mentoring.
- Performance Evaluation. By monitoring an operator's performance, you can identify gaps in training and areas where operators need improvement. This type of evaluation can create reports, graphs, and other data while scoring an operator's performance.
- Predictive Dialer. For call centers that make a lot of outbound calls, a predictive dialer enables a list of phone numbers to be called simultaneously. Operators are connected only when someone picks up. These systems can save a lot of time and prevent operators from having to wait for a call to be answered. Predictive dialers also monitor the availability of operators to ensure that calls aren't made when there are no operators available to route the call if someone answers.
- Speech Analytics. This is a sophisticated system that can analyze customers' voices and interactions to identify whether they meet certain specific business criteria, such as being genuinely interested in an offer or merely being polite with no intention of buying. These systems are less than reliable, but some call centers that have used them have had success identifying the most promising leads.
- Technical Support. This is a given for a system hosted by a third party, but for self-managed and cloud-based systems, technical support can be anywhere from nonexistent to extremely generous. Ask about 24-hour phone support, 24-hour Web chat support, and virtual management, where technicians fix problems remotely.
Calculating the true cost of a particular call center system isn't easy, as different variables and factors can turn what seems like a good deal into something that is, in reality, quite expensive. Finding a solution that provides the best value for you means assessing three different sets of costs: capital expenses, subscription fees, and outbound calling charges.
- Capital Expenses
- Self-managed. If you choose a system that will be installed on your own servers and computers, you're going to have to pay for the initial hardware and any additional storage required for expansion. You'll need lots of storage capacity if you're going to use functions such as call recording or workstation recording. You'll also need staff to look after the running of the system. This might amount to one or two people for a small outfit, up to a whole team of IT professionals for a large call center. Then you have the cost of the software. Buying all this in advance could be very costly, but is the preferred solution for those who want total control of the operation. It can even be the least expensive solution, depending on the cost of keeping the system running. Purchasing a system over time on a contract basis usually entitles you to some technical support from the vendor. After all, vendors don't want to lose your business if you're having problems they could easily fix.
- Cloud hosting. Running on the cloud will cut down on capital expenses, as there will be no need to buy or lease servers or hard drives. You'll still need support staff to look after the software; however, as cloud-based systems can be accessed from anywhere, you don't have to hire in-house technicians to keep your call center running. You can outsource the maintenance of your system separately from outsourcing the staffing of the phones, if you choose.
- Third-party hosting. Beyond the basic hardware-such as workstations and headsets-the capital expense with a third-party hosting system is negligible: no servers, no software, no IT team, and no setup costs. The hosting company should take care of everything. Watch out for low entry-level pricing combined with contracts that are difficult to terminate. Contracts vary from one to five years, and some of them have high termination fees.
- Subscription Fees
Monthly or annual subscription fees vary from vendor to vendor, but these are meaningless unless you factor in the total costs of operating the system. Usually a software company charges on a per-operator basis, making it more expensive for larger call centers. If you expand, for every additional operator, the subscription rate will increase. And subscription costs are not the only regular expense. You also need to consider the cost of outbound calls. Your subscription agreement might lock you into a high cost for outbound calling.
- Outbound Calling
These days, VoIP (Voice Over Internet Protocol) services provide the most cost-effective solutions for call centers because outbound calling plans are so much cheaper than regular business landline rates. The great freedom of a self-managed system is that you can choose from the large number of VoIP service companies, ensuring that you get a competitive price. Perhaps the most common and popular VoIP service is Microsoft's Skype, which offers 5,000-minute bundles for $30 to U.S. landlines and mobiles.
With a hosted system, you not only pay a monthly fee per operator, but you'll also be charged a per-minute or per-30-second rate for outbound calls, and usually you have no choice as to the outbound call provider. Discounts are normally offered for higher call volumes. Typical per minute charges are as follows:
- $0.035 / 60 seconds (0 - 350,000 minutes per month)
- $0.015 / 30 seconds (350,001 - 500,000 minutes per month)
- $0.012 / 30 seconds (500,001 - 1,000,000 minutes per month)
- $0.011 / 30 seconds (1,000,000 - 2,000,000 minutes per month)
- $0.010 / 30 seconds (2,000,000 - 5,000,000 minutes per month)
Another option, especially if you go the self-managed route, is to sign up for an unlimited calling plan. These plans allow for unlimited outbound calls, usually within certain areas or countries, for a monthly fee per operator. Whether this works out to be a better value than paying for individual calls will depend on the number and average duration of calls your operators make. Unlimited domestic calling plans typically start at around $10 per month, per operator.
Use this comparison checklist to track the offers of different vendors.
Glossary of Terms
- Automatic Call Distribution (ACD): An automatic system that uses either caller ID, or requests that a caller input numbers on a keypad, to route calls. ACD makes a call center more efficient by automatically routing calls to the correct operator.
- Cloud: Cloud computing is the hosting of software on the Internet, which saves you from having to install a system on your own PCs or servers. It also makes your system accessible from any device connected to the Internet, such as a tablet or smartphone.
- Computer Telephony Integration (CTI): This turns a PC into a telephone system, providing all the functionality and more of a telephone without the need for specialized equipment.
- Interactive Voice Response (IVR): A system that recognizes speech and what a person is saying. IVR enables automated operator systems where callers can vocalize what they want.
- Virtual Call Center: Instead of having operators in the same room or building, virtual call centers allow calls to be routed to any operator anywhere on the system. This allows operators to work remotely.
- Virtual Operators: Also called "virtual attendants," virtual operators are call-answering systems that instruct users in how to serve their own needs by either speaking commands or entering them on a keypad.
- Voice Over Internet Protocol (VoIP): The use of the Internet to make voice calls. Often VoIP is much cheaper than regular landline call rates.
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