Small-to-Medium Size Credit Unions Realize the Benefits of a Collaborative Call Center

By Steven Holmes, AnyHour Solutions

CU Contact Center Savings via Overflow/After Hours Provider

The recession has pressured many credit unions to reduce operational expenses and discard many capital-intensive projects. Even before the “Great Recession,” credit unions were increasingly looking to outsource many aspects of their operations, because it meant that they did not have to invest in or maintain costly internal resources. Now the business environment is fraught with increasing anxiety, guarded optimism, and pure exhaustion. The key is to gain efficiencies, thereby improving ROA and protecting net worth.

Contact center operations are a prime candidate for gaining efficiency via outsourcing, whether to provide supplemental 24/7/365 service or as a complete outsourcing solution. Small-to-medium size credit unions can realize the benefits of collaborative, contact center outsourcing options (i.e., regular business hours overflow or evenings, weekends and holidays, or even 100% outsourced), benefiting from third party provider economies of scale normally enjoyed only by larger credit unions.

Fortunately, these third party providers are making themselves more attractive to prospective credit unions by:

• Offering flexibility in services and robust economies of scale
• Locating in outlying metro areas with plentiful workforce & lower cost-of-living — then passing savings on to clients
• Investing in organic growth by training their employees in required skill sets
• Eliminating credit union risk by offering full money-back guarantee of services
• Offering a host of solutions that can be customized to meet the unique needs of any credit union — large or small

The most obvious cost associated with every contact center is staffing: the MSRs’ salary and benefits. However, in-house call center operational expenditures can quickly skyrocket when all of the hard and soft costs are factored into the equation. Many credit unions do not consider the following costs of their in-house call center:

• Overhead — Typical overhead (insurance, furniture, training, payroll, legal, etc.) plus hardware IT costs (servers, headsets, phones, etc.) and software expenses (PBx, ACD, IVR, call routing, CRM, scheduling, call analysis, call recording, etc.), add up to an industry average of 25% of the MSRs total salary plus benefits. These costs must be factored into in-house call-center expenses.
• Supervision — The cost of supervising is approximately equal to 11 percent of the MSR wage rate plus benefits.
• Occupancy — defined as the actual amount of time MSRs are taking member calls — is reduced by factors such as breaks, lunches, training sessions, coaching sessions, sick days, vacation time, and when an agent is available but simply not taking calls. Many CUs staff for peak times, leaving MSRs potentially “underutilized” during non-peak hours. CU industry figures show that full time MSRs are actually engaged in member interactions on average only about 30 hours out of a 40-hour work-week — an occupancy reduction of 25%. The CU, of course, has to pay the MSR for all this time, whereas the outsourcer saves the CU money, since the CU only pays when the outsource vendor takes a call.
• Attrition/turnover — As the attrition rate rises, operational costs increase dramatically because there are the “hard” costs of anywhere from $5,000 and $20,000 to put an agent to work (i.e., recruiting, hiring, and training), along with the “soft” costs from lost productivity, lost institutional knowledge, and lost business, which can dwarf the hard costs. A conservative industry estimate is to consider turnover costs to average 30% of an MSR’s wage plus benefits.
• Miscellaneous costs — for example, the costs of having a third-party company monitor and evaluate/score agent calls. These third parties can also provide additional services such as one-on-one coaching sessions to maximize agent call quality.

The bottom line result is that most all credit unions can realize a savings — and typically a very significant savings — from outsourcing a portion of their call/contact center operation. In addition, utilizing a third party for overflow calls during the day can enhance service to your members by lowering call wait times, average talk times, and call abandon rates.

For a free copy of this white paper entitled Cost Comparison of Insourcing vs Outsourcing Contact Center Operations and/or the cost analysis spreadsheet, email your request to Steven Holmes of AnyHour Solutions at: sholmes@anyhoursolutions.com; please include your name, title and CU name.