. Putting aside the importance of the work performance of call center managers and call center team leaders, still contact center agents are the people who communicate with customers directly. Thus they are those who create the first impression and work as the face of the brand. In other words, the better the customer service agents' performance is, the better is the overall call center performance.
Another important aspect of this issue is call center agents productivity - the amount of work they perform during a specific period of time. In a call center, it is clear that this work refers to handling customer calls. The goal is to use agent work time in the most effective way to provide agents with work during the longest part of their work shifts.
The percentage of agent work time spent on handling personal calls and working with call-related activities is called agent occupancy, and this customer service metric has an industry golden standard of at least 80%. The other 20% is called the call center shrinkage, and, as it follows from what is said above, the dream of any call center manager is to reduce call center shrinkage as much as possible.
So, what is shrinkage in call center? How to calculate shrinkage in call center? What is the call center shrinkage formula? How to reduce shrinkage in call center? Is there any call center shrinkage calculator?
Time to find the answers.
What is shrinkage in a call center?
Call center shrinkage is a workforce management metric that is used by call centers to measure the amount of scheduled work time spent by agents on any activities that are not directly related to handling customer calls or completing other call-related tasks. In other words, this means that call center shrinkage can have many causes and exist in numerous forms, yet it still has one same characteristic - this is the time when agents are not available to handle customer calls.
To put it simply, if an agent is online, present at his workplace, and available to answer incoming calls, but such calls aren’t coming due to any possible reason - this wouldn’t be counted as call center shrinkage, because the agent was available for receiving calls.
On the other hand, there are two types of call center shrinkage - internal and external shrinkage factors. Internal shrinkage refers to the time spent on activities that take place inside the organization and that are related directly to the agent's job responsibilities and included in the schedule - this includes training sessions, lunch times (as they are included in the agent schedules and guaranteed by the law), meetings with team members, conferences, webinars, and so on. External call center shrinkage refers to the work time spent by agents due to external reasons - this includes being late,unscheduled breaks that outlast planned duration, sick time, and any other issues that unable agents to answer calls. In most cases, it is unplanned shrinkage due to unplanned activities that highly reduces contact center efficiency.
What is the call center shrinkage calculation formula?
A call center shrinkage calculator is provided with the use of a specific call center shrinkage formula, and there are two of them.
First one of these call center shrinkage formulas is focused not on measuring the percentage of work time of agents that can be counted as call center shrinkage percentage, but on finding out your requirement in call center agents - in other words, it is a kind of type of call center FTE calculation as it helps you to forecast staffing levels and base staff requirement.
It is measured in the following way:
(The number of agents needed to deal with one-hour inbound call volume/Number of agents available during this period of time) * 100 = Call center shrinkage (number of agents you require to effectively manage one-hour inbound call volume)
Therefore, let’s look at it in action and presume that you require 50 agents to handle inbound call volume within one working hour in accordance with your SL (Service Level). But due to some reasons, only 35 agents were available during this hour.
Thus, the call center shrinkage calculation will work as follows:
50/35 *100 = 142.857
That is the real number of agents you require to meet your service level targets.
Nevertheless, this call center shrinkage formula can be less accurate in some cases, so we recommend that you should measure call center shrinkage personally for each agent to evaluate their individual performance and find out the imperfections in their work quicker to have enough time for adequate reaction.
Another call center shrinkage formula exists exactly for such a task:
Call center shrinkage = (Overall duration of internal call center shrinkage + Overall duration of external call center shrinkage)/Overall working hours scheduled * 100
Let’s measure the call center shrinkage percentage for a week. Basically, the weekly work time is 40 hours, and let’s presume the agent spent 2 hours per week (around 17 minutes per day) due to external factors and 6 hours due to internal call center shrinkage reasons. The exact result is the call center shrinkage percentage, not the number of hours.
Therefore, the calculation works:
(6+2)/40 *100 = 20%
Is there any call center shrinkage benchmark?
Yes, there is a call center shrinkage industry standard. For most call centers, it is considered that the call center shrinkage between 30% and 35% is acceptable, yet we don’t agree with such a point of view - even though this is an average shrinkage rate. First of all, call center shrinkage of 35% means that more than one-third of the work time agents spend on activities that don’t relate to their direct job responsibilities - under direct duties we don’t mean that taking training sessions or taking part in team meetings isn’t a work responsibility, we mean that this is a time when they can’t provide customer service or generate outbound calls. This also means that you pay them for 8 hours of work, while the actual time of work is less than 6 hours.
The perfect call center shrinkage rate is around 20%, and yet it is unreachable for most call centers due to numerous internal reasons - poor workforce management software and strategy, lack of budget, poor management, and so on. But we don’t recommend you focus on the results that are - to be honest - average. If you want your call center to be successful and provide superior customer service and seamless customer experiences, then it is your duty to try to go even farther beyond those 20% - and focus on better call center shrinkage rates.
How to reduce call center shrinkage?
Call center shrinkage reduction is an important task, so we are going to provide you with direct guidelines and tips on how to do it quickly and effectively.
Create effective workforce management strategy
As call center shrinkage is the issue that refers to the workforce management, it is extremely significant to pay close attention to how you operate your human resources. First of all, if you have issues with managing agent schedules, try to implement automated workforce management tools that will allow you to plan agent scheduling and make timely changes when needed. Secondly, try to adapt agent schedules in the way that will not only meet company requirements but also correlate with agents private life - some of them are students, for example, which means you can shift schedules to let agents have more time for rest and thus reduce cases of agents being late. Finally, try to switch to hybrid call center workforce management model - this way you will be able to improve agent satisfaction and thus reduce any cases of external call center shrinkage.
Use call monitoring tools
There are also two main factors that can cause call center shrinkage - call absenteeism and call avoidance . Call avoidance is the situation where agents intentionally try to avoid answering inbound calls due to any reasons - burnout, depression, or even banal unwillingness to work. Call absenteeism is a situation where agents are absent on the workplace when they have to be working. Listening to live calls can help you to identify issues in agent performance and agent productivity and thus notice whether some agents are trying to avoid doing their work properly or not - it is not that difficult to find out whether the person sounds depressed or angry, especially during customer calls.
Reduce inbound call volume
This is not the tip to tackle contact center shrinkage, but it is a good way to eliminate the negative consequences of it. Some agents can be just more effective in handling customer interactions through non-voice communication channels, such as online chats or social media, and let’s be honest, not all customer queries should be handled through phone calsl - some of them are either too common or too elementary. So, the first thing you should do is to implement omnichannel call center platform that would help you to manage customer inquiries through different digital channels from the single interface. Secondly, you have to invest in setting up a few self-service channels that will help customers resolve their queries independently, without involving customer service representatives.
Manage agent satisfaction
Job satisfaction is a vital factor of employee performance, because only satisfied agents can work as you expect them to do. In the call center industry, it is common to have around 40% of agent turnover in a year, so there is no way we can consider such call centers as good examples of organizations where employees are satisfied with their work conditions. Therefore, providing agents with a clear rewards program, proper onboarding, flexible scheduling and career development is a way to eliminate cases of call avoidance, emotional burnout, and other negative consequences of working in a call center. Try to even create call center shrinkage KPI - so agents who have less call center shrinkage rate will receive a promotion or reward. The more you invest in your team, the more you receive in reverse.
Analyze peak hours and downtimes
This is extremely important - you have to understand when you have to handle more calls with additional agents and when you require fewer agents. First of all, it is about proper scheduling - peak hours require you to allocate more agents to eliminate the risk of call abandonment and poor customer satisfaction during these times, while downtimes are the ideal time for organizing non-call related activities for agents, such as additional training sessions, mentoring, meetings, etc. Thus you will reduce the risk of calls being unanswered and let agents deal with non-call-related tasks during periods when there is no risk in having fewer agents online. This won’t reduce the call center shrinkage, but it will eliminate the negative outcomes of it.
Plan non-call related activities effectively
As we have already mentioned, non-call-related activities include training, onboarding, taking lunch, short breaks, meetings, and other activities that are included in the call center schedule, but have no connection to providing customer service. Let’s be honest - reducing the time agents spend on training or, what’s even worse, onboarding will have only negative effects on performance, but there are always opportunities for optimization and improvement. Thus, try to provide agents with comprehensive self-training materials and knowledge bases so they can train themselves during non-working hours - and yes, we are not as naive as you could have just thought - provide them also with rewards for that. Try to optimize their time spent on meeting and webinars - they are not always as important as helping customers. Monitor time agents spend on breaks, but don’t create conflicts - it is very difficult to replace one good specialist, especially in our industry.
Ensure two-way communication
To find out the root cause of any issue there is a simple way many people avoid - just ask directly. Many call centers suffer from such an issue as lack of internal communication, which means that agents feel lonely and don’t believe there is someone they can trust and ask for support. Deal with it - let agents provide you with their constructive feedback, as you do with them. Sometimes it is a key to success: build trust inside the team, and you will see how call center environment will become healthy, and employees will be willing to do their best. Trust and transparency are your keywords in this task, so encourage one-on-one meetings, discuss individual agent problems and fears, and address them adequately as the leader should do. Remember, that nothing but your team is the path to reaching business goals.
Conclusion
As you can see, call center shrinkage is a big problem for most call centers and a condition that can’t be totally eliminated - business owners have to tolerate it and consider even such high call center shrinkage rates as 35% as the industry standard. Our recommendation is to focus on achieving lower shrinkage call center rates in order to ensure high contact center productivity, employee satisfaction and positive customer experience provided by the department on a regular basis.
There are numerous ways to reduce call center shrinkage, including providing agents with a healthy working environment, a reward system to improve motivation, dealing with call center absenteeism and call avoidance, optimizing time spent on non-call-related activities, analyzing your inbound call volumes, and finally, using workforce management tools and omnichannel contact center software with self-service options to reduce agent workload. Make agents competitive to ensure high motivation. Also, work with staffing requirements during the hiring process to ensure operational efficiency.
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