Capacity planning is not about saving money and resources. Capacity planning is not about spending money on resources.
Capacity planning is about getting the plan right by understanding what you need to spend on resources to accomplish your objectives given defined criteria.
There can be a high cost for poor planning in terms of underspending and its impact on customer and employee satisfaction, lost revenue and customer loyalty, and over-spending and its impact on profitability.
Does is really matter if I'm only off by 1%?
The Customer
A contact centre with 133 agents was using an Excel spreadsheet to do their capacity planning. They had calculated an operational budget of $10.2 million to support their contact centre. This included 19 support staff in addition to their 133 agents, with the cost-per-contact calculated to be $8.64.
They assumed their data inputs were accurate and their Excel sheet formulas were using the correct calculations and thought that even if the numbers were slightly off - even just 1% off - it would have minimal impact on their estimated operating budget.
The Challenge
Many organizations lack the necessary tools to effectively develop their resource plan and associated budget, have inadequate or inaccurate data, and lack a defined process for capacity planning and budgeting.
Such deficiencies can have a significant impact on the accuracy of the operating budget. Even the leading WFM applications on the market often yield erroneous results as they miss or misapply data inputs resulting in inaccurate staffing levels and financial projections.
The Solution
Cinareo was leveraged to highlight additional data inputs that are not typically considered when capacity planning to accurately determine staffing levels, including data such as:
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Deferrable vs. non-deferrable work types
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Tenured agent average handle time
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New hire learning curves
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Shrinkage factors (unpaid leave, non-productive time)
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Support staff ratios and salaries
Cinareo determined that the contact centre had overstated the majority of their input assumptions by an average of 1% in three key areas:
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Workload forecast
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Average handle time
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Shrinkage factors
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This error was not due to a mindful effort to build a buffer into the budget, but the lack of data, the accuracy of data, and the lack of a tool to run scenarios to determine the impact of a range of variables on the operating budget.
The Result
Being 1% wrong resulted in a budget request of $10.2 million which was 8.4% or $860,000 higher than necessary.
Using additional data points to ensure greater accuracy, the contact centre could save significant money in their operating budget by:
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Reducing the number of agents from 133 to 126
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Reducing support staff from 19 to 18
This allowed them to reduce the cost per contact by $0.64. Over a one-year period, this resulted in savings of $860,000 and allowed the contact centre to eliminate inefficiencies and financial loss.
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Read Case Study #2: How to give your staff a raise when you don't have the budget