At any point in time, do you know how many agents can answer calls and how many people answer calls during breaks?
The difference between the two is that the call center shrinks.
Below we will understand how to calculate and manage shrinkage.
Suppose your call center has 100 agents to handle call volume.
If a meeting is required at a certain time, how do you know whether all the 100 seats can attend the meeting?
The difference between the number of seats that can answer calls and the number of seats that can take breaks, participate in meetings/training, work after a call (ACW), sick leave, etc. is the reduction of the call center.
Did you consider this factor when deciding who should be in the call center?
Staffing a call center is much more than just assigning a seat to each phone, and shrinkage is also one of the factors that plays a vital role in how many seats you need to attract customers.
Let us look at the definition of shrinkage, how it is calculated and how it affects the efficiency and performance of the call center.
Definition of call center contraction
Call center contraction refers to the number of seats actively serving customers divided by the number of seats unavailable at that point in time.
It refers to the service time spent by your agents and the actual time spent by customers.
The difference between the two is shrinkage.
It allows you to measure the time your agents spend on things other than helping customers.
There are similar alternative definitions throughout the industry.
They interpret call center contraction as:
Anything that causes the agent to be unable to respond to the customer, such as the execution of any certain/uncertain performance activities, makes your agent lose the element of productivity.
The difference between the number of seats hired and the number of seats available for a given.
The difference between the number of seats hired and the number of seats available at a given time.
Although the definition may be different for each organization, you can measure it based on the number of employees or the number of hours lost.
It is widely used as a planning factor for estimating how many seats to hire.
The factors that cause shrinkage are roughly divided into two categories:
External factors internal factors
Holiday team meeting
Holiday system down
Leave early Meal time
Late for training meeting
Although “internal” and “external” are the two standard categories, call center planners sometimes see it as a reduction in both planned and unplanned.
You can control some of the above factors, while other factors (such as paid breaks, meetings, etc.) can only be managed.
Employee dissatisfaction may lead to factors such as absenteeism. You can minimize/eliminate this situation by solving the root cause of employee dissatisfaction.
You cannot control/eliminate breaks, vacations and vacations, but you can monitor them to ensure that employees follow the recommended guidelines.
How to calculate the shrinkage rate of a call center
Two formulas can be used to calculate the shrinkage rate-one is used to calculate staffing requirements, and the other is used to measure the performance of individual seats.
Let us look at two calculation formulas
In terms of the number of seats:
Call center contraction calculation formula: contraction = number of agents required by the enterprise/number of idle call agents * 100
Suppose you need 100 agents to handle your call volume within an hour to reach your service level target.
If due to the above factors, 30 agents are unable to answer the call at any time within 1 hour, the contraction will be: contraction = (100/70) x 100 = 142.8
According to the above situation, your position has shrunk by 30%, so you need to hire 30% more seats to meet your target service level.
However, these 30 additional seats will themselves be reduced by 30%, which means that you need to add another 9 seats and continue to calculate this way.
This is why it is necessary to use the shrinkage rate formula to calculate personnel requirements, not just the important reason for calculating the shrinkage rate.
Therefore, based on the above calculations, after considering the overall reduction, you need 143 agents to meet your target service level within one hour.
When you need to calculate the number of seats required, please use this formula.
It will provide you with ideal calculations when you plan to run an advertising plan that may require additional personnel.
In terms of hours:
When you want to calculate the call center contraction of a single business agent, please use the following formula:
Shrinkage rate=[(total external contraction total hours + total internal contraction total hours)/total idle hours]*100
What is the acceptable shrinkage percentage for call centers?
The formula discussed above may make you wonder, is the percentage reduction in call centers normal?
Of course, the answer will vary from industry to industry, but for the call center industry, the most accepted number is between 30% and 35%.
The shrinkage percentage is usually calculated over 12 months.
Let’s see how to calculate the shrinkage rate step by step.
How to calculate the shrinkage rate of a call center
Bob leads a team of 12 customer service agents.
On any given day, he may have an agent who is on vacation, another agent who is sick, and another agent who may not be present at work.
Among those who go to work, one is resting and the others are working.
Therefore, now you have 8 agents who are actually receiving customers.
So, how to calculate the shrinkage rate of these four unavailable seats?
This is a model call center contraction calculator that can help you complete the process.
To calculate the management cost/reduction cost of your call center, you need to conveniently use the following details:
Hours of full-time
Total vacation days/year
Total sick leave days/year
Total number of statutory holidays
Total absent days
Other total rest days
The following calculations are based on:
Total working days = 261
Total working hours per week = 40
Total number of seats = 100
How shrinkage affects call center efficiency
High shrinkage indicates poor performance.
When the agent is unable to receive customers, it will eventually lead to longer waiting and waiting times, thereby reducing satisfaction.
Although shrinkage is not a performance indicator, managers sometimes use shrinkage to determine whether it can improve overall customer satisfaction.
The high shrinkage rate may put undue pressure on other test departments, leading to a decline in overall productivity.
Calculating the shrinkage rate can also help managers determine the number of seats needed to handle incoming/outgoing calls.
Managers will consider downsizing to achieve predetermined service goals.
Managers must regularly monitor and track this indicator to meet personnel needs and ensure overall call center efficiency.
How to control the contraction of the call center
You can track call center contraction manually or using cloud-based call center software.
This helps determine when and where it happens and how to reduce the shrinkage of the call center.
However, it must be remembered that certain causes of shrinkage cannot be controlled or eliminated.
Statistically speaking, most meetings are held between the morning and the afternoon, so you may find that the contraction is greatest during this period.
Weather also plays a role in contraction: for example, in winter, you may find that seats may wish to spend more time in the sun and may extend their rest time.
You can plan the office space and layout accordingly to overcome this problem.
There may also be high shrinkage rates in some departments/teams.
Analyzing this data can give you insight into which processes need improvement.
By identifying the triggers that allow employees to extend their breaks, you can make improvements to help employees comply with call center schedules.
In addition to these measures, you can also use the latest technology to keep the shrinkage rate to a minimum.
These will help you develop strong strategies to reduce and monitor shrinkage on a regular basis.
1. Use workforce management (WFM) tools
Nowadays, most contact center software has WFM function.
The shrinkage monitoring process can be performed automatically using software, and it is easier and more efficient than using traditional spreadsheet methods.
Using the WFM tool, you can arrange agents and even let them set a schedule within defined boundaries.
There are some WFM solutions that provide skill-based routing to enhance the work experience of the agent.
2. Continuous measurement of shrinkage
Shrinkage monitoring must be more of a continuous process, rather than once a year/month.
Shrinkage is a factor that affects the overall efficiency of the call center, so performance cannot be improved without maintaining a close to constant shrinkage rate.
This is only possible when measuring continuously.
New era call center solutions can help you achieve this goal.
You can measure shrinkage based on different criteria (such as call volume, service level targets, and average processing time).
Changes in these indicators directly affect the shrinkage rate, so by monitoring fluctuations, you can determine the factors that affect the shrinkage rate.
3. Measure shrinkage in hours instead of percentages
The reduction value is mainly calculated as a percentage to determine what percentage of additional employees you need to meet the current reduction requirements.
Although this may help in capacity planning, it is not operationally important.
When your goal is to reduce shrinkage to increase the efficiency of the call center, it is best to express it in hours/minutes per day.
This can help you discover and minimize the causes of shrinkage, thereby helping agents better serve customers instead of spending longer rest periods.
4. Solve the problem of absenteeism
Absenteeism is a component of contraction that you can control.
Managers can identify the agents who frequently ask for leave and resolve the reasons.
Managers should always check with their agents one-on-one about their problems and grievances.
Absenteeism usually stems from dissatisfaction with what they do, so you can solve this problem by providing them with advice on how to overcome difficulties.
5. Maintain the competitiveness of agents
Dealing with repetitive queries from customers can tire your agents, so keeping them motivated is vital.
In addition to providing training and guidance, you can also develop a reward plan to recognize their hard work.
Providing incentives is another way to stay competitive.
Today, call center solutions also provide gamification options, which will increase employee engagement and achievement.
Rewards for achieving goals may include recognition of tangible gifts such as leaderboards, badges or trophies.
The way forward for call centers
The shrinkage rate of each department/team in your enterprise may be different, so it is important not to shrink it in the enterprise.
By creating forecasts a month in advance and comparing them with actual results, shrinkage management becomes a continuous process.
Find out the root causes of controllable shrinkage factors, such as absenteeism, long rest periods, etc., and take measures to resolve them.
Through continuous operation, you can ensure that the shrinkage rate is less than 35%, which is the industry standard.
If shrinkage is not monitored, it may affect the overall operational efficiency of the call center.
Make sure to maintain a robust strategy, which will help you regularly monitor and reduce the working hours of the entire call center.
Use manual methods and adopt the latest technology to minimize the workload of the entire organization.