Karen Fischer

The Math of Bad Service

April 12, 2014

Ever wonder why you get bad service from “customer care call centers”? Blame it on math.

Often customers are talked about as being an investment to the firm. It is easy to understand; a company invests marketing and sales dollars to acquire you and through the money they make from you they can pay for the goods and services they deliver to you. This provides the ROI in the customer investment. In a commodity market such as telecom, it can take anywhere from 6 months to 2 years to see profitability; especially with these free phones that suppliers do not give away for free.

Unfortunately there is this thing called the annual budget that needs to be submitted and approved by the board of directors. These guys want to increase revenues and decrease expenses to improve profits and increase the share price. This is what their shareholders want; it is what you want; since your retirement funds depend on it. Once these budgets are submitted; all of that marketing speak gets translated in to dollars and cents and all of a sudden “You are an expense to be managed”.  You are not an asset to be managed – you are now an expense.

Assets require upkeep. They are maintained and looked after by qualified professionals; schedules are put in place to massage and take care of the chunk of steel. On the other hand, expenses are dollars spent during a particular period. Expenses need to be controlled and managed. If they are not managed, spending gets out of control – and this is a bad thing for profit seeking organizations. So how does this translate into bad service? It’s all about math.

A company allocates only a certain percentage of its total spend to its operations. Math dictates that if they want customer care, they will need butts in seats to take care of customers. They can expect to field “x” number of calls over the next year. The trick is to handle all those calls with a few dollars as possible. Why?  Because, Budget$ divided by “x” calls = Average cost per call. Do you see the math creeping in? They will want the average cost per call to decrease; this means that productivity is increasing and this is a good news message to send to management, the shareholders,  and the investment person who sold them RRSP’s.

Assuming they do not keep decreasing salaries of their current employees (they only hire the next person at a lower salary; or ‘outsource’ to a lower labour rate country) this implies the cost per hour remains relatively constant in the foreseeable future. Other than firing current staff and hiring cheaper labour, in order to decrease the cost per call, the option is to consider increasing the number of calls each agent needs to handle.

Math Lesson #1: Increasing Productivity
If the current agent can handle 50 calls in a day, then increasing their calls handled per day to 55 improves productivity by 10%. Out of an 8 hour day, ½ hour goes to lunch and another ½ hour goes to the morning and afternoon breaks – so 7 hours productive time is left. 50 calls over 7 hours equates to 7.1429 calls per hour or 8 minutes and 24 seconds per call. The improved 55 calls over 7 hours equates to 7.8571 calls per hour or 7 minutes and 38 seconds per call. That is shaving off an incredible 42.852 seconds of talk time. The agent probably does not need to know everything about you or why you are calling anyway.

How is this decrease in average call handle time going to be accomplished given that time is required to answer, gather relevant data to handle the call, address the issues on the call, and wrap up any action items required from the call?

Managers love metrics. It shows their boss how things are improving. Managers also have another weapon in their arsenal and that is performance management which is linked to job security and (very hopefully) potential pay increases. Performance Management sounds cruel; so let’s use the term “coaching”. Agents will be coached on how to get productivity improvements. Too much coaching does not translate well to an agent.

Here comes Math Lesson #2: Managing Productivity
Agents will be managed on their average call time. If this average exceeds 7 minutes and 38 seconds per call, then they will receive coaching. If the average call time is less than 7 minutes and 38 seconds per call, a new standard is achieved and the agent is promoted to a lead position so they can now coach those who do not meet the new standard of 7 minutes and 38 seconds per call.

Agents are not dumb, they know what the 7 minutes and 38 seconds per call means and they know the simple math equation
 Calls > 7 minutes and 38 seconds = Not good

There is a saying in management accounting; “tell me how you are measured, and I will tell you how you will behave”.  In response to keeping average call handle time under the 7 minutes and 38 seconds, you might find the following ‘defensive’ measures employed during your interaction:
  1. Tell the caller that something will be done at the 7 minute mark and then right after the call is complete,  take the next call without doing what you said you were going to do,
  2. At the 7 minute mark, transfer the call to another department so the next scheduled call can be taken,
  3. At the 7 minute mark, transfer the call to the supervisor or lead so the next scheduled call can be taken,
  4. At the 7 minute mark, indicate the system is not responding and ask them to call back so the next scheduled call can be taken,
  5. At the 7 minute and 30 second mark, do anything that can be done to get the call terminated off of the agent desk so the next scheduled call can be taken,
  6. At the 7 minute and 40 second mark, the agent starts to prepare his/her resume.

The next time you get bad service from an agent, blame math and the management team of the organization who told you that you were an asset, not the poor agent who is trying everything to do their best in a very chaotic and a technologically abusive environment.


Lobbying for Small Businesses in Canada

March 27, 2014

For those small businesses who have not heard of the CFIB or those that are not sure if joining is worth the cost,this article is for you. The greater question to ask yourself - Can you afford not to join. If you are a business that has employees beside the business owner, not joining could end up costing your business greatly in the long run. The CFIB is the Canadian Federation of Independent Business which is an organization that lobbies and advocates on small business owner's behalf agains...
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Changes to Klout Help Business Owners with Content Marketing

February 14, 2014

If you have not used Klout or are not familiar with the tool , it is a social media platform that tracks all of the interactions that you have on Social Media.  When it first was launched, I joined out of curiosity based off friends of mine in the business community sharing the information about Klout scores on LinkedIn. It started out providing a "social media score" for you as an individual, which was  based on the interaction on your Social Media platforms that you utilized.  Though I will...

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Blog Series - 2 Tools to Help You in Your Small Business #2

February 12, 2014

Two Tools To Help You Develop Video Content For Your Small Business

This is the second in our series on Tools to Help You In Your Small Business. The focus of this article is on tools that you can use to generate Video Content for your small business online.

PowToon Videos 
PowToon is a fairly new software as a service offering which allows businesses to develop content videos utilizing animation which are widely seen today in a lot of business videos. There is a free offering as well as two pre...
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10 Tips For Developing A Successful Website.

February 1, 2014

We developed this video using Powtoon which is a software as a service product that allows you to create cartoon videos for your business.  The product is fairly simple to use if you are use to using drag and drop objects and have a basic understanding of video and timing.  

Hopefully you will not only find the video useful, but also get an understanding of how video can be used in your business and does not have to cost an arm and a leg.

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Blog Series - 2 Tools to Help You in Your Small Business #1

January 24, 2014
As a small business owner, it can be overwhelming to do everything that needs to get done in your business having a limited staff and budget. For this reason, it is important to find tools and products that can help make your life easier. For this reason, I thought it might be helpful to develop a blog series that highlighted two products in each article to give small business owners insight into tools and products that are out there to help them in their business; as well as provide some com...

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How Slacking Off On Your Digital Marketing Can Affect Your Business

January 3, 2014
December is a short month for all businesses and can either be crazy or slow, but this December was especially crazy for our business and I found out what effect slacking off on spending my usual 3 hours a week on digital marketing had on our overall marketing efforts and business. Normally I do the following for our business and have maintained a steady rate of followers, traffic on our website, and new business from our efforts:
  • Share twice a day on all of our social media platforms

  • Write 1-2...

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What is Involved and Why to Consider Re-Branding of Your Business

December 5, 2013
Before we start to talk about re-branding and what are reasons you might consider doing it - it is first important to understand what we mean by branding. If you ask 10 people what branding is, you will most likely get 10 different answers from our company logo, our company colours, our messaging, connecting to our target market. All of these are true, but are just components of your brand. Your brand is how you portray and differentiate yourself to your prospects and customers, so can includ...
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Are You Working In Versus Working On Your Business?

December 5, 2013
Are there times that you feel you are working 24 hours a day on your business, but do not believe that you are getting what needs to get done accomplished?  Do you at times feel overwhelmed?   If this is the case, you are most likely experiencing what most small business owner have experienced at some point  with  their business. This experience is usually a symptom of working too much “in” your business versus “on” your business.

It is not uncommon to have worked to grow your business...

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Do You Have the Right Business Presence?

August 5, 2013
You are probably thinking I meant to say, do you have the right online presence?  The new buzz word of today is digital marketing or online marketing and every company that was either a web developer or graphic design company yesterday is now a digital marketing company as that is what everyone is talking about today. The problem with this is the same problem that it was yesterday is that digital marketing is just one piece of the marketing pie and cannot really be looked at separately from w...

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Welcome to Our New Site and Blog - We have moved all of our content from our previous blog, so a lot of our earlier articles are under August 2013.

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Our Canada small business blog provides you with articles and small business advice across different areas of your business and in support of our small business consulting and small business coaching practice. Our business focus is on providing small business content and advice to small businesses in the Canadian market. Our only focus is on Canadian small businesses or businesses outside of Canada who want to do business and provide new jobs to Canadians, but welcome visitors from outside of Canada in hopes that the advice we provide can help them as well. Visit us often, or subscribe to our small business blog Canada, as we will continue providing small business advice, small business tips , and techniques on topics of interest for your small Canadian business, whether you are a start-up or a mature small business. We would also be interested in hearing from you on small business topics of interest, or hearing questions that you might have in areas of your business.


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