Fundamentals of an Operational Optimization

Fundamentals of an Operational Optimization

They say that you need to get down into the trenches to fight a battle. It cannot be done merely making strategy in a safe war-room. It is great, and important, to make strategy, to plan, and a lot of very able and experienced people do that, but at some point someone needs to go beyond and fire a bullet, hammer a nail, till the soil, whatever, if any results are to be expected. Merely making strategy and thinking about possible actions will not go very far.

The same is the case with operational optimization.

It is a great idea. Every business leader is not only aware of it, but also buys into it. They are all aware that in a competitive world, it needs to be a continuous process. Everyone in the business should be thinking about it all the time, because their competitors are also doing it.

But eventually, after all the ideating and sermonizing and strategizing is done, it needs to be done.

There are some areas which have been found relevant by many BPOs, as areas that with some focus are capable of delivering enhanced performance. These could benefit the client if specific to a project, or could benefit the supplier, or, as is most likely the case, both. In a partnership, benefits realized by one often spill over to the other. Perhaps true for hindrances as well.

In order that you do not miss the low hanging fruit, not from the ease of benefit realization perspective but more from the perspective of knowing where to look, 8 such areas have been identified and listed in this article.

oWorkers is committed to its niche of data entry services in the BPO space. It is identified as one of the top 3 providers of data services in the world. With expertise gathered over 8 years, it has been working with over a hundred clients and looking for opportunities to make improvements in extant processes. 

Higher customer satisfaction (or experience) score

Customer satisfaction is the holy grail for any business that interfaces with customers. And that means all. A business needs to have customers for it to be one. Often, BPO partners also interact directly with customers. In fact, in some cases the partner perhaps handles a lot more customer interface than the client whose customers they are, particularly when customer interface channels like Call Centers have been outsourced to suppliers. Improving the customer experience has to be a primary variable for any operational optimization envisaged by a company.

Whoever does the interface, customer satisfaction is in everyone’s interest. When he sang “Everything I do, I do it for you,” Bryan Adams may have had amorous intent. However, a business could just as easily sing the same song for its customers without changing a word. They are the reason for their existence, survival and (hopefully) prosperity.

Regardless of the type of measure deployed, with the two most common ones being Customer Satisfaction Score (CSAT and Net Promoter Score (NPS), the objective has to be to enhance satisfaction and reduce dissatisfaction.

An NPS survey is usually done at a point of contact or transaction while a CSAT survey is an aggregate that is done periodically. Some companies believe surveys are subject to human bias, of the customer in this case, and prefer to use objective data points like repeat contacts made by a customer if she is calling in, to assess how long it took to resolve the issue. The fewer the contacts, the quicker the resolution.

The key is to establish a baseline measure that is suitable for you, carrying it out repeatedly, identifying the variables that impact scores, to the extent possible, and working on them for resolution.

Reduction in customer dissatisfaction and complaints

Reducing dissatisfaction is at least as important as enhancing satisfaction because in a competitive world, customers often ‘vote with their feet.’ They have no responsibility for telling you what they are dissatisfied about and simply get up and walk away to your competitor, without you ever knowing what went wrong or what you could have done better.

Also, a disengaged customer is perhaps less interested in providing feedback to the company if requested, as compared to a still-interested customer. Hence, it is possible that CSAT and NPS surveys report an inaccurately high positive picture drawn from them. 

Some companies make an extra effort to surface customer dissatisfaction with the objective of identifying them early and heading off the point at which the customer ‘votes with her feet.’ Before she reaches that point, she is likely to have gone through stages where she was perhaps still trying to seek resolution but the responses she received kept pushing her towards the exit door.

While customer dissatisfaction scores are important, some companies, in the belief that these could be biased, try to base their efforts on objective data like customer complaints. Their operational optimization efforts rely on a detailed analysis of customer complaints combined with monitoring trends to ensure they are headed in the right direction.

oWorkers has been trusted by several unicorn marketplaces with their operations. In addition, a large section of our clients are technology companies. This also keeps us on our toes and ensures we deploy the best technologies available.

Reduction in idle time

Idle time could be defined as the time, or duration of time, when paid resources are not engaged in activities that contribute to their assigned work. It could be on account of inadequate work in the queue, it could be because the process is setup in a manner that waiting cannot be avoided, or it could even be a consciously provided idle time in order to prevent resource burnout, especially in repetitive tasks.

Leaving aside conscious idle time, the company will benefit from a reduction in all other forms of idle time. It could be through a tweak of the process sequence or it could be through updated load balancing, as this is time already paid for, without additional cost there is an opportunity of getting additional units produced.

oWorkers works on an employee model, and not a freelancer model. Though it creates the responsibility for managing the careers and growth of staff, it provides us greater flexibility in terms of deployment, helping us review measures like idle time and take steps to keep them in check. With our deep connections in local communities, we are able to offer just-in-time hiring to clients, enabling them to minimize idle resources during lean periods.

Enhancement of output for operational optimization

Doing more with the same, doing the same with less and doing more with less are the eternal mantras of all organizations that are the surrogate variables that enable the organization to move towards its goal of maximization of profit.

Enhancement of output is a key variable, since business is about producing a product or service that gets purchased by a client and generates a revenue stream that goes towards meeting costs as well as profit. If there is no revenue, there is no business. And revenue is an aggregate of products and services sold.

The more the number of units of output, the greater the revenue, and consequently profit, opportunity. As we have discussed elsewhere, this enhancement has to ensure that nothing else changes, or changes only within defined parameters. If you are hiring more people or buying more equipment for increasing output, then it is an expansion, not an improvement or optimization play. But, enhancing output without increasing production costs is an improvement that we should all strive for.

With a culturally diverse team across its three centers, oWorkers offers support in over 22 global languages and works with clients to explore output enhancement options on a continuous basis.

Employment of fewer resources

Operational optimization through deployment of fewer resources is like a mirror image of output enhancement. In terms of units produced per unit of cost or investment it would perhaps achieve similar results. If today we produce 100 units at a cost of $25 per unit, we might try to improve that to a lower number, as would be the case with production enhancement with the same cost structure.

The deployment strategy would depend on the other variables in the mix. Is there a demand for the enhanced production? Are additional resources available at similar or lower costs? Does the company have cash available to invest in more equipment?

Of course, better than producing more with the same and producing same with less would be producing more with less. All options should be kept open. Eventually all roads that lead to the attainment of the goals of the business should be kept open and paved and free from any potholes that could slow us down.

oWorkers is GDPR compliant and ISO ISO (27001:2013 & 9001:2015) certified. This makes our processes sharp and ensures we don’t carry fat in any part of our operations.

Shorter training duration

Joined at the hip with hiring in a BPO is training. There is usually an almost continuous working of the hiring machinery that keeps providing fodder for the training machinery that smoothens the rough edges and produces diamonds that step out and deliver on client processes and projects.

Though some may argue that it is dependent on the hiring machinery and does not have control over its destiny, others might disagree and argue that any process that needs to be performed as a conscious effort, and involves people, has opportunity for review and improvement. The training process in a BPO is no different.

For the many BPOs that provide training to new hires at their own (the company’s) cost, each minute spent in training is a cost. Hence, if they can find ways of providing the same quality of inputs in a shorter duration of time, it will again contribute towards the end goals of the company.

E-learning technologies have emerged as likely saviours of training teams, equipping them with tools through which they can do more with less. After an initial investment in creating the automated content, e-learning could provide a quick payback in terms of saved trainer time and physical classroom space, leading to operational optimization.

Many clients have reported savings of upto 80% over their pre-outsourcing costs. With the help of initiatives like a close monitoring of training duration, we are able to keep costs reasonable and share the benefits with our clients.

Reduction of manpower attrition

Attrition in the industry has often been compared to a leaking bucket. All efforts at shoring up manpower resources come to nought as the resource bucket the hiring team is trying to fill up has many leaks. Resources keep leaking out of this bucket through attrition, often faster than the hiring tap is filling it.

Of course, it varies from company to company, process to process and location to location. Numerous attempts have been made by the employers to find the root cause and characteristics for it that could enable them to take corrective steps and continue to be made. Do female employees have higher attrition than male? Do graduates attrite more than non-graduates? Do people who need to travel far have a higher tendency to leave as compared to people who live close to the workplace? Is attrition based on the management style of individual team leaders? Is the nature of the client project a determinant in attrition levels? Do centers in big cities face higher attrition than those in smaller towns?

Companies have been trying to answer these questions with a view to taking strategic decisions in order to have a favorable impact on attrition numbers. Attrition is a significant cost. Not only in terms of resources expended in the hiring process, but also in training them. In addition, possibly lower quality delivered at the start by new hires could also be considered as a cost to the business.

Over a period of time, some companies have reached the conclusion that while lower is obviously better, it is a fact of the industry and needs to be managed. Hence, some of them focus on reducing the cost impact caused by attrition and not necessarily the actual number of people leaving. Early go-live and a higher component of performance-based salary have been experimented with by some organizations. As are efforts at setting clear expectations at the time of hiring, which was not always done as the hiring team is goaled on the quantity and speed of hires.

Though oWorkers has been best-in-class as far as attrition is concerned, it leaves no stone unturned to match hiring to client requirements to ensure processes are not adversely impacted at a later stage due to incorrect hiring and attrition. It employs a variety of tools, including emotional and psychometric assessments, to identify the right resources.

Reduction of wait time for operational optimization

Wait time is the time a transaction needs to wait in a holding queue before it is picked up for processing. It does not necessarily apply only to inanimate transactions that typically sit in a queue. It equally applies to a customer who calls in but needs to wait in a queue before the next agent becomes available.

Reduction of a customer’s wait time in a holding queue can positively impact the customer experience.

Reduction of a transaction’s wit time in the processing queue could enhance the efficiency of the overall process and might also impact the customer experience if the output needs to go back to the customer.

Essentially, wait time reduction relies on the ability of the provider to forecast volumes reasonably accurately and set up the service arrangements to match those volume flows. Product mix can change, as can consumer behavior, and service technology. Hence, processes need to be reviewed with a pair of fresh eyes and perspective for identifying opportunities of wait time reduction.

The 20 years plus hands-on experience of our leadership team comes in handy whether it is reducing wait time or any other initiative that helps the company achieve its goals.

The oWorkers advantage

The Quality team of oWorkers is an independent team that reports directly to senior management. Not only does that keep senior management informed about developments on the shopfloor, it also enables the Quality team to keep a check on the output of the delivery team. It leads and guides all improvement initiatives undertaken in oWorkers and is staffed with experts on various quality systems.

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