12 Principles for Better Contact Center Budgets

Ensuring that you are getting necessary resources is an important part of enabling the contact center's strategic potential. That, of course, requires the right budget and a clear understanding of what the returns on those investments should be.

A budget is simply a summary of proposed or agreed-upon expenditures (costs) for a given period of time, for specified purposes. Sounds easy enough. But the process of putting together a budget is often seen as tedious, time-consuming and, some say, a distraction from more important management responsibilities. However, don't forget the outcome of this much-maligned process: funding the contact center with what it needs to accomplish its mission and potential.

Here are a dozen principles to keep in mind.

1. View the budget as more than a document.

Those who picture rows and columns of line items and figures when they think budget are missing the point. It's really a communication process that presents a larger opportunity to learn about the business and make a case that's a win for everyone (employees, customers, and the business). I've seen managers spend many hours—make that many days—putting the details together, only to have their priorities swept away or diluted in a matter of minutes in the CFO's office. I've also seen powerful (and positive) budgetary agreements happen over coffee, literally on the back of a napkin. Remember, it's the effectiveness of your case, not the detail of your analysis, that matters most.

2. Answer the big questions.

Anticipate and be ready for the big questions. Why are we spending this money? Why does the contact center exist? Why are we spending more (or less) than last year? These questions form the backdrop of the budgetary process.

3. Focus on results.

Handling 1.7 million conversations, achieving 90 percent first-call resolution, or hitting service-level targets are not the results decision-makers want to see. These are only means to an end. As your center's objectives and focus mature from handling interactions efficiently to delivering great customer experiences, you will have a greater impact on business results—including revenue, profitability, market share, and word of mouth. Illustrating this connection focuses discussions on the things that matter most.

4. Base the budget on a clear strategy.

A necessary first step for a successful budgeting process is agreement on the contact center's direction and priorities. Your customer access strategy should be the de facto blueprint for the budget, defining who your customers are; when and how they want to reach you; the means by which you will identify, route, handle, and track those contacts; and how you will leverage the information that comes from those contacts. Without this foundation, budgetary decisions will likely not align with your organization's broader objectives.

5. Ensure that budgeting is an extension of resource planning.

In well-run contact centers, forecasting, staffing, scheduling, and cost analysis are ongoing responsibilities. These activities should take much of the work out of the budget process, because the budget should ultimately be based on the already-established forecasting and planning steps.

6. Identify key trade-offs.

What happens if the forecast is high? Low? What happens if you provide better levels of service? Worse levels of service? How much would you save/spend if ...? Once the budget for the expected workload and recommended resources is established, it is fairly straightforward to rerun scenarios for different workload assumptions and alternative service levels. These scenarios will contribute to good budgeting decisions and will improve the understanding others have of contact center dynamics.

7. Look for opportunities to maximize cross-functional resources.

Often, an organization's overall results can be improved by investing more in one specific area. For example, marketing managers might be willing to provide the contact center with budget to capture and analyze information on consumer trends and expectations. A portion of the product development budget might be directed to the contact center for improved analysis of customer suggestions and input. These possibilities become evident to the degree that relationships exist and collaboration is in place among functional areas.

8. Highlight investment opportunities.

As with organizations in general, most contact centers are consistently searching for ways to do more with less. But there's also a place for making some high-leverage investments in sensible and practical areas, including the following

  • Planning and process improvements;
  • Selective technology investments;
  • Management-level education;
  • Focused agent and supervisor coaching initiatives; and
  • Research and development.

The key is being selective, focusing on areas that are most likely to yield a high return on investment.

9. Present the budget formally.

This recommendation might seem like a contradiction, given the emphasis on collaboration and communication, but a formal presentation can be an important part of the process. To start, it can be the catalyst for getting all decision makers together at one time. (How many times did you answer the same questions for different people last year?) All in attendance will hear the questions and comments of the others, saving time and raising the general level of understanding more quickly.

10. Keep the presentation short and uncluttered.

Use graphs and illustrations where possible. Provide back-up material as necessary (but not as a part of the main presentation). And sprinkle the conversation with real examples—for instance, "Sarah Johnson, a small-business owner in Seattle and a seven-year customer, was one of the 1.2 million customers we helped last year. She contacted us because she was concerned that ..." Examples bring realities to life.

11. Anticipate and prepare for the usual questions.

Some questions have come up a jillion times before, and they will come up again. They include the following:

  • What did we spend on the center in total last year?
  • Did it accomplish what we intended it to?
  • What was our return on these investments?
  • Is growth in some channels (e.g., chat, social media, self-service) changing the workload for agents? (Reducing? Increasing? Altering?)
  • What's our cost per contact? Is it going down or up?
  • What are you doing to reduce unnecessary contacts?

There are others, and you probably know what they are in your situation. Be ready. These questions are your opportunity to shine.

12. Ensure the budgeting process is transparent and honest.

You should be realistic and candid about whether the contact center has been meeting its objectives. The budget must put that in context with customer satisfaction, agent performance, and the objectives and funding being proposed. It must support the mission of the organization and dovetail with the roles and requirements of other areas. And it must be transparent in terms of opportunities and challenges.

Yes, effective budgeting requires some number crunching and analysis. But above all, it requires a clear direction, good communication, and a solid understanding of the contact center's needs and strategic contributions. This is a process that will bring your leadership, communication skills, cultural savvy, and professional expertise to bear. The effort will be worth it many times over!

Brad Cleveland is a customer service consultant, specializing in contact centers, support desks, and other customer-facing environments. One of the two original partners in the International Customer Management Institute (ICMI), he acquired ICMI outright in 1996 and served as its president and CEO from 1996 to 2008. Today, Cleveland consults and speaks to a broad range of organizations and associations and serves as a senior advisor to ICMI. He is author/editor of eight books, including Call Center Management on Fast Forward. His current research is focused on the future of customer access management and the impact of social media; his blog can be followed at www.bradcleveland.com/blog.