Yesterday, we were asked a question from an SWPP member: “How can you put value on the accuracy of your forecast?  I’d like to invest in improving our forecasting, but I am having a hard time quantifying the benefits of it, and I want to sell it to my bosses!”

Better forecasts mean better decisions, right? Slam dunk, huh? But he had a very compelling take, and to be honest, I haven’t sorted out how to think about it.

Here is his take: Long-term forecast accuracy has significant value.  If I could create algorithms or business processes that improve our forecasting, I would hire the right number of people, at the right time, and with the right combination of skills.  I could plan my overtime, my VTO, and my training correctly, and make sure the right number of people show up to work every day.  My service levels could be more consistent, my occupancy would be in an optimal range, and my costs would be controlled. Long-term forecasting helps set the number of resources I have.

Long-term forecasting and planning are paramount.

However, short-term forecasting is different. From him: “If I do a better job of forecasting short-term, what will change?  Maybe I would offer overtime a day earlier? Maybe, if I was proactive, I would ask folks to take the day off with a little bit of warning? But in the end, I would likely have the same amount of overtime and undertime had I missed the forecast.  I haven’t necessarily improved the costs of my centers, and If I have, it’s only around the edges.”

Is this true? If your costs are set by your capacity plan, what sorts of big dollar decisions are left to short-term forecasts?

I would honestly love any thoughts from you on this.  Email me @ ri*@*********rs.com!

Note: This week’s tip is provided by Ric Kosiba, a charter member of SWPP and Managing Director of Real Numbers, a contact center strategic planning company. He can be reached at ri*@*********rs.com or (410) 562-1217.  Please know that he is *very* interested in learning about your business problems and challenges and knows a bunch about capacity planning. Feel free to set up some time at realnumbers.com. Follow him on LinkedIn!  (www.linkedin.com/in/ric-kosiba/)