Revisited: The Importance of Planning

By Ric Kosiba, Ph.D. Vice President, Interactive Intelligence’s Decisions Group

A Quick Announcement

I have to say that I am pretty proud that we have been hanging out with the SWPP community for 13 (!?!) years. I did some rough math and we have developed over 50 articles on contact center planning.

But we were wondering what to do with these old articles—all of which are, for the most part, still applicable. We’ve decided to revisit many of them, post them to a new (and admittedly amateurish) website, and update them with any new thoughts or new experiences. These can be found at, and we would love it if you dropped by our spot on contact center planning. The first one we are placing there is “Top Ten Tips for Contact Center Planning.”

The Importance of Planning Redux

One of the first SWPP Advanced Topic articles we wrote, when SWPP was just starting out, was about the importance of contact center planning. While it was true then that planning for call centers was important, it is truer now that contact centers, being even more complicated, require a solid strategic plan to enable it to run efficiently. With 15 years under our belt, we have real evidence that a focus on developing long-term capacity plans that are efficient and accurate leads to terrific benefits for the company.

What is Long-Term Planning?

What we are discussing goes by a few names; some call it strategic planning (our favorite), capacity planning, or longterm planning. But whatever it is called, its goal is to tame the seasonality of the contact center operation and to present to executives the tradeoffs between resources provisioned and the customer experience and revenues expected. This is by no means easy.

First, all important contact center metrics are seasonal. Volumes, handle times, sick time, vacation requests, agent attrition, outbound contact rates, revenues per call, outbound lead lists, and many other important metrics vary significantly week by week. So the planner must understand and manage this seasonality.

Next, even with the best forecasts, we all know that there is uncertainty and variability associated with our plans. This uncertainty must be quantified, understood, and presented to decision makers. The best plans outline the cost and service risks of planning wrong.

Contact center operations have always been complex, but today the complexity has skyrocketed as contact center operations have become multi-site, multi-skill, and multi-channel centers. The math required to evaluate staffing in these operations has become extremely complex. Simplifications like the old Erlang C and workload calculations are simply no longer accurate. Accurate staffing is sort of the point of the whole exercise.

Fourth, resource decisions are also getting harder and harder. When should we hire? When should we offer vacation and training? What is the best way to get to my seasonal peaks—with overtime or by hiring? Determining this by hand,
using a spreadsheet with an “over/under” line is impossible to do efficiently. Developing multi-site, multi-channel, and multi-skill staff plans by hand? Forget about it.

Finally, the old standard technology, the big Excel spreadsheet, is simply the wrong technology for building great plans. They are slow, cumbersome, and easy to mess up. But the focus of a contact center strategic plan is to develop hiring, shrinkage, overtime, and undertime plans that ensure that the staff available is very close to the staff required to hit targeted service goals through the seasonal peaks and valleys of the modern contact center operation.

Dangers of Not Planning

The purpose of this discussion was to point out the importance and the benefits of planning well. But let’s start with the converse; what happens when you don’t plan well?

The obvious repercussion of poor planning is being overstaffed or understaffed during the day. If you don’t hire enough agents, you’ll be understaffed. Hire too many, and agents will be looking for things to do. Hire at the wrong time? Again, you will likely be overstaffed or understaffed (or both at different times of the year). Either will lead to workforce management chaos as the real-time team works to remedy the poor plan. Agents can burn out if understaffed or be bored (and useless) when overstaffed. Neither is ideal.

Chronic mis-staffing also leads to service inconsistency, as customers receive very different levels of service. In an era where customer experience is important, an erratic experience will always be problematic.

An inefficient plan by definition means that the call center operation will be paying too much to service its customers. Hiring too soon, or hiring too late and incurring unplanned overtime all come with significant and wasteful costs.

Strategic planning at its core is about making decisions, and the best strategic planning processes embed the ability to accurately perform what-if analyses for the big picture questions of the call center executive. It follows that these systems must be accurate over the range of service levels that what-ifs might contemplate. When asked for the effects of a hiring freeze, say, the capacity planning process must be able to accurately and quickly quantify the service, costs, agent effort (occupancy), revenue, and profit repercussions of this decision. A what-if that is inaccurate will lead to significant decisions that are wrong.

Helpful Tools

Developing capacity plans is an exercise in mathematical modeling. There are three sorts of models that every capacity planner needs:

  • Predictive models to help planners develop forecasts.
  • Descriptive models to help planners determine the service, cost, and revenue implications of any staffing scenario. These models simulate the operation.
  • Prescriptive models to optimally develop hiring overtime, undertime, and controllable shrinkage plans.

All three models taken together allow a company to accurately and quickly (within a few minutes) evaluate any what-if analyses, forecast, or staff plan.

What We Have Experienced

I have the strange bragging right to have seen more contact center planning systems and spreadsheets than possibly any other human being in the history of the world (other than Jen Dziekan in our office). Here are my observations:

  • Too many companies still use an Erlang-based planning system to perform their capacity planning. Almost universally, these companies have issues hitting service goals without being chronically overstaffed.
  • Companies that have invested in developing a rigorous planning process, with each of the three model types, universally run a tighter operation. They provide more consistent service with slightly higher occupancies than those without the appropriate tools. Their distributions of service delivery are much tighter.
  • Companies that have invested in models and business processes saw a dramatic shift in costs per call when they migrated to the new process—their costs were taken down a notch (5%-10%).

If providing consistent customer experiences and service at a frugal cost is important to your organization (it is), then investing in the capacity planning process is critical. Good planning always leads to a smoother and less expensive operation.

P.S. If you are a planner and are dying to have better tools, print this out and leave a copy for your COO and CFO.

Ric Kosiba, Ph.D. is a charter member of SWPP and vice president of Interactive Intelligence’s Decisions Group. He can be reached at or (410) 224-9883.