Top 5 Customer Service KPIs (Metrics)
I was asked to write some articles on my top 5 Metric/KPI recommendations for various business functions. Here are my “Top 5 Customer Service KPIs”.
(Note: I use the terms Metrics and KPIs interchangeably – but prefer to use Metrics these days in an effort to reduce the use of 3 letter acronyms).
If you’re new to Metrics, I recommend taking a quick read of some of my previous articles first:
Every business model is different and you need to choose the right metrics that drive the performance of your Customer Service team, but here is a list of 5 generic metrics that are commonly used by my clients, and a brief explanation of each:
1. Complaints / Reported Issues / Support Tickets.
This is a simple count of the total number of complaints/issues/support tickets that are received over a given time period. If you see this number spike upwards, it signals an urgent need to investigate and address the cause.
We can pick up an increase in the number of complaints much earlier than we can detect a deterioration in customer satisfaction survey scores or client retention metrics. This lead indicator enables us to respond quickly.
2. Average Time to Resolution.
You must resource your customer support function with sufficient staff to meet the response time expectations of your customers. I’m sure we’ve all spent hours on hold waiting to speak to a customer service agent from our telecoms provider, only to be transferred to other departments, where we needed to repeat our personal details and the nature of our issue several times over. It’s a universally loathed experience and a major cause of customer dissatisfaction and resentment.
On average, how long do your customers have to wait from the time of their initial phone call (or email support ticket), to when their issue is marked as “resolved”? Likewise, if you see this number spike up, you need to investigate the cause.
3. First Contact Resolution (FCR).
What percentage of customer issues are resolved on the first contact? For a customer service team, first contact resolution (FCR) is the percentage of contacts that are resolved by the service team on the first interaction with the customer. For live calls or web chats, this means that the customer’s issue is resolved before they hang up the phone or end the chat session.
FCR is calculated as the number of customer issues solved in the first contact, divided by the total number of customer contacts.
Note: The issue is not “resolved” until the customer says it is. Many companies who offer phone service, have their customer service staff ask questions like, “Have I resolved your issue today?” as a part of the close on the call.
Likewise, your email support process needs to have a customer resolution feedback mechanism built in e.g. “We would like to know if you consider this issue to be resolved? Please note that if we have not heard back from you within XX hours this ticket will be automatically marked as resolved and closed. If you have any further questions, simply respond to this email.”
Once you have a good idea of your FCR performance, you can drill down to identify the types of issues that are not being resolved in the first contact to identify and address the cause.
4. Customer Callbacks.
One of the criticisms of the FCR metric is that it only focuses on dealing with the customer’s stated issue at the time: e.g. the customer contacts your support team; the issue is resolved as quickly as possible, and the customer service rep moves on to the next caller/support ticket.
A worthwhile supplementary Metric is to also measure the number of repeat phone calls or repeat email support tickets from any customer within a 7 day period from their first contact.
This Metric encourages customer service staff to not just solve the customer’s current issue but to proactively address any future issues that could be reasonably anticipated based on the customer’s current needs.
In essence, don‘t just react to the issue that the customer is having right now; be proactive and resolve any issues that the customer didn’t articulate but might encounter next. Ask yourself, “How can I make sure this customer doesn’t have to call us back?”
5. Customer Effort Score (CES).
Whilst the Net Promoter Score (NPS) is a common measure of customer loyalty in terms of the customer’s relationship with your company as a whole, it may not be the best metric for tracking their experience when dealing with individual customer service issues at a transactional level. For example, the customer might think your company is great, but your customer service experience is awful.
Research shows that customers want their problems solved quickly and easily, and the best way of describing what customers really want is “an effortless experience”. It’s a surprising finding and one that stands in stark contrast to what is commonly published in the business media or presented by self-proclaimed customer experience gurus. Instead of getting your customers to say, “You exceeded my expectations,” you should strive to get your customers to say, “You made it easy for me.”
The Customer Effort Score (CES) is typically structured using a Likert Scale as follows:
To what extent do you agree or disagree with the following statement: “(Your company name) made it easy for me to solve my issue”
- Strongly disagree
- Somewhat Disagree
- Neither Agree nor Disagree
- Somewhat Agree
- Strongly Agree
From there you can take an average of all the CES scores obtained over the period (e.g. per week or month). Effort reduction is the key. Customers just want to solve their problems and get on with their lives, so your job is to make it as easy as possible for them to do just that.
How can you make things easier for your customers?
Of course, there are many other Customer Service Metrics that you could consider, but these five common ones should give you a good start point for discussion.
Regardless of which Metrics you choose to measure, it is vital that your team meets every week to discuss performance.
There is a saying, “You can only manage what you measure, and what gets measured, gets done”.
I disagree with this statement. Just measuring the numbers will not deliver the outcomes you are looking for. I see plenty of companies who measure the right things, but they still don’t get the results they want, because they fail to meet to discuss performance every week, and they fail to hold people accountable for achieving the agreed standards.
I have my own saying which I think captures it better: “Successful Business Execution is 20% giving people clarity about what needs to be done, and 80% following up to make sure it actually gets done”
Until next time…
Stephen Lynch is the author of the award-winning book; “Business Execution for RESULTS – A practical guide for leaders of small to mid-sized firms” winner in the “Management” category of the 2014 Small Business Book Awards in the USA. He’s written articles on strategy and management for The Economist magazine and coached hundreds of companies in the USA, Canada, Australia, and New Zealand.
Do you want a Strategic Plan Facilitator for your next planning session? A Business Coach to help you scale your business? Management Training to upskill your team? Contact Stephen to discuss your needs.