The True Cost of Attrition

A Lifecycle Practice
for Attrition

Executive White Paper

July 2008
The True Cost of Attrition

Table of Contents

Table of Contents................................................................................................... i
Lifecycle Approach................................................................................................1
New Hire ...............................................................................................................2
Proficient Agents...................................................................................................8
Conclusion ..........................................................................................................10
References .........................................................................................................12

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The True Cost of Attrition

By Matt McConnell

Who cares about attrition? It depends.

ƒ If it concerns the effort involved in hiring 30-50 percent of the workforce every six
months, human resources does.
ƒ If it concerns the length of time it takes for new hires to become adequate,
supervisors do.
ƒ If it concerns how much all of this costs, operations certainly does.
ƒ If it concerns the impact of attrition on customer loyalty, the executive suite should
care about it.

What is becoming clearer to leading organizations is that the impact of attrition is usually
underestimated because of multiple partial owners, but it is absolutely necessary to
control.

What can be done to manage this many-headed beast?

Lifecycle Approach
The owner of the customer experience faces the greatest impact from rampant agent attrition and
therefore should own the attrition solution. Studies show that poor customer service leads to
customer defection. It is a fair assumption that a constant influx of new agents cannot provide the
same level of customer service that a steady core group of agents properly hired, trained and
coached can. These basic principles form the foundation for a practical approach to attrition
across the lifecycle (Figure 1), an approach that rallies all the players around the same goal and
measures their progress accordingly.

Agent Lifecycle Retention Model

Figure 1

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The True Cost of Attrition

The lifecycle approach is based on addressing different attrition factors at different stages of the
agent lifecycle. Solving the challenges at each stage requires different tactics, but the underlying
strategy for each relates to the larger goal of retention.

In approaching each stage of the agent lifecycle, it is important to determine which of the factors
the organization can or is willing to change. Attention to the fewest factors with the largest impact
will yield the largest return, in the shortest timeframe. These few key indicators should be
measured at each of the lifecycle stages, in addition to measuring attrition separately at each
stage to get a true picture of progress.

The best practices for attrition are outlined in the context of each stage of the agent lifecycle:

ƒ New hire
ƒ Agent-in-training
ƒ Agent on the job
ƒ Proficient agent

New Hire
Incorrect expectations, wrong skills and wrong personality “fit” are often given as the top reasons
new hires leave the job, either voluntarily or involuntarily. In a recent survey conducted by
Knowlagent, only pay ranked higher (Figure 1). The other three can largely be addressed by
more effective screening during the hiring process.

Rank order the top 3 reasons for attrition.

The agent has a poor relationship with the

supervisor

Other

The agent does not have a clear career path for

advancement
Number 1
The agent does not have the right knowledge and
Number 2
skills to perform the job
Number 3
The agent isn’t a good personality fit for the job

The job is not what the agent expected

The agent leaves to make more money

Figure 2

The figure below outlines a candidate screening process for eliminating three of the top reasons
for new hire attrition. By obtaining objective information about a candidate early in the process
and providing the candidate with expectations of the job, time is spent only with the candidates
who are capable of doing the job and committed to moving forward in the process.

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The True Cost of Attrition

This screening process has two components:

A Best Practice Process for Hiring

Figure 3

Candidate Learns About the Company

Often new agents have no idea of the pressures, expectations and environment of a call center.
Some companies try to address this issue by allowing candidates to tour the floor, sit side by side
at agent desks, etc. For many this isn’t feasible, either because of customer privacy concerns or
because of the time spent with candidates who may not choose to move forward.

As early as possible, standardized details about the company and the position should be
available to the candidate in order to help them determine their level of interest in the position.
Key to this step is allowing candidates to experience a preview of the job by providing access to a
realistic representation of the calls an agent receives and the actions the agent is required to take
on typical and even difficult calls. This step of the process is best suited to the beginning of the
screening process to minimize the time spent with candidates who are not interested in being
considered.

Company Learns About the Candidate

The objective of the early screening process for the company is to learn if the candidate meets
minimum requirements, and assessments provide the most objective way to determine that.

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The True Cost of Attrition

Although many companies use assessments, they are typically at the end of the process, after
recruiters and hiring managers have invested time in a candidate. A more effective use of
assessments is to screen multiple candidates, not to confirm or invalidate a decision on one. The
key assessments in this process are for personality and cognitive fit and base skill level.

Personality
Personality fit is uncertain ground with many hiring managers. This is because often the attributes
that are being hired for are not truly personality traits, but general, hard to measure
characteristics like “customer-service focused” or “friendly.” Additionally, when assessments or
other methods are used to determine personality, they typically try to find people who most
closely match high performers. This approach is risky as pin-pointing the reasons for a star
agent’s success is much more difficult than naming the characteristics that make low performers
fail.

A simpler approach is to determine what makes a candidate more likely to fail. By testing and
placing existing average and high performers in one group and low performers in another, it
becomes clear that a few traits are prevalent among low performers and rarer in average and
high performers. The distinction between high and average performers is more difficult to
ascertain as additional factors play a role in what makes a star among agents. Thus screening
out those who are unlikely to be successful leaves a pool of capable candidates.

Base Skill Level

If a candidate doesn’t possess the minimum requirements New Hire Retention Plan
needed for the job, that candidate is set up for failure.
Assessments of some type are often used to try and Key Questions
determine who has the basic skills to perform the job. ƒ What skills are basic
requirements?
Skills assessment thresholds should be based on existing ƒ What skills can I train?
high, average and low performers. Setting thresholds too ƒ Which few traits prevent success?
high may exclude too many viable candidates, and setting ƒ What is my decision process for
them too low may include too many with a high chance of retention-based hiring?
failure. The right threshold is based on an individual skill’s
correlation to performance as well as its relative importance Key Measurements
to the business. ƒ Compliance to hiring process
ƒ New hire attrition
ƒ Early performance data
Agent-in-Training
Once expectations and fit are addressed, the biggest risks to attrition and performance for
agents-in-training are related to on boarding and the nesting environment. If agents are
unprepared and are not able to perform to standards out of new hire training, they become an
attrition risk. If new hire training takes too long, costs become unmanageable. The key is
balancing these two concerns.

With an overall retention goal across all stages of the agent lifecycle, new hire training should be
linked to how an organization hires and be based both on the profile hired against and the
individual needs. Layering new hire training in this way meets the needs of both cost and proper
preparation.

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The True Cost of Attrition

Preparing and Positioning New Agents for Retention

Figure 4
Layer One – Cognitive Profile and Skill Thresholds
Using an example profile of a hiring company, let’s take one of the trait components and one of
the skill components to take through this first layer. This example model identifies and excludes
fast learners as a high attrition risk since they may quickly become bored with the routine calls at
this center. It also has a critical skill need for listening and typing.

The new hire training based on this profile might be a week longer than another similar job
because the profile eliminates fast learners, and the
agents hired would need the additional time to Agent-in-Training Retention Plan
understand and practice the concepts covered. A high Key Questions
threshold on listening and typing would ensure that ƒ In what areas is the agent already
new hires come in with an appropriate level of these prepared?
skills and could therefore begin learning the ƒ Which content covers 90% of
applications and specific call flows right away. calls?
ƒ What training will be online?
Layer Two – Individual Assessment Results ƒ What practice will be simulated?
At the individual level, hiring assessment results Key Measurements
coupled with training pre-testing enable organizations ƒ Time to proficiency
to move away from “one size fits all” new hire training. ƒ Day one performance
By creating tracks or paths within the new hire ƒ Early attrition
curriculum, new agents who have more skills and
experience can “test out” of particular areas and be
placed into nesting and move to the floor more quickly.

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The True Cost of Attrition

Adopting a blended learning approach in new hire training is key to making these paths of
learning logistically possible. Additionally, offering both instructor-led and e-learning means that
the learning style needs of more new hires are met. As new hires gain increased confidence in
this more “individualized” approach, early attrition is reduced.

Agents on the Job

Performance Link
Once agents are on the floor, performance shares a symbiotic role with attrition. More than 250
call center leaders responding to a survey Knowlagent conducted in the second quarter of 2008
indicated that low performers make up almost 50 percent of overall attrition.

Estimate the percentage each group contributes to your overall

attrition.

Highest performers 19%

Average
33%
performers

Lowest performers 48%

Figure 5

This high percentage of low performers proves a commonsense view most people have about
performance and attrition. People do not like to fail. Therefore, when agents lack confidence in
their ability, they are more likely to attrite. And obviously, low performers are more subject to
involuntary attrition. The call center is a dynamic environment with customer service level driving
many of the day-to-day decisions on the floor. When training is scheduled, it is often canceled
due to call volume demands. Low performers already struggling become more overwhelmed as
policies and procedures change, new products are rolled out, etc. This environment makes it
difficult, if not impossible, to move lower performers along the performance curve (Figure 6), thus
contributing to the ongoing battle with attrition.

Moving the Performance Curve

Figure 6

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The True Cost of Attrition

For those low performers who cannot be moved along the curve with training because of traits or
other factors, it is probably beneficial that they attrit and are replaced with better fit agents who
will be more likely to stay. As hiring efforts focus on screening out poor fits from the start, more
average and high performers join.

So how do you improve the performance of the agents on the floor given the aforementioned
challenges of the call center environment?

Best Practice Training

The best practices for improving performance form the foundation for improving satisfaction and
ultimately retention. Since changing behavior is the only way to achieve sustainable results, all of
the following principles are geared to that end. These principles are illustrated below (Figure 7).

Training to High Performance for Retention

Figure 7
Frequent
Too often training is an infrequent occasion as opposed to a consistent, systemic part of the call
center operation. In a recent survey by Knowlagent, almost 40 percent of call centers reported
training agents between one and four times a year. Many centers provide agents with access to a
learning management system or knowledge base with the hopes that agents will go get the
information and knowledge they need. Considering the enormous pressures to meet service
levels, it isn’t hard to figure out why so much of what is scheduled doesn’t occur and why agents
don’t often take the initiative to get the information they need before they need it. The
underutilized asset in this equation is downtime between calls. Pushing training to the agent
desktop during small pockets of downtime is the only way to ensure training happens frequently.

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The True Cost of Attrition

Targeted
Even if training is provided frequently, a one-size-fits-all approach doesn’t provide maximum
value. If the center and the agent invest time in training, it should meet the needs of both. An
agent does not want to be trained on something that isn’t relevant to their needs, and the center
doesn’t want to train an agent on an area at which he or she excels if there is another area that
needs improving. Basing individualized training on performance meets the targeted criteria and
provides the highest value.

Easy to Digest & Apply Immediately

Adult learning theory asserts that short learning interventions that can be immediately applied
have the best chance at retention. This concept is clearly important in a fast-paced environment
like the call center where the unplanned nature of calls gives agents less control over their day
than most. A 15-minute learning break allows a short respite for some targeted information that is
used on the next call for maximum reinforcement.

Measurable Impact
One of the keys to success in any endeavor is measurement, and nowhere is a culture of
measurement more prevalent than the call center.
Giving all players a view to their performance, and an Agents on the Job Retention
understanding of how they impact that performance Plan
through training, provides the measurement and Key Questions
guidance needed to underpin a successful ƒ How do I prioritize training?
performance improvement initiative at the individual ƒ How do I make training relevant?
agent level. ƒ How do I make training stick?
ƒ How do I ensure consistency in
Consistent training and communications?
Consistency has two applications in this context. The
importance of regular communications cannot be Key Measurements
overestimated in keeping agents informed and ƒ Amount of training delivered
engaged. Additionally, the consistency of message in ƒ Low performers moved to average
those communications and training is important. E- performers
learning provides a conduit for regular ƒ Training directly linked to
communications and removes the possibility of performance improvements
different teams getting different messages or levels of ƒ Mid-stage attrition
information from supervisors, team members or even
trainers.

Proficient Agents
Study after study shows that the supervisor-agent relationship has one of the largest impacts on
retention. Additionally most supervisors were high-performing agents who were promoted to
supervisor, without much training in how to manage and coach performance. Many supervisors
attest to being overwhelmed with the administrative burden of the job, which leaves little time for
coaching. In a survey on coaching conducted by Knowlagent, 71 percent felt they did not have
sufficient time to coach every day, with 80 percent spending less than two hours a day on all
coaching activity. In instances where there is performance coaching, it is typically not consistent
from team to team.

These facts add up to a setting where agents feel that they lack a supervisor who can truly foster
their performance. A common result is that agents leave just when the center has invested the
most in them, and that investment is paying the highest returns.

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The True Cost of Attrition

Best Practice Coaching

The foundation for coaching outlined here is based on the key principles needed to change
behavior though coaching in the call center in order to improve performance, satisfaction and
retention (Figure 8).

Best Practice Coaching Forms Performance Partnership

Figure 8

True Coaching
What gets called coaching on many teams is really managing without much guidance on
improvement. Eighty percent of executives in a study by Knowlagent indicated that they do not
believe supervisors have all the right skills for coaching. Because they lack the experience and
often the training to do so, supervisors rarely have the skills to coach for improved performance
and behavior change. Improving these skills with training is critical to making an impact on
performance and attrition.

Targeted
By its nature, coaching should be targeted, but it’s difficult for supervisors to keep up with all team
members’ performance and customize coaching accordingly. By linking to KPI’s, coaching
instances can be targeted to performance trends that indicate problems as well as those that
indicate opportunities for enhanced performance. Supervisors with access to personality
assessment results can even leverage that information to help them tailor their coaching.

Frequent
The demands on a supervisor’s time are many. And often the lower performing agents take up a
disproportionate amount of that time. To meet the needs of all experienced agents, time must be
uncovered and exploited for both agents and coaches to interact on performance problems as
well as enhancement opportunities. Finding pockets of call volume downtime for agents and
available time for supervisors to meet and work on coaching plans and activities creates the time
needed to provide frequent coaching.

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The True Cost of Attrition

Actionable
Unless it is actionable, much of what is called coaching is merely advice, perhaps applicable,
perhaps soon, perhaps not. Basing coaching on the call flow creates actionable coaching. The
steps to this process are:
1. Break the call down into key steps.
2. Identify the step where the agent struggles.
3. Identify the behaviors needed to execute the step successfully.
4. Develop a plan to change those behaviors.

Using this process provides a clear context and specific actions.

Consistent
Because most coaching happens on an ad-hoc basis, similarly performing agents can receive
very different types and levels of coaching. Nearly 50 percent of supervisors surveyed can not
define their coaching process. Creating standards and baking them into center processes
ensures that agent performance and retention efforts are individualized to needs and achieve
consistency in application.

Measurable
Even though it is one of the greatest points of leverage
with the agent, coaching is largely unmeasured, an
anomaly in the call center. By embedding a Proficient Agents Retention Plan
measurement system that shows how much, who and Key Questions
what is getting coached as well as its link to ƒ Are my supervisors prepared to
performance, constant improvement through coaching coach?
becomes systemic in the center. ƒ How targeted and actionable is
coaching?
ƒ Is coaching consistent across
Individual Accountability supervisors?
With the experienced agent, training results may reach ƒ How often do supervisors coach?
a plateau, and more individual plans might be required ƒ Do agents have a mechanism to
to reach higher levels of performance. But without a take ownership for performance
skilled coach and without a mechanism to take improvement?
ownership for increasing performance, proficient
agents may be left adrift, becoming dissatisfied with Key Measurements
the prospects for improvement and/or advancement. ƒ Compliance to coaching processes
There are areas where agents can work independently ƒ Time spent in coaching
to improve, and in others, they may require supervisor ƒ Problem coaching vs.
intervention to get the full benefit of coaching. Creating enhancement coaching
a partnership for performance between the agent and ƒ Performance changes directly
the supervisor provides the ownership needed at a linked to coaching
more experienced agent level and provides a ƒ Proficient agent attrition
framework for creating and sustaining improvement.

Conclusion
The impact of agent attrition is felt in many areas of an organization, but rather than galvanizing
efforts to reduce attrition, this situation often leads to silo efforts and unclear expectations across
the organization. Once the scope and scale of the problem is acknowledged, a central goal
organizes the efforts carried out across the lifecycle of the agent.

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These efforts can be summarized as:

New Hire Stop hiring the wrong candidates by utilizing the right
information as early as possible.

Agent-in-Training Give agents the best chance to succeed with the right
preparation.

Agent on the Job Create satisfaction by improving performance.

Proficient Agents Enable supervisors to partner with agents to provide

meaningful coaching and strong relationships.

Agent Lifecycle Retention Model

Figure 10

Key to each of these steps along the lifecycle is asking important, foundational questions that
help uncover contributing factors to attrition and determining which of those have the most impact
on the problem. Focusing efforts on those key areas will yield the most results, and the
measurement of the progress against those key areas ensures that the most important lead
indicators receive the right level of focus.

With a central goal coupled with a focused approach to reducing attrition across the agent
lifecycle, all of the key stakeholders involved in the customer experience will see improvement in
each of their arenas of focus as well as an overall improvement that benefits the entire
organization.

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About Knowlagent
Knowlagent’s on-demand agent management solutions ensure you get the right people on your
team and keep them there. Knowlagent’s solutions are designed to impact early, mid and late
stage attrition by hiring the right agents, placing them where they will be most successful, and
ensuring they perform at the highest levels. By automating traditional call center management
processes, Knowlagent’s solutions for training, coaching and hiring reduce spending attributed to
off-phone activities while improving the key metrics that matter most to you. With Knowlagent,
you can optimize frontline performance faster and more affordably than ever before. You can
spend less and get better.

References
Teodoru, S (2007). Satisfaction with contact centers drives customer loyalty. Contact Center
Satisfaction Index, 1, Retrieved September 1, 2007, from http://cfigroup.com

Knowlagent. (2005). Coachpalooza: a call center focus group series summary report (1st ed.)
[White Paper]. Alpharetta, GA: Debbie Qaqish & Dwight Lucas.

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