First Call Resolution: How to Define, Measure and Improve

It’s a given that customer satisfaction is crucial to customer loyalty, positive word of mouth, and return on investment.  First Call Resolution (FCR) has been and remains the #1 driver of customer satisfaction.

However, there is no standard definition of FCR.  Could it be as simple as I call a company’s call center and get my issue resolved in that one call?  Yes.  Could it be making a call for technical support, getting transferred, and the second person resolving my problem?  Yes, in fact, it is still only one call.

But what if I went to the website first; maybe even had a web chat and couldn’t get what I needed.  Now I escalate to a phone call.  While I may be calling you for the first time, I have actually used two touch points to get my issue resolved.  Is that first call resolution?  Maybe.

The point is that it’s up to you as to how you define it.  What’s of primary importance is that you are consistent in your definition, as well as your measurement.  If you measure starting today, choose your intervals and benchmark against yourself.  Notice the gaps and take action to remedy them.

A study recently released from CFI Group reports that (yet again) FCR has the most impact on customer satisfaction, and therefore, a customer’s loyalty and likelihood to recommend.  In this study, across all industries, almost a fifth of all callers hung up with their issue unresolved.  Of those customers that didn’t have their issues resolved, 68% are at risk of defection, 43% said they’d definitely defect, and 25% weren’t sure.  Are you one of these statistics?  I sure am.

It’s been reported that for every 1% improvement in FCR, you get 1% improvement in customer satisfaction.  Additionally, if a customer’s inquiry or problem were resolved in the first call, only 3% of those customers would be at risk of switching to a competitor.   

Repeat calls have a price.  In the chart below, column one represents the number of calls made, column two is the percentage of problem calls, and column three is the number of additional calls (beyond one) that are made using 200,000 calls per quarter in a sample center.

Formula for Repeat Calls

Based on 200,000 calls per quarter

120,000 x $5 cost per call = $600,000 per quarter or $2.4M Annually

Source: Dr. Jodie Monger, The CEO Refresher

In this example, 14% of the total 200,000 calls per quarter relate to an issue that takes two calls to resolve resulting in an additional 28,000 calls.  You can also see the staggering amount of extra calls due to issues that 3, 4, or more calls to resolve.

Using a $5 cost per call (for simplicity), that would mean a $600,000 per quarter or $2.4 million annual cost resulting from repeat calls, not to mention the consequences of losing a customer.

It’s been reported that for every 1% improvement in FCR, you get 1% improvement in customer satisfaction.  Additionally, if a customer’s inquiry or problem were resolved in the first call, only 3% of those customers would be at risk of switching to a competitor.

The challenge still exists of how to define and then measure FCR accurately, effectively, and efficiently.  How is it being done now?

Some centers allow agents to determine if the customer’s issue was resolved on first contact.  The problem is that it can be subjective.  Other centers use their QA (Quality Assurance) people to decide whether calls were resolved on first contact.  This method is based on random sampling and doesn’t reflect a complete picture.  Many others use post-call surveys and directly ask the customer whether or not their issue was resolved on the first contact.

We believe the best way to determine the question of resolution is to ask your customer.  Many technical programs, measurements, etc. will provide data that certainly could be useful for internal purposes, but please don’t forget the customer as it’s their perception that matters.

In Part II (next month) we will look at Human Errors, Best Practices, and the Top 5 Ways to Achieve FCR.