pros and cons of call center outsourcing

First Call Resolution – 7 Best Practices for Improving your FCR Rate

Table of Contents

    [Updated January 26, 2022]

    What Is First Call Resolution?

    First call resolution, also known as first contact resolution or FCR, is a measure of a business’s ability to problem solve and resolve customer questions, problems, or needs during their first phone call or email outreach for that specific issue. FCR is an important and exhaustive call center metric typically used to gauge a company’s performance and agent efficiency.

    Best Practices for Improving First Call Resolution are:

    1. Know where you are and where you want to go
    2. Measure performance and share actionable results
    3. Define escalations and empower front-line agents
    4. Connect with customers on a human level
    5. Scale support when needed and skill-up agents in downtime
    6. Recognize and reward performance
    7. Analyze trends and innovate to exceed expectations

    Before we dive into how improving your first call resolution rate will increase customer satisfaction and loyalty, we need to first cover how to calculate the FCR rate.

    How Do You Calculate First Call Resolution Rate?

    Many factors impact FCR. This includes the complexity and types of cases and transactions handled by contact centers, agent experience, the quality of training agents receive, and the tools used to measure and optimize performance. There are two approaches used to calculate the first call resolution rate. Both approaches are valid ways to calculate FCR in the contact center industry. 

    The first uses the total number of customer cases resolved in the customer’s first outreach divided by the total number of cases in a day.

    How to calculate FCR

    This first approach to calculating FCR is not always the most accurate. However, if used over the short-term, it can provide perspective on team performance.

    The second way to calculate the first call resolution rate can offer a more accurate picture of your FCR. This approach only looks at first calls, not all calls or the total number of cases. It may take more work to extract this data, and there needs to be a method established to access it, but the results are much more meaningful.

    How to calculate first call resolution

    With FCR, the higher the number, the more effective your team is at resolving issues the first time they arise. The metric is most often measured monthly because a monthly timeframe is long enough to provide statistical significance. However, FCR can also be measured annually, weekly, daily, or even hourly.

    The industry reported benchmark for FCR is between 70 and 75%. The first call resolution benchmark will vary by industry, and as noted above, there are many different ways to measure FCR. The percentage will also change depending on the data collection method you use.  

    Best Practices for Improving First Call Resolution

    1. Know where you are and where you want to go: Conduct a current state assessment to establish your baseline FCR and other success metrics. Gauge performance, assess customer pain points, and unmet agent needs. Then co-create future state goals and desired outcomes for inbound customer service with cross-functional participation.
    2. Measure performance and share actionable results: Use tools to track and measure key performance indicators (KPIs), including FCR, to improve customer experience and generate actionable business intelligence. Share both positive and negative findings with agents to drive team spirit and ownership of performance.
    3. Define escalations and empower front-line agents: Define and specify parameters for when an incident counts as resolved, especially a first contact resolution, and when escalation is required. Conduct ongoing customer experience training for agents, and empower them to make customer-centric decisions.  
    4. Connect with customers on a human level: Establish rapport and connect with customers on a human level. Actively listen to understand their needs. Use historical conversations and knowledge to give personalized advice, engage in a two-way conversation, and set realistic expectations. This is critically important for NOW Customers, who expect authentic interactions that are quick and efficient. 
    5. Scale support when needed and skill-up agents in downtime: Augment contact centers and scale support when occupancy is high to protect agents from burnout. Use low occupancy periods and downtime to optimize inbound customer service capacities with additional training.
    6. Recognize and reward performance: Establish feedback loops and platforms for customers, agents, and other employees to share positive experiences and recognize each other. Formalize “rewards and recognition” programs to celebrate team members who demonstrate customer-centric behaviors and delight customers.
    7. Analyze trends and innovate to exceed expectations:  Keep a pulse oncustomer expectations for the quality and timeliness of service interactions across all channels and continually analyze trends. Optimize your brand’s omnichannel approach with new innovative ways to not only meet but exceed customer expectations.

    Know Where You Are And Where You Want To Go

    Contact centers are often fast-paced, stressful, and demanding. The on-demand digital economy and high standards set by companies like Amazon have created a new kind of consumer : The NOW Customer. The “NOW Customer” is always on and expects rapid resolutions and engaged interactions from their brands at all times and across every touchpoint. The traditional contact center isn’t built to meet the needs of the NOW Customer. On top of that, the pressure to contain operating costs and high agent turnover continues to define their day-to-day reality. Before you can chart a course for the future, you need to understand where you are starting from and your baselines.

    To understand the current state, take a holistic approach to assess your contact center performance that considers the entire operation – strategy, people, process, and technology. The people component is critical. Your agents are tasked with providing customers with information, support, and a positive experience. According to Zendesk, speed of response, speed of resolution, and friendliness of call center agents are seen as the most important aspects of the customer service experience, regardless of channel.

    Another component of your assessment is to listen to your customer’s needs. Gather important data from your customer relationship management (CRM) tool, customer surveys, voice of customer (voc), customer satisfaction (CSAT), Net Promoter Score (NPS), and other forms of customer and agent feedback. In addition to understanding customer issues, dive deeper into what your agents need to improve first call resolution. 

    After you complete your assessment with baselines for performance metrics, including FCR, the next step is to create your contact center operation’s future state. To foster a customer-centric culture, co-create the future state goals and desired outcomes with cross-functional participation. Include leaders and non-managerial employees and representation from the various functions in the company, such as CX, marketing, consumer insights, that impact customer success. Conduct a detailed gap analysis between the current state and future state across all focus areas – strategy, people, process, and technology – to identify constraints, barriers, and risks. Lastly, identify quick wins and develop an activation plan to achieve operational goals.

    Measure Performance And Share Actionable Results

    Exceptional customer experience cannot be achieved without winning the Now Customer. These are your customers who expect immediacy in every experience they have, both online and offline. In fact, 65% expect customer service to be faster now than it was five years ago.

    First call resolution and talk time, the average time spent on a customer call, are standard metrics for call centers. High FCR rates combined with low talk time is a common goal. Track all metrics that indicate how quickly your agents respond and move through cases, as well as how satisfied your customers are with the resolutions they receive. Use tools, such as customer surveys, to add context to FCR rates and share both positive and negative findings with agents.  

    Sharing customer feedback with your team will drive team spirit and ownership of resolution. The way to improve overall customer satisfaction is by balancing quality and efficiency. A customer service team should work their way through a queue of cases at a steady pace while providing an excellent experience for each of those customers. This means that to assess your team accurately, you need to consider both sides of the equation – measure first call resolution and customer satisfaction with the resolution received.

    Define Escalations And Empower Front-line Agents

    A critical component of your first call response rate is defining when an incident or case counts as resolved for your company. Another requirement is a straightforward escalation process that includes when escalation is required and when an agent is empowered to make customer-centric decisions. 

    Your call center’s process should consist of CX practices such as, when a transfer is unavoidable, always make a ‘warm’ handover and ensure the customer connected to the next company representative. The goal is to optimize inbound customer service capacities with speed, empathy, and precision.

    It is equally important to give agents time for education and include them in customer experience training. Empower agents to make things right for customers. For example, you can provide a list of goodwill tools (waive a fee, send flowers or chocolate, etc.) and encourage agents to use them to boost the customer experience when required. While it may be impossible for one agent to know everything about the company, many inquiries can be resolved on the first call, even if the agent doesn’t know it. Cross-training also empowers agents to handle more incoming calls without transferring or needing a second call to complete. These efforts will increase the FCR rate, customer retention, and customer satisfaction.

    Connect With Customers On A Human Level

    According to Forrester, 73% of customers say that valuing their time is the most important thing a company can do to provide them with good online customer service. The way to show customers that you value their time is to actively listen to their needs and authentically connect on a human level. This means personalizing the experience and engaging in a two-way conversation. The goal is to create a positive memory and lasting impression. 

    One way to personalize connections with customers is to use historical conversations and data recorded in a knowledge base or CRM tool. Agents are already engaging customers in service interactions every day. One way to optimize the experience is to have them ask smart questions and store the customer information in your CRM. Use those customer insights to deliver memorable experiences during future interactions.

    It is extremely important to communicate with your customers. Let them know what the company is doing to resolve their issue and set clear expectations for service. For example: use your Interactive Voice Response (IVR) to set customer service level expectations in a transparent and human way – “As we’re all adjusting to social distancing guidelines, we’ve reduced our staff to make our workspaces safer. As a result, you may experience a longer than usual wait time to speak with us.” Lastly, when a customer ends their relationship with your brand, ensure that they leave on a high note. There is a high chance they will come back one day.

    Scale Support When Needed And Skill-up Agents In Downtime

    Agent turnover is a very real issue in the contact center industry. The call center industry in the United States faces an overall average turnover rate of 30-45 percent. Also, employees ages 20-34 are likely to stay for just one year. Many factors contribute to high turnover:

    • The repetitive nature of the work
    • Low pay
    • Inflexible schedules
    • Lack of training
    • Stressful environment
    • High burnout factor
    • Uninspiring management,
    • Abusive customers

    To retain agents, scale support by augmenting your contact center team during peak seasons and provide opportunities to skill-up or cross-train during downtime. Occupancy in a contact center is generally understood to be best placed between 85 and 90%. When occupancy is too high, advisors are overburdened. When occupancy is too low, the team will have little to do.

    A way to utilize downtime is to train agents on how to handle calls across multiple channels. Agents who can switch channels to match unexpected rises in call volumes on one particular channel type can improve first call resolution rate. Also, when occupancy dips lower than expected, encourage agents to use e-learning, read trade publications and resources, handle back-office queries, and so forth.

    The call center industry in the United States faces an overall average turnover rate of 30-45 percent.

    Recognize And Reward Performance

    In addition to customer feedback, encourage and seek agent feedback. Agent training extends beyond formal programs and continues with real-world examples of customer success in action. Actively seek out stories about employees who embody the brand’s values and demonstrate customer-centric behaviors. Spotlight them publicly to boost morale. 

    Set up an internal feedback platform for agents and other employees to share positive experiences and recognize each other. They can be in the form of a “humblebrag” or something more formal like a nomination for a reward.  Whatever the platform, the key is to provide all employees a way to give feedback and see the outcome of that feedback.

    Formal rewards and recognition programs are very effective ways to celebrate team members who demonstrate customer-centric behaviors and delight customers. These kinds of programs are typically lead by human resources. Contact center leadership should encourage employee participation in all these programs to recognize their hard work across the organization.

    Analyze Trends And Innovate To Exceed Expectations

    As quoted by customer experience expert Shep Hyken, “Customer service should be called something other than the ‘customer support center.’ It should be called the ‘customer loyalty center,’ it should be called the ‘revenue generation center,’ it should be called the ‘customer retention center.’ Because that’s what you do.” What may have once been considered a back-office job function is now on the battleground’s front lines for business.

    1. Customer experience models and, more importantly, contact centers need to change to meet the NOW Customer in the moment. Their expectations for speed are very high, and they strongly prefer to be met on the digital channel of their choice. Not winning the NOW Customer can result in major risks to your business. It is critical to keep a pulse on your customers’ expectations for the quality and timeliness of service interactions they have with your brand across all channels.
    2. Re-evaluate your measurement strategy regularly to ensure accurate reporting of first call resolution and capture new communication preferences. Continually analyze trends and share actionable insights and knowledge across departments within the company. Work with your ecosystem of stakeholders to optimize your brand’s omnichannel approach with new innovative ways to not only meet but exceed customer expectations.
    3. Lastly, identify what new strategies have worked (and what haven’t) and build robust capabilities to lean into those strengths and weaknesses. Whatever your company’s contact center model becomes, these seven best practices can be applied to improve your FCR rate and the overall customer experience your team delivers today and in the future.