How should Susan reorganize her division in order to achieve no abandoned

DEMBA Operations Management take home exam:
InterBank case
Exam Questions
1. What is the current capacity and capacity utilization of Susan’s team?
2. How should Susan reorganize her division in order to achieve no abandoned
calls? (Note: Think about both the operational and managerial consequences of
your recommendations).
3. What are the pros & cons of each of the three routing strategies? Which
one would you recommend to InterBank?
Deliverable: Case Analysis
Each student must submit a report (maximum 4 double-spaced pages of text, 12 font,
plus a maximum of 5 pages of exhibits) for the INTERBANK case. Your report
should address the three questions above. The three questions are weighed equally.
You should upload your report to Canvas by 23.30 Dubai time on August 12th.
Note 1: In order to answer the first two questions you need to conduct some numerical
analysis. Your answer to the third question should be qualitative (no quantitative
analysis is required).
Note 2: The file InterBank OM Exam.xls has been emailed to you. It includes
Exhibits 1 to 5 of the case.
Note 3: Please state clearly the assumptions behind your calculations (especially when
you are in doubt about how to interpret certain data).
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Call Centre Management at InterBank
What an unpleasant surprise! We had thought about 20% of our callers
waited more than 10 seconds to get one of our customer reps – but I
looked at the first data from our new call monitoring system this
morning and found to my horror that 76% of our callers waited more
than 10 seconds yesterday, with the average wait more than 80 seconds.
I wonder how many customers just get fed up and call another bank for
their loan or credit card application.
Customer complaints about call centre service have been increasing during the last
two years, so Jim Evans the Head of Call Centres at InterBank decided it was about
time he did something about the bank’s call-centre operations. Before getting into a
wider reorganization, he decided to start by asking Susan Smith, one of the call centre
team leaders who had recently taken a short course on call centre management, to
conduct an analysis of her team and recommend ways to improve performance. Jim’s
request from Susan was clear; he wanted her to adjust capacity in order to ensure that
no phone call was going to be missed.
Call center types and technology
Call centres fall broadly into two types -inbound and outbound. Inbound centres (such
as service centres) exist to take calls from customers, outbound centres (such as
telemarketing operations) to make calls to customers. Increasingly centres are
combining these two types in a single operation, a hybrid approach known as call
blending. The majority of call centres in financial services are inbound centres. In all
types it is the combination of computing and telephony that characterizes the
technology, and the management of often large numbers of agents that forms the key
operations task.
The ability to monitor calls and the performance of individuals or teams was a major
advantage of call centre technology -collection of performance statistics and analysis
of supply and demand data greatly aided the task of capacity management. Some
organizations could deploy “load balancing”, i.e. switch calls between sites, creating a
“virtual call centre” and thus a single queue served by very flexible use of multi-site
capacity. Other developments included CTI or computer telephone integration, the
linking of application software or database details with telecoms to enhance call
handling, and IVR or interactive voice response, whereby information was given to a
caller in response to input (touch tone or voice recognition) from the caller. The caller
usually heard recorded voice passages, giving information or offering further options.
This also enabled call centres to securely identify callers and capture information
about them without the intervention of an agent. Then when an agent was reached,
CTI could provide all the relevant data or call script to serve the caller effectively in
the shortest time.
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InterBank’s Call Center Operations
The InterBank phone system dealt with all incoming calls through IVR (interactive
voice response), whereby information was given to a caller in response to input (touch
tone or voice recognition) from the caller. The caller usually heard recorded
messages, giving information or offering further options and eventually assigning
incoming callers to available CSRs (Customer Service Representatives). If none were
available, the caller received a recorded message (Thank you for calling InterBank.
We are sorry that all Customer Service Representatives are tied up at the present time.
Your call will be answered by the first available representative”) followed by
background music. The message was repeated every 60 seconds during a caller’s wait.
When a CSR became available, the system automatically switched the first call in the
queue to his or her phone.
Six different types of calls were received by the CSRs: status check, billing statement
inquiries, credit card application, mortgage inquiries, consumer loan inquiries and
reporting a lost/stolen card. Task times and frequency of each task are presented in
Exhibit 1.
CSRs started at $10 per hour and were increased to a maximum of $15 over two
years. Benefits included medical and life insurance, paid holidays, a two-week paid
vacation – about a 25% increment to the salary. The CSRs worked an eight-hour day
that included two 15-minute paid breaks and a one-hour unpaid lunch period. Their
schedules were staggered across the workday from 6 a.m. to 6 p.m. (the phones had to
be attended at the start of the business day on the East Coast) as shown in Exhibit 2.
CSR turnover had been very high: of the eight CSRs working in October 2012, one
had been hired in 2010, two in 2011, two in the first half of 2012, and three in the last
three months. As one of the longer term CSRs (designated as “G” in exhibits) noted:
The position has always been stressful and not too many people are
willing to put up with the pace and the abuse. But it has grown worse
over the past few months as the volume has increased without
additional staffing. And Susan is a problem – she is just not managing
the department, and I think I’m more qualified to do it than she is.
Training for new employees consisted of a one-day orientation with the supervisor
and a series of four two-hour training courses spread over the first month. The
company has found that it typically took a new worker six months to get up to the
standard of 159 calls/day (see Exhibit 3 for standards and for recent CSR
performances).
Call centres consisted of two departments: the customer service centre and the data
entry operation. Data entry operators (DEOs) entered the order and new account data
generated by CSRs during the day into the computer system by the end of the working
day. The order forms were collected by the Customer Service supervisor from the
“out” bins on the CSRs’ desks and delivered to the DEOs. Overtime was sometime
required to meet this target but it seldom exceeded three hours/week for one of two
DEOs, and was most typically due to system downtime.
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Although their pay was comparable to that of the CSRs, the DEOs strongly preferred
their work to that of the CSR. As one DEO said:
We have a small congenial group working in data entry. Three of us
have been working together for about a year now. And, Jane, who was
hired to fill the newly budgeted fourth position last July, fits in nicely
with our group. In fact, we had a say in selecting her. The four of us
have lunch together almost every day. I wouldn’t trade jobs with a CSR
for 50% more money. They are always on the spot and have very little
freedom. And the stories they tell about disgruntled customers! I don’t
need that kind of abuse.
From Call Center to Customer Interaction Center
In February 2013, InterBank decided that it had to transform its call centres into
customer interaction centres, which meant that the new redesigned centres would have
to deal not only with phone calls but also with email and live chat. InterBank’s
management was not clear on which routing strategy to follow. There were three
possibilities from the CSR’s perspective. In the simplest case, each CSR was going to
be assigned to one kind of medium. The second possibility was task switching. In this
example, agents could be assigned one contact medium in the morning (e.g. phone)
and another one in the afternoon (e.g. e-mail). The third possibility was the fullyblended contact center. In this case, all agents take contacts from a universal queue
regardless of medium (see Exhibit 6 for a description of the three strategies). Jim
Evans had to decide which of the three strategies he should recommend to InterBank.
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Exhibit 1: Types of Calls Received

Type of call	Frequency	CSR task time (sec.)	DEO task time (sec)
Status check	60%	85
Statement inquiries	15%	120	40
Credit Card inquiries	15%	220	130
Mortgage inquiries	5%	450	240
Loan inquiries	3%	125	90
Lost/Stolen Card	2%	120	300

Exhibit 2: Daily schedule for CSRs – Week of April 9-13, 2012

CSR	A	B	C	D	E	F	G	H	Time Available (min)
Half hour ending at
6:30	A	B	60
7:00	A	B	60
7:30	A	B	C	D	120
8:00	A	B	C	D	120
8:30	A2	B1	C	D	E	F	150
9:00	A	B	C2	D1	E	F	150
9:30	A	B	C	D	E2	F1	G	H	210
10:00	A	B	C	D	E	F	G2	H1	210
10:30	*	B	C	D	E	F	G	H	210
11:00	*	*	C	D	E	F	G	H	180
11:30	A	*	*	D	E	F	G	H	180
12:00	A	B	*	*	E	F	G	H	180
12:30	A	B	C	*	*	F	G	*	150
1:00	A	B	C	D	*	*	*	*	120
1:30	A2	B1	C	D	E	*	*	H	150
2:00	A	B	C2	D1	E	F	G	H	210
2:30	A	B	C	D	E2	F1	G	H	210
3:00	A	B	C	D	E	F	G2	H1	210
3:30	C	D	E	F	G	H	180
4:00	C	D	E	F	G	H	180
4:30	E	F	G	H	120
5:00	E	F	G	H	120
5:30	G	H	60
6:00	G	H	60

* = 60-minute unpaid lunch break
A2 =denotes that CSR A took a 15 minute paid break during that half-hour
interval and worked during the 2nd quarter.
Note: CSR F was sick on April 10, 11, 12, 2012.
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Exhibit 3: Actual versus Standard Performance
CSR performance standards: Time on Job (months)

<1	1	2	3	4	5	6
Calls/Daya	68	114	123	132	141	150	159

a Based on 7 ½-hour day with four hours of little or no idle time, and 3 ½ hours with
some idle time (management estimates).
Actual Call Statistics (April 10-12)

CSR	Months on Job	Tuesday April 10	Wednesday April 11	Thursday April 12	Average
A	16	227	176	198	200.3
B	1	118	88	91	99.0
C	5	205	180	197	194.0
D	19	254	243	185	227.3
E	2	109	118	145	124.0
F	½	Sick	Sick	Sick	–
G	32	189	167	221	192.3
H	6	114	127	141	127.3
1216	1099	1177	1164.3
Average per CSR	173.7	157.0	168.3	166.3

Exhibit 4: Distribution of Calls by Day of Week

Index	% of Week
Monday	119.2	23.8
Tuesday	95.4	19.1
Wednesday	89.2	17.8
Thursday	92.8	18.6
Friday	103.4	20.7

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Exhibit 5: Call Statistics – Daily Average for April 10-12, 2012

# of	Average
Half-hour	Calls	Number	Delay	Number
Ending	Answered	Delayed	(sec.)	Abandoneda
06:30 AM	22.7	5.7	21.2	1.3
07:00 AM	26.7	10.7	28.6	2.7
07:30 AM	52.3	41.7	35.7	4.7
08:00 AM	54.0	47.7	49.3	5.0
08:30 AM	55.7	49.7	61.4	6.3
09:00 AM	58.3	59.3	73.8	7.7
09:30 AM	75.7	46.3	75.1	5.7
10:00 AM	75.3	60.0	82.4	8.3
10:30 AM	74.7	68.7	96.7	8.7
11:00 AM	67.0	60.3	103.5	10.7
11:30 AM	65.3	61.7	106.2	12.7
12:00 PM	62.7	58.0	102.1	10.3
12:30 PM	63.7	59.7	115.2	11.3
01:00 PM	47.7	46.3	127.2	16.3
01:30 PM	71.3	62.0	105.0	9.3
02:00 PM	72.3	60.3	66.2	7.0
02:30 PM	65.3	59.3	56.4	6.3
03:00 PM	47.7	12.3	22.3	2.0
03:30 PM	41.3	7.7	15.8	0.0
04:00 PM	22.0	4.7	14.2	0.0
04:30 PM	16.3	2.3	11.2	0.0
05:00 PM	15.3	0.3	5.0	0.0
05:30 PM	6.0	0.0	0.0	0.0
06:00 PM	5.0	0.0	0.0	0.0
Totals	1,164.3	884.7	81.0b	136.3

a Voluntarily disconnected by caller
b
Weighted average
8
Exhibit 6: Routing Strategies for Customer Interaction Centres
Task Switching Environment
Login
Voice Call
Email
Voice Call
Voice Call
Email
Email
Logout
Login
Blended Environment
Voice Call
Email
Voice Call
Email (continued)
Email (preempted)
Chat Chat Chat
Logout
“Dedicated” Environment
Login
Voice Call
Voice Call
Voice Call
Logout

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