How We Are Quickly Ending Excessive On-hold Times
Message from Sam Carpenter, Centratel CEO and majority owner
10/2/2012

For Centratel, the primary governing principle – and unique market niche – is to provide answering service quality that is literally second to none. “We are the highest quality answering service in the United States” is not an advertising platitude but an accurate ranking that can be objectively measured by a variety of statistics including Customer Reported Error Rate, client retention, staff retention, etc.  To meet this standard we have established a number of unique operating structures including a separate and independent quality-control department, highly-tuned/intensive training and monitoring procedures, assertive customer service communications and a personal quality bonus program (“Logged Call Review Performance Bonus”) for our Telephone Service Representatives (TSRs) which, based on individual performance, can amount to 30% of a TSR’s previous month’s wages. Also, unlike the great majority of answering services, we frequently drug test every employee (which, by the way, introduces a steep challenge: it’s hard to find qualified job applicants. Why do we drug test? Because having clear-thinking TSRs is mandatory not just so we can offer the very best quality to our clients, but because of the urgent nature of the calls we handle.)

These operational structures are rarely found in competing answering services and without question, no other service offers all of them together. This is why we are the highest quality answering service in the country.

However, there is an elephant in the living room: Despite our super-high message processing quality, a sore-spot for our clients has been excessive on-hold times for callers before they reach our TSRs. Although not bad when compared to other competing answering services, our average on-hold statistics are too high if we are to maintain the “best in the U.S.” standard that we advertise. (Why are we having this problem now? It’s my fault: As CEO and majority owner of the company, I have allowed the past five years of economic doldrums to soften my stance on staffing and proper revenue-per-call.)

Do ALL incoming calls go into our on-hold system? No, but last week’s analysis showed that 28% of incoming calls went into an on-hold status before reaching a TSR. In addition, we found that for those callers routed to our on-hold system, their average on-hold time was 45 seconds. (These statistics include our short “busy times” during which a much higher percentage of callers go into an on-hold state.)*

Our goal is to reduce on-hold calls to less than 10% of total incoming calls and, for those one in ten callers who go into an on-hold state, keep their average hold time to less than 20 seconds. We will accomplish most of this improvement by the end of October and all of it by the end of November.

To reach this goal, we are taking two significant steps.

First, we are increasing the TSR staff. In September we increased staff size by over 20%. Obviously, adding more TSR’s to help process the same amount of calls will create lower average on-hold times. Our statistics have improved already but we are preparing for a second round of hiring, increasing staff size again by another 15%.

Second, “revenue-received-per-client” must cover what it costs us to serve that individual client. In our just-completed analysis, we found that 22% of our client base is paying less than what it costs us to serve them. The connection between non-profitability and long on-hold times is especially illustrated by the fact that this 22% client-segment produces 53% of our total call traffic. In itself, losing money on over half of our processed calls is an unwise business practice, but this enormous amount of loss-generating traffic is also the primary reason for excessive on-hold times for ALL of our accounts.

As a company, the solution to this problem is clear and it comes from a philosophical/common-sense stance: Instead of making overall billing rate decisions based on an average revenue dollar figure for our entire client base (with the unintended consequence that one group of clients subsidizes the costs of another group), we must insure that each individual client is billed at a rate that will cover the cost for that individual account.  For this reason we are adjusting billing rates upward for all accounts that fall below the call-processing break-even point: approximately 1 in 5 of our customers. (How do we make these calculations? For TSR call-handling, we know what income per minute we need to make in order to break even, and we also know precisely the time expended in processing each client’s calls over any period of time (we typically use a month). With this information we can generate a benchmark break-even cost as well as an exact revenue-received-per-minute figure for each client.)

The end-result of this adjustment as it effects on-hold times? With higher rates, some of our clients will cease service with us, choosing to use another lower priced/lower quality answering service (thus, for Centratel, reducing call traffic and therefore reducing on-hold times), while other clients will choose to stay with us and pay the higher rate (enabling us to employ necessary TSR staff, which will also contribute to reduced on-hold times). The two outcomes will combine to significantly lower on-hold times for all of our remaining clients. Enormous improvement will be rapid and obvious – certainly within 30 days.

For those 22% of accounts affected, what will be the size of the rate increase? It will vary from account to account, but will range from 1% to 91%. Each account’s increase will depend on that account’s cost-statistics averaged over the most recent six months of service.

If you are among the one in five of our accounts to receive an increase, you were notified of the amount (and effective date) of that increase in a letter enclosed with your most recent billing statement (we send statements out on or about the 3rd of each month).

Please note: Whatever your service costs, if we can streamline your account, perhaps through adjusting your relay procedure or by using “Gold Service,” we can almost always reach cost-effectiveness because we set billing rates based on the time our Telephone Service Representatives actually expend processing your calls. If we do streamline your account, your rates will not be adjusted upward for now. Then, in  60 days, we’ll take another look at your account to see if we’ve caused a change. In most cases, streamlining a relay procedure, or employing Gold Service, will make a large difference in cost-effectiveness and so there is no need to adjust rates upward.

To discuss modifying your account, contact Andi Freeman at andif@centratel.com, or at 1-800-639-1818

I’ve made this a candid explanation and tried hard to be thorough, but if you have further billing-related questions please direct them to our Receivables Specialist, Teresa Abbas. You can reach her at teresaa@centratel.com or at 1-800-639-1818.

Thank you for your understanding and patience. It’s my personal promise that you will not find a higher quality answering service than Centratel.

-Sam Carpenter

*Busy times? For any answering service, anywhere, heavy call traffic arrives Monday through Friday afternoons between 5:00 and 5:20 (“check out time”), and Saturday and Sunday mornings from 8:00 to 10:00. These periods are always extra busy. For this reason, clients calling in to check on-hold delays then will often be disappointed (as their own investigative efforts add to the already extremely busy traffic that TSRs are handling). Note that “Forced Call Forwarding” will make the task of routing calls to us easier and faster for you, as it reduces incoming call traffic for our TSRs.