Profitable Customer Relationships: Balancing the Contact Center’s Conflicting Priorities

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Contact centers come in all varieties: some are focused on handling in-bound support calls, some specialize in out-bound collections, others on in-bound direct response selling, and so on.  It thus follows that contact centers would have varying missions and business goals.  At a strategic level, I contend that there are only 3 core business goals that drive all contact center operations and that contact centers are typically driven by 2 of the 3 goals.  The 3 goals are:

  1. Maximize the lifetime value of each customer
  2. Minimize the cost of managing the customer lifecycle
  3. Provide a best-in-class customer brand experience

For brevity, let's summarize these 3 goals as Revenue, Cost, and Customer Experience.  There is a natural tension between the 3 goals; for example, great customer experiences may have high costs associated with them, a high focus on up-selling to increase revenue may impact a customer's trust in the business and thus their experience as a customer, and so on.  One can visualize this tension as follows:

Of the 3 goals, Revenue and Cost are both factors driving the interest of the business; after all, the delta between revenue and cost is the business' profit margin.  On the other side of the analysis, Customer Experience is about ensuring customer satisfaction and pleasure with the brand.  Balancing those sides effectively is what allows a business to create "profitable customer relationships", a balance between business interests and the customer's experiences. 

However, that balance may vary depending on the customer's stage in the business relationship and therefore on the type of relationship the contact center has with them at the time.  For example, if we were to overlay 3 common types of contact center functions on our tension triangle: sales, support, and collections, they would land in very different regions:

Sales is driven primarily by the Revenue goal followed by an appreciation for Customer Experience; if a selling experience is too aggressive, it will clearly have an impact the customer's experience and their likelihood to become a loyal, repeat customer.  Support is typically thought of as "the best customer experience for the money" as it balances the Cost goal with the Customer Experience goal; while support contact centers are typically run as cost centers (in an accounting sense), they must not to be so cost conscious that the customer experience suffers.  Finally, a collections contact center is likely not too focused on customer experience and is instead driven by collecting as much debt as possible (the Revenue goal) while doing so for the least cost possible (the Cost goal).

As one can see, while each individual functional contact center (i.e., Sales, Support, Collections, etc.) may not balance all three goals, as a holistic company, the overall balance betweed this triad of goals must exist and, once it does, the company has achieved a profitable customer relationship.