7 Ways Modern Knowledge Management Helps Slash Operational Costs
Because of inflation and the conflict in Europe, the economic outlook has been uncertain. Layoffs are rampant and you got the directive from the C-suite to cut operational costs yesterday! How do you go about doing it?
Premier IT analyst firm Gartner has the answer. According to them, knowledge management (KM) is the #1 technology that simultaneously improves operational performance, customer experience, and employee experience, and we agree. Here are a few examples from our blue-chip clientele of how KM helps slash costs. They are all focused on the customer service function but if also leveraged by other business functions, KM can help reduce costs across the entire enterprise!
1. Call deflection
Self-service helps deflect incoming calls and requests for human-assisted digital customer service (e.g., via messaging, chat, social networks). But without accurate knowledge that is consolidated in a unified hub and optimized with analytics, self-service will do nothing but trigger rage by the time the customer gets to a human contact center agent. With knowledge technologies such as AI reasoning, you can do much more. Reasoning enables a conversational approach and helps solve more complex customer issues with self-service. Knowledge-backed self-service is a powerful tool to scale customer service quality while containing costs.
- Media and legal services giant deflected 70% of requests for email and chat customer service with knowledge-powered self-service
- Hypergrowth digital-only retailer deflected up to 90% of their incoming requests for human-assisted digital service with knowledge-guided digital self-service, including virtual assistance, across multiple brands
2. First-Contact Resolution and Average Handle Time
Consistent knowledge, delivered in the flow of customer conversations from a centralized omnichannel hub of trusted knowledge and knowhow, reduces repeat calls and improves the seemingly conflicting metrics of First-Contact Resolution (FCR) and Average Handle Time (AHT). The increased effectiveness and efficiency reduces the need to hire new agents, helping control or even reduce service costs while improving CX.
- A leading global bank increased FCR by 36% and reduced AHT by 67% by arming frontline agents with agent assist technology, powered by the eGain Knowledge and AI hub, in their B2B contact center
- A leading telco improved FCR by 37% across more than 10,000 agents and associates in more than 600 retail stores, while boosting NPS (Net Promoter Score) by 30 points, with AI-backed agent assist technology. They also used the flexible guidance capabilities of eGain’s agent assist AI technology by providing conversational paths personalized to the agent’s experience level and past performance. For example, expert agents would be allowed to take short cuts to the answer, taking efficiency and cost control to the next level without compromising service quality
3. Training cost reduction
Training new employees in customer service or any other function in an organization is not cheap, with U.S. companies alone spending as much as $92.3 billion in 2021, according to Training Magazine’s spending report. Moreover, it is a big challenge to train millennials and Gen Z, who constitute the majority of the contact center agent workforce. They have very short attention spans (12 and 8 seconds respectively, according to cultural intelligence firm sparks & honey) and they hate traditional classroom training. Moreover, humans forget 75% of new information they learn just after two days, according to the forgetting curve theory of German psychologist Hermann Ebbinghaus. In fact, research by the University of Waterloo found that number to be whopping 97% after just 30 days. Clearly, the solution to this challenge is knowledge and AI-enabled guidance delivered contextually to agents (and other employees) in the flow of their work.
- Leading telco client reduced training time by 50% across multiple thousands of agents with knowledge and AI guidance
- Leading health insurance client reduced agent training time by 33% and sustained agent performance even when their 2000+ agents had to go remote overnight when COVID hit.
- Global banking client reduced agent training time from 10 weeks to 4 weeks while being compliant with regulations.
- Miscellaneous professional services client reduced new employee training time for frontline services from 7 weeks to 1 week!
4. Hiring and onboarding costs
According to industry experts, the true cost of hiring new employees that includes not only the hard costs of placing ads and/or referral fees but also the cost of scanning resumes, interviewing, and selecting candidates, can be three to four times the position’s salary (Source: SHRM). The average salary of a contact center agent in the US is $33,000, per Glassdoor. That means the true cost of hiring an agent is close to $100,000! When agents are armed with knowledge and AI guidance, they are happier and more confident, resulting in lower churn and lower hiring and onboarding costs.
- With the eGain Knowledge and AI hub, a hypergrowth B2B software company was able to speed up time to answer by 67% and boost agent confidence by 60%
- Mammoth government agency improved agent engagement to 92% versus their industry benchmark of 67% with eGain Knowledge
5. Product returns and exchanges
No-charge product returns or exchanges has become standard policy in many branded manufacturing firms, retailers, and telecoms due to customer expectations and competitive pressures. Called No Fault Found (NFF), many of these returns and exchanges are unwarranted where the products were not defective, but the contact center could not solve the customers’ problems. NFF costs organizations tens millions of dollars each year, but KM and AI guidance in the contact center can address this issue head on.
- Leading telco reduced unwarranted ‘No Fault Found’ handset exchanges and returns by 38% through knowledge-guided problem resolution in the contact center
6. Field visit reduction
Field service is common in industries such as utilities, manufacturing, and CSPs (communications service providers). Depending on the industry, each truck roll or engineer callout for field service can cost organizations from a couple of hundred to a few thousand dollars. Oftentimes, these field visits can be avoided through more effective problem resolution by contact center agents with knowledge guidance.
- With the eGain Knowledge and AI hub deployed in the contact center and on the website, a water utilities client saved ~$5M per year by reducing unnecessary engineer callouts, while improving FCR by 30%
- Premier manufacturer of household appliances saved $50M a year by reducing unwarranted truck rolls through knowledge-enabled problem resolution in the contact center
7. Search costs
The knowledge deficit extends beyond the contact center. For example, did you know that workers across the enterprise spend 19%-35% of their time looking for information, knowledge, insights, or expertise during their workday (Source: McKinsey and APQC.) This is not even counting the time they spend in recreating knowledge that they are unable to find or the time it takes them to chase experts and get answers from them. Imagine cutting even a fraction of that wasted time and money across your entire workforce with a knowledge tool that helps them find answers quickly or guides them through an unfamiliar process or helps them with decisions. The search costs saved and the business value generated will be nothing short of transformational!
The benefits of AI-infused and analytics-optimized omnichannel knowledge, delivered from a central, trusted hub, are clear and proven. When it is time to cut costs, it is time to deploy a modern, AI-infused knowledge hub!Contact us