To boost productivity and shrink costs, a growing number of companies are moving their call centers into agents' homes. Key reasons: cost savings, low turnover and productivity gains make the move worthwhile.

Consultant Jack Heacock of Jack Heacock and Associates (Parker, CO) says businesses that have transitioned from in-house call centers to deploying at-home agents have cut property and IT costs by as much as 80%.

Another attraction: Teleworking enables call centers to more easily match agent supply with call and contact volumes. Because they don't have to commute, at-home agents are more amenable to split shifts and part-time work. They're available to handle call spikes in seconds. Companies can also outsource teleworking to specialist bureaus.

Allowing either a small portion or your entire workforce to telework limits the impact of natural disasters (like last winter's storms) and man-made disasters (including terror threats) on your service levels and costs. Night shift agents can also work more safely from home, unless they forget to turn on the lights.

Teleworking insulates your operation from performance-crippling tardiness and shrinking labor pools caused by worsening traffic and longer commutes. The Road Information Program (TRIP; www.tripnet.org) reported that commute times increased nationwide by 14% from 1990 to 2000. At-home agents are also less prone than their office colleagues to illnesses caught from co-workers. Such illnesses lower productivity and raise health care costs.

Growing broadband networks, chiefly cable and digital subscriber line (DSL) now make teleworking more feasible for data-heavy call centers. An October 2002 Gartner Group (www.gartner.com) report notes that 17% of households now have broadband and that installations grew by about 9% monthly from February 2000 to June 2002.

To cut communications costs to at-home agents, companies are experimenting with voice-over-IP, with mixed results (see next month's Multi-Site Operations feature).

Teleworking entails other issues: how to supervise agents who are out of sight and how to ensure adequate data security (more about this in September's disaster planning feature) and IT support. Companies can remedy these issues by formalizing teleworking setups, carefully selecting and monitoring agents, and boosting IT support.

Teleworking agents may also offer a better deal than more complex cost-saving and productivity-enhancing strategies. These include relocating or outsourcing customer care operations outside of the US.

"The total cost of each call center agent is about $34 per hour, while outsourcing offshore to places like India costs $12 per hour to $18 per hour," says Heacock. "Teleworking can close much of that gap. Plus it avoids the consumer and political resistance, personal and data risks, vendor assessment, training, and management issues with going offshore."

Call Center Experience

Perhaps it isn't a coincidence that last year's Customer Care Leadership winner for best team (December 2002) includes teleworkers: PHH Arval's Elite Action Team.

The ten-member at-home agent team, located up to 100 miles apart from each other, achieved a 97% customer satisfaction rating - nearly 7% higher than at-center agents. Home agents are there when PHH's clients need them: after hours, weekends and during peaks times.

PHH Arval's positive experience is not unique. Procter & Gamble (P&G) saw productivity grow between 5% and 10% after it implemented teleworking for its consumer call center in 1999. The gain allowed the company to close one of two call center floors after a three-year pilot with teleworking.

P&G's at-home agent turnover is just 8% compared with 22% for at-center agents. Some at-home agents have been with the company since the pilot.

About 100 full-time and part-time agents, or just over half the call center staff, work from their homes within the Cincinnati, OH area where P&G's headquarters and call center are located. Agents handle calls from 9 am to 6 pm, Monday through Friday.

Aspect's (San Jose, CA) WinSet software on the switch connects calls to at-home agents, who receive data through cable or DSL.

But the company has kept teleworking at 50% to 55% of its call center labor force. P&G still needed a small center to train new agents. And the firm found that not every agent has the self-discipline, quiet space at home, or desire to telework.

Adam Dietrich, P&G's telecommuting coordinator, says the firm implemented teleworking to reduce property costs, save on commuting and improve productivity and morale. Teleworking has also given agents more confidence.

"They feel that they don't need to contact their supervisors as often," says Dietrich. "Most at-home agents also find there are fewer distractions."

Companies that are in low-cost locations, like Canada, have benefited from teleworking.

Westjet, a large, growing Canadian discount airline based in Calgary, Alberta, has seen virtually no turnover among its at-home agents compared with 4% to 5% turnover (low by call center standards) at its Calgary call center. Out of Westjet's 400 agents, 30 telework. MCK's (Needham, MA) EXTender connects to Westjet's Nortel (Richardson, TX) switch, which routes the calls to teleworkers while cable delivers the data.

The airline deployed teleworking in late 1998 to better handle call spikes and keep quality agents. The results prompted plans to add 20 more at-home agents while keeping the same number of at-center agents.

Westjet has also had a decline in traffic- and weather-related tardiness as well as illness-related absenteeism.

"Call centers are germ zones," says Jeff Wimmer, Westjet's call center senior manager. "Typically when a call center agent has a bug, it spreads quickly to a good part of the workforce. We don't see that happen with at-home agents."

Call centers are finding that teleworking expands the labor pool by making productivity-improving split shifts more attractive and by eliminating regular commutes, especially in congested metro areas. That's vital when qualified agents are in short supply.

One call center that has learned this is IntelliCare (www.intellicare.com), a health care outsourcer based in Portland, ME. The service bureau, founded in 1997, has call centers in Portland and Woburn, MA; Bristol, CT; Dallas, TX; Columbia, MD; and St. Louis, MO. All but the last two centers are surrounded by constellations of at-home agents; IntelliCare will be adding at-home agents to those centers by the end of this year. Most of the at-center and all of the at-home agents are registered nurses (RNs).

In 2000, IntelliCare first adopted teleworking in its Portland center to improve productivity by offering split shifts, says senior vice president Dave Bjork. Teleworking agents also work regular shifts.

Prior to teleworking, agents arriving at the call centers for a full shift would invariably be idle for a portion of it due to wide fluctuations in call volumes.

"By telecommuting, we enabled split shifts, which allowed us to reduce our workforce," reports Bjork. "The at-home nurses must provide some on-call time. These and other cost-saving innovations have saved us over 15% on labor and infrastructure costs."

IntelliCare has approximately 90 at-home and 140 at-center RNs. The long-time goal is to deploy at-home 75% of all nurses who have been with IntelliCare for more than six months. The at-home agents work at the centers once a week.

The outsourcer discovered that telework more than doubled the distance agents are willing to travel to the call centers from 15 to 20 miles to 30 or more in major metropolitan areas. That increased radius takes in more people and has enabled the firm to snag more qualified agents.

"We now have RNs working for us who live in Worcester, about 45 miles from Woburn in the Boston metro area," Bjork says. "We wouldn't be able to attract them if we didn't offer teleworking. But they don't mind coming in one day a week."