It's the cuts that hurt the most

If you have ever led frontline service delivery, you have likely experienced the feeling when you are directed from senior leadership above to make cuts to your frontline service.

I recall a moment around 15 years ago when I was meeting with our CEO and told I needed to cut costs by 25%. I asked lots of clarifying questions as I tried to understand the decision-making process. The budget position required a tightening of belts, however, the most significant impacts would be for the Contact Centre - the frontline of the organisation.

During a breakfast event in Canberra I was talking of experiences with citizen service delivery, and this story popped back to mind.

At the time that I had my discussion with the CEO, we were seen as a cost centre, a cost of doing business. My biggest costs were labour and technology, and with technology costs at the time locked into fixed contracts, it meant that the savings would be made through reducing headcount unless I found alternative strategies.

It came to mind as I was discussing the concept of ensuring your service delivery operations are understood and seen to be of value to the organisation. I was talking about building relationships with internal and external stakeholders, focussing on demonstrating the value of service delivery. There are some simple ways to demonstrate value, and change perceptions within your organisation, with the two simplest:

1. Enter Award programs - external recognition can really help shift perceptions of the value that frontline service delivery offers.
2. Create a coalition of advocates within and outside your organisation. When the chips are down, you want others speaking up on your behalf and singing the praises and sharing stories about the value that service delivery brings to the organisation.

At the end of the day, service delivery teams will be targets for cost-cutting because they often have the largest headcounts in the organisation and have a cross-section of the most junior staff. It doesn't make it right, but it can make it a big target.

So, what do you do if you are facing cuts?

Firstly, you need to understand the options available to you. When I faced the need to recommend an action plan to cut 25% of costs, I started with clarifying questions:

• I sought to understand any "sacred items" that couldn't be sacrificed. This is about finding out any services, technology or deliverables that might be precious to senior stakeholders, for example, the CEO's pet projects.
• I asked about guardrails in terms of decisions relating to rebaselining our service model and the resources required. This included understanding viewpoints on our channels, services and performance and what decisions were possible. This also meant understanding redundancy options if a reduction in staffing levels was required.

Once you have some guiding parameters, you should look carefully at your existing operations and any assumptions you have made in why, how and where they are delivered. Sometimes this can involve spending to get an external perspective as they are more likely to challenge assumptions.

As an example, I was engaged by a client and in assessing their operations found them to be focussed on time-based service outcomes when what the business really needed was to build and maintain relationships with their customers. The lack of relationship-building and the focus on short, transactional interactions was losing them business. They couldn't invest in more resources so felt trapped. I looked closely at the reasons for contact, and I identified automation opportunities to unlock 15-20% additional capacity within the same headcount.

During engagement with another client, they were piloting the use of a Contact Centre as a Service (CCaaS) platform alongside their existing legacy solution. I worked with them to validate and prove that the new CCaaS was viable and suitable, and demonstrated that by rolling this out across all their services, they could save over $500,000 p.a. This was not even on the radar for them, despite the service being in financial strife.

There are plenty of reasons that organisations often need to cut costs, and leaders in frontline service delivery need to be ready to tackle the challenge.

If you are needing help with reducing costs, finding operational efficiencies or validating technology investments, contact me via email at [email protected]

Who is Michael Clark?

Michael Clark is not the famous former cricketer! Michael is a veteran of the Contact Centre and CX Industry and was recognised in 2023 as one of the Top 100 Influencers in the Contact Centre Industry in APAC, and as one of Australia's Top 50 Small Business Leaders in 2022.

Michael is the co-founder and Principal Consultant at CXTT Consulting.

Who are CXTT Consulting?

CXTT is a 50% Indigenous owned company providing CX, Contact Centre and Technology consulting, advisory and coaching.