Service Operations Management

Session VI: July 9, 2017

Service Quality Metrics and Data Analysis Part (II)

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 Assignment #2

Process Performance Review

Question: Below is the performance data for 2 months for a team handling inbound
customer service calls. Identify at least 4 issues / performance concerns with the
team. What additional data do you need?
Weeks
1 2 3 4 5 6 7 8
Calls 969 1025 900 820 560 896 920 456
Average Talk Time 25.4 23.5 22.5 20.9 21.5 23.3 22.1 20.5
Average Hold Time 1.2 1.1 1.1 1.3 1.2 2.3 1.1 0.9
Average Wrap Time 0.7 0.8 0.8 0.9 0.6 0.5 0.5 0.6
Total Available Time 79.4 41.2 33 22.3 184.3 196.5 203.4 241.1
Total AUX Time 95.2 85.7 87.6 78 85.7 85.7 85.7 85.7

Customer Satisfaction 45% 54% 55% 65% 60% 58% 57% 62%
Quality Score 74% 77% 80% 92% 94% 95% 95% 96%
FCR 55% 60% 62% 69% 67% 66% 65% 67%
Schedule Adherence 65% 70% 72% 65% 60% 55% 65% 70%

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 Service Quality Metrics Coverage

Part I:
1. Process Thinking for Service Management
2. Service Performance Metrics and SERVQUAL model
3. Measuring Service Quality and Defect Rate
4. Productivity and Efficiency of Service Staff
Part II:
5. Measuring Voice of Customer
6. Data Analysis and Basic Quality Management Tools
7. Measuring Quality Sampling and Calibration
8. Introduction to Continuous Improvement

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 PART (II) SERVICE QUALITY

5. Voice of Customer

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 Four Voices: Focus Areas for Business

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 Effectiveness: Customer Satisfaction

All customers want to be satisfied.

Customer loyalty is only due to the lack of a better

alternative.

Giving customers some extra value will delight them by

exceeding their expectations and insure their return.

Measuring Customer
Measuring Customer
Satisfaction:
Dissatisfaction:
% TTB (Top Two Boxes)
1. % Bottom Box (% BB)
= # of surveys on 4 or 5 / #
2. Customer Complaints
of surveys received

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 Customer Satisfaction

Evaluation on a scale ranging from Very Satisfied to

Customer Very Dissatisfied
% Satisfied and % Dissatisfied are tracked
Satisfaction Overall Satisfaction and Satisfaction on individual
attributes is tracked. Attributes typically are ease of
Survey access, knowledge of agents, resolution, number of
attempts, experience

Tracked from all sources across all modes of

Customer communication
Any negative comment is considered a complaint
Complaints Number of complaints and % of complaints are tracked
Complaints are analyzed by cause and category

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 Exercise #1

Exercise: Analyzing Customer Complaints

Complaint Type # in Jun-17

Wrong Billing 20
Incorrect part shipped 50
Did not get invoice on time 30
No communication about status 2
Service desk could not resolve problem 8

Service desk representative was unhelpful 4

Product did not function as expected 6

Order not received on time 80

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 Prioritization using the Pareto Chart

90 120%

80

100%

70
80 / 20

60 80%

50

60%

40

30 40%

20

20%

10

0 0%
Order not Incorrect part Did not get Wrong Billing Service desk Product did not Service desk rep No
received on time shipped invoice on time could not resolve function as was unhelpful communication
problem expected about status

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 Key Issues on Customer Satisfaction

Are you listening to the Voice of your Customer?

Is your survey sampling and capture methodology reliable?
Sampling: must be representative
Capturing: must ensure that there is no bias in Sample selection;
and that there is no agent influence

Is complaint capture reliable?

Are you analyzing and taking improvement actions?
Are your internal measures, e.g. quality, aligned with the
Voice of the Customer?

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 Kano Model Introduction

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 6. Data Analysis and
Quality Management Tools

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 Basic Tools for Performance Management
Pareto chart
Tools to prioritize Brainstorming tools Affinity Diagram, Fishbone
Control Impact Matrix

Tools to establish Scatter plots

relationships between Regression
variations Multi-vari charts

Tools to analyze Coefficient of Variation Bond factor, VSF

variation (Between / Box Plots
Within Analysis) Histograms

Tools to analyze Run charts

variation over time Control charts

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 Tool: Cause and Effect (C&E) Diagram
People Equipment Material

Effect or
Problem

Process Measures Environment

A graphic tool that helps identify, classify, and display possible

causes of a problem or quality characteristics
It is used for making Data Collection Plan
Please note it is NOT used to identify the Root Cause. Only
data can do that

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 Typical Cause-and-Effect Diagram

Cause and Effect diagram example

Measures Material People

P oor Know ledge P oor health

V oluntary or Bases
Inv oluntary
Insufficient training F amily reasons
Internal or E xternal
U nclear procedures Relocation

A gents only or A ll
N o expert support G oing for H igher studies
A ttrition is
high by xx%
for the last 8
Lack of motiv ation
Recession - less H igh stress
C omplex sy stems month
options Wrong job P oor connectiv ity
G row th in economy Inadequate w ages
P oor org culture S low sy stems
P oor political stability U nclear appraisal
Incorrect target H igh local commute
H igh C ompetition P oor performance
P oor Infrastructure
Wrong hiring

Environment Processes Equipment

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 Tool: Control Impact Matrix

High High
Impact, Impact,
High Low
Control Control

Low Low
Impact, Impact,
High Low
Control Control

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 Tool: Variation Analysis
Global Telecom Provider
Average Talk Time by Agent
300
Variation in ATT
250
outliers at both ends of
the spectrum.

200
ATT

150

100
Would you consider this process to
50 be in control?

0
111
121

161
171
181

211
221
231

261
271
281

311
101

131
141
151

191
201

241
251

291
301
1
11
21

61
71
31
41
51

81
91

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 Understanding Variation Start Simple
It is found that the best approach to measuring variation is to start
simple and then add complexity as management becomes more
experienced with measuring and managing variation
A Very Simple Measure of Variation

Range Average
Too much variation when > 0.70
We call this the Bond Factor
A More Complex Measure of Variation
Standard Deviation / Average is
Standard Deviation (Average 6)
also called coefficient of variation

Too much variation when > 1.0

This is the Variance Significance Factor or VSF

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 Exercise #2
Measuring Variation
Agent AHT
1 95 Average Handle Time (AHT)
2 120 in minutes
3 132 350

4 138 300
5 144
250
6 150
7 155 200

8 187 150
9 207
100
10 210
50
11 222
12 229 0

13 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15
241
14 270
15 300 Is there excessive variance?

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 Measuring Variation The Bond Factor
Data List Simple Calculations
Agent AHT Result
1 95 Minimum 95
2 120 Maximum 300
3 132 Range (Max Min) 205
4 138 Average 186
5 144 Standard Deviation 59.145
6 150
7 155 The Bond Factor
8 187
Result
9 207
10 210 Range 205
11 222
Average 186
12 229
= Excessive Variation 1.09
13 241
14 270 When the Bond Factor > 0.70,
15 300 there is excessive variation
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 Tool: Measuring Variation - VSF
Data List Simple Calculations
Agent AHT Result
1 95 Minimum 95
2 120 Maximum 300
3 132 Range (Max Min) 205
4 138 Average 186
5 144 Standard Deviation 59.145
6 150
7 155 Variance Significance Factor (VSF)
8 187
9 207
Result
10 210 Standard Deviation 59.145
11 222
(Average 6) (186 6)
12 229
= Excessive Variation 1.90
13 241
14 270 When the VSF > 1.0,
15 300 there is excessive variation
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 Why the Bond Factor?
Variability in data can be measured through Range, Inter-
quartile Range or Standard Deviation.
But only measure of variability is not enough. It needs to be
compared with Central Tendency. Hence the Bond Factors.
Range is the simplest, but is very sensitive to outliers.
Variance units are the square of the original units. Hence Standard
Deviation is used. We will use the standard deviation as a measure
of variation often.
If data are symmetric, with no serious outliers, use range and
standard deviation.
If data are skewed, and/or have serious outliers, use IQR (Inter-
quartile range).

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 Inter-Quartile Range

IQR = third quartile - first quartile

The difference between the third quartile (75th

percentile) and the first quartile (25th percentile)
- So, the middle-half of the values.
or, equivalently

IQR = Q3 - Q1

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 Exercise #3
Find Median and IQR

Raw
2
8
24
32
28
64
55
12
19
77

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 Calculation of Median and IQR

Units Raw Sorted

1 2 2 Q1 2.75 th value
2 8 8 Q1 = 8 + 0.75 * (12 - 8)
3 24 12 Q1 = 11
4 32 19
= (24 + 28) /
5 28 24 Median 2
6 64 28 Median = 26 Q2
7 55 32
8 12 55 Q3 8.25 th value
9 19 64 Q3 = 55 + 0.25 * (64 - 55)
10 77 77 Q3 = 57.25

This calculation helps to use a very IQR = Q3 -Q1

versatile variation management tool IQR = 46.25
called Box and Whisker" plot.

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 Tool: Box and Whisker Plots

Box-plots provide a wonderful tool for viewing the behavior of a data

set or comparing two or more sets

They are especially useful for small data sets when a histogram
could be misleading

The box plot is a graphic presentation that divides quantitative data

into quarters

Robust to outliers or extreme observations. Also helps identify

outliers. Works well for skewed data.

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 Box Plots

The Box plot is also known

Outliers as the box and whisker plot.
-
Upper Limit: : Q3 + 1.5 (Q3-Q1)
This is not amongst the 7 QC
tools

Q3
Very powerful tool to visually
Median compare the differences
between groups.
Q1

Lower Limit: : Q1- 1.5(Q3-Q1)

Boxplot of Males, Females

110

100

A box plot on weights 90

showing comparison 80

Data
70
between a group of 60

males and a group of 50

females. 40
Males Females

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 Exercise #4
Between / Within Analysis

Team A
30 64 36
35 76 48
45 82 88
82 43 93
95 54 96

Team B
64 66 82 43
58 47 81 44
52 55 94 55
73 88 85 48
79 83 86 52

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 Calculating the Values

Class
Class B
A Range 66 1 43 Range 51
1 30 Average 64.4667 2 44 Average 66.75
2 35 3 47
3 36 Position Value Position Value
4 48
4 43 Q1 4 43 Q1 5.25 52
Q2 (median) 8 64 5 52
5 45 Q2
Q3 12 88 6 52 (median) 10.5 65
6 48 7 55 Q3 15.75 82.75
7 54 IQR 45 8 55
8 64 9 58 IQR 30.75
9 76 UE 155.5 10 64
10 82 LE -24.5 11 66 UE 128.875
11 82 Negative means LE 5.875
0
12 73
12 88 13 79
13 93 14 81
14 95 15 82
15 96 16 83
17 85
18 86
19 88
20 94

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 Drawing a Box Plot
Plot this with Excel:
Open High Low Close
Q3 UE LE Q1
A 88.0 155.5 0.0 43.0
B 82.8 128.9 5.9 52.0

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 Example: Compare Tenure vs. AHT

Boxplot of C23 vs C22

2000

1750

1500

1250
C23

1000

750

500

1-2 month 13 months 6 months 9 months

C22

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