Saturday Scheduling at Eterno


This case was prepared by Mike Bendixen, professor of Research Methods and Decision Sciences at the H. Wayne Huizenga School of Business and Entrepreneurship, Nova Southeastern University. It is intended as a basis for class discussion rather than to illustrate effective or ineffective handling of an administrative situation. The numbers and characters in the case are fictitious. Copyright © 2013, Nova Southeastern University. December 1, 2013.

 

Saturday Scheduling at Eterno

“Where are you when I need you Jenna! Why do I have to work with idiots?” thought Alejandra as she sat down at her desk in frustration. Alejandra headed the workforce planning team for the inbound call center operations at Eterno Life. She had just returned from her first meeting with the Jeremy, the acting Service Executive, of Eterno Life and Alejandra’s boss while Jenna, her regular boss, was on four months maternity leave. Jeremy was a senior member of the Compliance Officer’s team and had been seconded a few days earlier to look after service operations while Jenna was away. Jeremy was regarded by many in call center as an obnoxious character with strong opinions and poor listening skills. She knew that the current problem that she was working on was going to take all her persuasive skills.

Eterno Life was a medium-sized life insurance company based in Modesto, CA. It had been started some 20 years ago by a smart young actuary, Gustavo Lopez, who was bored with working in the loss assessment office of one of the nation’s largest life insurance companies. Gustavo had always dreamed of running his own business and had carefully saved as much of his salary and bonuses for the day when the opportunity arose. When the father of one of his college friends had died in tragic circumstances leaving his family virtually destitute, Gustavo saw his opportunity. He started Enterno Life which offered simple and affordable life insurance and funeral coverage policies. The product line appealed to the large number of agricultural workers in the San Joaquin Valley, as did the high levels of service quality offered.

The main operating hours for the call center were from 7:00am to 7:00pm, Mondays to Fridays except for public holidays. At the special request of brokers, a small team handled calls on a Saturday morning from 9:00am to 12:00pm. The basis of this request was the high level of policy sales on Fridays, especially Friday evenings. In keeping with the service orientation of Enterno Life, this was agreed to some three years ago. Both brokers and customers were very happy with this service and it had even been featured in some of the company’s promotional material and advertisements.

Alejandra had noticed that service levels for this Saturday service were regularly not achieved and was about to suggest that the staff complement for this three hour shift be increased from three to four customer service representatives (CSRs). Eterno Life had established a shift target that 80% of calls should be answered within 30 seconds and that no more than 10% of customers had to wait for their call to be answered. The Saturday shift regularly missed these target metrics.

Alejandra set up a meeting with Jeremy to approve this change. She had barely finished stating her case when Jeremy launched into a tirade claiming that, if anything, the staff complement should be reduced from three to two rather than increased to four. He argued that with three CSRs there was considerable idle time (when CSRs we not handling calls) so they were clearly goofing off and not getting their work done. Alejandra knew that this was not the case as she was regularly at work on Saturday morning to add the final touched to the staff schedules for the coming week. Her workspace was adjacent to the call center. Before she could defend her request, Jeremy tasked her with investigating the situation to justify the reduction in staffing and summarily ended the meeting, demanding a report within two days.

When she had calmed down, Alejandra set to gathering the data and start the analysis. Firstly, she extracted details of all the calls taken on the past four Saturdays. She noted that there were a total of 320 calls and calculated that the mean time between calls was 2.25 minutes (4 shifts x 3 hours/shift x 60 minutes/hour divided by 320 calls}. She knew that the time between calls followed an exponential distribution so that was relatively easy to model.

The handle time (customer talk time plus administrative wrap-up time after the call was completed) for the 320 calls is presented in the attached Excel spreadsheet. The mean handle time of this sample was 3.80 minutes which corresponded well with the standard of 3.83 minutes used for weekday shifts. However, in order to model the Saturday shift, it would be necessary to understand the distribution of these handle times. Alejandra remembered from her studies that service times generally followed a gamma distribution. This distribution has two parameters, shape and scale. However, the gamma distribution was difficult to work with and it would be preferable to use one of the special cases of this distribution: either the exponential distribution (shape parameter = 1) or the Erlang distribution (shape parameter = positive integer greater than one). The exponential distribution seemed an unlikely candidate as it has a mode of zero implying that the most frequently occurring situation would be calls with a zero handle time! As a last resort, a triangular distribution could be used to fit the data.

Lastly, Alejandra recalled that the formula for the percentage occupancy of a call center was given by:

100 X mean handle time/(mean time between calls x number of CSRs).

The percentage idle time was simply this number subtracted from 100.

With this, Alejandra started to model the Saturday shifts so as to write a report arguing for increasing the number of CSRs for the Saturday shift to four rather than reducing it to two.