Amazon Confidential

Introduction
The Customer Service organization at Amazon responds to customer contacts. A contact is a request from a current or a potential customer for information or action on part of Amazon. Given that online retail has fewer customer touch points as compared to brick and mortar retail, the role of customer service and its ability to satisfactorily address customer queries is extremely important for Amazon. Amazons goal is to offer best prices, convenience and selection to its customers and Amazons customer service is known to be friendly and responsive, which has helped Amazon win accolades and awards for its world class customer service. A customer contact might come through one of the 3 mediums, i.e. phone, email or chat. Amazon has customer service associates aligned to these skills who address customer concerns coming through the respective medium. The director of customer service, Robert had recently returned from the 2012 Q2 quarterly business meet with Amazon leaders. Rather than being happy and relaxed with the impressive results his team had achieved in Q2, Robert was reflecting on the next steps to make customer service organization even more effective and efficient. Of late, his thoughts had been on the issue of introducing cross-skilling among customer service associates. Cross skilling referred to the concept where an associate was trained on more than one skill. For example, a cross-skill customer service associate may be able to work on both email and chat mediums. Cross-skilled associates offered certain advantages such as responsiveness to contact volume spikes, flexibility to shift people from one medium to another and increased employee satisfaction due to more variety in regular work done by associates. On the other hand cross skilling would increase onboarding duration, cost of training and may result in lack of specialization, thereby leading to reduced productivity. Sitting in his office, Robert stared at the chart prominently displayed in his office that listed Amazons customer service tenets. He had the data that he had compiled to analyze the crossskilling issue and wondered what would be the right mix, if any, of cross-skilling among associates to optimize associate utilization and at the same time, maintain the high customer service quality that customers expect from Amazon. Associate Training The training process for associates comprises of 2 parts: Customer service process (common to all skills) Skill specific training

The specific duration for each of these trainings is given below:

This case and the numbers published in this case are not representative of any Amazon businesses within India or in any other region where Amazon has offices or operations. Page 1

Amazon Confidential Training Customer Service Process Training Phone Chat Email Training Duration 2 weeks 4 weeks 3 weeks 2 weeks

The process training is the initial training that all customer service associates are required to undergo to understand Amazons customer service processes. Following this, the associate goes through the skill specific training. While the training times were applicable for new hires, data compiled from training team had shown that existing associates moving to a new skill gained learning curve advantage of up to 20%. Performance While Robert contemplated the benefits of multi-skilling in Amazon customer service, he had concerns regarding its impact on performance metrics. The primary method of measuring associate performance in customer service is Defect Ratio (DR), which is the ratio of number contacts where customers were not satisfied to total number of contacts. Data consolidated over the last 6 months clearly showed this impact. Skill Phone Email Chat DR - Single Skill Associate 3.5% 6% 4% DR - Multi-Skilled Associate 6.5% 6.25% 4.25%

Some of the reasons for a worse multi-skilled associate performance included lack of specialization and inability of associates to keep up with new updates across multiple skills. Operational Cost The primary benefit of having multi-skilled associates was the ability of sites to operate with a lower headcount to meet required service levels. Robert recalled that having multi-skilled associates allowed Amazon customer service departments to operate with 15% lower headcount as compared to single-skilled operations. Other benefits included lower attrition rates for multi-skilled associates and higher employee satisfaction that also contributed to lower hiring and training costs. Volume Correlation While pondering over the issue of multi-skilling, Robert also recalled that there exists a negative correlation between the contact volumes across chat and email skills. The volume forecast for contacts in each of the skills is given below: No. of Contacts Week 1 Week 2 Week 3 Week 4 Week 5 Week 6 15000 9000 17000 9500 2200 18500 10500 2200 20000 11000 2250 22000 11200 2250 22500 11900 2300

Skill Email Chat

Phone 2000

This case and the numbers published in this case are not representative of any Amazon businesses within India or in any other region where Amazon has offices or operations. Page 2

Amazon Confidential Robert was aware that the forecasted volumes were on the conservative side. Robert recalled that the worst email spike he saw last year had email volume higher by 5% than forecasted, accompanied with a 3% reduction in chat volumes. Robert was wondering if these spikes could be handled using multi-skilled associates. Questions 1. What are the strategic considerations for Robert in order to evaluate the cross-skilling decision? 2. Should Robert go for cross-skilling in Amazon at ABC site? Why or why not? Justify your answer with backing data. 3. Work out a suitable ramp-up plan for the number and timing of hires in order to meet the forecast volumes.

This case and the numbers published in this case are not representative of any Amazon businesses within India or in any other region where Amazon has offices or operations. Page 3