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6
Telemanagement
#187
Reproduction in any form prohibited. For additional copies phone 905-686-5050.
 “Hey, it’s simple arithmetic! We get 3,200 callsa day. That’s 400 calls an hour. Each call laststhree minutes, so each person can handle 20 calls an hour. So we’ll need 20 incoming linesand 20 people to answer the phones.” 
Does that sound familiar?Many telephone and call centre deci-sions are made using just that logic. It’ssimple, and it’s clear — and it’s absolutelywrong. The problem can be summed upin three words:
Calls Bunch Up
.If you get
3,200 calls in an eight-hourday, and your calls follow a typical distri-bution pattern, 550 or 600 of them willarrive during the busiest hour of the day.And then they will bunch up during thathour, leading to times when the phonesare going crazy and times when manylines are free.Then you have to take into consid-eration the fact that no one can handle20 three-minute calls every hour withoutburning out, and that there is usually post-call work to do in addition to talking tocallers.In short, the
“
simple arithmetic
”
ap-proach will result in too few trunks, toofew people
—
and too many very unhappycallers.The alternative
—
the only approachthat actually works
—
uses mathematicalformulas that form the basis of the disci-pline called
“
traffic engineering.” Someof them are easy for anyone to use; othersrequire expert support, or at least special-ized software. If you make configurationdecisions about networks, PBXs, or callcentres, you must understand the basicconcepts involved, whether or not you planto do the calculations yourself.
Basic Concepts
Until recently, anyone using traf 
fi
c engi-neering techniques had to either masterthe mathematics, or learn to use thickbooks of tables based on them. Personalcomputers changed all that,
fi
rst bymaking traf 
fi
c programs widely afford-able, and now by making them availableon the Internet. Several sources are de-scribed in the box on page 7.But remember the phrase,
“
garbage in,garbage out.
”
Before you jump to yourbrowser, be sure you understand somekey concepts.
Erlang:
The basic unit of telecom traf 
fi
cintensity. Strictly speaking, an erlang iswhat mathematicians call a
“
dimension-less unit,
”
representing continuous use of one circuit. However, since a single circuitused continuously carries 60 minutes of calling in one hour, one erlang is usuallyde
fi
ned as 60 minutes of traf 
fi
c. If youreceive 300 two-minute calls in an hour,then you received 600 minutes, or 10 er-langs, of traf 
fi
c in that hour.(For many years, AT&T and BellCanada insisted on measuring traf 
fi
c inCCS
—
100 call seconds
—
instead of themore convenient but not-invented-hereerlang. If you have data in CCS, divide thenumbers by 36 to get erlangs.)
Busy Hour:
Because
“
calls bunch up,
”
 all traf 
fi
c planning has to focus on peakperiods. It isn
’
t acceptable to provide excel-lent service most of the time and terribleservice just when customers want to makecalls. Most commonly, we take the busiesthour of each day for
fi
ve or 10 days duringthe busiest time of year, then calculatethe average of those hours
’
traf 
fi
c load.That
“
Average Busy Hour
”
 
fi
gure is usedto determine the maximum number of trunks or people needed.
Server:
Something that handles calls.For example, in a call centre situationthere are two kinds of servers: the trunks
It Started in Denmark
 All modern methods for optimizing networks have theirroots in work done by Agner Krarup Erlang, a scientist who joined the Copenhagen Telephone Company in1908. He set out to solve the key problem in telephonenetwork design: how many trunks are needed to carry agiven amount of calling?Imagine a village in which every home has a telephoneconnected to a local switch. How many trunks shouldthe phone company install between that switch andthe one in the next village? Erlang saw that there wasno absolutely correct answer. Rather, there is alwaysa trade-off between service and cost. In the case of the village, there are two extreme options, neither of which is acceptable:
!
Provide just one trunk, and let callers wait until it’s available. The cost is low,but the service is unacceptably poor.
!
Provide
one trunk for every local phone line, so no call is ever blocked. Theservice is excellent, but the
cost is much too high.The problem was to convert that insight into hard numbers that would allownetwork planners and accountants to evaluate each possibility on the curvesbetween low and high cost, poor and excellent service.
To do this, Erlang conducted the world’s first detailed studies of telephone traffic,and then developed mathematical formulas to evaluate the trade-offs. His work wasenormously influential worldwide. One Bell Labs researcher taught himself Danish just to be able to read Erlang’s papers in their original form. In 1946, the InternationalConsultative Committee on Telephones and Telegraphs (CCITT) honoured him byadopting the name “erlang” for the basic unit of telephone traffic.
 A.K. Erlang, 1878-1929
 An Introduction toErlang B and Erlang C
If you make decisions about networks, PBXs,or call centres, you must understand these concepts
IAN ANGUS
 
Reproduction in any form prohibited. For additional copies phone 905-686-5050.
 July-August 2001
7
that carry the calls, and the agents whoanswer them. With a voice mail or IVRsystem, the servers are ports.
Grade of Service:
The probability thatall servers will be busy when a call attemptis made. For example, on a trunk group:P.02 means that there is a 2% probabilityof getting a busy signal (being
“
blocked
”
)when you have a given amount of traf 
fi
cand a given number of trunks. In a callcentre, the same number would mean thatthere is a 2% probability of having to waitto speak to a human.
Probability Formulas
There are many traf 
fi
c formulas, appropri-ate to many different situations, but twoof them, both developed by A.K. Erlang,cover the most common business telecomrequirements.
Erlang B
: This is the formula to usewhen a blocked call is really blocked
—
 for example, when somebody calls yourphone number and gets a busy signal ortries to access a tie trunk and
fi
nds it inuse. It is built around three variables: Serv-ers, Traf 
fi
c, and Grade of Service. If youknow any two of those, the formula willcalculate the third one.
Erlang C 
: Use this formula when ablocked call is delayed
—
for example,when someone calls your call centre andmust wait for an agent to take the call.It uses the same three variables, plus theaverage length of each call, to calculate theprobability of being delayed and how longthe delay is likely to be.These formulas only work if you havea large number of independent sourcesof traf 
fi
c. For example, 10 people makingoutgoing calls, with no incoming calls,will never need more than 10 trunks, nomatter what the formula says! A math-ematician will tell you that these formulasrequire
“
in
fi
nite sources,
”
but in practicethey work very well if there are at least 10times as many possible sources (callers)as servers (trunks or agents).
Erlang B: The Easy One
The most common traf 
fi
c engineeringproblem involves sizing a trunk group
—
how many trunks are needed to carryyour toll-free calls, how many tie trunksbetween two of 
fi
ces, how many ports intoyour voice mail system, or some similarquestion. Erlang B handles that relativelyeasily, in four steps:1.
Collect traffic data
. You need toknow how much traf 
fi
c will try to use thetrunk group, each hour, for
fi
ve or 10 busi-ness days. You may be able to use phonebills, call detail reports, carrier traf 
fi
c stud-ies, or even manual counts
—
or you mayjust have to make educated guesses. Theobjective is to produce an hour-by-hourspreadsheet, showing the number of min-utes of traf 
fi
c in each hour. Divide thosenumbers by 60 to get erlangs per hour.Bear in mind that the traf 
fi
c on yourtrunks may be greater than actual conver-sation time
—
you must allow for dialingtime on outgoing calls, and for ringingtime on incoming calls, for example.2.
Determine the Average Busy Hour 
.Select the busiest hour of each businessday, total the traf 
fi
c, then divide by thenumber of days.
Software has replaced the thick books of tables that used to be basic equipment foranyone involved in optimizing telephonenetworks. The following are some usefulresources.
Telemanagement
has not testedall of these products, and does not endorseany of them. All prices are in U.S. dollars.
!
Erlang Calculator 1.0
: An Erlang B program for Palmcomputers. This simple freeware program displays threeblanks: Fail Rate (Blockage), Traffic, and Lines. You fill in twoand it calculates the third. Available from various sources,including 
www.palmspot.com
,
www.visorvillage.com,
and
www.palmblvd.com
.
!
Westbay Engineers
: A UK company that develops and sellstraffic calculation software, ranging from
Erlang for Excel
($80) tocomplex network and call centre modeling tools. Their websitefeatures the best on-line traffic calculators we’ve seen, including Erlang B, Erlang C, and call centre staffing. They also have an easyweb address:
www.erlang.com.
!
HTL Telemanagement
:
Turbo Tables
($595) was the first program to add traffic formulas to Excel, and remains one of thebest. HTL focuses on call centre planning tools, using Hills A, aproprietary extension of Erlang C.
www.htlt.com
.
!
Teleopti
: A Swedish firm that sells software for call centremanagement and optimization. Their website includes a rathercomplex Java-based
Call Center Wizard
for calculating trunk andstaffing requirements.
www.teleopti.com
.
!
 
Erlang-Software
: Another source forPC traffic software, this one in Australia.Their
Erlang-G
program is said to include sixcommon traffic formulas. $40, with multiple-copy discounts.
members.iinet.net.au/~clark/ index.html
.
!
Certis Technologies
: Their
ErlangCalc 1.2
program isavailable in three versions: Standard (Erlang B only, $39); Pro(Erlang B, Extended Erlang B, Erlang C, Daily Traffic, $69); Deluxe(Erlang B, Extended Erlang B, Erlang C, Daily Traffic, Spreadsheet for Erlang B Batch-Processing, Graphical Presentation of Results,$89). Free trial versions are available.
www.certis.com/ 
.
!
ClienTel
: Don’t be dismayed when you find that the homepage is in Dutch. Just click on
Online Call Center Assistant
forErlang B and Erlang C calculators and a 24-hour call centrescheduling program.
www.clientel.nl/.
!
Maths.org
: Interested in the math behind Erlang’s formulas?There’s a tutorial, including some simple on-line calculators, at 
 plus.maths.org/issue2/dar/index.html.
!
Basic on-line calculators
. When you need quick answers,these non-commercial sites can be useful. Most use few graphicsand download quickly, a major advantage.
www.dcss.mcmaster.ca/~qiao/publications/erlang/erlang.htmlmmc.et.tudelft.nl/~frits/Erlang.htmwww.owenduffy.com.au/electronics/telecommunications.htmwww.cs.vu.nl/~koole/erlang.html persoweb.francenet.fr/~hilleret/ 
Finding Erlang On-line
 
8
Telemanagement
#187
Reproduction in any form prohibited. For additional copies phone 905-686-5050.
3.
Choose a target Grade of Service.
Inmost cases, a target of P.05 is acceptable,P.10 is terrible, and P.001 is so good thatmost callers will never get a busy signal.4.
Use Erlang B
. Calculate the numberof trunks you need to carry that amount of traf 
fi
c with your target Grade of Service.At this point, you need to decide wheth-er the answer is acceptable. Usually, thatmeans deciding whether you can affordthe number or trunks or ports required.If not, try reducing the number of trunksand see what the effect is on the Grade of Service. You may discover that the differ-ence is negligible
—
or you may decidethat you have to get a budget increase or
fi
nd some way to reduce the amount of traf 
fi
c. (Are those calls really necessary?)The best thing about the various PCand Internet traf 
fi
c calculators is that theymake it very easy to do multiple calcula-tions until you
fi
nd a balance between costand service you can live with.
Erlang C: More Dif 
fi
cult
Because Erlang B is so simple to use (inserttwo numbers, it calculates the third), manymanagers assume that Erlang C will besimilarly easy. That
’
s a mistake
—
evenbasic Erlang C calculations are dif 
fi
cult,and more complex ones can be dauntingindeed.Erlang C is most commonly used tocalculate how long callers will have to waitbefore being connected to a human in acall centre or similar situation. This addscomplexity in at least four areas.1.
 What
’
s included in call times?
In aqueuing system, traf 
fi
c includes not just
“
conversation minutes,
”
but also the timeagents spend doing
“
post-call work
”
re-lated to that conversation. Gathering ac-curate data on this can be much more dif-
fi
cult than just looking at a traf 
fi
c study ora toll-free service bill. In theory, your ACDreports provide the information
—
butthat only works if everyone has been press-ing the right buttons at the right times.2.
 What
’
s meant by delay?
The
“
Aver-age Delay
”
might be the average of all calls,including all the calls that didn
’
t wait at all,or it might be the average of calls that actu-ally experienced a delay. The latter
fi
gure isusually more useful, but you must be veryclear which one you are concerned with.Also, using averages can conceal situa-tions in which most delayed calls wait onlya few seconds, but some experience verylong delays. That can be a serious cus-tomer service problem, even if the aver-ages look good.Most call centres summarize theirdelay objectives in a phrase like
“
answer80% of calls within 20 seconds,
”
but get-ting from the Erlang C formula to thatresult can be dif 
fi
cult.3.
 What
’
s the hour-by-hour load?
Withtrunks, you don
’
t have the option of addingor removing circuits every hour, so youmust install and pay for the numberneeded under peak load conditions. Withpeople, the peak period determines maxi-mum staf 
fi
ng, but you also need to calcu-late staff requirements for other times,and plan staff scheduling accordingly.This usually means doing separate calcu-lations for each half hour period in everyweek you operate.And bear in mind that the Erlang Cforecast only tells you how many peoplemust be answering phones at any giventime. That
’
s quite different from thenumber you must schedule to work eachday, since almost no one can be on thephones 60 minutes an hour.4.
How does waiting time affecttrunk load?
The time a caller spendson hold listening to music adds to yourtrunk traffic
—
you can save money byhaving fewer agents to answer calls, butthat may require adding trunks and/orincreasing your toll-free service bill. Youmay have to do several iterations todetermine the optimal mix of trunks,people, and delay.These issues mean that anyone doinganything more than the simplest delaycalculations
—
above all anyone doingregular staff and con
fi
guration planningfor a call centre
—
should consider buyingspecialized call centre planning software.All such programs
—
despite the fact thatevery one claims to be absolutely unique
—
are ultimately based on A.K. Erlang
’
sformulas from 90 years ago.If you are comfortable with the mathand at creating spreadsheets, considerbuying one of the commercial programsthat adds traf 
fi
c formulas to Excel, makingit much easier to do multiple
“
what if 
”
 calculations.
E
very telecom professional should haveat least a general familiarity withErlang B and Erlang C. However, whetheryou use them yourself or evaluate reportsproduced by others, always keep threethings in mind.
!
Using math is no substitute for usingyour head. If the data you plug in to theformulas isn
’
t valid, the answers won
’
t beany good either.
!
All formulas make assumptions thatsimplify reality. Erlang B assumes thatcallers who receive busy signals won
’
t im-mediately try again. Erlang C assumesthat delayed callers will wait on hold in-de
fi
nitely. For low blockage rates and shortqueues, those assumptions don
’
t cause aproblem
—
but when your service level ispoor, they can give misleading results.
!
All traf 
fi
c formulas calculate prob-abilities, not absolutes. Erlang B and Cpredict what will happen, on average,over many hours with similar traf 
fi
c. Youractual experience in any speci
fi
c hour canbe quite different.
!
Related Reading 
!
 
Call Center Management on Fast For-ward
, by Brad Cleveland and JuliaMayben, includes a useful plain-Eng-lish discussion of using Erlang C forcall centre planning. Order from
www.incoming.com
!
 
Tables for Traffic Management andDesign
, by Ted Frankel, seems to bethe only book of traffic tables still inprint. Lee Goeller’s introduction andFrankel’s first three chapters consti-tute an excellent brief course in traf-fic engineering concepts. Order from
www.abcteletraining.com.
!
Cisco’s website has useful tutorials.Go to
www.cisco.com
and type “Traf-fic Engineering” into the searchbox.
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