Optimization

and Pricing
Model Review

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Introductions
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WebEx Expectations
• Be on time
• Participation is mandatory
• Please ensure your phone is placed on MUTE when not responding
to a question or activity
• Every person logged into the session will need their own computer
• Every participant must complete pre and post test as well as
Satisfaction survey
• 80% passing score must be achieved on the Post Test
• The estimated time for this session will be 2 hours
• Ensure accurate Email address is in Sitel University
• You must remain dialed into the conference bridge

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Pre Testing
• A polling window will open in a moment, this poll
is a quiz, comprising of 10 questions, that
measures your knowledge of the topic being
covered in this session.

• You will have 5 minutes to answer the 5

questions.

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Learning Objectives
By the end of this session you will be able to:
• Describe how pricing and optimization works.
• Identify levers to maximize the efficiency of our
campaigns.
• Explain variances and appropriate actions to
bring GM and BTP in line.

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Purpose
What is the purpose of our Optimization Model?
• New Account: Set a price point that will allow
Sitel to achieve required GM% while offering the
prospective client pricing that can win the
business.
• Existing Account: Determine optimal
performance goals either because the pricing
model is not available, the business has changed
or performance improvements are required.

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9
New Account
New Account
RFP

EBR Site Tour

Site Selection

Pricing

Sizing SOW

Assumptions

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New Account – Pricing
New Account- Pricing
Pricing generally takes one of the following forms:
• Per minute
• Per call or transaction
• Per Agent staffed hour
• Per Agent “productive” hour Per FTE
• Cost +

Check RFP/SOW Closely

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New Account- Pricing Inputs
What information would you need to price an account?

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 New Account- Pricing Inputs
• Pricing begins with EBR process.
• Data is gathered and assumptions are made to complete pricing model.
 SL% Goal Length of Training/OCP
 AHT Attrition Percentage
 Call Arrival Pattern Recurring Training
 Volume Tiers Training – Billable/non-billable
 Hours of Operation
Other
 Management Ratios

• Pricing is developed by the Regional Pricing teams.

• Price points are communicated to sales representative or RM.
• Sales rep/Relationship Manager presents to client.

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New Account – Pricing
New Account- Pricing
What factors will cause the price to increase?
 Aggressive SL goals – Lower Occupancy
 Hours of operation which lower Occupancy / BTP
 Low volumes – Lower Occupancy
 Lower management ratios -- Standard ratios are:
 Coach 1:18
 Trainer 1:75
 OM 1:126
 Non-productive position requirements (PS, QA, etc.)
 High attrition
 High absenteeism when absenteeism is paid or unpaid
 High wage rates

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New Account- Outputs
The Pricing Model has
different inputs and levers;
the goal of which is to
maximize BTP and Gross
Margin.

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Roles and Responsibilities
• Owner – Site Director and Financial Analyst
 Responsible for making sure the task is completed
• Reviewer – Regional VP
 Responsible for reviewing results and directing any
necessary changes
• Facilitator – Operations Manager and Financial Analyst
 Provides necessary information and assist as needed
Note: While the SD and Finance Analyst own the process, it is the
responsibility of all parties to review and recommend any
necessary changes and take action to maximize our profitability.

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When?
• When changes occur to key requirements
or volumes.
• When performance improvements are
required.

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What might change from initial pricing?
• Hours of Operation
• Exchange Rates
• Service Level Goals
• Call Arrival Patterns and distribution of volumes
• Volume and Tiers
• AHT
• Penalties and Bonuses
• Refresher Training (Up-training)
• Labor Costs
• Shrinkage Factor (Attrition / Absenteeism)

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Optimization- Existing Accounts
The objective is to maximize BTP and GM that can be
achieved based upon current requirements of the account
at the current price point.

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 Existing Account
• Uses components of the pricing model to determine optimal
BTP% and GM%.
• Data is gathered to complete the information required in the
model.

 SL% Goal  Length of Training/OCP

 AHT  Attrition Percentage
 Call Arrival Pattern  Recurring Training
 Volume Tiers  Training – Billable/non-billable
 Hours of Operation  Other
 Management Ratios

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Existing Account
• Optimal BTP% determined by inputs and desired
improvement on BTP levers.
• Optimal GM% determined based upon the existing price
points.
• Goals communicated, if different from previous goals.
• Actual performance is measured to goals and reasons for
variances identified.
• GOS Bridge Plans are put in place to reduce variances and
achieve goals.

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Existing Account
Existing Account
What factors would cause variances in your optimal performance?
 Changes in volume
 Over/under achieving SL% goal
 Staffing
 Changes in hours of operation
 Deviations to Management ratios
 Non-productive position requirements (PS, QA, etc.)
 High attrition
 High absenteeism when absenteeism is paid
 Higher than expected wage rates
 AHT actual vs. goal
 Occupancy
 Penalties

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Existing Account
Existing Account

The point is NOT to make excuses but to

identify controllable factors and take action.

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Group Activity
• Scenario 1: Your new campaign launched 4 weeks ago. This is a per minute
campaign with a cap of 7 minutes.
 Calls offered has been 50% of what the client forecasted for the past 4
weeks.
 AHT is currently running 5.5 minutes.
 There is no cause for lower than forecasted volumes.
 SOW states the client will pay for approved up-training 2 hours per week.
 What actions would you take to maximize BTP and GM%?
• Scenario 2: Your campaign is paid per staffed hour and absenteeism is
running high due to a flu epidemic.
 How would you maximize potential revenue?
• Scenario 3: Your BTP is below target by 3%.
 What actions would you take to bring it back line?

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Scenario- Lower than Forecasted Volume
• Your new campaign launched 4 weeks ago. This is a per
minute campaign with a cap of 7 minutes.
 Calls offered has been 50% of what the client
forecasted for the past 4 weeks.
 AHT is currently running 5.5 minutes.
 There is no cause for lower than forecasted volumes.
 SOW states the client will pay for approved up-training
2 hours per week.
• What actions would you take to maximize BTP and GM%?

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Scenario- High Absenteeism
• Your campaign is paid per staffed hour and
absenteeism is running high due to a flu
epidemic.

• How would you maximize potential revenue?

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Scenario- Low BTP%
• Your BTP is below target by 3%.

• What actions would you take to bring it back

line?

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Quick Fixes
• What are your best practices or quick fixes
to meet margin and contribution goals?

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Reminder!
• While the Site Director is not the one who actually
completes the optimization model – it is the SD’s
responsibility to review and agree with the targets.
• Once agreed to we are ALL responsible for meeting those
targets.

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Other Impacts Often Overlooked
• Tax and Fringe costs forecasted
 Benefits, Taxes and Average Wages
 Under / Over estimating costs and participation rates
 Holiday vs. Holiday Worked
 Holiday paid day off is calculated consistently
 Holiday worked time is not estimated or projected in both the
optimal and forecasted targets set
• Telco
 Lack of clarity on these costs and allocations
• Pass Thru Revenue and Expense
 Inconsistent

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DMT- Be Prepared
• Be prepared to explain variances and actions you are taking.
• Quantify statements, make them meaningful, add activities
• Utilize available tools and resources to assist in quantifying
 Cost calculators, BTP calculators
 Bridge plans
 Automated reporting (utilize ORA to build in BO)
 Utilize staff to action plan and build accountability measures
 OM, ORA, PIPM, WFC, FP&A, Coaches
 Involve agents
 Conduct follow up sessions to review activities and results

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DMT- Explaining Variances and Actions
• Variance: Absenteeism is trending at 10% vs. an
optimal of 6%. This is a reduction of 250 billable
hours at $25 per hour = $6,250 in lost top line
revenue and an estimated loss of $2,187 in GM
(35%) dollars.
• Action: Identified 10 agents who can make up 4
hours per week and 10 part timers to increase
weekly hours by 4. With 3 weeks left in the
month this will make up 240 of the 250 billable
hour short fall.

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DMT - Explaining Variances and Actions
DMT- Explaining Variances and Actions
• Variance: Over revenue forecast by $164K, due to client increasing forecast
as they continue to have calls come in well above their initial expectations.
 Tier 1 hours are currently 3600 over forecast which accounts for $62K of the overage.
 Billing 60 training heads this month, this accounts for $129K which was not in the forecast as
this was not finalized until start of April.
 Spanish is trending lower than forecast due to attrition, reducing revenue by13k.
 QA hours trending about 10k lower than forecast due to leveraging of members to other
positions - additional positions to be filled this month. In terms of the margin, they are
tracking 2% over this month.
 Language Line pass through came in at 44k opposed to 29k projected based on last month's
bill, causing a .5% decrease in margin.
 The above mentioned billable new hire training consisted of 75 additional personnel
requisitioned, 60 of which are billable; causing a .8% increase in margin.
 Benefits costs are 6k lower causing an additional .7%.
 Management expenses tracking slightly higher by 3k, causing about a .2% drop.
 Wage rates are also lower than forecast, $9.88 versus $10.05, this is causing a 1.7% increase to
the margin.

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Optimization- Be Proactive
• Staffing, AHT Reductions and or Lower Than Planned Volumes
 Schedule and conduct any billable training that needs to be completed
 Utilize VTO by creating a sign up sheet everyday for associates to pre
volunteer
 Keep the list in a centralized place and release agents based on first
in/first out
 Use your ROC resources to identify overstaffing intervals/days
 Reduce maximum hours in the scheduling software and have ROC rerun
schedules
 Increase vacation approvals, target agents who have PTO hours available
 Use your ORA to run Kronos hours to insure no one is in jeopardy of
accruing OT
 Performance manage by removing low performers

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Optimization – Be Proactive
Optimization- Be Proactive
• BTP
 Measure and manage BTP at all levels.
 Create and execute bridge plan that sets aggressive improvement targets.
 Reach out to the ROC and insure your intervals staffing patterns, AHT and
other shrink variables are following the current trend.
 Build a daily culture that has coaches, learning specialists, LM, OM’s and
agents reviewing and acting upon their daily, wtd and payroll period AUX,
schedule adherence and occupancy usage.
 Include training in your actions plans. Insure there is adherence to OCP
GOS mentor ratios and TSLA agreements are current and executed.

AUX, Occupancy and Schedule Adherence are BTP “Killers” if not measured ,
monitored real time and acted upon!

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Optimization – Be Proactive
Optimization- Be Proactive
• Attrition and Absenteeism
 If a spike with attrition occurs, it is critical to quickly conduct a
deep dive into the data as to why. Red flags to look for can be
training and or OCP, coach outliers.
 Utilize the site Red Zone tracker to identify high risk individuals
and team trends. Personally schedule a one on one session with
the individual.
 Conduct focus groups with the team members for feedback.
 Utilize HR to conduct exit interviews.
 Have HR or Leadership make proactive telephone calls to all
associates who call in absent and all NCNS.
 Implement the attendance Rehab process across the center. Start
including it as part of new hire orientation.

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Review
 Why should you be concerned with managing the optimization of your account?
 Maximize BTP and GM that can be achieved based upon current requirements of
the account at the current price point
 Who is responsible for the creation and review?
 Finance Analyst and Site Director
 Who is responsible for managing your campaigns to optimal performance?
 Everyone
 When is optimization needed?
 When changes occur to key requirements or volumes
 When performance improvements are required
 How do you go about managing your campaigns to optimal performance?
 Track performance consistently and utilize tools, resources, and bridge plans to
maximize efficiencies, GM, and BTP.

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Questions?

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Download Files
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that will provide the following to you:

• PDF copy of today’s presentation

• Optimization Best Practice Tools
• Opt Best Prac Docs

Reminder: You can only download one file at a time.

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Satisfaction Survey
• A polling window will open in a moment. This poll is a 13
question satisfaction survey.

• You will have 5 minutes to answer the 13 questions.

Please be sure to add specific feedback regarding
anything particularly helpful or anything that could be
done differently.

• “1” is the Lowest Score

• “5” is the Highest Score

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Post Testing
• A polling window will open in a moment, this poll is a 10
question quiz (the same questions you answered
previously) that measures your knowledge of the topic
that was covered in this session.

• You will have 5 minutes to answer the

10 questions.
• You will need to score 80% or higher to
receive credit for completing this course.

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Experience shared.