When we drive up to stop signs, we stop. When the “buckle up” sign is on, we stay in our plane seat. When our car’s gas light comes on, we get gas. While we heed the warning signs in our daily lives, in business we often either don’t see the warning signs, we misinterpret them, or we don’t know how best to respond.

Missing or ignoring the profitability danger signs in today’s contact centers is one of the reasons many organizations are still struggling to become profit centers versus cost centers. While contact centers know that contributing to the bottom line requires boosting customer satisfaction, increasing revenue, and controlling operational costs, the road to achieving these goals is often full of hazards that are neither easy to identify, nor easy to overcome.

Today innovative predictive analytic technologies can proactively identify and help overcome profitability trouble spots, thereby, giving contact centers a clear path to their ultimate destination – profitability. Here are three leading customer service hazards that intelligent analytic solutions can identify and help circumvent on every contact centers’ drive to high profits.

1. Red Flag: Agents are making offers to every customer.

When challenged with increasing revenue from inbound callers, the first thing many call centers do is increase agent resources so they can make sales offers to every customer. This strategy is risky, because it often leads to higher expenses and lower sales. The reason? Every customer is not a candidate for upsell and cross-sell offers. In fact, many will become disgruntled and, as a result, will become retention risks.

To circumvent this problem, companies must proactively identify exactly which customers are upsell, cross-sell, and retention candidates. Innovative predictive analytic solutions offer this intelligent forecasting capability. By accessing unique sets of existing customer data and modeling them in new ways, these solutions discover meaningful and previously unknown correlations, patterns, and trends.

With this insight inbound call centers can answer critical questions such as: Which accounts will respond favorably to upsell and cross-sell offers? And which high-value, attrition-risk customers will positively respond to retention offers? With this information driving smarter decisions, companies only spend agents’ valuable time on the right customers, at the right times, and with the right offers.

2. Warning: High-value customers are serving themselves.

Self-service technologies have accelerated customer service and lowered agent costs. But all is not perfect in the land of automated customer service. For one thing, companies cannot control customers’ actions in self-service. According to a Bearing Point report on call centers and customer service, “the push for self-service in the name of cost savings and expediency over recent years has given customers unprecedented power over the relationship.”

In fact, companies have not only lost the opportunity to enhance customer relationships, but also created potential retention risks by annoying high-value customers who either get lost in the self-service maze or are queued on hold for agents behind long lines of low-value customers. As a result, many high-value customers are closing their accounts without ever talking to agents.

Priority routing solutions can overcome these high-risk situations by proactively identifying and routing high-value customers to appropriate service levels – either driving them to retention agents, or sales agents, or allowing them to complete their calls in self-service – thereby boosting their satisfaction, longevity, and value.

3. Caution: Costs to replace lost customers are escalating.

In the past companies often focused on acquiring new customers versus retaining existing customers. But customer retention has moved up the priority chain as the high cost of acquiring new customers and the value of retention has become clear. Among the stats: a five percent increase in customer retention will boost profits by 25% to 85%, according to a report by the Harvard Business School.

Now contact centers can apply predictive analytic solutions in real time to call routing. These applications pull relevant data to determine customers’ future value and behavior as they arrive in self-service – and before they can self-select their service levels. The applications then assess all inbound callers’ future profitability potential and propensity to respond to offers, and balance customers’ overall needs with the call center’s actual resources and business objectives. They then route all callers to the appropriate service levels, where agents engage customers as needed – before customers can simply click a button to disconnect the relationship.

Aim Higher and Smarter

Any contact center tasked with turning a profit should carefully analyze its current profitability strategy. Too often the very actions that should help build profits are actually profitability pitfalls. Today it’s often the roads less traveled that help contact centers overcome the costly hazards in customer service organizations and, thereby, drive up profits. The signs showing the path to higher costs or higher profits are all around us. Which ones will you heed?

David Perona is director of product management at Austin Logistics (www.austinlogistics.com), where he oversees the development and delivery of the company’s marketing analytic solutions. David has over 15 years of experience delivering innovative real-time marketing solutions to global 1000 companies. He has helped leading-edge analytics companies such as Epiphany, Sigma Dynamics, RightPoint, CSC Credit Services, and KnowledgeBase Marketing develop and deploying analytic solutions across channels, including contact centers, the Internet, ATMs, kiosks, and retail stores. David holds an MBA from University of Houston – Clear Lake and a B.A. in Statistics from University of Minnesota. He can be reached at dperona@austinlogistics.com. Austin Logistics