Results of Research - People Issues

Conducted March 2001 by supportindustry.com
and Help Desk 2000

survey technology provided by CustomerSat.com

Executive Summary by Peter McGarahan, Chairman, Help Desk2000

supportindustry.com and Help Desk 2000 sponsored the Staffing and Operations Survey in order to mark the continuing evolution of the 21st century support model. The data generated in this survey provide valuable insights into the operational performance behaviors of support organizations, supplying important benchmarks against which the ongoing progress of the support model can be measured.

Objectives
Staffing and Operations are the most frequently benchmarked categories within the Support Industry. This survey was designed to provide key performance indicators, metrics and trends in the industry, in order to aid companies in their maturity toward becoming the model 21st century support organization.

Methodology
Recognizing the critical importance of providing reliable support management, we surveyed more than 500 executives from a broad range of small, medium and large corporations, from sectors including education and government. In order to generate the metrics necessary for measuring the ongoing evolution of the support industry, the survey asked questions in categories including:

• Budgeting
• Handling service demands
• Labor supply characteristics
• Support staff salary information
• Support services outsourcing
• Support services maturity curve
• Strategy objectives for the support industry in 2001

Key Findings

• Despite the lagging economy, nearly 54 percent of respondents indicate they increased their support budgets for 2001.
• Across the board, respondents reported that personnel/labor comprise the majority of their operating costs, averaging between 50 and 80 percent of total operating budgets.
• Nearly 24 percent of respondents report that improving service levels is their top support strategy objective for 2001.
• The majority of respondents, 68 percent, reported they currently do not use any form of Outsourcing or Insourcing.
• On the support maturity curve, 44 percent reported their support team is in Reactive/Dispatch mode.

Detailed Findings
Staffing a support operation is time consuming, expensive and difficult to perfect. Sustainable excellence in support operations has everything to do with the quality of the leadership, culture and environment, as well as with the ability of management to attract and retain the best support professionals. A careful comparison of compensation, staff turnover rates and outsourcing rates indicates that increasingly, companies are attracting, training and keeping internal support staff rather than spending valuable time and funds fostering outsourced support staff.

Support professionals, managers and directors are well compensated compared to prior years. Inextricable from this change in pay scale, 53 percent of companies surveyed noted their support budgets also are set to increase in 2001, and 77 percent already incur support staff labor costs constituting between 50 and 80 of total operating budgets.

Likely related to the rise in spending for support staff, staff turnover rate has decreased. In fact, 73.3 percent of respondents note a turn over rate of less than 20 percent, compared to 2000 attrition rates, which were reported as high as 50 percent. This change can be attributed to a number of factors, including the rise in salaries and the slowing of the dot.com economy. Specifically, the economic downturn has increased the supply of qualified support professionals, while concurrently decreasing the massive churn seen among support employees in 2000, when there were almost unlimited opportunities to switch companies after less than six months on a job.

In addition, increasing numbers of companies are keeping their support staff internal. In 78 percent of companies that responded to the survey, contractors make up less then 15 percent of total staff. Reasons for this remarkably small percentage most likely lie with efforts of support managers and directors who have convinced senior management to refrain from overuse of contractors. Proof of this reasoning came recently from a support manager writing a business case that proved that hiring full-time support professionals can lower labor costs, increase scheduling flexibility, ownership, company loyalty and maximize training investment by creating internal career paths that utilize company-specific knowledge and skill sets. Another cause for this diminishing percentage could be the Microsoft decision about the classification status of long-term contractors.

Despite the decreasing number of contractor staff in companies surveyed, outsourcing is a hot button issue for companies in 2001. A large number of respondents (68%) do not use any form of outsourcing, and 80 percent of those who do not also have no plans to use outsourcing anytime within the year. It is important to note, however, that only 26 percent of respondents to this survey indicate they have authority for the company's Internal Help Desk and External Support Center, meaning they may not have as much outsourcing or Insourcing decision-making authority as company executives. Most decisions about company support operations traditionally come from executive management, who view them as strategic objectives, rather than from support managers or directors who are directly involved with support systems activities.

Support Operations Rankings
Dispatch, Reactive Support: Located at the bottom-left quadrant of the support operations grid, support at this level is considered low-value, costly and inefficient - and a perfect target for Insourcing/Outsourcing/Reengineering. Characteristics of these systems include:

• Fragmented processes
• 80 percent of the calls escalated to Second Level
• Poor image
• No service level agreements
• Limited reporting
• Low customer satisfaction scores

Additionally, hidden support in this environment is high. Customers view the support team as the "Helpless Desk" and prefer to rely on their peer support network rather than call the Support team, costing the company between $6,000-$15,000 a year per employee (Gartner Group).

Problem Management, Managed Growth: Located at the middle quadrant, support at this level is characterized by a support team that is maturing and delivering a well processed and documented (Standard Operating Procedures - SOP and Service Level Agreements - SLA) level of problem management. Teams at this level start to leverage remote control, High Impact Training (HIT), documented problem resolutions and begin to integrate their problem management tool with change and asset management to increase their First Contact Resolution to 80 percent by practicing Total Contact Ownership. They also begin to create a self-service Web site where they can publish FAQs, Infrastructure availability alerts, training classes, scope of services, SLAs, technology standards and allow access into the Call Tracking system for customers to submit, status check and research their own problems/requests/resolutions. This support team, based upon their success, also starts to get more involved with areas outside of their traditional problem management focus. This might include supporting:

• Facilities (IMAC - installation, moves, adds and changes)
• HR ·
• Technology rollouts
• Training
• Documentation
• Business process support (SAP, PeopleSoft, Oracle Financials) I
• Integrated problem, change, asset, desktop and network support of the technology infrastructure

Knowledge Center, Strategic Customer: Located at the upper right quadrant of the support operations grid, support teams at this level are providing a strategic, value-add to the business and its customers. Customers are serviced consistently and within service levels that are measured, managed and communicated. The support team begins to integrate high value activities like asset management and remote assistance with other e>Support technologies such as self-healing and e-mail automated response technologies. A higher value is placed on problem elimination and call deflection, which happens as a direct result of good Root Cause Analysis. The support team becomes predictive, proactive and able to anticipate problems and resolutions before they impact productivity. Knowledge management is linked to the multi-channel e>Support alternatives, allowing the support team to focus on the more strategic, value-add, mission critical and complex problems while customers handle repetitive tasks through the support alternatives maintained and monitored for success by the support team.

Conclusion
supportindustry.com and Help Desk 2000 are committed to providing ongoing current support industry benchmarks and measurements from practitioners. Please join us as we report back to you, the trends and directions of the support industry supported by practitioner data.

Size of Company Choice Number Of Responses Percent Graph Small (0-999 employees) 170   31.9%   Medium (1000-9999 employees) 222   41.7%   Large (10,000+ employees) 141   26.5%   Total Responses: 533 100%

Are you responsible for your company's Choice Number Of Responses Percent Graph Internal Help Desk 282   54%   External Support Center 100   19.2%   Both 140   26.8%   Total Responses: 522 100%

What market-place is your company in? Choice Number Of Responses Percent Graph Business to Business 257   48.7%   Business to Consumer 189   35.8%   Government 56   10.6%   University/College 26   4.9%   Total Responses: 528 100%

What percent of your total support staff is first level? Choice Number Of Responses Percent Graph 0-9% 104   19.7%   10-19% 67   12.7%   20-29% 52   9.8%   30-49% 85   16.1%   50-99% 220   41.7%   Total Responses: 528 100%

What percent of your total support staff is second level? Choice Number Of Responses Percent Graph 0-9% 113   21.5%   10-19% 82   15.6%   20-29% 102   19.4%   30-49% 100   19%   50-99% 128   24.4%   Total Responses: 525 100%

What percent of your total support staff is third level? Choice Number Of Responses Percent Graph 0-9% 296   58%   10-19% 76   14.9%   20-29% 35   6.9%   30-49% 53   10.4%   50-99% 50   9.8%   Total Responses: 510 100%

What is your current staff turnover rate? Choice Number Of Responses Percent Graph 0-9% 239   45.7%   10-19% 145   27.7%   20-29% 89   17%   30-49% 36   6.9%   50-99% 14   2.7%   Total Responses: 523 100%

In 2001, did your support budget: Choice Number Of Responses Percent Graph Increase 280   53.4%   Decrease 110   21%   Stay the same 134   25.6%   Total Responses: 524 100%

In the next year, do you expect call volume to: Choice Number Of Responses Percent Graph Increase 426   80.4%   Decrease 42   7.9%   Stay the same 62   11.7%   Total Responses: 530 100%

What percent of your operating budget is personnel/labor related? Choice Number Of Responses Percent Graph 50-59% 131   26.7%   60-69% 125   25.5%   70-79% 122   24.8%   80-89% 81   16.5%   over 90% 32   6.5%   Total Responses: 491 100%

What percent of your staff are contractors? Choice Number Of Responses Percent Graph 0-14% 415   78.3%   15-29% 36   6.8%   30-44% 30   5.7%   45-59% 18   3.4%   60-74% 10   1.9%   over 75% 21   4%   Total Responses: 530 100%

Are you currently using some form of Insourcing/Outsourcing? Choice Number Of Responses Percent Graph Yes 164   31.6%   No 355   68.4%   Total Responses: 519 100%

If no, do you plan to using some form of Insourcing/Outsourcing in the next year? Choice Number Of Responses Percent Graph Yes 80   20.3%   No 315   79.7%   Total Responses: 395 100%

What functions do you currently or plan to outsource in the next year? (check all that apply) Choice Number Of Responses Percent Graph After-hours 73   18%   Business Apps (e.g. PeopleSoft, SAP, SFA) 62   15.3%   Web-based Apps 59   14.6%   Shrink-Wrapped 51   12.6%   Break/Fix 78   19.3%   Networking 39   9.6%   Demand Peaks 43   10.6%   Total Responses:   What is the primary reason you would outsource all or some of your support operation? Choice Number Of Responses Percent Graph Lower Cost 74   22%   Not core competency 35   10.4%   Improve service level 62   18.4%   Business Need 62   18.4%   Can't fix it yourself 36   10.7%   Demand Peaks 28   8.3%   Other 40   11.9%   Total Responses: 337 100%

What are currently paying your Level 1 staff? Choice Number Of Responses Percent Graph $15,000 - $19,999 16   3.2%   $20,000 - $29,999 146   28.9%   $30,000 - $39,999 231   45.7%   $40,000 - $49,999 92   18.2%   over $50,000 21   4.2%   Total Responses: 506 100%

What are currently paying your Level 2 staff? Choice Number Of Responses Percent Graph $25,000 - $39,999 134   27.1%   $40,000 - $54,999 269   54.3%   $55,000 - $69,999 73   14.7%   $70,000 - $84,999 15   3%   over $85,000 4   0.8%   Total Responses: 495 100%

What are currently paying your Support Managers? Choice Number Of Responses Percent Graph $35,000 - $49,999 86   17.6%   $50,000 - $64,999 181   37%   $65,000 - $79,999 153   31.3%   $80,000 - $94,999 65   13.3%   over $95,000 4   0.8%   Total Responses: 489 100%

What are currently paying your Support Directors? Choice Number Of Responses Percent