Customer Service Wait Times Could Be Costing Americans More than $100 Billion a Year, New Survey Finds

U.S. Businesses Face Annual Productivity Losses of $900 per Employee

Jul 15, 2014, 13:00 ET from ClickSoftware

BURLINGTON, Mass., July 15, 2014 /PRNewswire/ -- "Your call is important to us. You are the 50th caller in line." Whether it's weaving your way through a maze of automated prompts or waiting for a worker to show up at your house, the service experience in the U.S. is bound to raise blood pressure. New findings from a ClickSoftware (NasdaqGS: CKSW) study show dealing with service issues is causing more than just frustration. It could be costing Americans $108 billion annually with an individual loss of more than $750 per person. Businesses stand to suffer a yearly productivity loss of approximately $900 per employee due to work time spent contending with customer service inefficiencies. Overall, that's a $130 billion annual expense to companies nationwide.

Click to Tweet: #ServiceFrustration could be costing Americans billions says new @ClickSoftware survey via @HarrisPoll http://bit.ly/1ymjpve. #custserv

The online survey of 2,051 U.S. adults, 1,197 of them employed, was conducted by Harris Poll on behalf of ClickSoftware in May 2014. Collectively, employed Americans reported burning 30.8 potential work hours per year waiting for service industry responses. Based on the average national hourly wage of $24.45[1], that's an average $753.06 that people lose waiting instead of working. Multiply that by 144 million employed Americans[2] and the cost of frustrated wait time experienced by the U.S. population emerges at $108 billion.

$108 Billion Cost to Americans of Service Industry Wait Times

$24.45

U.S. average hourly wage

*

30.8

Potential work hours
per year spent waiting

=

$753.06

Total cost of time wasted by survey
respondents

$753.06

Total cost of time wasted by
survey respondents

*

144 Million

Number of employed
U.S. citizens

=

$108 Billion

Total cost of time wasted by employed
U.S. adults

When Americans waste time dealing with service industry issues during work hours, businesses take a massive productivity hit. On average, human capital costs a company 20 percent more than an employee's base salary[3]. This 20 percent added to the individual American's $753.06 loss reveals an unaccounted expense of $903.67 to companies per employee. $903.67 multiplied by 144 million U.S. wage earners arrives at a total annual cost to businesses of more than $130 billion in lost productivity—attributed solely to service sector issues. 

$130 Billion Cost to Employers in Productivity Losses

$753.06

Total cost of time wasted by
survey respondents

+

20%

Additional cost of
employee to employer 

=

$903.67

Yearly cost to employer per employee in
productivity loss

$903.67

Yearly cost to employer per
employee in productivity loss

*

144 Million

Number of employed
U.S. citizens

=

$130 Billion

Annual expense to companies overall

"Service industry shortcomings have massive implications—both for consumers and for businesses—as revealed by this survey, so organizations that are taking measures to equip their workforce with tools and analytics to adeptly handle customer needs gives them a strong advantage," said Steve Timms, President, North America for ClickSoftware. "The findings show people want first rate service, they won't pay extra for it and more than a third will sever ties if they don't get it. Businesses need to realize the actual toll poor service quality takes and put a specific focus on optimizing their existing resources in order to more effectively serve their customers and improve their bottom line." 

U.S. Service Industry Consumer Frustration Index

The following information provides key insights into how Americans feel about certain industries and the time spent on service issues. Employed adults who find fault with the service sector each selected their top two most frustrating industries. They then reported the number of hours spent dealing with these two industries over the course of a year when they otherwise could have/would have been working.

Industry

Average number of hours spent
dealing with their most recent issue

Banking

6.0

Repair/Home services

5.3

Insurance

4.7

Automotive

3.7

Healthcare

3.1

Communication service providers

2.5

Public Sector

2.2

Retail

1.8

Utilities

1.5

Total time

30.8 hours per year

 

  • It's gonna take time. A whole lot of precious time. As the table above indicates employed Americans are frustrated about dealing with virtually all service industries. At least two in five employed adults who find an industry frustrating have spent at least one hour dealing with the issue that they could have/would have spent working. The banking industry is the most time consuming with those frustrated spending six hours dealing with them that they could have been working followed by the repair and home services industry where they could have spent, on average, more than five hours working.
  • Brands are losing business. Big time. Over one-third (35%) of Americans have cancelled their service or stopped using that brand altogether due to a frustrating experience. And a whopping seven in ten Americans (72%) say their frustrations have caused them to take action of some sort. Half (51%) have demanded to talk to a supervisor, while over one in ten have yelled at the service representative (14%) and voiced their complaints on social media (13%) while smaller numbers have lied to get better or faster service (6%), begged (3%), or cried to the service rep, either real or fake tears (3%). However, seven in ten Americans (71%) say they would not pay anything more for VIP service or premium appointments.
  • Frustration comes in many flavors. Besides the industries themselves being frustrating, there are also frustrating aspects of actually making and going to the service appointments. More than two in five Americans say waiting for the service rep (44%) and being put on hold while on the phone with the service rep (43%) are among the most frustrating while almost two in five (38%) say it is service representatives who do not know how to fix the problem. Around one-third of U.S. adults say among the most frustrating things is a service rep who doesn't understand the problem (35%) or who have to come back because the problem wasn't fixed (32%) while one in five (21%) say it is billing issues and around one in ten each say it is scheduling the appointment (12%) and calling to make the appointment (10%).
  • Can companies do anything to improve their services? Yes they can. Around half of U.S. adults say companies can provide customers more frequent and exact estimate arrival times via their preferred method of contact (52%) and show they understand them as a customer (49%) to improve their services. Around two in five Americans say companies can proactively update them on the progress of their problem (43%) and share more accurate service estimates by understand the full extent of the job and required part(s) (39%) to improve their services while around one-quarter say companies can provide more opportunity to communicate with service reps (27%), schedule appointments via phone (23%) and schedule appointments via other methods (23%).

"Ultimately, satisfied customers help drive retention and profitability for service organizations. Our research found those that reached a 90%+ customer satisfaction rate achieved an annual 6.1% growth in service revenue, 3.7% growth in overall revenue, and an 89% level of customer retention," said Aly Pinder, Senior Research Analyst, Service Management, Aberdeen Group[4].
"Today solutions exist to alleviate consumer frustration. Considering the high cost to the bottom line, there is no justification for under-performance. Service organizations of all sizes should consider adopting automated tools to improve forecasting, planning and invest in mobile tools to provide field workers better access to information and the ability to communicate in real-time."

Survey Methodology 
This survey was conducted online within the United States between May 12 and 14, 2014 among 2,051 adults aged 18 and older by Harris Poll on behalf of ClickSoftware via its Quick Query omnibus product. Figures for age, sex, race/ethnicity, education, region and household income were weighted where necessary to bring them into line with their actual proportions in the population. Propensity score weighting was used to adjust for respondents' propensity to be online. For complete survey methodology, including weighting variables, please contact clicksoftware@mslgroup.com.

About ClickSoftware
ClickSoftware (NasdaqGS: CKSW) is the leading provider of automated mobile workforce management and service optimization solutions for the enterprise, both for mobile and in-house resources. As pioneers of the "Service chain optimization" concept, our solutions provide organizations with end-to-end visibility and control of the entire service management chain by optimizing forecasting, planning, shift and task scheduling, mobility and real-time management of resource and customer communication.

Available via the cloud or on-premise, our products incorporate best business practices and advanced decision-making algorithms to manage service operations more efficiently, in a scalable, integrated manner. Our solutions have become the backbone for many leading organizations worldwide by addressing the fundamental question of job fulfillment: Who does What, for Whom, With what, Where and When.

ClickSoftware is the premier choice for delivering superb business performance to service sector organizations of all sizes. The company is headquartered in the United States and Israel, with offices across Europe, Latin America and Asia Pacific. For more information, please visit www.clicksoftware.com. Follow us on Twitter.

[1] http://blogs.marketwatch.com/capitolreport/2014/07/03/more-than-half-of-2014s-new-jobs-pay-higher-than-average-wage/

[2] http://www.dlt.ri.gov/lmi/laus/us/usadj.htm

[3] http://blogs.marketwatch.com/capitolreport/2014/07/03/more-than-half-of-2014s-new-jobs-pay-higher-than-average-wage/

[4] Aberdeen Group, "Secrets to Optimize Field Service for Better Customer Experiences" September 2013

Media Contacts:                  




Kristin Amico                           

Tiffany Darmetko

ClickSoftware                           

MSLGROUP

781-272-5903 ext. 2364             

781-684-0770

kristin.amico@clicksoftware.com    

clicksoftware@schwartzmsl.com

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SOURCE ClickSoftware



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