Understanding Key Performance Indicators (KPIs) for Customer Service

Understanding Key Performance Indicators (KPIs) for Customer Service

A Key Performance Indicator, or KPI, is a measurement used to gauge how well a business is performing against a goal.

In the case of customer service, KPIs are a set of metrics that evaluate how well a business is delivering on its promise of providing top-notch service to its customer base.

KPIs come in a wide range of different types, and they’re measured in a number of different ways.

Some customer service KPIs are more direct and straightforward, such as your average time to answer a phone call or the number of issues that a customer service rep resolves in a given time period.

Other customer service KPIs are more indirect and qualitative, such as customer satisfaction surveys and customer attrition rates.

Why are KPIs important for customer service?

KPIs for customer service teams  are important because they can help track the overall performance of a company’s customer service. A company that understands how to measure KPIs can make data-driven decisions about how it can best benefit customers.

Best KPIs for customer service is also important because they can be used for both improvement and monitoring.

A company can improve its customer service by focusing on its KPIs, like how quickly its customer service teams respond to inquiries. On the other hand, customer service teams can use metrics to monitor how their customer service teams are performing.

For example, a company may have a customer service KPI that measures the number of calls per hour that are answered in under one minute. It’s important to understand the customer service KPI because it allows the customer service department to understand their performance and improve the customer experience.

There are a lot of different types of KPIs out there, but here are 7 KPIs you need to know when it comes to measuring customer service.

  • First Response Time (FTR):

    First Response Time (FTR) is widely considered to be the most important of all the KPIs. First Response Time is the time taken from a customer sending a support ticket to the time the agent responds to the ticket.

    You may ask why this is so important. The answer is very simple, FTR is the most important KPI for two reasons.

    First, it is the only KPI that shows the buyer how fast you are responding to their problem. Second, it is the only KPI that shows your customer that you are taking their concerns seriously and that you are not just trying to get rid of them.

    It is especially important in the case of e-commerce websites as customers expect to get their queries answered at lightning speed.

    An average FTR should be less than two minutes, but this figure depends on the industry. For example, a book publisher may take more time to respond to the queries of a customer than an online store selling shoes.

  • Average Resolution Time (ART):

    An essential part of Customer Service Level Agreements (SLAs) is Average Response Time. It measures the time it takes to resolve a support ticket from beginning to end, and the length typically varies according to the complexity of the problem. Lower resolution times, however, are better indicators of success, since they ensure quick resolutions of customer issues.

  • Average Handle Time (AHT):

    AHT is the amount of time it takes to answer a customer service call. For example, if agents take an average of four minutes to answer a call, then the AHT is four minutes. AHT is often used as an efficiency metric for customer service departments. Companies may want to figure out how long it takes to answer a call, or how many calls they can handle within a certain amount of time.

  • Number of Tickets:

    When dealing with the customer service KPIs, you must consider data like this, which is the number of tickets that were created in a month. It’s important to set a baseline and then compare this data with the previous months. As you can see, the ticket volume started to decrease in the second month and then stabilized in the third month.

  • Number of Resolved Tickets:

    A measure of customer service quality that is based on the number of unresolved customer tickets, measured over a specified period.

    It is important to consider the total number of tickets with the number of users your business has, because a large number of tickets may be caused by a small number of problems. It is also important to consider the period you are measuring.

    For example, if your business has an issue with a virus that affects a small number of users for a short period, you may have a high number of tickets, but that does not necessarily mean your customer service is bad. In addition to the number of tickets, it is also important to measure the number of tickets resolved in the specified period, as well as the average time to resolve a ticket.

  • Escalation Rate:

    It is the number of customer service cases handled per call center agent. The most common metric is calls per hour.

    The escalation rate is an indicator of the operational efficiency of the customer service team. An escalation rate greater than one may be a result of an understaffed call center, or the company may be experiencing a period of exceptionally high call volumes.

    A high rate of escalation requests can also indicate that agents are not handling calls properly, or that there is a knowledge gap in the team.

    Using the escalation rate to understand the efficiency of customer service agents is important because it allows a company to determine if it needs to hire more agents or train its agents better.

  • Customer Satisfaction Score (CSAT):

    A customer satisfaction score (CSAT) is a metric designed to assess customer satisfaction with a specific brand, product, or service.

    CSAT is a valuable tool in measuring how well you are handling your customer problems and complaints. It is typically measured on a scale of 1 to 10. You can also use a scale of 0 to 10 but we recommend using a positive scale because a 0 score can be discouraging and could make customers think that the brand is broken. The higher the CSAT score, the more satisfied customers are.

    It’s important to collect CSAT scores because they can help you analyze the areas where you can improve your business the most.

How to track your customer service KPI?

A customer service KPI dashboard allows access to data in real-time. Data is continuously updated in the dashboard and displayed as graphs and charts, so the organization can track the progress of the company over time. DialDesk allows you to create your customized dashboard.

How can you Improve Customer Service KPI Metrics?

Companies can strengthen their customer service KPIs in different ways:

  • Increase the number of human agents:

    Increasing the number of agents can reduce resolution times and first response rates. For most companies, it is not cost-effective to hire new agents to work 24/7 and oversee all of the traditional and new support channels.

  • Outsource Customer Service:

    Even the most diligent of entrepreneurs feel that hiring someone to handle everything is sometimes beyond their reach. That’s why so many businesses outsource customer service to companies such as DialDesk to help manage these operations for businesses.

Need help improving your overall customer service KPI? Discover how DialDesk can track every call from the moment you receive it until the moment you hang up. Learn what dialer solutions are available, who they are best suited for, and how they help.

Request for a FREE DEMO today!!

Author Profile

Varuna Raghav
Varuna Raghav
As a CX and marketing specialist, Varuna Raghav has more than 15+ years of experience to her name. Her enriching input has been valuable to the brands and organizations she's worked with.

One response to “Understanding Key Performance Indicators (KPIs) for Customer Service”

  1. Hello there! I like your article, keep sharing it. You’re really professional at it.

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