Support Metrics: Occupancy Vs Utilization

Occupancy and utilization are two of the most often confused support metrics. Many call centers use the terms interchangeably and commonly only measure one or the other, but there are stark differences in their uses and what they actually measure.

Both occupancy and utilization are essential metrics for a call center, but which of these metrics should you use? When should you use them?

What is occupancy?

Call center occupancy is the measure of an agent’s total available time to help customers compared to the time they are actively helping your customers through customer-related activities. It is measured as a percentage using the following formula:

For example, if one of your agents is actively taking calls for three hours with a total talk time of two hours, their occupancy rate for that three-hour block would be 66.6%.

Handle time can include one or more of the following:

• Time spent on the phone
• Wrap up time after the call
• Hold time

Depending on your call center processes and your customers, you can combine these distinct activities as one “handle time” metric, or split them out to more accurately measure each category.

What is utilization?

Call center utilization is the measure of an agent’s total time at work compared to the time they are actively helping or available for customers. This is the main difference between occupancy and utilization—utilization takes into account the time your agents spend doing non-customer-facing work.

Let’s use Bob as an example. Bob works in your call center and is scheduled to spend a large part of his day taking calls from customers—say six hours. Occupancy tells you what percentage of those six hours Bob’s actually helping customers; utilization tells you what percentage of Bob’s total shift he’s actively helping customers.

Utilization is also measured as a percentage. The formula is:

“Logged-in time” simply means the time your agents are actively working on customer issues or are available to help your customers. The non-customer related time (anything that’s not “logged-in time”) includes things like:

• Team meetings 
• One-on-one meetings with leadership
• Training classes
• Personal break time (coffee, bathroom, etc.)
• Project time
• Downtime during low contact volume

Let’s say you have an agent working a typical eight-hour shift. For three of those hours, they are scheduled for taking calls and other customer service activities. The other five hours are a mix of meetings, lunch, and a big project. Using the formula above, this particular agent’s utilization would be 37.5%. The formula looks like this.

Why is occupancy an important call center metric?

Occupancy is an important metric because it measures how much time your agents are spending on helping your customers. It’s a measure of productivity that keeps your call center agents and leadership team accountable. It keeps you focused on your main purpose, namely, being there for your customers.

Occupancy also helps you find a balance in serving your customers well. If the occupancy percentage is too low, you risk bored agents and unnecessary costs. If your occupancy rate is too high, you risk burnt-out and overburdened agents. Both outcomes lead to poor customer service and can negatively impact your customer experience.

Why is utilization an important metric?

Utilization helps you gauge what percentage of time your call center agents are being paid for non-customer-related activities.  It can help you determine if your agents are in too many meetings, involved with too many projects, or are too occupied working on things that take them away from helping customers.

Utilization can also help you look deeper into projects and prioritize them appropriately. If you’re taking team members away from serving your customers to work on projects that aren’t really moving the needle forward, you can deprioritize those items to get the agent back to the core of their role.

At the same time, if an agent is being taken away from serving customers to work on a project that will create a better customer experience or make customer service more efficient, you can prioritize that since it helps attain your overall customer service goal.

What should the target be for occupancy and utilization?

When comparing call center occupancy vs utilization, even their target metrics may look similar.

Occupancy rate standards usually fall between 80% and 90%, whereas target utilization rates are usually between 79% and 86%. However, your call center’s specific target will ultimately depend on the industry in which you’re serving your customers. Factors like company values and budget will also impact your goals.

3 questions to ask to figure out the right occupancy and utilization rates for your customer service team

Occupancy and utilization are great metrics to track, but they aren’t the end-all-be-all of support staffing. To determine what occupancy and utilization rates make sense for your call center, ask these questions.

Do my occupancy and utilization targets make sense for my employees?

With the industry standard for both occupancy and utilization being in the 80s, you have to consider if percentages that high make sense for your team. Depending on the industry, high occupancy and utilization rates—or even just the industry standard ranges—may cause your agents to burn out and leave your company.

Talk with your employees to see:

• What kind of calls they’re getting (more difficult calls or stressful calls may mean occupancy targets should be lower)
• How they’re feeling overall
• If they have enough time between calls to work and resolve customer issues effectively
• If they have any process improvement ideas to promote an easier and more efficient working environment

Industry standards are guidelines, not rules. Your customer service agents are experts on their jobs and on your processes, and they’re an invaluable resource in determining the right KPIs for your business.

Do my occupancy and utilization targets make sense for my customers?

You can’t (and shouldn’t) ignore what’s best for your team. At the end of the day, though, your call center exists to help customers with their issues and inquiries. Do the targets you’ve set for occupancy and utilization make sense for your customers?

With targets too low, your employees may get bored or disengaged, which directly affects their ability to deliver great customer service. If your targets are too high, it has the same negative effect (due to burnout).

The only way to know what occupancy and utilization rates make sense for your team is to deeply understand your customers. You can run surveys and gather feedback on their support experience. You can look at metrics like customer satisfaction (CSAT) or customer effort score (CES) to understand how they feel about your team’s support.

Signals that you need to adjust your occupancy and utilization rates can include complaints about long hold times or long response times or unhelpful agents (high occupancy can cause stress, which can lead to worse interactions). Of course, these complaints can also be solved in other ways—for instance, maybe you decide to keep a relatively low occupancy and utilization rate, but reduce hold times by adding a few new team members.

What other metrics should I be tracking to help inform current occupancy and utilization rates?

One thing occupancy and utilization have in common is that they don’t tell the whole story of customer satisfaction. To understand your customer experience in a more holistic way, you need to track other important metrics as well.

For example, if a customer support agent is on a single call for 50 minutes out of an hour, their occupancy percentage for that hour is 83.3%. This meets the target occupancy many call centers set. However, that doesn’t mean it was a great customer experience.

Other metrics that will help complete the CSAT story are:

• Cases (or contacts) per hour
• Average Handle Time
• Handle Ratio
• Service levels
• First contact resolution

Cases per hour and average handle time can help determine agent productivity and efficiency. Combine that with your target occupancy and you can make sure your customers are getting the help they need in the quickest and most efficient way possible. This in turn should lead to better service levels and a higher percentage of cases resolved on first contact (first contact resolution). That’s where CSAT levels rise.

Check out our guide to metrics for more on implementing all of these (and more) into your call center.

Conclusion

Occupancy and utilization, though often confused with each other, are two customer service metrics that continue to provide value for call centers. With the correct target percentages, you’ll have satisfied employees and even more satisfied customers. It takes real work to determine and maintain your targets, but it’s well worth the effort.

At Peak Support, we bring years of experience providing outsourced customer service to companies big and small. We can partner with you to help you design the right systems, hire the right people, and optimize your support processes to ensure your customers get the high-quality service they deserve. Contact us for more info today!