Calculating ROI for Customer Service Improvement Initiatives Part 2

Calculating ROI for Customer Service Improvement Initiatives Part 2

In order to achieve a desired ROI, everyone—the project team, the client, and participants—must all play a role to secure the success of the project.


Posted by Etta AuYeung on October 17, 2013 at 10:00am


Welcome to Part Two of the CSA blog series on calculating ROI for customer service improvement initiatives. In Part One, we covered how to calculate and interpret the ROI values. This blog post will walk you through the crucial conditions that need to be met in order to achieve a desired ROI. Without meeting these conditions, the forecast success of the project cannot be guaranteed.



First, let’s define the participants needed to achieve ROI.

  • Project team¹: responsible for the projects from creation to implementation.
  • Client (or the organization): funds, initiates, and supports the project.
  • Participants: particularly for the customer service improvement initiatives, are client’s employees—the managers, supervisors, and frontline staff.


Commitment and Effort

Each of the participant groups plays an important role. Every project requires some level of agreeable mutual cooperation and agreement from all parties. The participants’ full participation, commitment, and effort to make the project a success are indispensable. The impact and success of any customer service improvement initiatives should reflect on and through the participants. To reach N% ROI, the client must ensure that the managers are doing X, the supervisors are doing Y, and the staff is doing Z. Then, we can be confident that we have the potential to reaching this targeted N% ROI.


Determine Project Needs and Set Objectives

How can a client ensure the participants can achieve the maximum benefits of a customer service improvement project? Set specific objectives. Objectives are measures of values that are important to all stakeholders. The client should set the minimum acceptable objectives and help participants understand why their involvement in the project is relevant and what they are expected to do.

According to The ROI Institute², there are six levels of objectives needed to be defined. These objectives provide focus and meaning to the project, direction to the stakeholders, and define success. The different level of objectives depend on the project needs.

Level 5: ROI

The questions that people might ask regarding the need of a project may include:

  • “Is this project worth pursuing?”
  • “Is it a feasible project?”
  • “What is the likelihood of a positive ROI?”

The payoff of any project can either be a profit increase or cost saving. For most cases and especially customer service improvement initiatives, the payoff is likely to be cost saving, such as reducing staff time spent on a task, improving the quality and driving towards first contact resolution, and avoiding cost associated with errors.

The client has subject-matter experts who can determine the cost of problems. Problems that can be abated or eliminated with customer service improvement initiatives include the following:

  • Time wasting
  • Employee turnover
  • Errors / mistakes
  • Delays
  • Employee dissatisfaction
  • Productivity problems
  • Customer dissatisfaction
  • Inefficiencies
  • Bad reputation

The objective at a ROI level would be a desired percentage of improvements based on factual data collected from data above.

 Level 4: Impact

The impact questions that people might ask are:

  • “What happens if we do nothing?”
  • “What problem(s) are we trying to address?”
  • “Is it an output, time, cost, or quality problem? Or is it related to work satisfaction, customer service, employee development, or organization image? Or a combination?”

The impact objective should focus on what impact you want the customer service improvement initiative to have. Examples of impacts include increase in productivity and customer satisfaction.

 Level 3: Application

Examining performance needs, we ask the questions, “what might be the cause of the problem?” and “what inhibits the organization from taking advantage of the opportunity?” The answers to these questions are usually related to organizational setting, individual behavior, and the system functions. Based on the performance needs, the objective of application should focus on the applicability of the project.

Let’s use customer service training as an example. A client asks the project team to hold a series of three customer service training sessions for its employees (participants) to refresh their customer service skills. The application objective will determine how frequently the training should take place and in what areas the training is applicable.

Level 2: Learning

After we address performance needs, we need to find out what skills, knowledge, and ability the participants need to do their job differently or to learn a new process. This level will again require client subject-matter experts to help determine the knowledge and skills necessary to address the performance issues.

With the client’s input, the learning objective is crafted to identify what the participants need to learn and what level of learning they need to attain in order to apply what they learned confidently.

Level 1: Reaction

This is where we determine preference needs. Preference needs dictate the perception and reaction of the participants in the project. Each individual participant might prefer certain schedules, processes, and activities. We will find participants value the projects with different levels of relevance, importance, appropriateness, usefulness, values, and challenges.

The reaction objectives look at whether the managers, supervisors, and staff find value in the project. If participants do not find value in the project, it’s very unlikely that the project will be successful.

Let’s use the training example above. If the training participants anticipate the class to be boring and not helpful, and it turns out that is true, the participants won’t be taking away anything even if the class has valuable content to share.  That is why it’s especially important to have skilled professional trainers who are passionate and experienced in the subject matter to provide the training (like your CSA, Inc. trainers).

Level 0: Input

The input needs may stem from a recommendation analysis, a regulation compliance, or time-sensitive event. Input needs direct the request for the project. The input of a project will determine the project scope: who the participants are, how many hours are required for the project, and what’s the cost and duration.


You can see it is critical for the participants to be committed and put forth effort toward a customer service improvement project. Our next blog post will highlight how to convert intangible outcomes into tangible values and why not all intangible benefits of a customer service improvement project even need to be converted.


¹ At CSA, Inc., our team provides leadership for the larger project team for our clients

² The ROI Institute, founded in 1992 by Dr. Jack J. Phillips and Dr. Patti P. Phillips, is an industry leader in return on investment (ROI) measurement and evaluation.


Phillips, Jack and Patricia. The Consultant’s Guide to Results-Driven Business Proposals. The McGraw Hill Companies. 2010. Pages 46 – 48, 52 – 54, 65 – 86.

The Bottom Line of ROI Workshop was a course on how to measure the return on investment of learning, performance improvement, and human resources programs. The workshop was held on August 20, 2013 and was taught by Dr. Patricia Phillips.