What Is the Difference Between Occupancy and Utilisation?


You may be excused for thinking that occupancy and utilisation are terms that contact centres use interchangeably. However, these are two completely separate metrics.

Henriette Potgieter, a call centre best practice management consultant at QBIC Solutions, tells us: “Occupancy differs from utilisation in that occupancy considers only live logged-in time, but utilisation considers total time at work (including logged-out time such as training).”

But let’s dissect these two metrics further, explaining each fully and highlighting the value of calculating both in the contact centre.

What Is Occupancy?

Occupancy is calculated as a percentage and represents the amount of time that advisors spend on call-related activity while they are logged in and expected to be taking calls. “Call-related activity” includes talk time, hold time and wrap time. It is often referred to as “productive time”.

Henriette Potgieter

Henriette Potgieter

As Henriette Potgieter summarises: “Occupancy answers the question: for what percentage of the time that my advisors are logged in live are they actually busy with a customer activity, or are they available to do more?”

It is typical for a contact centre’s occupancy to lie between 80 and 85%, and if your occupancy rate is at this level, it is likely that your Resource Planning team are doing a good job. However, if occupancy is consistently higher than 85%, you are risking advisor burnout.

But remember, there is no recommended best-practice benchmark for occupancy, and targets should be set with a goal of continuous improvement in mind, balancing financial/budget requirements with employee needs.

Here are the two equations that most contact centres use to calculate occupancy.

\(\text{Occupancy (%) = } \, \large\frac{\text{Total Contact Handling Time }}{\text{Total Logged Time}}\normalsize\times100 \)

However, these formulas are often presented using the following terminology, although they all equate to the same thing.

\(\text{Occupancy (%) = } \, \large\frac{\text{Traffic Intensity (Erlangs) }}{\text{Raw Advisors}}\normalsize\times100 \)

For more on how to use these formulas in practice, read our article: How to Calculate Occupancy

What Is Utilisation?

Like occupancy, utilisation is calculated as a percentage. However, it differs from occupancy as utilisation instead represents the amount of time that advisors spend on call-related activity while present in the contact centre.

As Henriette Potgieter says: “Utilisation answers the question: for what percentage of the time that I pay my advisors are they logged in and assisting or available to assist with a customer activity?”

So, utilisation calculations include all the time spent on internal shrinkage activities, not just logged-in time. These internal shrinkage activities include:

  • Coaching and training sessions
  • Team meetings
  • One-to-one reviews/chats
  • Toilet and other unplanned facility breaks
  • Time spent helping other departments
  • Special and creative projects
  • System downtime

Put simply, utilisation calculations include the total shift time of an advisor, not just the logged-in time when they are available to take contacts. This is evident in the utilisation formula below.

\(\text{Utilisation (%) = } \, \large\frac{\text{Total Contact Handling Time}}{\text{Total Shift Time}}\normalsize\times100 \)

As you are dividing by the total shift time, instead of logged time, utilisation will be much lower than your percentage occupancy.

However, while all internal shrinkage activities are part of the “total shift time”, time taken for external shrinkage activities should not be included. This includes things like paid breaks, absence and lateness.

Why Is It Important to Measure Occupancy?

Occupancy is especially important in schedule design, as it assists with measuring schedule optimisation, so as not to have advisors sitting and waiting for calls too often.

Henriette Potgieter

Henriette Potgieter tells us: “Occupancy is especially important in schedule design, as it assists with measuring schedule optimisation, so as not to have advisors sitting and waiting for calls too often.”

So, occupancy rates are a great indicator of the efficiency of your staffing calculations. But not only that, the occupancy metric is a key part of scheduling advisors, if you do so with the Erlang Calculator and not workforce management (WFM) software.

In fact, top-of-the range Erlang Calculators will include an occupancy target. So, enter in your preferred occupancy rate (between 80 and 85%) and the calculator will give the ideal number of advisors to match that percentage, which will also be based on the other information that you’ve provided. This other information will include contact volumes, Average Handling Time (AHT) and so on.

However, occupancy must only be measured on a contact centre-wide level; it cannot be used as an advisor target. Advisors cannot control when they receive calls and shouldn’t be pressured by handling times, so it’s a measure for the Resource Planning team only and not a measure of advisor productivity.

For more on measuring productivity, read our article: How to Calculate Productivity in the Contact Centre

Why Is It Important to Measure Utilisation?

Henriette Potgieter says: “Utilisation is important as input to overhead cost or shrinkage calculations, as it considers ‘non-customer-related activities’ that still get paid for, but that take the advisor away from servicing a customer.”

Utilisation is important as input to overhead cost or shrinkage calculations, as it considers ‘non-customer-related activities’ that still get paid for, but that take the advisor away from servicing a customer.

Henriette Potgieter

Overhead costs are business expenses that help to build the success of your business but do not directly generate any revenue. Utilisation is therefore a consideration for overhead calculations.

Also, as Henriette  referenced, utilisation rates can be useful in calculating overall shrinkage, as they provide an idea of total hours of internal shrinkage. This is important when considering the equation for overall contact centre shrinkage:

\(\text{Shrinkage (%) = } \, \large\frac{\text{Total Hours of External Shrinkage +}\\\text{ Total Hours of Internal Shrinkage}}{\text{Total Hours Available}}\normalsize\times100 \)

For more on measuring shrinkage and how to use this formula in practice, read our article: How to Calculate Shrinkage

Other Metrics Not to Be Confused With Occupancy and Utilisation

While occupancy and utilisation are often confused, both metrics also have similarities to others that are commonly used in the contact centre.

So, let’s quickly introduce you to these so-called “others”, to see how they differ.

Schedule Adherence

Schedule adherence is the percentage of the advisor’s scheduled working day when they are present at work. This includes all internal shrinkage activities.

For further clarification, here’s an equation for contact centre adherence:

\(\text{Schedule Adherence (%) = } \, \large\frac{\text{Minutes in Adherence}}{\text{Total Scheduled Minutes}}\normalsize\times100 \)

So, if an advisor was supposed to work from 8am to 9am, but instead worked from 8.05am to 9.05am, their schedule adherence rate was 91.6%.

This is because they were present for 55 of their scheduled 60 minutes. The additional five minutes they worked was “out of adherence”.

To find out more on measuring schedule adherence, read our article: How to Calculate Schedule Adherence

Conformance

Conformance is a percentage measure of the amount of time that an advisor spends at work, versus the amount of time that they were scheduled to work.

The formula for conformance looks like this:

\(\text{Conformance (%) = } \, \large\frac{\text{Actual Work Time}}{\text{Schedule Work Time}}\normalsize\times100 \)

So, using the example above, if an advisor was supposed to work from 8am to 9am, but instead worked from 8.05am to 9.05am, their conformance rate was 100%. This is because they were present at work for the exact same number of minutes they were supposed to be.

It is especially important to consider adherence and not just conformance, as adherence looks at whether you are supporting the business when you should be, at the right times.

Productivity

While this isn’t exactly an individual metric, many people use occupancy as an indicator of productivity. But, as highlighted earlier, occupancy is a WFM metric only and shouldn’t be used at an advisor level.

Productivity calculations should be mostly made up of schedule adherence, because that is something that advisors have complete control over.

Just remember that the contact centre is not a factory, which means that advisor productivity should not be measured through efficiency metrics.

To find out more on measuring productivity, read our article: How to Calculate Productivity

For more on contact centre metrics, read our articles:

Published On: 22nd Oct 2018
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