Thursday, July 14, 2005

The Meaning of Optimization

Great word to use in business: Optimization. It conjures up all kinds of thoughts about high performance, streamlined methods and maximum ROI. Yet, what is so great about this word optimization is also what makes it so hard to use in a business setting. Exactly what does optimization mean?

The dictionary definition of optimization is “the procedure or procedures used to make a system or design as effective or functional as possible”. While this definition is acceptable to most people, it does not provide a picture of what optimization looks like. How does one know when something has been optimized? What measure or set of measures properly reflects the changes indicating that optimization is occurring? I suggest that such a picture cannot come from a definition of the word as the very subject is fraught with a wide variety of viewpoints.

In the call center, what one constituency sees as the most “effective” system may be quite the opposite from what another group sees as the most “effective”.

A call center supervisor whose income is tied directly to the volume of calls the agents are able to handle during a given time period views “optimal” as having enough agents to never have a caller abandon and for callers to never hear an expected wait time message.

This is in stark contrast to the call center business analyst whose focus is on minimizing the number of agents per shift while maintaining a competitive stance from a service level standpoint.

Let’s not leave out the VP Sales who sees the responsive, knowledgeable call center agent as a great source of product differentiation and thus, optimization means continual efforts to maintain if not grow this point of differentiation.

Each of these 3 views is valid yet in conflict with the other 2. “Optimizing” the call center for any 1 of these views will negatively impact the other 2. So how do you optimize a call center?

The starting point is an agreement on the overall goals of the optimization effort. Goals that take into account the needs of all effected parties. Goals that take into account the larger enterprise-level goals. Goals that have specific measures of success and for which there are systems in place to provide ongoing status reports.

Every organization should be engaged in an ongoing optimization effort. The worst thing such an effort can produce is a better understanding of the conflicting goals found in most organizations. The best outcome is a highly focused organization that knows the goals they are striving to achieve, knows why the goals are important and is able to continually measure their progress towards achieving those goals.

Take a look at your own company. Can you find your optimization initiatives?