What is First Contact Resolution (FCR) and how do you calculate it?

Natalie Smithson
AI enthusiast | Tea addict | Focused on using AI assistants to win the working week

What is First Contact Resolution?

First Contact Resolution (FCR) measures the percentage of customer enquiries resolved during your first interaction with a customer. This metric determines how well you solve problems promptly when someone first reaches out, improving their overall experience.

Achieving a high FCR rate signifies quick solutions to issues, a focus on customer satisfaction, and arguably a strong customer service mindset, always putting their needs first.

How do you calculate FCR?

To calculate FCR, divide the number of customer inquiries or complaints resolved during the first interaction by the total number of inquiries received. This calculation, expressed as the number of enquiries resolved on the first contact (F) divided by the total number of inquiries (E) x 100, allows you to track and report on how effectively you solve customer queries.

Formula for calculation

(F/E) x 100

  • F = number of enquiries resolved first time
  • E = total number of enquiries

Example calculations

80% FCR rate

Number of enquiries resolved first time (F): 120

Total number of enquiries (E): 150

  • (F) 120 / (E) 150 = 0.8
  • 0.8 x 100 = 80%

97% FCR rate

Number of enquiries resolved first time (F): 654

Total number of enquiries (E): 672

  • (F) 654 / (E) 672 = 0.97
  • 0.97 x 100 = 97%

What is a good FCR benchmark?

A good benchmark for FCR typically falls within the range of 70% to 80%. Establishing internal benchmarks based on industry standards, customer expectations and operational capabilities is essential for your business. All in all, by aiming for a high FCR rate, you can improve your overall operations, boost customer confidence, and encourage long-term customer loyalty.

Rethinking FCR strategies to suit the age of AI

The one thing AI is already known for is speed. Customers get instant answers to their queries 24 hours a day using automation, but key to FCR is being able to resolve customer queries first time. To do that effectively, you should integrate your AI assistant with all your go-to business systems.

Without integration, your AI assistant can still answer queries instantly any time of the day or night, but oftentimes you need to carry out other actions to confirm the interaction as truly complete. Say you offer template training documents to teach people about a product or service. An AI assistant can understand the request and send the template to interested enquirers, but a member of your team then has to log that enquiry as a lead in your CRM ready for follow up. An AI assistant with easy integration capability can do both of these tasks for you, so your contact teams don’t have to be involved at all. The leads simply appear in your system.

AI creates a new definition for ‘Resolution’ in FCR

As use of AI becomes more commonplace, it’s helpful to track FCR alongside other metrics to highlight the impact an AI assistant is having on your operations. Where does it bring the most relief?

Start tracking how much time your teams spend on answering the initial query, but also on other administrative tasks that relate to it. How much time or effort does using AI automation save them? And with that time they save, how much of it can they use to work on higher value tasks?

Like many organisations, your telephone communications might currently command the largest piece of what we call the customer service pie, where customer service operations hinge on standard business hours. But if your support is only active for 8 hours from 9-5, how do you help people for the rest of the 16 hours in a day?

Rethinking the customer service pie: 80% AI chatbot, 15% live chat, 5% phone

In the long term, you can start to see where the most profitable work stems from when time is not being used up on administrating routine tasks and using an AI assistant keeps your support open 24/7 and is a far less expensive ‘pie strategy’.

In just six months of launching an AI assistant, Barking & Dagenham Council saved £48,000 on waste enquiries before expanding the service to five more departments at no extra cost. Customer satisfaction soon jumped up by 67%.

“The AI assistant is transforming the way our customers access information. Our next focus is to allow our customers to complete end-to-end journeys via the AI assistant.” ~ Dwain Nicely, DX & Digital Manager for Barking & Dagenham Council

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FAQs

How can FCR impact customer loyalty?

High FCR rates lead to increased customer satisfaction and trust, enhancing customer loyalty and overall customer retention.

How does FCR impact overall operational efficiency in a business?

A high FCR rate leads to improved operational efficiency by reducing the need for repetitive customer interactions, lowering customer service costs, and allowing employees to focus on more complex or strategic tasks.

What challenges might hinder achieving a high FCR rate?

Potential challenges include complex customer issues, lack of adequate training for service agents, and ineffective knowledge management systems (solved by consultancy from experienced providers).

How can I improve FCR rates continuously?

You can continually train service representatives, analyse customer feedback, optimise workflows, and implement AI enhancements to improve FCR rates consistently over time.