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How accurate should a forecast be?

This might seem like an odd question, but in many larger call centres the fact that the forecast can be very accurate can actually lead to problems.

Imagine a very large call centre of, say, 5,000 agents taking broadly similar call volume with very smooth and predictable call flows across the days and from one week to another.  Forecasting accuracy for such large centres can often be very good, so let’s assume we’re always no worse than 5% away from the forecast, and usually within 2-3%.

Call centres of this size typically have a low availability requirement to deliver the required service levels, and often have very good scheduling efficiency.  A total availability of 5 to 7% would not be unusual.  Suppose that we’re set up to expect availability of 5% on a day that happens to coincide with being 5% over forecast.  In this situation, calls would queue for much of the day and the whole call centre would suffer with significant abandons.

Although it may seem appropriate to set forecast accuracy targets so tightly, it’s important that the operation retains sufficient levels of availability to cope with the random fluctuations that will inevitably come.  A much smaller call centre with typical availability in double figures would have much less of a problem soaking up a 5% over-forecast position.

In the example of the large centre, we have a choice: we can either continue to develop better and better forecasts to reduce the variations, or we can increase the availability in the call centre to cope with the randomness inherent in the customer behaviour.  At 5,000 people, however, a 1% increase in availability would require a further 50 people; it might be cheaper to hire more forecasters instead!