How to set KPIs for Call Centre Team Leaders

‘You can’t expect what you don’t inspect’ is an old management adage one of my mentors shared with me many years ago.

What he was helping me understand is that regardless of whatever goals and objectives you have in your work life, you must regularly examine the outcomes of the tasks you and your team do to make sure you’re all moving forward towards your goals.

If you don’t regularly check the important aspects of your operation, you can quite quickly find yourself adrift, aimlessly moving along, risking a severe calamity, as one might if they were sailing a vessel without regularly checking their compass, speed or radar.

Obviously, if you don’t regularly check the direction and speed of your vessel, you’re not likely to reach your destination when you need to arrive.

This is fine if you’re just out for a pleasure cruise; however, in business, that’s never the case, is it?

The ultimate destination or goal for any business is to be profitable.

And along the way profitability is checked on a weekly, monthly, quarterly and annual basis.

To achieve its goal, a company generally uses five indicators, commonly referred to as Key Performance Indicators (KPIs), which are metrics that track their direction and speed:

• Revenue growth.
• Revenue per client.
• Profit margin.
• Client retention rate.
• Customer satisfaction.

KPIs aren’t goals; they are performance indicators that measure your progress towards your long-term goals.

They are an important part of measuring the success and failures of your operation and predict what will happen in the future.

They keep you on track to achieve your goals within the time frame set and act as an earlier warning signal letting you know that you need to make adjustments to reach your goal.

Each department of a company has its own KPIs to help them track their progress, and it’s no different with a Call Centre operation.

There are many different KPIs for the many types of operations involved with customer service, support and inbound or outbound telesales.

Regardless of the department, each KPI should be set for the needs of the particular department to drive towards the company’s goals.

Common KPIs used in a call centre

Listed below are a number of the more commonly measured KPIs for call centres, keep in mind that you’ll need to select the KPIs and outcomes you’ll measure that is relevant to your situation:

Human Resources:

• Recruitment– This may relate to the Team leader’s involvement in recruitment campaigns and is measured by their requirement to be involved in the process.
• Absenteeism– Less than 10% Full-Time Equivalents (FTE) per week.
• Staff Retention – Over 65% Of FTE per quarter.

 Voice of the Customer:

• Net promoter score (NPS)– At least 50% per month, and raise as scores rise over time.
• Customer satisfaction (CSAT)– At least 25% per month, and raise as scores rise over time.
• Customer Effort Score (CES)– On a scale of 1 to 7, an individual customer effort scores of 5 or more.

General efficiency, sales performance and service levels:

• Abandonment %– 5% to 8% for most inbound call centres
• Average Handle Time (AHT)—This needs to be determined by your call centre’s needs based on a fair and reasonable amount of time to properly engage with your customers. I’d suggest you determine the average of your top performers and see if this group’s average is a good minimum standard to set.
• Average Talk Time (ATT)—This needs to be determined by your call centre’s needs based on a fair and reasonable amount of time to engage with your customers properly. I’d suggest you determine the average of your top performers and see if this group’s average is a good minimum standard to set.
• After Call Work (ACW)– This needs to be determined by the needs of your call centre based on a fair and reasonable amount of time to properly engage with your customers. I’d suggest you determine the average of your top performers and see if this group’s average is a good minimum standard to set.
• Grade of Service (GOS)– 80% of calls answered in 30 seconds.
• Average Speed of Answer (ASA)– 80% of calls answered within 20 seconds.
• Wait time (WT)—This metric really depends on the size of your call centre and the technology systems you use. However, you need to determine what wait time is the MAXIMUM you can afford to have and set KPIs to reduce this overtime to less than 1 minute.
• Average Revenue per Call (RPC)– This is a sales metric that you need to determine based on the overall team’s weekly/monthly revenue target divided by the total number of calls and then divided by the number of team members. However, you shouldn’t simply have the same RPC for all team members as usually 30% or more are new or underperformers, so you’ll need to reduce the RPC for new team members to give them time to become competent and raise their RPC as they improve.
• Average Revenue per Operator Hour(ROH) – This metric is much the same as RPC, only based on an hourly activity, and setting this KPI for individuals should apply as done with RPC.
• Gross Sales % (GSP)– This needs to be determined by the needs of your call centre based on a fair and reasonable gross close rate to achieve the Net Sales % when cancellations are factored in. I’d suggest you determine the average of your top performers and see if this group’s average is a good minimum standard to set.
• Sales Cancellation/Rescission % (SCR)– I’d suggest you determine the average of your top performers and see if this group’s average is a good minimum standard to set. As the cancellation rate falls, set your KPI accordingly.
• Net Sales % (NSP)– the net sales rate is determined by the interaction of your gross sales and cancellation rates. I’d suggest you determine the average of your top performers and see if this group’s average is a good minimum standard to set, and as the team’s gross sales % increases and/or the cancellation % decreases, adjust your KPI accordingly.
• Sales Target % (STP)– your sales targets are typically determined by the senior leadership team every month, and this KPI is the percentage of actual net sales made of the target number.  You need to be careful with this KPI. It shouldn’t be set by simply dividing the total number of sales required for the period by the number of teams available. You need to consider whether there is a team comprised mainly of new hires or another filled with ‘top guns’ and set their respective targets with this in mind.

How to develop and set KPIs for Team Leaders

A good KPI provides objective evidence of the team’s (or individuals’) progress toward the required outcome or result.

It is clearly understood and agreed to by all parties, and is easily measurable – there are no grey areas, you either hit it or you didn’t.

It only covers areas the Call Centre Team Leader has direct control over—or if it’s a shared responsibility, it is specific to only what the Team Leader is responsible for and what they will be measured on.

When creating KPIs for Team Leaders (or anyone else for that matter), they must be designed with these characteristics:

• Clearly defined and simple to understand in terms of what is required.
• Specific and related to specific goals or targets – focused on improvement.
• Objective – not based on someone’s opinion.
• Aligned with the overall goals of the Call Centre.
• Relevant with a clear purpose.
• Easily measurable and exact on what is being measured.
• Reasonably Achievable.
• Timely in terms of the needs of the Call Centre and Team.
• Agreed by all relevant parties.
• Visible for all to see – including management and team members.

How many KPIs should a Call Centre Team Leader have?

The key to assigning the right number of KPIs is to consider the main objectives of your call centre as they relate to the overall goals of the business.

Of course, you don’t want to overburden Team Leaders with too many KPIs at the one time.

If you do, you risk creating an environment where Team Leaders feel that they have too much to do and, as a result, either spread themselves too thin or concentrate only on those areas they’re comfortable with while only paying lip service to the other KPIs.

Consider the main objectives in your Call Centre each quarter and base 2 to 3 KPIs per objective to ensure that you’re not overburdening your Team Leaders.

If you need to hold one or more of them over into the next quarter, do so; otherwise, move on down the list to the next most critical objectives Team Leaders need to get on top of.

Always work down from the top objectives to the less important ones.

Monitoring KPIs

Many companies have KPI Dashboards or Reports that cover all the key performance areas, which team leaders should review daily.

The best reports are the ones that track and show where each team and team members are in relation to each specific KPI.

One of the best reports I’d recommend, particularly in a sales environment, is a Pace Report. This report shows where a team (and team members) are in relation to their sales and/or revenue targets throughout the month.

It’s an incredible tool for keeping everyone focused daily on their sales targets, whether they are ahead or behind, and by how much in terms of where they are likely to end up at the end of the month.

Team Leaders should review their dashboards or reports each day before their shift to prepare themselves for what needs to be done that shift and share critical information in their pre-shift huddles with their team.

Team Leaders should also review these reports with their manager every week to discuss how their team is tracking in relation to their KPIs and agree on any measures that need to be taken to correct any shortfalls.

They should also meet each month, or at least quarterly, to review KPIs to make sure they are still relevant and measurable.

Focusing Team Leaders on their Targets and KPIs

Aside from regularly inspecting the activities required to hit (or even exceed) a Team Leader’s targets and KPIs, tie these to their bonus structures to really drive focus and desire for achieving them.

One way I have done this in the past is to design the bonus structure so that if they achieve over 100% on a specific target or KPI, they’d receive more than 100% of the monetary reward for that particular achievement.

I’ve set up this type of bonus structure with all my teams in the past by using an ‘under and over’ framework.

For instance, in a sales environment, if they reached 100% of their target or KPI, they’d get 100% of the monetary reward.

So, if the monetary reward for 100% achievement was $100, they’d get $100. However, if they achieved 110% (or more) of the target or KPI, they’d receive $110.

Conversely, if they only achieved 90% of the target or KPI they’d only get $90; and if they achieved less than 90% they wouldn’t get any bonus.

I highly recommend you look at this type of bonus structure, particularly in an outbound sales environment. The increased productivity actually reduces the cost of sale, and typically, there are enough savings to allow you to use some of those savings for extra bonus money.

If you’d like to consider this type of bonus structure, just make sure you work the numbers out with the Financial Controller’s team.

Once they see how much the increased productivity saves costs, even when paying out the extra bonus, they’re usually getting on board straight away!

Setting KPIs for Call Centre Team Leaders

In the 2024 Contact Centre Best Practice Report, over 300 Australian contact centres contributed to the report and provided some interesting insights for setting KPIs for Team Leaders.

For instance, the top five duties ranked by importance by Team Leaders in order were:

1. Leadership
2. Coaching and Development
3. “Checking in” with other Team Leaders
4. Hitting KPIs and targets
5. Quality Assurance

85% of Team Leaders felt they had enough time to lead effectively.

However, 41% of Team Leaders claimed they did not have enough time for coaching and development of their employees. 

Obviously, coaching and developing a team is the pathway to achieving team goals and targets.

While many of the performance indicators mentioned earlier would apply to a Team’s performance, other activities that relate specifically to coaching and development are rarely set for Team Leaders as KPIs.

With this in mind, you should develop specific KPIs for Team Leaders that cover these activities below to ensure that the development of team members is constantly being undertaken:

• Call Monitoring and Scoring– set a minimum of 3 team members’ calls scored per week.
• Providing Constructive and Corrective Feedback– should be set as 30 min sessions based on the number of team members who had calls scored that week.
• Conducting Skills Audits– set quarterly, or 4 weeks from the start date of the new hire.
• Creating Coaching Plans– usually done quarterly after completion of Skills Audit.
• Conducting Training and Coaching Sessions– should be 30 to 60 min one-on-one sessions with at least 3 team members, or if classroom style training is required for product/systems knowledge could be done as a group.
• Conducting Performance Reviews– with teams of 12 to 15 team members’ one-on-one sessions should be done each week for up to 15 mins each with each team member. For larger teams – fall off your wallet and promote or hire another Team Leader!

In my view, each of these areas should be set as specific KPIs for Team Leaders to ensure they are engaged in leadership activities that drive higher performance from team members, particularly underperformers!

The main purpose of a Team Leader is to lead their team to consistently reach (or even exceed) their team’s targets and KPIs every month.

It’s one thing to set targets and KPIs for a team, however rarely do you see KPIs set for Team Leaders that specifically measure leadership activities that drive teams to reach their targets and KPIs.

Typically, what happens is a Team Leader’s boss tells them that they have to get this specific KPI up, or that KPI down.

The boss may tell them what they need to do to achieve the required results, such as more coaching and training, but rarely does that follow up!

General human nature suggests that if someone in authority tells a subordinate to do something and then doesn’t bother to follow up on it, the message they’re delivering is that it’s just not all that important to them.

So, most subordinates think – why should I bother about it?

Unless you make (and measure) specific activities as KPIs, then you can’t expect what you don’t inspect!

The reason these should be the main KPIs (especially for new Team Leaders) is to have Team Leaders regularly engaged and focused in all of these critical areas to ensure their team has the skills and direction to achieve their individual KPIs for the team to reach its collect target and KPIs. 

Ultimately, what you want are Call Centre Team Leaders who view these activities as essential areas for them to focus on each week.

You want them to ingrain this thinking so that conducting these activities becomes part of what they do every week to turn underperformers into productive team members and keep top performers sharp.

So when you bring on a new Team Leader with the understanding that they will be measured (fairly and regularly) on each of these KPIs, they will make sure they do them; particularly if you have them provide you with proof!

What I mean by this is having them provide you with a schedule each week of the particular activities they will undertake, like – Call Monitoring/Scoring and Feedback Sessions, Coaching Plans, Training and Coaching sessions and Performance Reviews.

Each week have them give you a copy of their weekly schedule that outlines which activities they will be doing – you want to see who they will be working with, when they’ll be working with them and what they will be working on together.

If they aren’t working with enough team members, have them increase that. Just be fair and reasonable.

Also, have them provide you with any score sheets of the calls they monitored, a short synopsis of the Feedback and Coaching sessions they conducted, coaching or Training Plans they created, and copies of the Performance Reviews they conducted.

Having them show proof of what they agreed to will ensure that they understand you’re serious about these KPIs and will be ‘inspecting’ what you expect.

Just remember, the main things to remember when developing KPIs for Call Centre Team Leaders is to focus on the most important objectives you want to achieve; make sure each KPI is fair and reasonable; get ‘buy-in’ from your Team Leaders, then make sure you have the mechanisms in place to accurately measure the KPIs, and inspect these regularly.

Recommended Links:

• Call Centre Team Leader salaries, common duties & more!
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