Cost per Resolution

What is the Cost per Resolution?

A means of gauging a support team’s efficiency, Cost per Resolution is the average cost of a support team successfully resolving a ticket. Crucially, it takes into account all operational costs incurred by the support team – including but not limited to salaries, equipment costs, and travel expenses – and divides these expenditures by the number of tickets resolved.

Cost per Resolution is an important metric for your customer support and finance teams to track.

Why is the Cost per Resolution important?

Cost per Resolution is important because it allows functions in a manner similar to ROI (return on investment). This is the central question that Cost per Resolution answers – are your support team’s expenditures worth the effort it takes to resolve each of your customer enquiries?

We can evaluate Cost per Resolution in four ways:

• High expense, high efficiency: your support team is well-invested and operating at peak performance.
• Low expense, high efficiency: this might appear the most ideal scenario, but the danger here lies in your support team becoming overworked.
• High expense, low efficiency: little more need be said!
• Low expense, low efficiency: a too-low investment in your support team, coupled with inefficiency, indicates a lack of care for customer satisfaction.

While reducing the Cost per Resolution appears to be an ideal path to follow, there’s a real danger that cost-cutting will result in a far lower quality of service for your customers–and a far higher degree of stress for your support team employees.

How to calculate Cost per Resolution

Best practices for Cost per Resolution

The best practices for Cost per Resolution ultimately will depend on the amount of resources you provide your customer support team. These could prove extremely valuable investments, especially if you’re able to resolve a large number of tickets in line with, or even exceeding, industry standards.

That said, the overhead costs associated with Cost per Resolution might simply prove too expensive. With this in mind, it’s probably ideal to keep your expenditures moderately high – high enough to encourage the best performance from your team, but not so high that they become simply unsustainable. Once the expenditures associated with Cost per Resolution are viewed as investments rather than mere expenses, a clearer picture of this KPI emerges.

Other KPIs similar to Cost per Resolution include:

• Customer Acquisition Cost (CAC)
• Average Revenue per User
• Customer Satisfaction (CSAT)