What is Erlangs in customer service and how do you calculate it?

When creating or adjusting the structure of a customer service center, the objective is that all calls are received, in addition to avoiding cancellations due to the congestion of the available channels. Technical knowledge that helps with this job is to learn How to calculate Erlangs.

‍

The Erlang formula was initially applied to projects in the area of telephony, since its creator, A. K. Erlang, worked at the telephone exchange in Copenhagen, Denmark.

‍

But as we will see throughout the article, the idea behind the formula is useful both for planning a Contact Center as much as a telephone exchange based on another type of channel, such as virtual chat.

‍

Read on and understand what the Erlang formula is, how to use it and its importance in the humanized chat service.

What is the Erlang formula?

The Erlang formula is the calculation method used to determine the volume of call traffic received by a channel within an hour. The result is expressed in Erlangs (equivalent to hours), which works as a measurement unit.

‍

Learning how to calculate Erlangs serves to define the technical and human resources necessary to structure an efficient service center.

‍

The objective is for the center to receive a continuous flow of calls and there is no waiting line or channel blocking due to high demand during the hours of Peak service.

Who was Erlang?

Agner Krarup Erlang was a Danish mathematician who worked for the Copenhagen Telephone Company, Denmark. He was the author of the first theoretical studies for telephone network projects in the early 20th century.

‍

At the time, the challenge was to ensure that the existing telephone infrastructure was able to meet demand. However, the issue was to be able to calculate the number of lines that should be available, in addition to avoiding traffic jams if demand increased suddenly.

‍

The formula developed by Erlang was published in 1913 in the article by 'Solution of some Problems in the Theory of Probabilities of Significance in Automatic Telephone Exchanges' — in free translation, 'Solving Some Problems in the Theory of Probabilities of Significance in Automatic Telephone Switches' —, still being used today in the telecommunications sector.

How to use the Erlang formula in customer service?

The Erlang formula is used in customer service to scale the structure necessary to meet the demand for calls received with agility and quality.

‍

The focus of this article is on chat support. However, the concept and formula for calculating Erlangs are applicable regardless of the channel. This is because, to structure a functional system, there are three variables involved:

‍

1. number of channels available to assist users who use the service center;
2. Demand from the plant: the service time provided (in hours), according to the number of calls received in the 1-hour period;
3. Locking the power plant: percentage of calls that will not be answered because of possible central congestion.

How to calculate Erlangs?

To understand how these variables interact in practice, let's explain how to calculate Erlangs. The original formula is more complex than the one presented below, however, this simplified version is equally useful for analyzing the status of a functioning customer service.

‍

Consider that a chat service center has 200 channels available. What is the demand generated if each chat channel receives, on average, 4 calls per hour and each call lasts 2 minutes?

‍

To calculate demand in Erlangs, the following calculation is made:

‍

• 200 channels x 4 calls = 800 calls per hour
• 800 calls/hour x 2 minutes = 1,600 minutes/60 = 26.66 hours of service

‍

Thus, the demand received by the plant is approximately 27 hours per hour, which is equivalent to 27 Erlangs (official measurement unit of demand).

Applying the result

After obtaining the demand result in Erlangs, this data can be used in a new calculation. This time, to find out the number of agents needed on the team to handle current call traffic.

‍

Prior to that, the company evaluates the current standards of Service SLA and analyzes whether, with the existing structure, it is possible to meet demand and avoid waiting times.

‍

An example of a recurring pattern that companies establish in the SLA is to answer 80% of the calls answered within 20 seconds.

‍

With the help of a Automatic calculator, we did another calculation to extract new information and continue the example above. To answer 800 incoming calls per hour, you will need:

‍

• 45.5 active agents, with which a 90.3% service level can be achieved in 20 seconds and an average response time of 5.3 seconds.

‍

The justification given by the calculator to increase the SLA from 80% to 90% is to prevent more than 85% of the agent team from being active. In this way, the overload of the agents is avoided, in addition to allowing the planning of relays and breaks, without loss of service margins.

‍

In this configuration, the chat service center would immediately answer 76.4% of the calls and record only a 2.23% abandonment rate.

‍

Learning how to calculate Erlangs and apply the results in practice requires dedication to understanding the technical aspects. But with good customer service advice, your company has the necessary support to understand this and others service indicators.

What is the importance of using the Erlang formula for humanized chat service?

The use of the Erlang formula is important because, based on this information, companies understand the current workload, whether the team is able to serve it, and what to do to improve service.

‍

The result of the changes made are perceived when other indicators are analyzed together, such as:

‍

• dropout rate;
• Average Wait Time (TME);
• Average Service Time (TMA);
• time between the end of one call and the start of the next;
• seasonality of the service channel (period of high and low demand);
• among others.

‍

This data shows whether the service structure provides a quality and humanized customer experience and also whether the customer is satisfied with the service.

‍

Learn more about 'How to use' service indicators for the action plan'in this other blog article.

Discover how to improve service

Now that you know how to calculate Erlangs and what this data is for, you can take the first step to improve your company's service.

‍

Calculate the cost of each ticket opened in your company currently with our free CX calculator.

‍

Afterwards, Talk to the experts at Cloud Humans about how to reduce service costs in your business, creating an efficient operation that meets your company's demand.