Editor's note: Jodi Meryl Wallace is senior vice president of marketing at Stamford, Conn.-based EIS International, a provider of outbound call center technology.

The technology revolution is not just affecting the way market research information is being tabulated and analyzed - it's transforming the very nature of how telephone calls are being made. Today, the telephone interviewing industry faces such formidable obstacles as rising refusal rates, leaner client budgets and a dwindling number of hours that most consumers can be found at home. That's why telephone interviewing companies are on the lookout for time-saving measures that can increase productivity and control costs.
Armed with systems that combine computerized call management with automated dialing, telephone interviewers are eluding the natural enemies of telephone interviews - busy signals, answering machines and no answers - to make more contacts, complete more surveys in less time and become more competitive.

Predictive dialing systems, as they are known, automatically dial numbers from lists, deliver answered calls to waiting interviewers, and provide online access to market surveys. Unanswered calls and "busies" are detected and rescheduled for future callback.

Market research companies that use predictive dialers report double- or even triple-digit productivity gains, and say that the systems often pay for themselves in productivity in less than a year. In fact, they are so efficient that users are sometimes challenged to provide a telephone sample list large enough to keep up with the system.

Such problems are a blessing to Valley Forge Information Service, a telephone interviewing service in Langhorne, Pa.

As a division of the ICT Group, a pioneer in the use of computer technology in telephone marketing services, VFIS was no stranger to the benefits of predictive dialing, even before it purchased its first system about two years ago. In 1988, ICT's telemarketing division had installed one of the first predictive dialing systems developed by EIS International Inc. of Stamford, Conn. Today, ICT uses EIS systems at 550 of its 750 agent workstations, and in seven of its nine calling centers. Each month, ICT agents use predictive dialing to make about 9 million calls. VFIS, which operates as a separate division of ICT, makes half a million of those calls.

"Predictive dialing is a win-win proposition," says Bob King, VFIS's director of sales. "With manual calling, we didn't have the capability to bid aggressively enough on large projects with tight deadlines. Now we're more competitive - and more profitable - and our customers are paying less for better work with a faster turnaround."

Productivity gains vary from one survey to the next, but King estimates that the move from manual to predictive dialing has increased the number of surveys completed per hour by as much as 200 percent, reduced the cost per interview by 20 percent to 25 percent, and boosted overall productivity by an average of 30 percent to 40 percent. Economies of this magnitude have enabled VFIS to pass the savings on to its clients and remain profitable.

"Predictive dialing is particularly suited to low-incidence surveys, where it can take 1,000 calls to reach 50 people who meet the survey criteria, and then only 35 of them will agree to be interviewed," King says. "With odds like that, who can afford to waste time on unproductive calls?"

According to King, his company's track record in the computer industry and the productivity of its predictive dialing system caused it to be hired last year by a marketing research consultant doing a survey of mobile workers who use PCs. The consultant, Link Resources, was impressed with results that exceeded expectations - and costs that didn't.

King credits the system with bringing in business from a Chicago market research firm that hired VFIS to survey fishermen from a random sample. "It would have taken our competitors 1,400 hours to collect the data manually," King says. "Instead, it took us 900 hours and the client saved about $10,000."

In some cases, the savings from predictive dialing have allowed clients to conduct surveys that would not have been cost effective in a manual environment. "The system lets us access respondents in the consumer marketplace who are difficult to identify and even harder to reach," King says.

Although predictive dialing is used in telemarketing, collections and other fields, its benefits are still being considered by some market research firms. Recently, VFIS did its own market research test by conducting three surveys of varying lengths and incidence using manual and predictive dialing methods. The results? Productivity gains for predictive dialing ranged from 74 percent for a five-minute survey of convention attendees with 70 percent incidence, to 86 percent for a seven-minute survey of 401k-plan holders with 43 percent incidence, to 122 percent for a 15-minute study of whiskey drinkers with only 5 percent incidence.

Increased productivity is the most compelling reason to use predictive dialing, especially in an industry where time really is money. But there's more to market research than simply dialing calls. King believes that the key to a productive data collection center is finding ways to bring out the best in interviewers.

To this end, King says predictive dialing has helped reduce caller burnout, boost morale and improve personnel management. Interviewers make more contacts with less frustration. They have less paperwork, and they need only simple training to learn the system.

"Predictive dialing and computerized call management free supervisors to concentrate on coaching and motivating instead of worrying about keeping the project moving," King says. Supervisors monitor activity and real-time statistics to see how the research project is going. The success of the study can be analyzed every step of the way and, if necessary, adjustments can be made within minutes instead of hours.

According to King, the EIS system paid for itself in less that a year. "But the benefits far exceed the return on investment. Predictive dialing has made telephone interviewing more cost effective at a time when the cost of mail and face-to-face interviews keeps going up," he says.

For Jack Kerins, ICT's vice president of systems and technology, another strong selling point was that the predictive dialing system could be linked to existing computer-assisted telephone interviewing software. "It took about a month to work out the kinks in the CATI software, but ... the predictive dialing system worked the first time we tried it," Kerins says.

Last month, VFIS added eight more workstations to the EIS system. The company plans to expand even further as additional VFIS personnel are hired. As Kerins explains, "Manual dialing is about as effective in market research as hand typing thousands of letters for a direct-mail campaign. Frankly, I don't understand how market research firms can operate effectively without the benefits of predictive dialing. It's definitely made VFIS more competitive."