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The new federal tax-cut legislation is expected to generate not only gains for taxpayers but also a flood of citizen inquiries to the Internal Revenue Service.

"We are anticipating fairly significant increases in telephone volume, probably starting the middle of this year," said Cecil Usher, deputy business assurance director for the Customer Communications Project at the IRS.

Last year, the agency's 27 call centers fielded about 130 million calls — fewer than expected thanks to several years of reasonably stable tax laws and call- center improvements, Usher said.

The stability may be gone, but the improvements remain and are expected to be just a down payment on future upgrades. The IRS is one of a number of government organizations planning call-center improvements to boost efficiency and citizen service. The Social Security Administration, for example, which handles 60 million calls a year, began exploring last year how to improve its centers under its Channel Convergence Proof of Concept program.

A component of the customer relationship management market, call- center technologies accounted for about 15 percent of the $3.7 billion spent worldwide on CRM software last year, according to Gartner Inc.'s Dataquest unit.

Call centers today have evolved "way past the typical group of cubicles housing telephone service representatives," said Ken Munson, director of public-sector strategy for PeopleSoft Inc. Call centers are often staffed by "fully functional customer service representatives" who may have at their disposal a battery of telephone and Internet technologies, such as interactive voice response, e-mail, Internet chat and computer telephony integration tools (see box, below).

Those technologies give callers "automated, self-help and self-diagnostic capability" and around- the-clock access to information, Munson said. At the same time, organizations can use the technologies to streamline support operations by consolidating "the routine, repetitive support tasks across the enterprise into a single, customer- focused support organization," he said.

To reap those benefits, hurdles must be cleared.

"Cost is certainly a challenge. We are looking at fairly expensive changes to our data infrastructure as well as to our teleconferencing infrastructure," Usher said. The recent modest call-center improvements cost the IRS about $2 million.

Privacy is another key issue, said Tony Trenkle, deputy associate commissioner for the office of electronic services at SSA. "I don't see it as a stumbling block, I see it as an opportunity," he said, explaining that the agency plans to address the issue before implementing technology. "It is easier to do it upfront than to go back and do it."

Toward that end, SSA is preparing to launch a project to explore secure call-center technologies, with the help of Com.merce.Net, a nonprofit consortium of e-commerce companies. The initiative is essentially the second phase of last year's Channel Convergence Proof of Concept project.

In that trial, SSA tested four prototype systems that included several telephony, Web and computer technologies, such as Internet chat, e-mail and voice over IP. The prototypes were assembled by a number of vendors, including Cisco Systems Inc., CosmoCom Inc., Microlog Corp., Microsoft Corp., Nortel Networks Ltd., Sideware Systems Inc., Siebel Systems Inc., Sybase Inc., Unisys Corp. and Vignette Corp.

The new study will use the same proto.types and focus on ensuring authentication of the customer's identity on the front end and privacy of data on the back end, said John Meyer, vice president of collaborative programs at CommerceNet.

Most of the roughly $500,000 spent on the project was borne by vendors, Meyer said. SSA anted up about $200,000 for an evaluation of the proj.ect by KPMG Consulting LLC, according to Trenkle.

Without offering a timetable, he said SSA's ultimate goal is to tie "together the customer service channels." To get there, the organization is following a three-stage strategy: testing the technologies in a secure environment; taking the more promising technologies to a proof-of-concept or piloting stage; and, finally, devising an agencywide strategy for implementing a comprehensive CRM solution.

The IRS is keeping tabs on SSA's efforts, Usher said, adding that the two organizations share similar infrastructures, call volumes and technology goals. Usher said the goal of the IRS' Customer Communications Project is "a virtual call center" or "multimedia portal" that will allow citizens to enter via "their own choice of media and get the information they want."

Because they mainly added capacity rather than new technologies, the latest IRS call-center upgrades represented only an incremental move in that direction, Usher said.

During the past year, the IRS has added network pre-screening of calls, or network prompting, and voice recognition capabilities for callers using rotary phones. The agency also upgraded its telephony infrastructure to increase call management capacity.

Many of the improvements were the result of upgrading to the latest version of Aspect Communications Corp.'s call-center software. IRS call centers have used Aspect software for 10 years to route phone calls to appropriate agents at the different call-center facilities. The software upgrade enables the agency to add capacity and new technologies, such as voice over IP, said David Puglia senior vice president of global marketing at San Jose, Calif.-based Aspect.

By enabling phone communications via the Internet, voice over IP would make it easier for the IRS to quickly deploy new centers because it would not be necessary to set up phone trunk lines, Puglia said.

The IRS is unlikely to use all of the capabilities available in the software, Usher said. However, he does expect to add new functions, such as Internet chat capability.

McKenna is a freelance writer based in the San Francisco Bay area.