Customer Reach April 2012
VOLUME 9, ISSUE 4 APRIL 2012 ISSN 1718-8938
Inside this Issue
Why is Most Call Center Service So Bad? 1
US Call Center Industry sees Negative Growth 4
JC Penny Closes Pittsburgh Call Center- cuts 300 jobs 4
How Does Your Call Center Rate? – Find Out Now! 5
Toronto Contact Centre Professionals Network Meeting 5
The True Costs of Turnover 6
2012 Call Center, TeleSales and Customer Service National Salary Guide Published 6
15th Annual Customer Service Conference, “Transforming the Customer Experience”. May 10-11 7
GTACC – Spring Event 8
Case Study 9
Why is Most Call Center Service So Bad?
By: Colin Taylor
We have all had the experience, we phone our cable company, wireless provider or our utility and Bang! The pain and suffering begins: “Your call is important us, Please hold”. Well if my call was really important I would have thought you would have answered it. Of course some hold messages can be even more frightening: “We are experiencing higher call volumes and you should expect a longer than average hold time”. No I don’t make it a habit to phone my wireless provider often enough to know what their average hold time is, but I am scared nonetheless. Perhaps the standard greeting announcement should be replaced by “Abandon All Hope Yea Who Enter”, a little dramatic, but perhaps more accurate.
Then when I finally reach an agent can they help me? Am I able to get done what I want to get done? The answers to these questions often depend upon the organization and the complexity of the question I asked. In some cases the center is quite helpful and able to provide me with the information I seek quickly, effectively, completely and professionally, with other centers it is more like phoning the call center in those old Capital One ads that featured David Spade. None the less research has repeatedly shown that while the quality of mercy is not strained the quality of customer service call center often is strained. The expectation of poor service has become engrained in our society. Comedians quip, television ads for Capital One and CarMax entertain us with bad service experiences and the twitterverse is alive with hundreds of thousands of people complaining about their call center or customer service experiences- hashtags #custserv, #callcenter and #cctr. Why do so many organizations deliver poor service?
Research Proves Service is Bad
I would like to propose some highly intelligent and provocative explanation, but unfortunately I feel the truth is much simpler. Companies and organizations don’t care. It’s not that they necessarily want to not care it is just that they don’t. There are too many other priorities and ‘more important fish to fry’. The research on this topic backs me up: 86% of consumers quit doing business with a company because of a bad customer experience, according to Harris Interactive. That figure is closer to 73% said Gartner. American Express found that Customer Service Experiences generally….’
•Exceed Expectations – 2%
•Meet Expectations – 62%
•Miss Expectations – 32%
•(4% weren’t sure!)
In fact 90% of executives see Customer Service as crucial to their future business success. In the same study more than 70% of senior call center executives revealed that their companies fail to meet their customers’ expectations, according to Bain.
So we have a strange dichotomy. Organizations know that good customer service is essential to their future success, they understand that there is a real tangible cost and risk of dissatisfied customers defecting and yet these same organizations seem incapable of affecting change.
They say that the first step to dealing with a problem is to first to admit you have a problem. Well we as the customers of these organizations we may see the problem, as call center and customer professionals we may recognize the problem, but the organizations in question do not seem to recognize this. Why is that, businesses are full of bright, knowledgeable and skilled professionals.
Is it as Dave Farrell suggests in his recent article Why Do Companies Give Bad Customer Service? “We have a Contrary Point of view. A point of view is simply how you view, judge or appraise things. How you see things determines how you act. How you act determines your results. In the world of Customer Service it would look something like this; a customer calls in and has an issue. Lets say that I see customers as people who will lie through their teeth to get what they want. My point of view of the customer will determine how I act toward them. I am much more likely to be defensive and argumentative. The customer then will deal with me however they deal with defensive argumentative people. The result won’t be pretty.”
Or perhaps as Grant Nieddu pointed out in a Linked In post “Companies give bad customer service because they see that it is far cheaper to pay for a corporate rally and “mission review” teams than to over-haul their tactical processes. Rewording personnel reviews, restructuring the training process, and, gasp, revisiting incentive programs is far more costly and takes more time. You can learn, execute and train a culture of quality customer relationships, as long as you are willing to invest the time and money to do so. Companies that give bad customer service simply do not believe in the investment.”
Both of these experts raise good points, we can certainly project our feelings and perception to others and define the service process from this perspective and as Grant said we certainly can’t discount the fact that some organizations are just cheap, but I think that the single biggest factor contributing to bad customer service or as my kids would say Customer Service that Sucks, is… drum roll please…..wait for it… neglect.
Neglect Equals Bad Service
Sorry to let you down after the big build up but let me explain. There are a number of types and forms of neglect that can lead to poor service.
The first one I will deal with is complete neglect. This is most common in SMB’s with small call centers where the center is not really considered as a major part of the enterprise. They are neglected, their costs and budgets roll up into other much larger budgets like Operations, IT or Sales and senior managers and executives do not any visibility into what is really going on in the call center nor, likely do they really care. It is neglected. Of course this can change dramatically once the call center reaches that special threshold, whose level varies by organization, but it is when the call center actually appears as a line item on the monthly P&L. The first time this happens you can almost hear the screams of astonishment from the executive suite, “We are spending what on the call center!” In centers receiving this form of neglect they will generally be underfunded- trying to do more with less, significantly lack appropriate technologies to serve customers and be struggling to meet their service performance and targets. The operation of the center is usually in a vacuum, they are disconnected from the organization and only dimly aware of the company’s goals and aspirations. With insufficient staff, poor processes and technology and no vision these centers struggle day in and day out not to deliver lousy service, but they do not often succeed. This is not good service.
The second form of neglect is neglecting to understand that a call center is a primary communications channel between the organization and its customers. In fact for many organizations it is the primary communications channel and the only meaningful one that facilitates a two way discussion, a dialogue. Failing to recognize this fact leads organizations to undervalue the contribution the call center and broader customer service and technical support plays in sustaining the business. Not only can a call center generate revenue through orders, up-sell and extensions, but the call center also protects revenue already promised through solving issues and fixing problems, many of which were not caused or created by the call center. As my colleague John Cockerill is wont to say “There are only two kinds of calls; Value, where we gain revenue and Fault, where we fix a problem someone else created”. By neglecting to understand the role played by the call center in maximizing lifetime value and customer retention these organizations treat the call center as an after- thought. The call center discovers new campaigns and initiatives only after they launch are criticized for failing to meet patently unattainable goals which they had no part in creating and generally receiving all of the perks and privileges bestowed upon it by ‘mushroom management’. It is in these centers where senior executives will ask if we really need all of those people or even if we really need to answer the phones at all. For the record I have heard that exact statement on two occasions in my consulting career. In centers suffering from this form of neglect they will be generally underfunded-trying to do more with less than none, they will often invest in technologies to reduce costs or create efficiencies regardless of the suitability to the purpose of the center or its potential impact on customers. The operation of the center can be characterized as a cost center, in a way that informs you that this is a very bad thing to be. There will be calls to transform the center to a profit center, to reduce costs and to increase productivity. Of course all of these activities can be positive however they are all but doomed to failure if they are not connected to the desired customer experience and the service quality the organization wishes to deliver. With insufficient staff, poor processes and technology focused on reducing volumes and/or reducing transaction times these centers make it difficult for their customers and when they get an answer they rush them off the phone. This is not good service.
The third form of neglect is complicity in these organizations the call center is acknowledged to exist, its role appreciated and generally understood and there is an agreement on the value the center delivers to the organization. Senior executives look at their weekly dashboard reports and might comment on the change in service level or abandon rate. All may appear to be happy in ‘mudville’, but that is not necessarily so. The company having invested in people and technology to equip the center to do its job and recognizing its value reviews and scrutinizes the weekly reporting can feel that its job is done. You can almost hear them saying, “There now the call center is completed and we won’t have to worry about that again”. In the call center itself this stage can be the most frustrating as it begins with such promise; spending on headcount to match the demand, acquiring new technologies etc., but it soon grinds to halt coming face to face with the perception that ‘we did this (the call center) and now we are done’. The conversations go along the lines of “why do you need more people, you just hired 6 last quarter”, or “Last year we spent X million on your techno-goodies so you will have to make do”. All of the hallmarks are there of a professional call center engaged and integrated into the business, but it is not really so. The center likely struggles with scheduling and a disinterested and high turnover workforce, adequate technologies give them a fighting chance, but the absence of integration to the company vision and low level of agent experience condemns it to deliver inferior service.
It is clear from the above that neglect can take many forms and that these various forms of neglect can handicap a call center and ensure that they deliver bad service…service that sucks. Success in delivering Good Customer Service lies in not neglecting your center but rather to paying attention to the center. Organizations have found success by elevating the call centers role within the organization and openly discussing the role the center plays in attracting and retaining customers. By defining the strategic plan for the call center and linking the call center plan to the company goals, mission and values brings everyone onto the same team and speaking from a perspective of alignment. By equipping the center with the appropriate tools to do the job the organization can begin to reap the rewards of this stewardship. Of course this should not be construed to suggest that the call center should be given a blank check. Quite the contrary each desired investment in people, or process or technology should be modeled, justified and be confirmed to be in line with the call center strategy and the broader goals and objectives of the business. Any requested investment that doesn’t make economic sense and/or fails to align and support the business goals must be discarded until a more suitable and appropriate solution can be found.
There is no excuse for an organization to have poor service the cause can includes neglect, lack of funding or perhaps even projection. But if there is no excuse for bad service why hasn’t somebody done something about it?
There are likely a million reasons that have been cited by other authors, experts and pundits, but I would suggest that the simplest reason is that companies don’t have to improve service. We expect poor or at least difficulty in resolving customer service issues Forrester Research found in some verticals such as computers and health insurance only 30% of consumers expected customer service to be easy. We often expect to have a fight on our hands. If this is the view of the customer, then is it any surprise that organizations steel themselves for the conflict with restrictive policies and penalties for changes.
The Way Forward
Of course at the same time this expectation of poor customer service creates an opportunity for those organizations able to rise above the din and actually deliver superior service. They could be motivated by a sincere and genuine wish to deliver better customer service to their customers or they may simply realize that happier customers stay customers longer and spend more money with you.
But this can on the surface appear to be a risky strategy, to spend more money to improve the quality of service, staff, technology and processes and then to wait and hope it pays off. But maybe it is not so risky. Research from American Express found that 61% of Americans report that quality customer service is more important to them in today’s economic environment, and will spend an average of 9 percent more when they believe a company provides excellent service.
A few organizations are bravely marching forward carrying the ‘Superior Customer Service’ banner. Some of these organizations have achieved fame and success others are just quietly reaping the financial benefits. Zappos has defined itself as a Customer Service organization that just happens to sell shoes and has created a cult of believers. F&C has been recognized as the best call center in the UK by exceeding all service parameters. And American Express, well it is their research cited above that tells us that customers will pay more for better service; it appears that they are walking the talk. American express derives their customer satisfaction scores directly from their customers and this CSAT score has replaced the internally generated quality score that they used to rely on. Satisfaction is in the eye of the customer, it is as simple as that.
So we are not forever doomed to suffer through endless IVR call trees, hours on hold only to speak with an ill-tempered and poorly trained agent. We needn’t abandon all hope when we enter the customer service queue. We must simply choose to patronize organizations that deliver superior service. Voting with our feet and our wallets is the best way to encourage lagging organizations to cease their policies of neglect and embrace the new maxim of better service equals more and happier customers.
Hopefully and not to far in the future companies will no longer be able to provide poor customer service because they can get away with it, customer service laggards are going to be punished by the market and forced to change their ways. At least that’s what my crystal ball says.
US Call Center Industry sees Negative Growth
The month of April saw the US call center industry actually contract by approx 675 jobs after months of positive growth. The net reduction was cited in the April 2012 Call Center Openings & Expansions Report, published by the Site Selection Group.
Based on major announcements of openings expansions and closings the report saw global increase in call center jobs of almost 4,000. 61% of the increase in new call center jobs was found in the US, but so were job losses of approximately 8,600.
The biggest job creation announcements were Apple creating 3,600 jobs in their Austin TX campus and Wells Fargo creating 1,500 jobs in Tagiug City in the Philippines. The largest reductions were seen at T-Mobile who eliminated 3,000 jobs.
For the first time in a number of months there were two new job creation announcements in Canada. Canada has struggled under a strengthening dollar and weak demand from US clients for its near-shore call center solutions. Announcements by Northstar of 288 jobs in Fort Erie and Transcom with 150 new jobs in Barrie ON represent a small amount of good news for the Canadian industry.
JC Penny Closes Pittsburgh Call Center- cuts 300 jobs
Former Apple, Inc. executive Ron Johnson continues to make his mark at J.C. Penny. The company is going through large changes, and the customer service call centers are not escaping the close scrutiny:
J.C. Penney Co. announced Thursday that it will close its Customer Call Center in Pittsburgh, and eliminate 300 associates.
The company laid off 600 associates, or 13 percent of the staff at its headquarters in Plano, Texas, as the department store chain looks to streamline its operations amid a major reinvention of the business.
The company had hinted that cuts would come when it told investors in January that it planned to reduce layers of management at its headquarters. Before the layoffs, the company had 4,400 employees at its headquarters.
The announcement is part of the Company’s plan, announced on Jan. 26, to reduce annual expenses by $900 million by the end of 2013.
The moves come as its new CEO, former Apple Inc. executive Ron Johnson, is transforming every aspect of its business, from pricing to the brands it carries.
How Does Your Call Center Rate? – Find Out Now!
The Snapshotz Online comparator is designed to serve as a guide for contact center management to get a view quick view of where their center sits vis-à-vis other centers in the same vertical worldwide.
The comparator is drawn from data across the 400 plus centers that use Snapshotz as an audit and benchmarking tool.
Snapshotz Online contains over 700 plus data points and provides a holistic approach for assessing and managing a contact center. Whilst a summary report amongst more detailed reports are available when the tool is used, this comparator only uses 8 of a potential of 30 key elements to summarize the Snapshotz scores achieved by Best Practice Centers (the top 25% of users of the Snapshotz tool).
How to use the comparator.
Step 1: Please confirm your vertical industry you belong to (10 seconds approx)
Step 2: Complete the self assessment (30 seconds approx)
Step 3: Let us know who you are so we can send you the comparator results via email
Click here to compare your center
Toronto Contact Centre Professionals Network Meeting
The Toronto Contact Centre Professionals Network Group is planning their inaugural meeting in late May, and would like your input. We are planning on holding the event in the North end of the city. The date and location to be confirmed. The group has solicited member input in terms of the topics and content for the meeting and suggestions for topics. The current choices for topics is shown on the chart below;
We invite members of the TCCPN group to vote on the topics they would like to see addressed during this meeting. If you are a contact centre professional in the Toronto area, use Linked In, and would like to join this group please email Colin Taylor and request and invitation.
The True Costs of Turnover
The following statistics are food for thought when we consider the real costs of turnover in our organization.
Halogen Software shared the following information
“The cost of losing good talent is particularly acute and one of the most direct calculations that demonstrates the impact of poor talent management.
• HCI research shows that at a minimum the cost of losing good talent is 1.5 times the employee’s fully loaded salary.
• David Ulrich says that top performers are valued at two to four times the performance of competent employees.
• Dr. John Sullivan quantified that when a top performer does leave, it costs the organization $7,000 a day to operate without them if they are in a strategic position.
These statistics attest to the morale, corporate memory and momentum that also walk out the door when you’ve got bad turnover.”
When looking at the above figures the average call or contact center may suggest that these costs are overstated, but they costs may cause us to reconsider the $5,000 to $7,000 per employee turnover cost that many call centers employ.
2012 Call Center, TeleSales and Customer Service National Salary Guide Published
The 2012 edition of the Call Center, TeleSales and Customer Service National Salary Guide, has been released by Telemanagement Search. The Salary figures in the guide were compiled during the last quarter of 2011.
While salaries reported in the 2012 guide have been relatively flat over the previous year, the big news for 2012 is the tremendous increase in the number of call center executive and management searches we are receiving from companies located all over the country. Especially noteworthy is the amount of recruiting activity in Southern California, an area that has been especially quiet over the last few years.
In the first quarter of 2012, we have seen a 34% increase in the number of searches we have been asked to conduct in the $100,000+ base salary range and a 27% increase in positions paying a base salary in the $75-100,000 range.
Telemanagement expects this trend will continue for the balance of 2012, resulting in an escalation of salaries as the year progresses. In addition, for the first time since recent economic downturn, some job seekers have been receiving multiple offers, a sure signal that a recovery is finally underway.
Connie Caroli of Telemanagement told Taylor Reach that they will send a PDF of the full Guide free of charge to Customer Reach readers if they provide their Name, Title, Company Name, and email address. You can reach Connie at email@example.com and you can visit their website at www.tmrecruiters.com .
If you haven’t signed up yet, there is still space available!
ICSA Toronto Chapter has managed to round up 14 tremendous speakers over two full days who are sharing the most valuable information in the industry. You can’t find quality like this anywhere else. Hear representatives from Service Ontario, Transat Holidays, SNC Lavalin, Ricoh Canada and others tell their service stories and discover new an innovative ways to transform the customer experience for your clients.
14 speakers over two days? It must be expensive to attend! WRONG. We appreciate our members so much that we have kept a very reasonable and affordable price just for you. While other conferences cost into the thousands for two days, you can attend the entire ICSA conference for as little as $699, which includes extra perks such as continental breakfast, lunch, free parking, delegate workbook, door prize draws and of course, 14 world-class presentations.
ICSA’s annual conference always draws the biggest and brightest stars in customer service. Everyone who attends the ICSA conference is looking to gain and share information to improve the way their organization delivers every customer experience. These decision makers are also on the constant look-out for the most talented people in customer service. Don’t miss your opportunity to meet and speak with the best!
Each year for the conference, we attract high quality vendors who provide quality business and consulting services relating to customer service. Their goal is the same as ours: to help you improve the customer experience you provide. This is a great way to network with vendors who are endorsed by the ICSA for the professional work they do.
5. Dedication and Recognition
Okay, this might be two reasons to attend, but everyone who registers for the conference is showcasing their dedication to transforming the customer experience. ICSA acts as a platform for those who attend to brand themselves as customer service focused. Our members receive constant recognition and are promoted to the business world and consumer world as leaders and innovators in customer service.
Why do we host an annual conference?
We believe customer service is the differentiator between our members and their competitors. Get a step on your competition! Join us on May 10th and 11th and find out just how powerful your customer service can be. You can view the conference program here.
GTACC – Spring Event
Sangeeta Bhatnagar of GTACC has announced the next GTACC event.
Happy Spring! It has been a couple of months since our last session, but it will be worth the wait!!!! We are bringing you a GTACC workshop right on the leading edge!
Clear your calendar on Wednesday May 16th. We have 3 different speakers, each lending their unique perspective and expertise in the Mobile Commerce space.
On our esteemed panel we have Sarah Gowdy – Director Mobile and IVR Banking, Scotiabank, Aran Hamilton, Managing Director of Venture Grower Inc., and Kelly McDonald, Manager | Consulting | Technology Systems Integration –Deloitte.
Where: Toronto Don Valley Hotel (DVP/Eglinton) Entrance is off of Wynford Drive
Why: Be on the leading edge with GTACC and learn from those leading the way!!!
Who: Anyone in the Contact Centre Operations looking to gain knowledge, share with peers and network with other professionals!
We are limiting the size of this event to ensure that it is fully interactive. To ensure you have a spot please Register here. Vendor seating is limited to GTACC sponsors.
For more information please visit the GTACC group on Linked in.
In this regular column we review the successes that Taylor Reach is part of.
Facilities Management Firm Builds on success!
A new call centre was built by a large facilities management company in eastern Canada a few years ago. It had not delivered the promised savings or effectiveness anticipated. Turnover was a constant issue as was the skills of the staff hired. Long call times, poor service levels and low morale all contributed to the lack of success in the center.
TRG began the Strategic Assessment, a full end-to-end review of each of the ‘moving-parts’ within the call center infrastructure. The engagement assessed the people in the call center, their skills and competencies, the processes, procedures, operational methodologies, technologies, quality and service practices and business objectives. Special focus was given to the recruiting, staff training and scheduling.
The firm employed adequate telephony technologies but had not invested in self-service or workforce management solutions. The recruiting and training was inconsistent and piece meal. The technology was limited and slowed the agent responses to the client’s requests.
A plan was devised to focus on three key interrelated areas: Recruiting/Training, Technology and Forecasting. Knowing what the forecast for call load was would enable better planning in the recruiting process and staff scheduling. Technology and specifically the agent desktops were changes were recommended to improve response time and reduce the overall call length by over 40%. Key tests for recruit skills and attributes were advised to reduce the problem hires and speed the hiring and training of competent staff.
The large facilities management company was provided with a detailed list of recommendations that if followed were likely to reduce call length by 40% while improving customer service and agent occupancy. The initial upgrades have to date realized call length reductions in-line with the TRG estimates. Training of recruits was to be done in groups or cadres in order to develop consistency and better use of trainers’ time. Recommendations for changes to the take on of new clients and business assured that both existing and new clients received the service they deserved.
“We were very satisfied with The Taylor Reach Group’s work as they helped shape a much more productive and profitable Customer Service Dept. at Aldo.”
Vice President, Aldo Group
“I really enjoy Colin’s’ writing style and the info he conveys in his articles. His thoughts on self service and customer service are brilliant. I would highly recommend his articles as they can serve as a good primer to anyone interested in improving their customer service or call center capabilities.”
“The new guru of customer service excellence is Micah Solomon” –The Financial Post
Author, keynote speaker, consultant:
Micah speaks, writes, and consults on change and continuity in customer service, branding, company culture, and sales in our revolutionary times.
“Colin is a rock-solid business professional with a deep knowledge of the contact center industry. With honesty, integrity, and excellent interpersonal skills, Colin will tell you what you need to hear, rather than what you want to hear. His exceptional communication abilities allow him to deliver a message without the nonsense, and he is a trusted listener and advisor to colleagues and subordinates alike. He really understands what “partnership” is all about. He is a hands-on leader, who completely understands the requirements, committing and delivering on-time/on-budget projects by rolling up his sleeves and getting the job done. He will do whatever it takes to complete the project and do so with style.”
December 2010 – Vice President-Sales and Service, ING Bank
“Colin’s years of Call Center experience have resulted in him becoming one of the premier experts in this field. He has helped countless companies improve their Call Centre and Customer Service processes, and his monthly Newsletter provides valuable information and advice for all of those who are lucky enough to subscribe. In one place, you can find industry happenings, statistics, advice on problems/questions, case study information and much more. It’s invaluable, and an easy on-line read, which makes it even more valuable in my view. I would recommend contacting Colin if you find that you are having problems providing the service you want in your call centre. Although his business is recommending and providing call centre solutions, he will not hesitate to be honest with you and tell you that with a few changes, you can manage everything on your own. This is an honesty that I value highly.”
Senior Customer Service Executive, Readers Digest Asia
“Colin is one of the leaders in the Contact Center industry. He really understands the key drivers of this business. He always showed me a better way to understand each side of this very complex business. He really helped me to develop my knowledge and view of Contact Centers.”
“Colin’s vision, direction and management style was motivational and inspiring as he grew the business. Working along with him on many new and exciting ventures I admired his ability to build strong relationships with customers and suppliers, his strategic and visionary thinking, business savvy, and his supportive nature for his employees.”
Customer Care Manager, BMO
“John was retained by Advantex to lead a prototyping effort to outsource the sales cycle of a new business concept. John and his team worked diligently on this Proof of Concept, proving that business could be sold over the phone; this was an important step forward for Advantex, in terms of validating the opportunity to decrease the cost of sales, as well as confirming that it was a viable alternative to feet on the street. John took a complex offering, which worked in person, and broke it down to a workable over-the-phone pitch. John was a pleasure to work with every step of the way on this POC.”
“Colin’s depth of knowledge greatly enhanced the results. His recommendations made good business sense, and created a good outcome for the company and the employees. I trusted the research and the deliverable he and his company provided in a timely manner.”
Customer Service Executive, Rodale
“Colin understands the complex service requirements needed to support large multi-channel companies and he is able to articulate those needs to a range of audiences. Once the needs are defined, Colin has the ability to create a roadmap and structure for a given project, communicate the plan effectively, and deliver the desired results within the defined timelines. Colin is a creative thinker and has deep industry knowledge that would make him an asset to any company that engages in his services.”
Senior Contact Center Executive, Best Buy
“John is a true pleasure to work with. A leader in every sense of the word. John has the ability to motivate, guide, and instill confidence – All within a 3-4 minute phone call. You can always depend on John to give a swift and direct cure to any dilemma you may get stuck in.”
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