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What we can learn from call centers: Humanize.

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Call centers might be the front line in the war between traditional command-and-control approaches to management and the third way of work.

Alex Pentland found that the best predictor of performance in a call center he was researching was the level of engagement of the teams outside of formal meetings. It was the informal socializing that led to the best behavior, and so he arranged the almost unthinkable: instead of organizing their work schedules to optimize greatest numbers of staff on the phone, he organized to increase the number of workers on breaks at the same time, to increase socializing.

The result? As Pentland said,

It worked: AHT [average handling time] fell by more than 20% among lower-performing teams and decreased by 8% overall at the call center. Now the manager is changing the break schedule at all 10 of the bank’s call centers (which employ a total of 25,000 people) and is forecasting $15 million a year in productivity increases. He has also seen employee satisfaction at call centers rise, sometimes by more than 10%.

So, dismantling the ‘cut costs’ mindset leads to new sources of performance arising spontaneously from the social interactions of the staff formerly being treated like numbers in a spreadsheet instead of living, breathing human beings.

This can go even further. Jim Bush took over the Amercan Express service operations in 2005, as described by Rob Markey in HBR, and inherited the call center operations for the company. That was being managed with the same ‘by the book’ approach, including requiring staff to follow highly scripted responses to customer requests. He decided to through the book away, and dropped the focus on call time. He stated that the support representatives would set their own pacing, and — within clear limits — were empowered to help clients with all the tools at their disposal. He professionalized the job, calling them customer care representatives and providing them with business cards and other symbols of status. He began hiring for people with experience in retail and hospitality business instead of call centers, people with the right personality profile for making customer’s happy. He started paying higher salaries, to hold onto the best people. He upped training, and made clear the company’s doctrine to provide the best customer service within the restrictions of company policies.

Bush switched to a single metric: Net Promoter score — the percentage of callers who, when asked, said they would recommend American Express to a friend. And the company moved to a very fast feedback system, so that staff could see what they were doing well and where improvement was needed. And numerous opportunities were created to allow more training, both formally and informally between reps.

As Markey summarized the results,

Call-handling time edged up slightly at the very beginning, then dropped and kept falling. Likelihood-to-recommend scores doubled, indicating far more enthusiastic advocacy of American Express on the part of customers. Employee attrition was cut in half. Within just three years, the company saw a consistent 10% annual improvement in what Bush calls “service margins.” The company began to win the J.D. Power customer service award in credit cards year after year.

The bottom line is this: every part of the business needs to be made as human as possible, in order to gain the inherent leverage of social connection. That requires breaking the barriers between people, whether those are business processes, schedules, or policies intended to theoretically optimize the wrong metrics — like the length of calls — while missing the important ones, namely customer satisfaction and workforce turnover.