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Business Journal
Running Call Centers: A New World
Business Journal

Running Call Centers: A New World

by Glenn Phelps

Conventional wisdom once held that the Earth is flat. And why not? It sure used to look that way.

Likewise, conventional wisdom about call centers -- that managing a call center is primarily about managing technology -- seems true on the surface. It takes sophisticated technology, advanced computers, and complex software just for agents to make calls or answer the phones.

Both lines of reasoning seem logical, because they are based on confidence in our own perceptions. And both hold true when all we need is a limited worldview. Who cares if the world is actually round, if we can act like it's flat and be fine?

The problem with this line of reasoning, and the reason call center managers should care about faulty conventional wisdom, is that it represents significant lost opportunity for their centers. As long as explorers accepted the flat-world model, the New World remained out of reach, not because the technology was lacking -- they had the ships -- but because of a failure to imagine and explore new possibilities. Call centers are similarly limited by a management heritage that stems from the industry's birth as technological solution to an operations problem.

The key to exceptional call center performance is no longer technology, but the performance of the people who make the calls and answer the phone. The Gallup Organization has found that it's far better to have a center with average technology and exceptional people than the other way around. The new world of call center management is about structuring the center's processes and systems to support the performance of the person on the phone -- not about routing issues.

In practical terms, that means doing some basic things that would never be considered under most current, flat-earth management philosophy:

  • Get great people to talk on the phone.
  • Get great people to manage the front line.
  • Create a work environment where optimal performance is achieved and maintained.
  • Evaluate and coach performance on the individual level.
  • Create a career path so the best people stay on the job.

These things sound like common sense, and they are to managers who have begun to move away from the tired, old call center model. But there is one serious problem facing managers who try to move away from managing technology and toward managing people: The tools available to them are geared to support management by conventional wisdom. In many cases, those old tools do more harm that good when applied to a new management approach. Explorers need a satellite view of the world, not more telescopes.

A well-rounded perspective

Making clear the differences between management approaches takes just a few examples. There is no better place to start than with the first commandment -- "Get great people on the phone." A flat-earth call center manager might say, "I can barely find enough people to fill the seats in my center now -- how can I be selective? I need to hire every person who walks through the door. I'll take 'em if they can fog a mirror. And I'm looking at moving the center, because I've used up the available labor in this market."

The problems with this attitude are too numerous to mention here, but increased costs for recruiting, hiring, and training are just the beginning. The real killers are dramatically decreased productivity and the long-term consequences of poorly served customers.

The alternative? Find the right people. It might take a little longer, but with the right recruiting effort and selection instrument, it can be done. And business models support patience in hiring; when looking at overall financial results, it's clear that an empty seat is far less damaging to a center than a seat filled by the wrong person.

The principle of "better no one than the wrong one" is even more imperative when applied to the manager's role. A poor manager can ruin his or her entire team. Why would great agents put up with a terrible manager? They won't -- poor managers increase agent turnover and decrease team productivity. No organization can afford to have a front-line manager wreak that kind of havoc on its business.

Often though, ineffective management tools place poor managers in that role. Individuals are frequently promoted into management because they received excellent internal reviews as agents -- the worst possible reason. Internal evaluations generally don't relate to objectively measured job performance, and they also don't indicate management ability. There are excellent tools to recruit and identify people with the talent to be an outstanding manager, but they aren't usually found in conventionally managed call centers.

Creating a great work environment is the manager's job. A surefire way to determine which managers are doing the best at managing their teams is to look at how the teams score on workgroup metrics that relate to positive business outcomes. Gallup does this with an employee engagement survey, the Q12, described in First, Break All the Rules. In this book, the authors describe the importance of a great work environment and how the best managers create it -- and everything they say is applies directly to call centers.

Keeping great agents and managers is another challenge and again, conventional management theory fails to deliver positive results. The most productive call centers are those where agents and managers view the jobs they hold as a career. From a practical perspective, a career means that agents and managers have sufficient opportunity to earn a salary that supports their life goals. It is a difficult task, though, to offer career-level salaries in the cost-competitive call center industry.

The best way to offer an increased salary is to tie it to performance. This is best accomplished through an agent scorecard that directly relates to the value an agent creates for the business. A "new world" agent scorecard contains three types of objective measures: productivity, quality, and customer impact. The agent's pay is based on how well his or her performance rates on the scorecard and not on seniority or experience. An agent who creates twice the value for the organization as another should receive twice the pay. In Gallup's own call centers, the very best agents earn three times the salary of entry-level agents -- and Gallup wants new agents to join those ranks quickly, too, because every dollar a agent earns in salary represents revenue produced for the organization.

The bottom line

The question is simple: Does your call center want two people each doing one unit of work or one person doing two units of work? The answer is as clear as the question is simple -- you want one person who can do twice the work of an average, or below-average, performer.

Does all of this stuff work? If a call center manager decides that the world is round and that new opportunities are just beyond the horizon, what results may she find in her new world call center's future? One of the best examples comes from Gallup's own centers. Six months after acquiring a call center, Gallup measured the improvements:

  • a 48% increase in the number of projects completed
  • a 40% decrease in the number of agents required to do the work
  • a 240% increase in per-person productivity
  • agent retention increased from 14% to 83%
  • agent pay increased 70%
  • cost per completed call decreased 42%

Gallup has seen similar results in its other call centers and with those of its clients. It's hard to discard old ideas about how the world works, but for businesses looking for new value and new horizons, there may be no better place than to start than a new-world approach to managing their call centers.


Glenn Phelps, Ph.D., is a Senior Consultant with Gallup.

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