Posted in Big Data, Call centers, Computers and high tech, Forecasting, Human resources, Services, Technology, Uncategorized, tagged Big Data, Human resources on April 22, 2013 |
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We have already written in the past about the use of data analytics to best route customers to agents based on demographics and other characteristics. The NY Times has an interesting article on the use of data analytics to improve retention and employee-employer relationships (“Big Data, Trying to Build Better Workers“)
The article discusses the broader appeal of these ideas, but focuses on applications to call centers. Why call centers? In contact centers, customer service agents, that are hourly workers handle a steady stream of calls under challenging conditions, yet their communication skills and learning capabilities play a crucial role in determining both the employee’s tenure and performance. The article discusses a new startup, Evolv, which helps firms find better-matched employees by using predictive analytics.
Transcom, a global operator of customer-service call centers, conducted a pilot project in the second half of 2012, using Evolv’s data analysis technology. To look for a trait like honesty, candidates might be asked how comfortable they are working on a personal computer and whether they know simple keyboard shortcuts for a cut-and-paste task. If they answer yes, the applicants will later be asked to perform that task.
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We would be remiss if we did not note that this weeks Economist has a special series of articles on outsourcing and offshoring. The general theme is that after rush to send a variety work to cheaper locations, many firms are reconsidering and bringing some work back home. The rationales range from underestimating the impact of long lead times and the difficulty of coordination across continents to a belief that doing work in-house allows for greater flexibility. On the whole, the report is well worth reading. One article, however, stood out for me. It looks at the increasing use of automation in service centers (Rise of the software machines, Jan 19).
IPsoft is a young company started by Chetan Dube, a former mathematics professor at New York University. He reckons that artificial intelligence can take over most of the routine information-technology and business-process tasks currently performed by workers in offshore locations. “The last decade was about replacing labour with cheaper labour,” says Mr Dube. “The coming decade will be about replacing cheaper labour with autonomics.”
IPsoft’s Eliza, a “virtual service-desk employee” that learns on the job and can reply to e-mail, answer phone calls and hold conversations, is being tested by several multinationals. At one American media giant she is answering 62,000 calls a month from the firm’s information-technology staff. She is able to solve two out of three of the problems without human help. At IPsoft’s media-industry customer Eliza has replaced India’s Tata Consulting Services. …
A small British start-up, Blue Prism, has developed a software-development toolkit that allows people within a company to create their own software “robots” to automate business processes. … An onshore information-technology worker may cost $80,000 a year and an offshore one perhaps $30,000, wrote James Slaby, HfS’s research director, in a recent report. But Blue Prism’s robots cost at most $15,000 a year. They can perform only routine, rules-driven tasks, but there are plenty of those about.
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American Express runs its call centers differently. No scripts. No high pressure on handle times. Instead, they put a focus on relating to customers and evaluate agents on how the customers they interact with answer the question “Would you recommend this company to a friend?” Fortune has an interview with Jim Bush, American Express’ EVP of world service, who has overseen this change (How can American Express help you?, Apr 19). (Dedicated readers of this blog with long memories might recall that we posted on this about a year and a half ago.)
He makes some interesting points on their philosophy in running customer service — starting with the fact that they view call centers as serving customers, not processing transactions.
The perception of service is that it’s all about problems. Problems are actually a very small percentage of why customers interact with American Express. What we’ve learned is that the power of that interaction gives us an opportunity to expand the perception of the brand in a very positive way.
There’s a tendency to see service as a sunk cost — the customer is reaching out to you. So people say, “It’s a cost. Let’s look to eliminate it.” And over time we can eliminate friction points, which eliminates the need for some customers to interact with us. But the reality is, it’s a very powerful opportunity to build a relationship.
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Posted in Call centers, global operations, Human resources, Operations Strategy, Services, Uncategorized, tagged Call Center, Friends, India, outsourcing, Phlippines on November 29, 2011 |
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One of the goals of the Operations Room is to equip its readers with the ability to converse knowledgeably on all-things operations. In our board meetings, we tend to imagine situations in which such knowledge will be of at-most importance. Thus, we were very happy to see that the NY Times (“A New Capital of Call Center“) covered a story we already covered before (“Call centers in Manila“,) so when a reader would be invited to an operations- oriented cocktail party, and confronted with the question “what’s the world capital of call centers”, said informed reader would not be left speechless.
Over the last several years, a quiet revolution has been reshaping the call center business: the rise of the Philippines, a former United States colony that has a large population of young people who speak lightly accented English and, unlike many Indians, are steeped in American culture. More Filipinos — about 400,000 — than Indians now spend their nights talking to mostly American consumers, industry officials said, as companies like AT&T, JPMorgan Chase and Expedia have hired call centers here, or built their own. The jobs have come from the United States, Europe and, to some extent, India as outsourcers followed their clients to the Philippines.
As several observers point out, this change reflects the maturations of the outsourcing business that now focuses on more than just pure cost and a somewhat superficial view of language. In the early days of this industry, as in many other industries that attempt to outsource, firms focused on finding call centers in English speaking countries with low wages. India was a good solution, and developed a whole industry around Business Process Outsourcing in general, and call center outsourcing in particular. Wages in India are still significantly lower than in the Philippines ($250 a month in India, rather than $300, at the entry level in the Philippines).
…but executives say they are worth the extra cost because American customers find them easier to understand than they do Indian agents, who speak British-style English and use unfamiliar idioms. “It helps that Filipinos learn American English in the first grade, eat hamburgers, follow the N.B.A. and watch the TV show “Friends” long before they enter a call center. In India, by contrast, public schools introduce British English in the third grade, only the urban elite eat American fast food, cricket is the national pastime and “Friends” is a teaching aid for Indian call center trainers. English is an official language in both countries.
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So which country is a bigger market for off-shored technology services, India of the Philippines? According to Market Watch, the latter is the answer (Philippines lifted by outsourcing boom, Jun 15).
The Philippines’ fast-growing business-process outsourcing industry has turned the Asian nation into a major center for off-shored information tech services. The country recently passed India as the world’s top outsourcing destination, according to a report by the services arm of International Business Machines IBM +1.09% — which has a major presence in the country. …
“Ten years ago, we had maybe about 25,000 people in the industry,” said Jose Mari Mercado, business development director at Convergys in the Philippines, who said that number reached about half a million last year.
“The interest in the Philippines has really grown tremendously in the last five years,” he added.
While business outsourcing is typically associated with call centers, the industry actually covers a range of IT services, including customer relations, human resources, accounting and even more specific functions, such as mortgage processing.
In 2010, the Philippines’ IT and business process outsourcing grew 26% to $8.9 billion, according to the Business Processing Association of the Philippines. Workers and professionals employed by the industry grew by 24%, the industry association said.
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We have had a couple of recent posts about firms trying to get more out of their call centers through psychometric data. The idea is that by classifying both customers and agents along psychometric dimensions, the firm can route callers of a particular characteristic to the type of agent that is most likely to lead to a good outcome (where “good” is presumably defined based on what the firm wants). I have to admit that I am not overly familiar with what psychometric measures they are using and am not sure how well they can measure these with infrequent customer contact. At some level, this starts to sound like whether a libra should date a taurus.
With that background, I found a recent Sloan Management Review article really fascinating (Matchmaking With Math: How Analytics Beats Intuition to Win Customers, Winter 2011). It is an interview with Cameron Hurst, a VP at Assurant Solutions. Assurant Solutions sells credit insurance. You pay them every month and then if you are, say, laid off they help cover your credit card bills. What customers pay ranges from $10 to $80 per month and it is not hard to see that some people may have second thoughts about paying that. What seemed like a good idea six months ago might not seem worth $20 now. Hence, their call center plays a key role in keeping customers. When customers get cold feet, it is up to call center agents to “re-sell” them on the product and retain the business. And that is where “affinity routing” comes in. They brought in some business analytics experts who already worked in the firm but doing actuarial work and such and asked them to look at the call center.
The first thing that was interesting about their approach was that rather than thinking about the average speed of answering phone calls, or the average “handle time,” or service level metrics, or individual customer experiences or using QA tools to find out what we did right and what we did wrong — all the things we usually consider when looking at customer and representative interaction — they started thinking of it purely from the perspective of, “We’ve got success and we’ve got failure.”
Success and failure are very easy things to establish in our business. You either retained a customer calling in to cancel or you didn’t. If you retained them, you did it by either a cross-sell, up-sell or down-sell.
So this is what they started asking: What was true when we retained a customer? What was true when we lost a customer? What was false when we retained a customer? And what was false when we lost a customer? For example, we learned that certain CSRs generally performed better with customers in higher premium categories while others did not. These are a few of the discoveries we made, but there were more. Putting these many independent variables together into scoring models gave us the basis for our affinity-based routing.
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From Belgium, a creative approach to exacting some revenge on a telecom provider with a disappointing customer service record. Reading the subtitles is pretty amusing. Judging by how much the Belgian in the office next to me laughed, the Flemish is just hilarious.
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1 to 1 Magazine had an interesting article on matching customers and agents in different call centers (“Customer Service: Matchmaking in the Call Center“)
Skills based routing, i.e. the concept of routing customers to agents based on the customers’ needs and the agents skills, has been around for several years already. The idea of having the right agent, at the right place, at the right time is very intuitive and appealing, yet is not as simple when it comes to its implementation.
For many years, the main difficulty was how to best route customers given that we know the customers characteristics (and problems) and given that we know the skills sets of the agents. For example, if a customer speaks Spanish he can be served by agents that speak only Spanish and agents that speak Spanish and English (say). The main issues are: (a) the more skilled the agent, the more expensive he or she is, and (b) determining the actual priority rule that ensures that all customers receive adequate service.
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Fast Company had an interesting article on the technology being pushed by firm called eLoyalty to improve call center operations (How a Personality Test Designed to Pick Astronauts is Taking the Pain Out of Customer Support, Dec 1). The roots of this approach date to a methodology developed by a clinical psychologist to categorize personality types.
The methodology, called the Process Communication Model, was created in the 1970s by a clinical psychologist named Taibi Kahler. He divided people into six main personality types, each of which has a different communication style and each of which has different stress triggers. If you know the personality type of the person you’re speaking with, Kahler explained, you can modify your own communication style to work more effectively with them, prevent misunderstandings, and avoid inadvertently pushing the other person’s buttons.
Apparently, this approach has been used by NASA to determine who’s got the right stuff to for space missions. But how does this apply to call centers?
In call centers, eLoyalty’s system uses the PCM framework to compile a personality profile of each caller from the moment they first contact the center. The system, which is automated, analyzes the caller’s language patterns and other behavioral cues to identify their personality type. (A team of 250 linguists, behavioral scientists, and statisticians have compiled a massive set of linguistic libraries and behavioral algorithms to parse callers’ every word and mode of expression.)
Each time the customer calls back, the system uses the existing profile to steer them to a customer service representative who’s the best match for their personality type, and it continues to analyze their subsequent conversations to deepen and enrich their profile.
eLoyalty, which has clients in the banking, health care, and insurance industries, among others, is the only organization in the call center industry licensed to use PCM. Typical call center quality assurance programs train reps in specific issues and rely on supervisors listening in to a small percentage of calls, and providing coaching to individual reps. The automated eLoyalty system not only allows a larger proportion of calls to be analyzed, but it moves coaching out of the realm of intuition and grounds it in evidence about how to communicate effectively.
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I am getting geared up for teaching my service operations elective this fall. I was consequently intrigued when a colleague forwarded a New Yorker essay to me on the “crisis” in customer service (Are You Being Served?, Sept 6). The article unfortunately is fundamentally disappointing. It begins with discussing the response to Steven Slater, the irate Jet Blue flight attendant, and noting that customer service workers are “frustrated … with stagnant pay, stressful working conditions, and obnoxious customers.” It then moves to observing that “everyone knows that the contemporary customer is mad as hell, too—fed up with inept service, indifferent employees, and customer-service departments that are harder to negotiate than Kafka’s Castle” before asking “When it comes to customer service, it seems, people are unhappy no matter what side of the counter they’re on. Why can’t we get it right?”
The analysis that follows then isn’t much. Yes, customer service is generally managed as a cost center, and that is going to put a premium on efficiency over pampering. Yes, companies are usually eager for growth and that means they are going to be scouting for the next customer as much looking after the ones they have. But that all seems old hat. One of the most basic frameworks in service management is the service profit chain. It is built off the idea that customer loyalty is the driver of profitability. It’s a useful way of thinking about some issues but I have been sorely tempted to drop it from my course because by the time I have students in the elective they are so tired of hearing this point. I start by noting that loyalty matters and they roll their eyes and start to doze off.
So what then is the way out of this customer service crisis? (more…)
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