Not many times the parliament of a country requires its government to enforce strict quality of service requirements on call centers of firms in the private sector. But this is the case since December 12th, 2012 in Israel (“Israel: New Law Demands Live Telephone Support” and in Hebrew). I am not sure what I find more alarming and hilarious: the law (and its specificity) or the decision to begin the regulation on 12/12/12:
A Knesset committee has taken a step forward towards protecting and assisting consumers, now setting into place a new regulation. When one calls a company for support, a live person must be on the line within three minutes. Alternatively, the company must offer a call back option during this same period, and the caller must received a call back within three hours of calling the company for assistance.
Laws that require timely response are not entirely new. We already covered the regulation in California that mandates a maximum waiting time for an appointment from HMOs. The main idea of that law is to make sure HMO’s provide adequate service with the resources they have. Since patients that belong to an HMO have very few choices, such a law is necessary. Furthermore, since this law pertains to health care services, it is easy to argue that time is a crucial aspect of the quality of care.
Now back to the Israeli Law. This law regulates the speed of service for customers calling the call centers of the major service providers, such as financial and communication services. The law requires a human response within three minutes, or offering a call back option. The law also provides a very specific schedule for the call back: they have to be made within three hours. For those staying on line, firms must provide information on their location in the queue. It is not clear to me why a government should regulate quality of service in competitive markets. These markets are quite competitive when it comes to pricing (some are not, and there I can see the point of such a law). If customers are not willing to punish firms that offer poor quality of service, why should a law do that? It is also not clear that it is socially efficient to push firms to improve the quality of service, if customers do not value it enough to take an action. I can see a situation where the market divides itself into two firms and two customer segments: one firm offers a superior service at a premium and attracts the customers who value such a service. A second firm offers a lower quality service, at a lower price for those who cannot afford the higher cost. Furthermore, if the idea is to regulate quality of service, this is really not the way, since it is very easy to provide a meaningless response within three minutes. I do not see the law getting into better measures of quality of service, such as First Call Resolution, since these are difficult to measure and thus regulate.