Contact Centre Expo 2009 - Day One

It's that time of the year again, when most of the UK Contact Centre industry gathers in Birmingham for the Contact Centre Expo.

I covered the Expo last year (see the posts "UK Call Centre Expo" and "UK Contact Centre Expo Day 2") and was interested in the feedback I got as both comments and as e-mails. In the feedback, there was a solid body of opinion that the 2008 Expo lacked much innovation from the vendors. This needed to be weighed against a smaller set of feedback arguing that the show did offer new and valuable ideas, but nonetheless, there was a strong view that the exhibitors needed to raise their game.

I understand where the first group are coming from, but I still find the Expo very useful just because it has so many vendors and customers gathered in the same place and I find innovation a bonus on top of that. There are interesting ideas out in the exhibitor hall (as well as a few rather tired ones) and it's worth going round the Expo to see what is genuinely new.

So the stands that worked for me in the exhibitor hall, in no particular order, were:

• Sword Ciboodle - In some ways, nothing radically new from what I used to know as Graham Technology. In other ways some interesting incremental improvements and a feeling that the market for process based CRM was probably one of the growth areas of CRM. I've felt for a while that the record-centric approach of Oracle/Siebel grown too big for many customers and too 'one size fits all', so it was interesting to see a CRM approach that was much more process-centric.
  
• 60k - Presenting themselves as 'The Alternative BPO & Contact Centre Outsourcer', I was interested to see what 60k thought distinguished themselves from the many other outsourcers in the hall. Part of the answer was "Bulgaria", but the value proposition was much more than that. I've managed outsourced contact centres in a past job (we had European customers with customer service sites split between Europe and South Africa), and my experience is that outsourcing to far off locations can have real disadvantages when you try and manage the resulting operation. Nearshoring and so locating your centre within three hours flight time, but still with cheaper labour is very interesting. The crucial advantage of Bulgaria is that it is in the EU and the EU location is a big advantage over destinations like India when you think of the challenges with outsourcing and data movement compliance with the laws on exporting data outside the EU. What also interested me was the focus of 60k on higher value business process. I've long argued that this is where outsourcing needs to go (see past posts like "Offshore - why I would go for South Africa over India") and it was good to see 60k as a European outsourcer positioning things like 'Insurance Claims Processing' and 'Product Recall Management' that add real value to customers, rather than trying to sell cheap call centre seats.
  
• Egypt - I am very interested in the Egyptian contact centre industry as it shows what growth can happen very quickly with government support. I had a good chat with Raya contact centres, who run the contact centre operations of a number of the big tech firms. I must confess a vested interest here, as I recently blogged on Cisco opening their 300 seat centre in Egypt (see "New offshore developments in the European Market") and it was very useful to hear the Egyptian perspective on this.

So all in all very useful (on top of being an exhibitor with a decent number of customer visits to our stand).

Tomorrow, things I'd like to do are:

• Catch up with Redbox Recorders to understand what they are offering.
• Have a look at the Nortel stand to understand how they are presenting things after last weeks acquisition by Avaya.
• Talk to Aspect and better understand the relationship with Microsoft that is so prominent on their stand. (I'm guessing things have moved on since I covered posted on the tie-up announcements back in March last year "VoiceCon 2008 - IBM, Microsoft & Aspect")
  

As always, do let me have any suggestions for other areas that are getting attention.....

System Integrators write interesting things about contact centre for the downturn!

The title says it all, but I was pleasantly surprised in the past week to see that both Accenture and IBM had written some interesting white papers on contact centre. I'm often deluged by vendor whitepapers but these are usually from the smaller niche product vendors. It's quite nice instead to see something from the big boys.

I was sent the IBM whitepaper via the Call Centres.net website. Call Centres.net is an Australian and APAC focused site, but the content is good and often worth comparing with what we see in the European market. The site is run by Dr. Catriona Wallace, one of APAC's leading authorities on call centres and she has a very good blog that's well worth reading.

What I found interesting about the IBM whitepaper was that it focuses on the customer service process. You can download the whitepaper here , as I thought that a focus on the end to end processes was one of the things that too many contact centres don't worry about. To be sure there's always a focus on the applications, but less often is there a good understanding of how the customer process flows between those applications. This is important, as process is often a greater determinant of customer experience than the capabilities of any application. I appreciate that a system integrator with a portfolio of SOA offerings might be have a vested interest here, but it's still a good study and applicable outside of the sample of Australian contact centres it studied.

The Accenture study looks at the impact of poor customer service. The idea that poor customer service leads to loss of customers and loss of revenue makes sense but has been challenging to prove. Their findings are that,

"...Service again ranked above price as a global driver of customer churn, according to Accenture’s fourth annual study on customer service satisfaction, titled “High Performance in the Age of Customer Centricity.”

The study is based on a survey of more than 4,100 consumers in eight countries across five continents. Through the survey, consumers provided feedback about customer service across the full range of customer service channels, including use of the telephone, e-mail, corporate websites, mail, online chat and on-premise services.

In total, two-thirds (67 percent) of respondents reported moving their business to other companies as a result of poor service in a variety of industry sectors, up from 59 percent of respondents in last year’s survey. Underscoring the sharp increase in consumers switching business providers is an overall erosion of customer loyalty. Half (50 percent) of respondents in this year’s survey reported that they switched providers in multiple industry sectors during the year, taking an average of $4,000 worth of business with them, by their own estimate, each time they took business elsewhere."

That service is more important than price for customer retention should come as no surprise, but it is nice to have experience supported by research.

The challenge is what this means for business. It seems to me that there is a strong case being made here that investing in customer service in the downturn is likely to be more profitable than an across the board cost cutting program. I found it interesting that outsourcing was (at least in the IBM study) only one way of fixing service issues and that approaching outsourcing from a purely cost reduction point of view was likely to fail. Outsourcing to fix process problems (either BPO or BTO) seemed more likely to succeed and the Accenture study provides the evidence for how that might show up on the balance sheet.

UK Call Centre Expo

Today the blog is going to be up to the minute and topical.


I know the blog normally comments on things at leisure, and quite a lot after the event sometimes, but today and tomorrow is the UK Contact Centre Expo in Birmingham.

I will be there tomorrow as I find it one of the most useful shows for the UK and Irish market. There's always a danger at these shows that it ends up with vendor talking to vendor with perhaps the odd consultant in the mix, rather than being relevant to the end users.

I tend to find that although there's a bit of that at the UK Contact Centre Expo, it's one of the better shows for providing some value. The Expo's program tomorrow, for example, has some good sessions on customer strategy and workplace culture. Most importantly, they have real contact centre managers presenting on their strategies and experiences. There will also be a chance to see some of the latest trends in offshoring, outsourcing and so on.

I'm very hopeful tomorrow will be a good day and looking forward to it.

For a Friday - Contact Centre, video and the call centre movie

I feel there is the opportunity for a serious discussion about video in contact centre, but Friday is probably not the time to have it. The growth of 3G for mobiles and video calls on Skype make video very relevant for any discussion of the future of the contact centre. I believe video is an inherent part of the move to voice over IP. If you can send packets of voice across a network, then sending packets of video is a logical next step and restricted more by bandwidth limitations (which are ever reducing), than it is by technology capabilities.

I've touched on video before in "SOA - bringing CRM, telephony and business together? part 2, voice portals", especially with reference to the Cisco Voice Portal but video deserves a deeper discussion than most people have time for at the end of the week.

I'll write more about managing video at the start of next week and instead introduce you to "Call Centre the Movie". It's a film with no intention of taking itself, outsourcing or call centres seriously, but it is important because it has shaped perceptions of the industry, it has won a number of awards (e.g. here at the 2005 Riverside International Film Festival) and it has a very significant internet presence as any Google search will show. You can see the trailer here on Youtube .

If that 30 seconds has whetted your appetite, then the full movie (all 12 minutes) is here.

What I find interesting about this movie is how well it shows that consumers understand offshore service as being driven by cost. Whether you like the movie or not, it does summarise very neatly a lot of public perceptions the call centre industry has to deal with.

Does lack of management experience cause most contact centre problems? The perspecitve of the "Puritan Gift"

The blog has tackled strategic questions before, from SOA to CRM and from process to performance, but a new book has got me thinking. The book is the 'Puritan Gift' by Kenneth & William Hopper (352 pages, published by I.B. Taurus & Co.). It's on the Financial Times list of best business books of 2007 and has been extremely well reviewed.

It's a very interesting book and one that is difficult to summarise without loosing at least some of the depth that makes it so well argued. The starting point for the book are the questions: "Where does the Protestant work ethic come from? And how did America achieve such dominance in management for so long?", deep and important questions for business I'm sure you'll agree but while they might not seem relevant to the contact centre, the conclusions are very illuminating.

The book argues (very persuasively) that the rise of management as a 'profession' (rather than as a set of behaviours or values) destroyed America's management culture. It makes a strong argument that what it terms 'domain knowledge' (i.e. experience of the area in which you work) is crucial for anyone working as a manager in a given industry and that management in it's own right is not a transferable 'horizontal' skill that can be generically applied across all industries. The book is particularly acid and well targeted in its criticisms of business schools and their fads around building this belief in the 'professional manager' who has no real knowledge of the area they work in. This 'professional' can engage in high-visibility tasks like financial engineering or succession planning but does not actually understand basic business operations or know what most workers at the business actually do.

Of necessity, I've only provided a very brief summary, but there is a much better overview in this review on the Manchester Business School blog of Prof. Peter Kawalek and also the BBC is making available a short (7 min) and a long (24 min) video interview with one of the authors which I highly recommend. The book also has a website.

I hope the relevance of the book is starting to become more obvious. Contact Centres were set up to help people and yet are widely disliked. I talked about this dislike in an October post ("For a Friday - why are contact centres so disliked?"), but I feel now that I was still commenting more on symptoms than root causes.

It is my strong suspicion that many contact centre problems come from senior management setting objectives with no knowledge of what a call centre does. There are of course extreme examples, like the contact centre described in "Reporting - Having your cake & eating it", which managed to achieve a 230% annual agent attrition rate through its management system, but I suspect there is a much more general problem of unrealistic objectives behind so much of the dissatisfaction with contact centres.

A former colleague of mine, now non-executive director of a very organisation with very large call centres, confirms this suspicion. He regularly sits for a day with agents taking calls and from that he gains a far greater understanding of the problem areas for his organisation than he does from management presentations. Management have often never worked in a customer facing role and so have great PowerPoint slides on 'the customer experience' (and other abstract concepts) but no practical experience of what the customers actually do feel and which problems regularly crop up. In my experience, having worked as a call centre agent is one of my great strengths when working today with call centres. There's a big difference between talking (abstractly) about soft tools for motivating agents to perform certain behaviours, as so many consultants do, and my experience of being on minimum wage unless you got bonus for meeting your call targets. It's not that a nice environment isn't important for agent performance (see past posts like "Sometimes it's not rocket science....") but pay really does matter. As an agent I would have liked to give every caller the desired customer experience (as was suggested in various HR goals for agents), but I was paid bonus to wrap up calls in under five minutes. No surprises which mattered more to agents...!

Yet the fundamental reason behind the mis-aligned metrics, the agents incented to do things against the organisations interests, the poor customer experiences and the broken processes is that senior management are have often not experienced their organisations customer service or worked in customer facing roles. Were they to promote more from the shop floor or insist that managers regularly went back to the floor to take calls many of these issues might be resolved.

Yet the cult of the manager is insidious. When I suggested to one organisation that it might be an idea for the graduate managers to spend a period taking calls so they understood the business better, I got the response back that "...if we did that they'd hate it so much we'd struggle to retain them." This left me slightly stunned. After all, if the call centre experience was that bad, did they think the agents liked it much? Unsurprisingly, their high agent attrition rate reflected what the call centre was like, but lack of management understanding meant the problem not dealt with and instead was treated as 'cost'. In this case, (as Richard Dworkins describes so well in his FT article on the Puritan Gift), management decided to outsource the contact centre to save money rather than fix it. Of course they saved no money in the final reckoning as they ended up spending far, far more on advertising and brand to counter the reputation they acquired for poor customer service, and the cost of managing the outsourcer was greater than anticipated.

The core point of the "Puritan Gift" is that managing something that has not been experienced or understood by managers is likely to fail. There is no real substitute for "domain knowledge" and contact centres that are looking to achieve excellence would do well to build that into their thinking.

Happy New Year - 1,000 new UK call centre jobs

I was wondering what blog topic I should begin the new year with. This good news story, "Call centre begins recruitment drive" in the South Shields Gazette seemed a very appropriate way of starting.

Garlands, one of the UK's largest privately held call centre companies is adding 1,000 jobs (100 in the first phase)to their South Shields centre. It's interesting to see that these are onshore customer service jobs, primarily for the telecoms/ broadband industry.

Now my experience of the telecoms industry is that many organisations have a high percentage of low margin customers and make their money on a much smaller percentage of high spending customers. In the past this has led to a focus purely on cost of service and for many organisations that meant looking at offshoring. It's good to see that the onshore is now a consideration again when customer service is a consideration besides cost.

In many cases, offshoring purely for cost led to a reduction in customer service quality (and as previously discussed in posts like "Offshoring and mainland Europe" and "On-shore Call centres in decline.... is that the whole story?"), that decline in customer service led to the brand value of the business being damaged. Offshoring should not be blamed purely for customer satisfaction declines though, any large change program focused only on cost would have reduced customer satisfaction. A good example is Powergen (now called EON), a big UK energy utility, who closed their Indian operations. The BBC reported their managing director as saying this was because Powergen were "...not prepared to achieve savings at the risk or expense of customer satisfaction". Six months later in Jan 2007 this seemed to have produced results as the BBC ran a story that Powergen had moved from last place on EnergyWatch's table of customer satisfaction to second place.

It's good also to see that Garlands as an onshore outsourcer recognise that they will compete on quality and innovation rather than cost. It's not just that they run Cisco technology in their call centres (they also use a number of other suppliers as well), but more that they have a strong focus on the quality of their workforce and the agents working conditions. I know recent surveys suggest that salary is a major driver for agent recruitment, but as I argued in my last post "Sometimes it's not rocket science....", it is a key factor in agent retention.

Anyway, a Happy New Year to all readers and I hope you have a pleasant work environment and successful year.