Towards Telework in Call Centres
Sebastiano
Bagnara
This report has been produced with the support of the
European Commission, DG Employment and Social Affairs, under the European
Social Fund (article 6). Views expressed within the report are those of the
author and do not reflect the views of the European Commission.
Euro-Telework
Sebastiano Bagnara © November
2000
http://www.euro-telework.org
CONTENTS
0. EXECUTIVE SUMMARY
1. INTRODUCTION
2. EVOLUTION OF TECHNOLOGIES, FUNCTIONS AND COMPETENCIES
2.1 The claim office
2.2 The claim factory
2.3 Communication node
2.4 Selling node
3. PEOPLE
4. CALL CENTRES IN THE MEMBER STATES
4.1 Austria
4.2 Belgium
4.3 Finland
4.4 France
4.5 Germany
4.6 Greece
4.7 Ireland
4.8 Italy
4.9 Luxembourg
4.10 Netherlands
4.11 Portugal
4.12 Sweden
4.13 United Kingdom
5. MAIN ISSUES
5.1 Work organisation
5.2 Training
5.3 Career development
5.4 Health
5.5 Suirveillance and monitoring
5.6 Localisation
5.7 Industrial relations
6. CONCLUSIONS AND RECOMMENDATIONS
7. REFERENCES
8. BIBLIOGRAPHY
0. EXECUTIVE SUMMARY
This report aims to provide a general overview of work in call centres.
Call centres are designed as 'operations in which a managed group of people spends most of their time doing business by phone, usually working in a computer-supported environment'.
The basic tenet is that work in call centres has to be conceptualised in terms of distributed knowledge. This means that only part of the knowledge needed to carry out any transaction is (or rather has to be) in the mind of the operator, and important knowledge may be distributed among colleagues in the organisation, available and accessible cognitive artefacts in the work environment, and clients.
Operators in call centres are knowledge workers, because they carry out any activity by manipulating internal and external knowledge.
The report first illustrates the evolution of technologies, functions and competencies.
There have been four phases in the evolution of call centres since the first one was opened.
The original call centre in the 1960s was a claims office with a toll-free phone line that answered standard requests. Agents had limited knowledge and basic communication skills.
Later, in the 1970s and 1980s, claim factories were served by Automatic Call Distribution (ACD) systems that handled a large number of mostly repetitive requests. Operators had limited, specialist knowledge and a few restricted communication skills; stress was high and the agent had to cope with a quantitative cognitive workload.
During the 1990s, the call centre became a communication node dedicated to customised interactions, in which the process of communication was dynamic and long-lasting, and whose objective was customer care and retention. Operators were supported by the integration of computer and telecommunication technologies (CTI), and had good communication skills.
The virtual call centre and selling node will be next: it combines previous ACD, CTI and new Interactive Voice Responder (IVR) technologies with web-based communication, and takes the form of a learning, marketing, negotiating and selling node. The Web-Enabled Call Centre (WECC) evolves in the virtual call centre, where customers are mainly web-site visitors, and incorporates access to agents via call-back, voice-over Internet protocol (VoIP) and text chat. It is predicted that by 2004, WECCs will be central to organisations (Intranet), across supply chains (Extranet), and with the online population (Internet).
The report then considers people in call centres.
Call centres are among the most rapidly growing forms of employment. In Europe, 1.3% of the total European workforce (i.e. 2m people) will be employed in the call centres by 2002. North European countries have the highest call centre concentration with southern Europe falling far behind; the figures for eastern Asia and Australia are very similar, and in the USA, more than 5m of new jobs have been created in this sector since 1990. On average, call centres are growing at something like 30-35% per annum in terms of call volumes, and 20-25% per annum in terms of the number of agents. According to some estimates, 1 in 20 jobs in the USA nowadays are in call centres, and by the year 2005 that figure may have risen to 1 in 7.
However, the crucial point is not the number of people in call centres, but the fact that people are critical to their success.
Research and surveys alike confirm that human resources form the strategic factor that makes all the difference in managing the customer relationship. The customer-focused culture is the main asset when seeking competitiveness and getting the most out of the customer relation. Technology can support, but never replace, human resources skilled in communications, problem-solving and caring.
Although companies are aware of the central role of human resources, they seldom pay the necessary attention to the training, retention and career development of agents. All surveys of call centres in EU member states reveal symptoms of organisational disease including high turnover, workload and stress.
Notwithstanding suggestions for improving human resources management, some paradoxes are apparent:
· agents work alone in their relationship with clients, and technology and organisation do not adequately support the communication flow
· standards of education are usually high, but they are managed according to the paradigm of the traditional 'blue collar' industrial worker; moreover, agents do not possess an integrated view of the process: about the half of them do not even know the objective of the call centre they work for
· call centres themselves are isolated from the rest of the organisation, and there is little contact with the sales and marketing departments
There is a need for to integrate and develop the technology, organisation, performance, jobs and quality of work, and for people to be seen as the hub that allows the call centre to become a learning organisation.
This is followed by a report on data and trends on people and call centres in the EU: the report focuses on key features in Belgium, Finland, France, Germany, Greece, Ireland, Italy, Netherlands, Norway, Sweden and the UK. Reference is also made to the growth of pan-European multi-lingual call centres in some European countries.
The report also examines issues to be tackled in the near future:
· Work organisation: call centres are usually designed on the model of a factory. Given the evolution of call centres, work organisation should support collaborative forms and tools including the development and sharing of organisational memories
· Training: call centres are the largest work group with no training programme. Training and retraining packages are both unusual and too general
· Career development: since call centres are 'flat' organisations, vocational development is rare, and has consisted so far of considerable horizontal mobility from one organisation to another. Such mobility masks the lack of a career development path, and of intra-organisational mobility
· Health: stress symptoms are frequent as because people have no experience of the work, and no cognitive or emotional tools for coping with strains and tension
· Monitoring and surveillance: the technology in use is much the same throughout the world, and includes a facility for continuous monitoring of performance. The mechanisms of surveillance and monitoring contribute to stress, and there are also legal and ethical factors involved
· Localisation: call centres are usually located where a skilled workforce is available at low cost because of the rate of unemployment or the need to enter (students) or re-enter (women) the labour market. This may reduce flexibility in the medium term
· Industrial relations: concrete experience of developing a local and global framework for industrial relations has been building up over the last few years. Workers in the call centres all over the world raise identical issues of pay and benefits, stress, working time and workload, equal opportunities and training, harassment at work, poor working environment and equipment, respect and proper consultation, and social benefits
In conclusion, call centres and teleworking have reached a cross-over point. Since the former is now becoming 'virtual', it will now enter the phase of 'networked distance labour' and share the same socio-economic context. Steps must therefore be taken to open up a new phase of industrial relations in which more active attention is paid to individual workers.
For the trade unions, this means a sensitive approach to differences in individuals, areas and sectors, and a network-like organisational structure designed to capture both the few common features and the many unique, not to say personalised, dimensions of the workforce. For this purpose, the most useful tool will be a credible scenario with a few shared rules, and used as a concrete support to specify attainable objectives within the 'eEurope 2002 Action Plan'.
1. INTRODUCTION
Call centres may be defined as 'physical or virtual operations in which a managed group of people spend most of their time doing business by telephone, usually working in a computer-automated environment' (Merchant, 1998).
People directly involved in these operations may be described in many ways, for example as telephone agents, telephone operators, telephone communicators, telephone sales representatives (TSRs), customer service representatives (CSRs), customer consultants, champions and assistants. They are usually simply called 'agents', that is to say 'people working within a call centre whose main job is to handle incoming and/or outgoing telephone calls'.
As we shall see, such definitions capture only some of the generic components of operations in call centres, and of agents' work. Other definitions exist, but they all reflect particular types of call centre. These days, it is most likely that call centres will be the organisational nodes controlling relationships with customers. Agents are knowledge workers who manipulate internal and external knowledge (this may be distributed among colleagues, it may be organisation itself, cognitive artefacts in the work environment, or clients) to solve often unexpected problems and control long-lasting dynamic relationships and processes.
However, when discussing call centres, there are key quantitative dimensions that immediately demand attention.
The statistics are impressive: the number of call centres is due to double in three years (from 9700 at the end of 1999 to 18,500 by the end of 2002) (Datamonitor, 1997).
Call centres constitute a vast economic phenomenon. Authoritative research estimates that the overall market for call centre technology and services will grow to about $30bn by 2004, from around $7.1bn at the end of 1999. If one includes infrastructure (for example, computer systems and buildings), the total forecast needs to be at least doubled (Bradshaw, Wood and Delaney, 1999). The overall European call centre market is growing at a rate of 40%.
Call centres are a vast social phenomenon. They constitute one of the most rapidly growing forms of employment: according to Datamonitor, about 1.3% of the total European workforce will be employed in call centres by around 2003, and the industry has accounted for as much as 37% net of all new jobs in Europe over the past three years. The figures in East Asia and Australia are very similar, and in the USA, more than 5m new jobs have been created in this sector since 1990. According to some estimates, 1 in 20 jobs in the USA are now in call centres; by the year 2005, that figure may have risen to 1 in 7.
Other sources give different figures, but
there is no doubt that the number of call centres, and of the people employed
in them, is increasing. On average, the number of call centres is increasing by
approximately 30-35% per annum in terms of call volumes, and by 20-25% per
annum in terms of the number of agents.
2. EVOLUTION OF TECHNOLOGIES, FUNCTIONS AND COMPETENCIES
The numbers are impressive, and they speak for themselves, but they conceal the fact that not all call centres are the same at the present time, even though they all belong to a complex technological, economic and social phenomenon that started in the 1960s. The phenomenon can be divided in phases according to the technology used, the functions carried out, the aims pursued, and the competencies required by people working in them.
The peculiar characteristics of the various phases in the evolutionary process of these systems of distant relationships with clients have not passed away. Indeed, the original phases of the evolution may still be found in many up-to-date call centres, and other call centres within a given area boast differential evolutionary characteristics.
It may be useful for descriptive purposes to single out the main phases in the evolution of call centres as a function of technologies used, aims pursued and competencies required.
2.1 The claim office
The first type of call centre was established in the late 1960s when a US Federal Judge ordered the Ford Motor Company to establish a 'free phone line' to facilitate the recall of faulty cars. To comply with this obligation, AT&T and Ford developed the '800' number. Since then, call centres have been concealed, invisible offices behind phone-based services designed to ease consumers' access to companies and public administration for claims, and, later on, for booking purposes.
This cost-saving solution was reached by centralising demands, and the specialisation of the replies focused on keeping calls simple and short.
The operators were asked to possess limited knowledge (usually about a specific product and fault), some communication skills (politeness and kindness were enough) and linguistic skills (to understand various regional variations). Their tasks were repetitive, and there was a need to address boredom and the ability to counter quantitative, cognitive overload. Workstations were designed to keep the operators protected from noise interference: the consequence was (and is) social seclusion.
Some present-day outsourced call centres share many of these features, as do many of their workers. Call centres that use Computer Aided Telephone Interview (CATI) techniques are very similar to original call centres in respect of operator competencies and the main technology and work environment. Computers in these centres register and quantify types of request and answer, and market research and opinion polls make considerable use of them.
An alternative is now already available. It is the IVR (Interactive Voice Responder), which automatises frequent standard requests and replies for low-premium customers.
2.2 The claim factory
During the 1970s, the hidden claims offices and the invisible workers inside them remained a rather small reality, despite the fact that dramatic changes in customers' behaviour began to emerge. Consumers tended to prefer personalised, rather than mass-market, goods and services, and people started to require assistance in using the products they had bought. Buying and selling were no longer seen as one-off activities: they had become long, lasting, dynamic and communication-based processes.
Changes in people's attitudes have modified the demands and requests coming into call centres. Claims still account for the overwhelming majority of calls, but they have become less common as new personalised products and services have come on the market. Operators in call centres (they are usually called 'customer representatives' or, in call centre jargon, 'reps') have to support clients through the whole life-cycle of products, and preserve and improve the relationship between the organisation and its clients by keeping track of the dynamics of questions and replies. Of course, this activity is possible when there are only a few clients and products, but even then the cognitive burden can be very high.
Call centres were designed to answer standard claims relating to a limited number of mass products and services, and cannot cope with the new situation. As a result, their performance rapidly deteriorates, and long queues and low-quality replies became a painful and daily experience for customers.
In the late 1980s, a technological solution, the integration of computers and digital telephones, came on stream and Automatic Call Distribution enabled queues to diminish and performance to improve.
The hidden service office became a visible service factory.
The operator's working conditions did not change very much, though. Measures to counter noise interference were stepped up, but despite the widespread use of open-plan working environments, social isolation was still the order of the day. Moreover, their skills did not change much either: the knowledge that was still needed was mostly in their heads; however, it was very limited in scope, communication skills remained at a very basic level, and it was acknowledged that they had to tolerate stress because of the monotonous tasks and boredom.
The high variation in peaks in calls during the day, week or season had been dealt with by employing staff as and when they are needed. This led to the introduction of the 'three thirds rule' whereby the workforce in a call centre consisted of one third full-time employees, one third part-timers, and one third temporary workers. The 'service factory' was seen as the solution, and Tayloristic design and practice followed.
Of course, stress responses, high absenteeism, high turnover (more than 20% per year), and difficulties in personnel recruitment, management and retention were very predictable outcomes. Indeed, as some authors (for example, Kjellerup, 2000) maintain, when a call centre only has ACD, it easily becomes an example of 'toxic organisation': because of the heavy workload, it is often a place where people work in order to make money, and then they move on (1).
2.3 The communication node
By the 1990s, the call centre had become a profit centre rather than a cost centre. It was clear that the process of communication with the customer was dynamic and long-lasting, and that it was vital to take care of, and retain, clients. A breakdown in communication meant a net loss of revenue.
The call centre was a place where the organisation found out about clients' needs and their changing attitudes. The call centre had a proactive function, and it also had marketing, testing, promotion and sales objectives. The call centre became dedicated to customised interactions, and it focused on keeping track of, and making use of, all transactions.
In previously described types of call centre, the number of applications the operator had to handle during a conversation was usually very high. Access to stored knowledge was painstaking, and the quality of knowledge distribution between operator and artefacts was poor, but the integration of telecommunications and computer technology (ICT) made it possible to record, elaborate and extrapolate powerful artefacts, and use knowledge to make conversations easier and actively memorise them (in the Merchant survey [op.cit.], CTI technology was not as widely used as ACD technology [under 30%]).
The history of transactions with clients could be stored and retrieved during any call. In addition to the dynamics of claims, the recording and processing of transactions with clients made information about their desires and skills – not to mention their spending attitudes and opportunities – all possible. The service had become truly customer-oriented.
Operators were still required to have knowledge about the content of interactions, but their core competence involved understanding clients' requests, and finding, accessing and manipulating knowledge in the organisation and in the cognitive artefacts. Communication skills were at a high level: the competence was the ability to manage surprise and unforeseeable events. Stress came from tension in facing unpredictability rather than from repetition and boredom, and work had to be carried out in teams because of the complexity and value of the demands. It was important to adopt a distributed-knowledge approach and teamwork-based organisation. Unfortunately, the 'factory model' is still to be found.
2.4 Selling node
The scope of call centres is changing: far from being centralised claim-handling offices, they are now becoming business centres. They are profit-seeking nodes rather than costs to be scaled down. Communication is no longer initiated solely by clients, as an increasing proportion are initiated from call centres for learning marketing, promotion, and selling purposes.
They combine old ACD and CTI, and new Interactive Voice Responder (IVR) technologies with the web-based communication. The core is still communication designed to keep and improve relationships with clients, but the possibility of adding 'show' to 'tell' multiplies commercial capacity. Currently, there are fewer and fewer calls, and more multi-channel asynchronous communication transactions.
Finally, the combination of high-speed digital telephone networks and the sophisticated software and switching technology that underpins modern computer telephony integration now make it possible to re-route calls and messages anywhere. Remotely based agents can be managed as if they were all geographically in the same place.
This is where call centres and telework merged. While consistent deployment of the web enabled call centre (WECC) is still some way off, there is ample evidence of a proliferation of innovative applications. It is forecast that during the period 2002-2004, WECCs will match the increasing uptake of web technologies within the organisation (Intranet), across the supply chain (Extranet) and with the on-line population (Internet).
A WECC can integrate the various media in the process of contacting the client or, as some recent cases suggest, it may follow a process of differentiation.
The two trends may specialise operators' competencies, and media integration will further develop the current trend in call centres towards knowledge manipulation and integration, collaboration and team working. Specialisation may also indicate a process towards call centres centred on one or more 'service products' in which the content rather than simply communication may be the core of the operator competence. In both cases, the focus will be on trust building and ongoing relationships.
When customers are mainly web site visitors who have access to human agents via call-back, voice over Internet protocol (VoIP) or text chat, the agent may come to resemble a real teleworker. Nowadays, such a situation is fairly unusual, and a transitional phase is now under way (in the Datamonitor report [op.cit.], call-back accounted for 2% of all calls).
The challenge is how to meet the needs of Internet users, who will grow from 121m at the beginning of 1999 to 339m in 2004.
In the meantime, the percentage of total communications through media other than the telephone is negligible (3% inbound and 31% outbound in 1998); functional integration is also quite low: only one third of call centres perform a combination of customer service, sales and marketing (Merchant, 1998).
Though the emergence of the web, the call centre is still an interface, that is to say a customer contact centre where the aim is still efficiency rather than efficacy. In order to reduce costs, investment seeks to introduce 'self-service technologies' with a view to cutting human resource costs.
However, 'self-service technology' should be seen as complementary, rather than alternative, to human agents. Highly skilled, motivated people are essential if a call centre is to become proactive and successful: it is impossible to establish trust and long-lasting relationships, which are essential in selling services, by substituting human beings.
3. PEOPLE
In the average call centre – this is a combination of the four types identified above, but is usually very similar in terms of work organisation and managerial culture to the claim factory – agents can be differentiated by functions, tasks and communication skills (Prentice, 1999).
Currently, a small group (usually not represented in call centres where outsourced standard and repetitive tasks are carried out) of up to 10% (in the most advanced call centres) carries out complex, non-repetitive jobs. These are 'universal agents' in the sense that they can handle any communication with customers, and move easily and rapidly from one function to another (for example, from customer retention to activation) and between media and applications. Since vertical flexibility does not pay off (it is a waste to have them performing low-level activities), and because of the trends toward content and customers' target specialisation, the notion of universal agents is questionable.
Another small group (5-15%) is used as a flexible workforce to move around different media and float between functions from time to time to carry out complex activities, and a consistent group of people (20%) carries out a blend of repetitive, though rather complex, activities and occasionally moves among communication media. The two largest groups either carry out a restricted blend of simple activities or make use of a fixed type of communication media, or are dedicated to simple tasks and use a specific simple communications medium.
To summarise, people in an average call centre belong to three main, roughly equal groups: one works full-time and has wide experience and high level skills; one is made up of horizontal (not many hours a day) or vertical (a few days a week, usually peak days and weekends) part-timers with medium-level expertise and skills; and one comprises temporary workers who have basic skills and very little experience.
The evolution of call centre functions is making the skills and competencies of agents more relevant, but the above-described distribution of agents is still widespread. There is a clear contradiction between the aims to be pursued and the way people are treated. Accordingly, it is not surprising to find that an overwhelming majority of call centre managers among Fortune 1000 Corporations cited 'people' as the most critical factor in the success of call centres (The Customer Connections Solution Team, 1999). Specifically, more than two thirds (79%) of them reported that people were the key critical issue. This attitude was consistent across different industrial sectors: people were the issue in telecoms (85%), insurance (82%), healthcare (80%), banking (77%), manufacturing (77%) and utilities (75%). Interestingly, the lowest level (68%) of people of crucial importance in call centres were those working in computer/software/electronics. The idea of automation as simply a substitution for human workers may have played a role in this outcome.
Similar indications emerge from a survey of 285 call centre managers and senior executives completed in 1999 by the Gallup Organisation. Participants were asked to give their top three management issues: again, personnel ranked high (42%) followed by customer satisfaction (29%); technology (20%) and finance (9%) were again seen as less important.
Such a widely shared view of the problem is rooted in the working conditions in the average call centre.
Indeed, although a call centre should be a locus of communication and relationship with the customer, and the agent (any agent) represents the whole company to its customers, agents conduct the relationship with the customer alone. They do not have a complete view of the process (data show that only half of all operators can quote their call centre objectives); there is a low level of technological integration (in more than two thirds of cases, agents have to switch between more than two applications during the same call); there is a lack of organisational integration; and communications between the call centre and other departments in a company are usually extremely poor. It is quite common for products to be heavily advertised and launched onto the market, and for the call centre to know little about it: this means overload and degradation in quality.
Moreover, agents are in charge of critical processes of communication, information diffusion and gathering, knowledge creation, and sharing: moreover, they possess knowledge about customers, products, services, processes, organisation and technologies. They are young (on average 23-25 years old), hold diplomas or university degrees, and in most cases this is their first work experience. However, for most of them, there is no clear path to the future: career development in call centres has not been made very attractive, and often it is completely unplanned. It is unclear what will happen next. Large-scale horizontal mobility (from one call centre to another new one) conceals the fact that there is little mobility within the company from the call centre to other departments: the call centre tends to be a sub-company within a company.
Moreover, there are no vocational training programmes. Call centre jobs are based on generic education, and the perceived image is that of a job that anyone can do. Needless to say, social and professional recognition is scarce. The number of names and definitions (each lasting some months and accepted within small, mostly company-wide communities) indicate that social and professional identities are very weak. This situation is also underlined by the figures for part-time and temporary recruitment. What is more, most of companies are start-ups, and they have their own weaknesses in identity and corporate culture.
In most cases, they are managed as disposable resources, and retention plans are rare. Although average turnover is high (20-30% a year), the cost of training is rising: new employees need about ten days' training and six days' retraining, and six days' tuition a year is considered the threshold level. Recruitment is becoming increasingly difficult and expensive, with the cost for any new agent estimated to be about €5,000. Absenteeism is also high: there is anecdotal evidence that some people do not even show up to get the money they have earned after one or two days' work. Stress is widespread.
Given this state of affairs in call centres, it is no surprise that people are generally considered to be of crucial importance.
People are the key issue in call centres.
The issue may be tackled from two angles: the first is well exemplified by solutions put forward by Glenn Phelps, Program Leader of Gallup Call Centre Management. It focuses on individuals: the measurement of performance shows that top performers obtain higher financial results, are less likely to change job, are safer and healthier (they are less likely to take sick leave), file fewer disability claims, require less training, produce little or no customer attrition, and are better at selling. A study of the practices of top performers identifies the best solutions for dissemination, thereby improving call centre performance, and an analysis of the profiles of top performers builds up a selection process that makes it possible to get the right people both as agents and managers.
Such an approach centred on individuals can be successful, but it does not address the aforementioned organisational paradoxes to be found in average call centres that may be technologically advanced, but still imbued with a Tayloristic culture.
An alternative approach is to recognise call centres as knowledge-based service organisations focused on creating value. Here, the distinction between universal knowledge workers and disposable under-skilled operators lies at the heart of human resource issues. Core knowledge is not restricted to supposedly universal agents. The basic unit is neither the individual front-line position, nor the operator-customer pairing, nor the universal agent, but a 'knowledge cell' where the operator is integrated within a team and shares cognitive artefacts and supporting technologies with colleagues, and even with the customer. The objective of the cell is not merely to provide customers with information and assist and support them, but also to acquire and transfer knowledge for the customer and for the company.
In the knowledge cell, knowledge is accumulated and distributed among people, teams, technologies and customers. The activities of the agents are then characterised by knowledge creation and manipulation, and job design is centred on enabling access to, and sharing knowledge with, all members of the cell. Taylorisation can improve the number of calls handled, and the average time needed to close a call, but it cannot improve the quality of communication or the development of the knowledge system for achieving effectiveness.