What we'll share in this chapter:

• Call centers (and the toll-free numbers companies offer) were once a value-add for customers, and the quality of the phone experience was of paramount importance to most companies.
• But over time, the fundamental corporate desire to constantly drive down operating expenses set up a tug-of-war between cost and quality in service. It was no contest.
• Amplified by an inherently negative societal bias, the reputation of customer service declined.
• However, the source of this negativity has evolved over time – from frustration over phone experiences, to frustrations experienced during digital interactions. And while this changing dynamic creates a different challenge, it is considerably easier to overcome.

IT WASN'T ALWAYS THIS WAY

If you're under the age of about 55 or so, it might be hard to imagine that there was a time when call centers were considered a “bonus” for customers. It's true.

The option to reach customer service by phone hadn't existed previously, other than to call a corporate switchboard (with 25 people sitting in front of a wall of crisscrossed wires), hoping to reach someone in the Complaint Department.

And while some companies had been operating outbound “boiler room” sales centers – the first one, Dial America, was created by Time Inc. in 1957 to hustle subscriptions to Life magazine – the term call center was only first recognized by the Oxford English Dictionary in 1983. That's the year when the now-defunct trade magazine Data Communications ran the first-known feature article describing the operations of customer service taking place in a call center setting.

And if you're younger than about 45 or so, it might be hard to imagine that there was a time when being able to reach the Customer Service Department using a “toll-free” telephone number made it feel like you were getting away with something. Almost like stealing. And as more companies expanded their calling hours – some were even available on weekends! – customers and companies both agreed: We've got a hit on our hands!

But over the past few decades the general reputation of “customer service call centers” has transformed. Here's a composite of how the service experience is typically described in customer focus groups:

From the moment you're confronted with a menu of choices in a “phone tree” narrated by some robo-voice (“for billing issues please press *7 …”) you already know that whatever you choose is going to be “just the starting point” in an unguided and meandering journey in quest of getting SOMEONE to help you solve your problem.

What happens from there … could be … anything. There's no telling how many times you'll have to explain or re-explain your issue. There's no telling if the person you end up talking to will understand your issue … or even your words. There's no telling how long this might take, or if you'll ever get whatever the heck it is you need.

What was once a true “difference maker in customer experience” has now been relegated to being just another pain-in-the-butt on your to-do list.

What happened? And who's to blame?

HOW DID CUSTOMER SERVICE BECOME SUCH AN EASY “PUNCHING BAG?”

Here's a question that doesn't feel good to have to ask, but it's worth thinking about (or at least having a good self-effacing laugh over – just among ourselves!): How does it feel to be part of a profession that is generally regarded so negatively by people? To be part of a profession that – if we're being honest – is an easy one for people to beat up on?

If there was a question on the TV game show Family Feud like: “Name a job where a lot of people are angry at you,” one could imagine Steve Harvey saying:

“Show me … customer service … (ding ding ding) … It's Number 3 on the board.”

(By the way, Number 1 is: IRS agent)

Now, for a lot of service executives and leaders, the first natural reaction to this negative bias would likely be defensive: “Yeah, but service has improved GREATLY in the past decade. We've made so much progress with new channels and new technologies and new ways to engage our customers. As a collective discipline, we in service are way better than we used to be. That's a fact.”

And of course that's true. There's no question among anyone in the research or analytics community that the general level of service being provided by companies has significantly improved over the past few years (and can now be measured every minute of every day – for quality assurance!).

So … who's to blame for this inherent, ingrained negative bias against “customer service?” You can't blame customers – that's just how they're wired.

CUSTOMERS ARE WIRED FOR NEGATIVE REACTIONS

To understand why humans would have a negative predisposition toward any specific experience (like calling customer service) might seem like an emotional consideration. But in this case – whether it's untrue or at least somewhat outdated – this bias is not, in fact, an emotional reaction. It is entirely rational and explainable based on two factors:

1. Customer baggage¹. This is the more obvious factor. The perception of “customer service” isn't based solely on experiences people are having with your company, but to some extent by negative interactions they've had with all companies.
2. Stickiness. The lesser-considered factor is the impact of customer emotions during service interactions. Experiences that trigger a negative emotional reaction are inherently more memorable.

Roger Paulson is one of the few customer service authorities who doesn't work for a company – he resides in the academic world. For the past 15 years, he has served as customer service practice director at the University of Wisconsin's E-Business Consortium – a collaborative learning community and membership organization open to leaders of customer service and customer experience – the only of its kind affiliated with a major university.

He says:

It starts from a recognition of the fact that even in the best of cases, these kinds of service interactions are conceived with negative karma. People don't want to have to interact with customer service. All of the different ways we have to spend our time just makes us feel busier and a service interaction is an interruption that no one wants. Plus there's the hassle factor—whether real or imagined, the perception is that it's not going to be quick or easy.

There's this sense that I've purchased something, and yet I'm having an issue, and now you've interrupted my life, so now I can't enjoy the thing I've purchased. It's basic psychology. We're wired to remember when our hand gets burned on the stove, not when we put on a pair of warm mittens on a cold day.

Author and speaker Ty Bennett agrees, and then some. He has written four books on leadership and communication strategies and is well-known for his keynote presentation “The Psychology of Customer Service”:

The human brain is engineered to overweight negative experiences five times more than positive experiences, and this has been borne out in experiments that analyze our brain's chemistry in a variety of different situations. We've been built that way to avoid pain and stay safe. So what happens with customer service is that bad experiences tend to create more memorable, tellable stories that are more likely to spread. It only makes sense that the negative ones would move faster and be more impactful.

COMPANIES ARE WIRED FOR EFFICIENCY

It's always been hard for most companies to commit significant resources against how service interactions “feel” at a subjective, psychological level, when it is so much more logical to base decisions on cost efficiency and immediate ROI.

There's a name for that – it's called business.

Among C-suite executives, the generally accepted mental model is that service is a “cost center” – an “unavoidable cost of doing business.” Taken from an economic standpoint, it might seem to make sense to do everything possible to reduce the cost to serve customers. If you were to think like a CFO – with a strictly logical Vulcan mindset – what other conclusion could you reach?

Once we've made a sale, that's all the money we're going to make from that transaction. Sure there are all kinds of long-term considerations that fit into the realm of “customer loyalty” but those may only bear fruit at some undefined future date.

For right now, we've received X-amount from X-customer, and we realized X-profit, but what remains unknown is how much it will cost to serve that customer. And that's unsettling, because customer service is expensive.

Customer service industry analyst Blair Pleasant of COMMfusion says she's observed a kind of myopia among senior executives: “Yes, there are some companies that do service right, but way more companies that don't. They look at customer service as something they have to do, and they want to do it as cheaply as possible and it doesn't feel like it's their top priority. I think a lot of them understand the importance of customer loyalty and customer satisfaction, but for many of them it's just more about the constant pressure to cut costs, and because there are so many people involved, contact centers are considered expensive.”

Customer service does cost a lot. A 2019 report in Harvard Business Review estimated that the price tag for serving customers and solving problems – after they'd already purchased – cost companies more than $38 billion.³

So, as an efficiency play, many service leaders started focusing more scrutiny on their employees to cut customer calls as short as possible by reducing AHT (average handle time). But that only tended to make the agent's job harder, which had a downstream impact on employee turnover, and certainly didn't improve the customer experience in any way.

COST EATS QUALITY FOR LUNCH

Sure, every company says they want to do what's right – for customers and the bottom line. But the lure of cost-optimization became more and more powerful around the time of the millennium. And as most of us have observed in our careers, any time push comes to shove, the scale invariably ends up tipping to the financial side of the equilibrium.

Perhaps no other single stage in the evolution of customer service fueled the fire of public negativity more than the outsourcing boom of the late 1990s and early 2000s. During that time, it felt to many customers like every company was suddenly shifting the responsibility of interacting with customers to agents who seemed to be working out of “overseas” call centers.

It is estimated that in less than a decade, over a quarter-million call center jobs were outsourced from the US to a range of other countries – including the Philippines and India, among others.⁴

The mounting backlash against outsourcing and the resulting job losses became so pervasive that Congress was called on to do something about it. One of a number of bills was introduced under the umbrella heading of the United States Call Center Worker and Consumer Protection Act, requiring businesses that employ 50 or more employees to notify the Department of Labor at least 120 days before relocating such centers outside of the United States. Civil penalties of up to $10,000 a day were proposed, as well as directing the Secretary of Labor to maintain and make publicly available a list of all such employers that relocate a call center.⁶

Adding to the frustration for customers, “When there's an issue of some kind, there's a fundamental mismatch of seriousness levels,” says Ty Bennett.

“When I have a problem it's a one-time event for me, cause I'm the only one here and it's happening to me. But to someone working in a call center (especially in an outsourcing model), if you're the 999-thousandth customer with that same exact problem, it's very easy for an agent to become bored doing the same thing over and over. Customer expectations are always increasing, and yet companies are incentivizing the wrong activities: speed, efficiency, and volume.”

If the general reputation of customer service wasn't already bad enough, the pressure to continue cutting costs – epitomized by the outsourcing boom – sent it plummeting to even greater depths.

So, who's to blame for this pervasive negative perception that has an impact on EVERY interaction you have every day with your customers?

• You can’t blame customers. Most people have accumulated a wealth of negative experiences with customer service over time that are then amplified by our inherent human psychology and their viral nature.
• You can’t blame companies. Businesses must always focus on efficiency – so, reducing handle times and moving to outsourcing felt like necessities in order to stay competitive.

EVOLUTION OF CUSTOMER SERVICE: THE “QUALITY VALLEY”

So … what to do? One can imagine the hushed conversation in corporate boardrooms, at executive retreats, and around customer service conference tables:

OK, call centers are people-intensive and expensive – a live interaction with a customer ties up one employee for however long as that call takes. One customer, one agent.

Not scalable.

But … finding the cheapest labor in the world to handle service issues … or pressuring our reps to keep their calls as short as possible … is that really what we want to do?

Think about it: If there’s only one person representing our company in each interaction, don’t we want that person to be someone we’re proud to have on the front line greeting our customers? Someone you’d be proud for your Mom to talk to? Sounds great, but sounds expensive.

But what if there was another way to cut costs? What if there was a way to enable customers to “serve themselves?”

That would solve the cost problem … and if the experience was acceptable … it might even solve the quality problem as well. Bingo!

What could possibly go wrong?

KEY TAKEAWAYS: CHAPTER 2

• You're already starting behind the 8-ball. The inherently negative perception of customer service may not be fair, but it's reality. Humans are conditioned to remember negative experiences more than positive ones, and many service issues are driven by a problem or issue a customer didn't want to deal with in the first place. If the whole thing is perceived as a big hassle, that only imprints the experience more deeply.
• Cost of service vs. quality of experience is not exactly a fair fight. While no company would ever say, “We're OK with our customers having poor experiences,'' the instinct to reduce operating costs is almost irresistible.
• Customers have been sucked into a vortex of negativity. The more that businesses worked to squeeze efficiency out of their service operations, the more negative experiences were created for customers. This downward spiral led to a continual decline in customer experience and reinforced the negative perception of call center operations.