1 800 Flowers - Undercover Boss Draws Wrong Conclusions
04/25/2010 4:22:00 PM EDT
The latest episode of Undercover Boss was for 1-800-Flowers. Jim McCann (founder and CEO) and Chris McCann (President and COO) are brothers and seem to treat each other in that older brother-younger brother dynamic. This episode takes us on a journey through flower shops and a candy factory.
Chris McCann’s visit to the candy plant was the most revealing. I’ve watched contact centers try to copy manufacturing in the way they go about treating employees, using measures and increasing productivity. So let’s use this as a learning opportunity.
The Productivity Goal
Chris McCann mentions that he wants to increase productivity in the plant from ten million pounds to 16 – 20 million pounds. Goals are set by management and the machines speed up. Contact centers are managed in much the same way by management coming up with targets for the number of calls taken in a day.
The whole idea of a prescription of how many calls a contact center should take, the allotted AHT per call, and the service level given are rooted in how contact centers can reduce costs. This prescription seems logical enough and most contact centers subscribe to this approach. The problem is that focusing on costs always increases costs.
This isn’t a matter of making workers part of setting the productivity goal as Chris McCann concludes. This is a matter of understanding targets drive dysfunctional behavior.
It was in the early 1900s that Frederick Winslow Taylor started this path with his scientific management theory and separating each function of work with productivity targets and incentives. W. Edwards Deming taught the Japanese a better way and we have learned that to increase productivity in manufacturing economies of flow must be optimized, not scale.
In service, the variety of demand makes customer demand and flow even more important for contact centers. Instead of viewing all demand as something that needs to be done, contact centers have to understand that failure demand (demand caused by a failure to do something or do something right for a customer) needs to be reduced, not productivity increased.
Incentives Will Make Things Worse
Chris McCann concludes not only that the problem is that of workers being involved in setting goals, but decides incentives will make employees happier and more productive. None of these things are true.
Working together on understanding customer purpose and demand and getting rid of systemic failure demand should be the appropriate response. New measures emerge that are associated with what customers want from service as these drive the lagging financial and productivity measures up.
Chris McCann should take a couple of steps back and design a system that works for the customer and workers. This requires different thinking about the design and management of work.
For contact centers there are better ways to manage than trying to copy manufacturing (never a good idea to copy), especially old and worn-out concepts that don’t work very well.
* = required.
i know it is altruistic but every call is a sales call. If all, from top down would recognize this then call centers would not be a cost center. Although more often then not a call is made in anticipation of a resolution of some sort even if it is just the satisfaction of being heard, regardless if the paradigm can be shifted to, every call is an opportunity rather than a potential cost and train it consistently to those on the front line, you would see a drastic change in dollars!
I know I know, I love living in my delusional world! |
I agree with some of what each of you have had to say but the three big hits are - if the caller is calling because they want to place an order, not calling because we did something wrong the are generating revenue not costing us money. If they are calling for resolution then the tracking systems should be in place to identify the key down falls of the ordering and delivery processes that have generated the call. But your question of why the decision makers fail to see the errors of their ways is because it is their jobs to focus on payback to the shareholder thus the bottom line not relationships. If you want to sway the decision makers you have to define how the relationship downfalls relate to the bottom line in a metric that shows where the bottom line will increase without antedotal information - hard numbers and trust me decision makers will follow the dollars. |
I agree with some of what each of you have had to say but the three big hits are - if the caller is calling because they want to place an order, not calling because we did something wrong the are generating revenue not costing us money. If they are calling for resolution then the tracking systems should be in place to identify the key down falls of the ordering and delivery processes that have generated the call. But your question of why the decision makers fail to see the errors of their ways is because it is their jobs to focus on payback to the shareholder thus the bottom line not relationships. If you want to sway the decision makers you have to define how the relationship downfalls relate to the bottom line in a metric that shows where the bottom line will increase without antedotal information - hard numbers and trust me decision makers will follow the dollars. |
Tripp we created a metric to monetize customer time for exactly the reasons you've stated - it's the missing value in management's decision equation. The book, Customer Why and How Everyone in Your Organization Must Think Like a Customer details the metric and the framework for companies to use it to offset customer-blind and deaf internal metrics. It also addresses employees as internal customers and mutual stakeholders which speaks to your productivity and incentive compensation argument. A very large percentage of employees empathize with the customer metric and view work differently using customer as a performance lens.
Jremach - you will see the connection to Taylor, Byrum and Reichheld and restructuring work, processes, metrics and compensation
Michael R Hoffman
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Mr. Babbitt - good thoughts, good recommendations but not convincing for a very simple reason: You put "end-to-end" and "systems thinking" in the title of your article. And we all know what happens when "leadership" hears these words: their eyes roll into the back of their heads, they start panting, go into a fetal position, suck their thumbs and think that their brains will explode.
The same applies to the true assessment of the cost of running a service desk/contact center - end to end, with all supporting assets and systems being maintained and amortized - not just labor and transactions. Yet, we focus on simple “productivity” metrics ($/call, FCR, AHT, etc.) and locally optimize the service.
But the real issue is a philosophic one: Be it manufacturing or service delivery, we insist on considering the relationship between the parties as an adversarial one: YOU are costing ME money when you call! rather than what can be a better model "YOU are calling ME because I FAILED you.
The philosophical divide is further compounded by our inability to convince our management/executives/leadership of the error of their ways. Why is it that studies, metrics, analyses fail to move the decision makers? Why is it that progressive practitioners of CRM and call center operators suffer instantenous amnesia and turn to "stubborn bozos" when they get promoted to leadership positions?
Just wondering... |
Tripp this is so on target. This was recenly covered at a Frost & Sullivan Executive MindXchange (session notes: http://bit.ly/afVdUT). There is also a great book on this titled,"The Recovery and Sustaining of the Human Element in Modern Organizations" By: C. Stephen Byrum, Ph.D. In this book he covers constructing a better way using the work of Fredrick Taylor and Robert Hartman. It is very insightful and thought provoking. Bottom line, the McCann brothers need to read it and so do Call Center leaders. |
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