Organising in financial call centres

The call centre image is of the large industrial shed, located on an out of town business park, where tens or hundreds of people are brought together to work. However the Automated Call Distribution technology which underpins call centre operation does not necessarily demand this way of working.

Using fast data telecommunications channels, it is also possible to operate a call centre service using workers based at workstations in their own homes. Limited use of home-based call centre staff has been reported in several countries.

A report in the UK has recently suggested that ‘virtual call centres’ like this may be an idea which will become increasingly attractive for companies. [Virtually There: The Evolution of Call Centres; The Institute for Employment Studies for Mitel, 1999]. The report considers a number of British case studies, including the Automobile Association (AA). This motorists’ assistance service recently closed a conventional call centre in the north of England, replacing it with a team of home-based staff each equipped with ISDN lines and computer workstations. The company expects the number of home workers (currently over 50) to grow shortly to over 150.

According to the AA, home-based working has been introduced partly as a way of overcoming staff recruitment and retention problems. Another advantage for the firm is that the home workers are also required to work unpopular early morning and late afternoon shifts. The company says that productivity in handling calls has increased dramatically. It also says that home-based staff are more flexible in their hours of working, and can begin work very quickly when unexpected surges in call levels are received.

The British report also considers two examples from the financial sector, including Prudential Insurance which has been running a five-person home-based pilot linked to a conventional 100-person call centre.

There are additional costs involved in equipping individual homes with the necessary telecoms lines and equipment and this form of work organisation also poses management challenges in terms of worker supervision and team motivation. In the banking sector the development of virtual call centre working may also be held back by data security concerns (ie, the fact that personal financial information would be accessible from private homes). These concerns would seem to apply less in the case of outbound telephone call handling, where calls are being made for marketing purposes. Security concerns would also seem less relevant for the insurance sector.

Virtual call centre working raises some significant additional issues and challenges for trade unions, not least in the area of membership recruitment and organisation. Home based workers face isolation, and may not be aware of the pay and employment conditions being made available to staff working centrally. The demands of UNI’s campaign for On-line rights for on-line workers are particularly relevant where staff are working from home.

The general issues raised by home teleworking, which can have both advantages and disadvantages to the individual worker, have been investigated by several unions, and a number of guidelines for good practice have been developed. The subject has been examined in detail in the report Teleworking and Trade Union Strategy, published by FIET three years ago.

Unions should monitor the development of virtual call centres closely. Home-based working needs to be voluntary, introduced only after adequate training and carefully monitored by trade unions.

The German banking unions fighting Citibank’s call centre at Duisburg talked of the need to combat the bank’s use of ‘social dumping’. The prospect for social dumping (that is, moving work geographically to areas with low wages or poor social protection for workers) is much greater, however, at the international level.

There are already numerous examples of call centres being set up to handle international call handling. A number of computer companies, for example, handle marketing and technical hotline calls from across western Europe at a single call centre, where staff automatically answer incoming calls in the appropriate language. Ireland is a popular destination for pan-European call centres, where the industry has been developed with government financial support. The UK also has a number of call centres handling international calls, several based in London where a large pool of native non-English speakers is available. This was the reason given by Air France, for example, which opened its pan-European reservations centre in London in 1999.

Despite the recent international merger and take-over activity in banking and insurance, there is as yet much less evidence of the internationalisation of call centres in the financial sector. It may be that it is felt that customers would be resistant to the idea that their bank or insurance adviser was located in another country. It is also true that most banks and insurers continue to operate on a national level, even where the companies are internationally owned. However, it could also be that the sector has simply been a little slower off the mark than other industries.

Perhaps the most worrying possibility from a trade union perspective is the idea that call handling work could migrate to much lower wage economies. Technically, it is not necessarily more difficult to route customer calls to, say, India or Mexico rather than to, say, Ireland. (There is already experience in the financial industry of using ‘offshore’ data processing workers in countries such as the Caribbean for work such as insurance claims processing.)

In this context, it is worth noting that GE Capital set up a wholly owned subsidiary GE Capital International Services (GECIS) in 1996, to offer back office processing services to international clients from a centre in Gurgaon near Delhi. GECIS says that this Indian subsidiary aims to offer ‘Transaction Processing, Accounting Services and Call Centres [my italics] to service both GE and non-GE companies world-wide".

There are language and cultural reasons why call centres may be less prone to migration offshore than back office administration. Nevertheless if (as seems likely) call centres increasingly handle email and web based enquiries language issues will become less crucial. This is an issue which needs to be watched closely, and where international cooperation and solidarity between unions will be of practical relevance.

The internationalisation of call centre operating raises challenges for trade unions at both ends of this process of work migration. Effective international cooperation and solidarity is necessary, to avoid social dumping.

What is the likely future for call centres? Ironically - given that the industry is very young and has been expanding very fast - trade unions need to be conscious of longer-term technological developments which could threaten continued call centre development. Could it be the case that unions will be called upon in the next few years by their newly recruited members in call centres to defend their jobs from redundancy?

The growth of touchtone phones and interactive voice recognition (IVR) technology allows customers to use their phones to undertake basic transactions (such as obtaining a bank balance or paying a bill) automatically without the need for human mediation. The endless menus (‘Press 1 if you are an existing customer’) may not be liked by customers, but are cheap and efficient for companies.

As IVR has taken over this sort of routine enquiry handling, so the work of call centre staff has shifted noticeably from a customer service role to a customer sales role. Call centre staff are needed for adding value — or in other words, for using the opportunity to develop the relationship with a customer by trying to sell additional services. This suggests that handling of inbound calls may increasingly be automated, but that banks and insurers may want to further develop their use of outbound telephone calling (cold-calling) of customers.

The development of the internet, and in particular of on-line banking and insurance services, reinforces this trend. In many countries a customer can now not only check their bank balance over the Web, but can also compare car or household insurance quotes, arrange bank loans or even take out a house mortgage loan.

The take-up of Internet banking has been rapid in several countries, and the introduction in the next two years of Web-enabled third-generation mobile phones using Wireless application protocol (WAP) and of digital television will extend the opportunities for direct banking transactions by customers. Another likely development, the introduction of electronic purses based on smart card technology which can be loaded with e-cash from home computers, also puts the individual customer more in direct control of their finances. In each case, the implication is that call centres may become less utilised.

A recent survey by market analyst Datamonitor [European Call Centres in 2003, publ January 2000] suggests that the internet will indeed slow down the growth of call centres in Europe. Nevertheless Datamonitor maintains that the number of call centres will still be greater in 2003 than at present. Indeed the report predicts a compound annual growth rate over the next three years of 12%. By then it suggests that a total of 1.3m Europeans will be working in call centres.

However industry analysts also suggest that the nature of call centres will change in the years ahead. From being simply telephone call handling units they will be transformed into customer relationship centres, which deal not only with telephone conversations but also with other technologies, including customer contact by e-mail, web and digital TV. (It may be significant in this respect that one UK call centre operator Telecom Potential already prefers to describe itself as a ‘customer interaction centre’.)

It is clear that the Internet will be an important means of communication with customers. Already some corporate web sites are equipped with ‘call me’ buttons, enabling customers who are visiting web sites to request that a telephone call is made to them at a time of their choice. More sophisticated refinements of this idea have already been under development; for example, the facility whereby customers using the Internet can activate a live two-way videolink through to a call centre agent was demonstrated by the US telecoms company MCI in 1998. Whether this sort of video link will really take off is a debatable point. What is not in doubt is that many companies need to improve their procedures for handling email communications with customers.

The speed of technological change will undoubtedly have an effect on the call centre industry. It reinforces the importance of pressing for adequate training for call centre staff, to enable them to have the breadth of skills needed to be able to adapt to future change.

Call centres have grown very fast in recent years, but their future development is uncertain in the light of technological change and the expansion of the Internet. Adequate training is necessary to equip call centre staff to cope with future change.

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