You Made a Contract With Your Call Center Representatives, So Keep It!

Whether or not you know it, you made a contract with your call center representatives when you hired them. This agreement is known as a psychological contract, a well-documented phenomena that occurs at the time of employment. This circumstance was first reported in 1960 by Chris Argyris, a professor at the Harvard Business School. He defined the psychological contract as the perceptions and implied expectations of all parties to form a fair and reciprocal relationship that is mutually beneficial to both the call center and the new call center representative.

The psychological contract is concerned with whether the promises and obligations of both parties have been met and the consequences if the contract is perceived to have been violated.

Two-Sided Relationship at the Call Center

The psychological contract is a two-sided implied agreement with assumptions on behalf of both the call center management and the call center representative. Here’s how it works. When an applicant is hired he or she assume the call center management provides:

  • Fair pay and benefits
  • A good working climate
  • Fair management and supervision
  • Positive work relationships
  • Reasonably clear work expectations

On the other hand, the call center management assumes the new call center representative commits to:

  • Get a fair days work for a fair days pay
  • Adhere to reasonable attendance requirements
  • Remain loyal to the organization

Obviously this contract is full of potential pitfalls and requires constant attention to be maintained. Yet, it needs to be kept in balance or there are significant problems that will manifest themselves to the unaware.

Excessively high and expensive turnover within the call center is one clear outcome that almost always results from violation of the psychological contract. For example, several months ago, many call centers were struggling with runaway attrition of call center representatives. In this case, the balance of power was clearly with the call center representative. They knew the call center was desperate to keep seats filled. So, under such circumstances, if the call center representative felt the psychological contract was violated, it was easy to vote with their feet. In other words, get another job.

A Reversal of Power in the Call Center

Now, the pendulum has swung in the opposite direction and the balance of power is with the call center. Call center representatives who perceive the contract had been violated can no longer easily quit and get another job. This is an especially explosive situation and actually more damaging to the call center than the previous state of affairs. At least, in the previous situation, an employee would leave and take their dissatisfaction with them. Now, many people are trapped in a job by an employer they feel is taking advantage of them. Under these circumstances, resentment will build, fester and spread until the balance begins to shift in the other direction once more. And thus, a never-ending cycle for those contact centers who just don’t get it.

The call center management is thinking, "You should be grateful to have a job in these hard times, so get over your problems and do your job." Conversely, call center representatives are thinking, "You are taking advantage of me because you know I can’t leave." I repeat this is a very dangerous state of affairs for the organization!

I was struck by the significance of the psychological contract by the results of a recent internal survey of call center representatives at a large call center. Here are the anonymous responses from the call center representatives to the following statement.

Overall, to what extent has the organization and call center kept his promises and commitment to you?

Promise from Brand to Customer and Brand to Call Center Representative

2007 2009
Fully 45 percent 30 percent
Partly 49 percent 39 percent
Not At All 6 percent 31 percent

This is a dramatic shift in perception. I think it is safe to assume that more call center representatives now feel the call center contract has been violated. And to make matters worse, the annualized employee attrition rate in 2007 with 123 percent. To date, in 2009, the rate is 63 percent, which is an indication dissatisfied call center representatives are staying on the job. To me, data such as this is a warning there is a perfect storm brewing on the horizon.

The employer at the call center is naively thinking, "Isn’t it great that we no longer have to deal with inordinately large turnover rates in the call center." Simultaneously, the call center representative, is thinking, "OK, you got me trapped for now, but as soon as things loosen up I’m out of here." Even worse, I suspect that trapped call center representatives will begin to display their frustration and anger by poor customer service and other subversive behavior.

The solution to the dilemma is to be attentive and aware of the psychological contract that exists with call center representatives. Clearly, these are difficult times and sacrifices must be made on the part of all parties.

Demonstrate You Value Your Call Center Representatives

Especially now, it’s time for call center management to demonstrate to call center representatives that they are valued and not going to be taken advantage of. In addition to close attention to pay and benefits, there are many other things call center management can do to demonstrate the commitment to the contract with the call center representative. For example, increased incentive plans for exceeding normal call center performance goals. Or, increased focus on call center representative bonding activities such as birthdays, anniversaries, holidays, etc.

In summary, call centers that are mindfully aware of the psychological contract with their call center representatives will be able to increase their chances for survival in hard times and build a solid and leaner workforce of dedicated and motivated call center representatives. The companies and the call center will reap the full benefits of this commitment while other companies will see their call center continue to repeat the vicious cycle of the past.