Systems Thinking

Advice For Contact Centers In The Health Care Overhaul

Tripp Babbitt
Contributor: Tripp Babbitt
Posted: 04/22/2010

Large contact center vendors may be licking their chops to provide their services to the wide-open health care market. 32 million more Americans will need coverage and this should translate to more phones needing to be answered. There will be more questions about enrollment, coverage and much more.

The track record for the health care industry has been less than stellar when it comes to insurance companies. Michael Moore in his movie Sicko outlines some of the suspect things that happen in health care companies when the insured are denied coverage. In the movie, one customer service rep was in tears when she described how she had to deny coverage (that won’t be a problem in this health care overhaul).

More people needing coverage doesn’t mean that we should keep doing things the same old way. Most articles I read discuss how outsourced contact centers can save money. Those who know me will testify to the fact I don’t like outsourcing when lowering transactional costs is the aim.

The mantra is cost reduction actually drives up costs. This paradox is something most outsourcers and outsourcing companies miss. Organizations that outsource contact centers wind up shipping out their failure demand to the outsourcing company (this is demand caused by a failure to do something or do something right for a customer).

The saving grace for outsource contact center vendors would be if they understood the causes of costs. Then they would design the contract and the work to serve customer purpose rather than the financial statements and productivity numbers. If outsourcing vendors understood the power of improving the system end-to-end from a customer perspective there would be the opportunity to add value.

The traditional outsourcing contact has measures of activity and productivity targets that the outsource vendor can control, but provides both poor service and increased costs. Better to have customer measures derived from customer purpose that decrease overall costs. This means that the outsourced contact center function has to be part of the system.



Don’t Do This

Failure to understand customer demand was a huge error made in an outsourcing contract in the State of Indiana for eligibility to food stamps, Medicaid and other services. Wrong thinking not only led to the cancellation of the contract, but led to an increase of 30 percent in employment and delays in getting services to some of Indiana’s neediest people.

Assumptions were made about how technology would help automate and modernize a paper system. Case workers were replaced by the cheaper contact center customer service representatives to save money (wrong focus). A litany of other problems in the design of the work led to the inevitable catastrophe.

Contact center scripts are a form of standardization that does not allow the customer service representative to absorb the variety of demand seen in service. At the contact centers, employees were given scripts as the expensive case workers disappeared. Confusion, delays and high failure demand led to this outsourcing agreement to meet a costly end that the State of Indiana will be paying for in years to come.

What Should You Do?

I am yet to find an outsourcing vendor that understands costs and its causes. For that matter, too few organizations understand the causes of costs. They are in the flow (economies of flow) end-to-end from a customer perspective.

Any contact center outsourcing vendor would be both wise and different to come to the table with a better solution than to lower transactional costs. You have trained customers to think this way and now you must "untrain" them. You will need to show them their failure demand and work with them to understand customer purpose and demands deriving new measures that will decrease costs dramatically, but with a shift in thinking.

First published on Customer Management IQ

Tripp Babbitt
Contributor: Tripp Babbitt
Posted: 04/22/2010

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