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   Columnist: Thomas Pyzdek

Photo: A. Blanton Godfrey


The Dilemma--Part 1

A quality story




Great,” Mary thought, staring through the darkness and the driving rain at the car parked in her spot. She’d arrived before sunrise to prepare for meeting Dennis Tisda, the new “owner” of the customer service and support process, whatever that meant. Things had been getting weird around TechDyno since the new CEO, Steve McDowell, had been hired. Mary learned that McDowell had come from General Systems, where he had been president of the consumer credit division, and GS was known as one of the best-managed companies around. Steve had turned its consumer credit from a disastrous division into a cash-generating giant. Mary knew that Stan Scott, TechDyno’s founder and chairman of the board, expected Steve to take TechDyno to the next level by introducing his revolutionary approach to business. Steve’s people were throwing a lot of new jargon around, like CTQs, VOC, and a dozen other acronyms. She hoped that Dennis would fill her in on some of the details. Sighing, she found the nearest unreserved spot and parked her car.

As Mary walked down the hall, she saw the light was on in the office reserved for visitors. She stopped when she recognized Dennis at the desk. He rose and reached for her hand. “Mary, great to meet you! I’ll meet you in your office in an hour or so.” So much for getting time to prepare.

Mary was the director of TechDyno’s call center. Her staff, a thousand strong, answered questions from customers about everything from orders and billing to TechDyno’s software. The software, called “HealthNet,” managed everything from patient records, to prescriptions and drug interactions, to billing. It was the market leader, but several new competitors were making it increasingly difficult to maintain margins, and market share had been eroding for years.

Dennis appeared an hour later, a cup of coffee in hand for him and another for her. He got right to business. “The contact center is losing money,” he said.

“We’ve been reducing costs steadily,” she countered. “We’ll be close to breaking even in a couple of years.”

Dennis nodded. “I know. I’ve seen the plan. That’s not good enough. The contact center needs to become a profit center. Bringing in a few million in the next year, at least. By then we’ll know just how much upside to expect after that.”

Mary’s head swam. Who was this guy, anyway? He acted as if he were her boss. His demand was absurd. The call center had been in operation for years, and had never turned a profit. It wasn’t expected to. She was proud that under her leadership she had reversed the flow of red-ink by deploying technologies such as web help, live chat, and e-mail response to customer inquiries. But to make a customer contact center a profit center would take more than technology. It would take… she didn’t know what it would take.

“I support the business units,” Mary said. “The BU leaders have us in their budgets, and we are meeting their targets. Are the targets changing?”

Dennis shook his head. “It’s not about arbitrary budget targets any more. Things are changing for the BUs, too. Steve wants us to focus on customers, not functional departments and budgets. That’s why he’s created the process owner position.”

Ah, Mary thought, I finally get to learn what your job is, Mr. Tisda.

Dennis produced a printout showing five chevrons.

“The business starts by identifying a customer’s need and developing a way to meet the need,” he said, pointing to the concept-to-design chevron. “Then we build a solution, identify prospects, and make the sale. Next we deliver the solution. Finally, we cultivate the relationship after the sale with ongoing service and support.” Dennis tapped the service and support chevron. “I own this process,” he announced. “And the call center is an important part of it. But we have other stakeholders, too--shareholders. We can’t run the business at a loss just to serve customers. You have to make money in the call center, Mary.”

“Do I report to you now, Mr. Tisda?” Mary asked directly.

Dennis nodded his head. “All functional departments that affect the process that I own must answer to me. I have input into your performance appraisal. I decide how to measure the results for the service and support process. For example, one very important metric is customer loyalty. The call center has a big effect on that, and I’ll hold you accountable. An important shareholder metric is cost per contact, and you have to meet goals for that, too.” Mary nodded. Just what she needed, another boss.

To be continued…

About the author
Thomas Pyzdek is the author of The Six Sigma Handbook (McGraw-Hill, 2003), Quality Engineering Handbook (CRC Press, 2003), and The Handbook for Quality Management (Quality Publishing, 2000). He is a consultant on process excellence. Learn more at www.pyzdek.com . Contact him at tom@pyzdek.com.