The In-Built Design Flaw in Service Centres

Ask any leader: “What is the one thing you would change about your people?” And invariably, “Greater Ownership” is a popular answer. There is an in-built design flaw in service centres that undermines the sense of ownership. What is it? How do you overcome it? And what does George Clooney have to do with it?

The design flaw we’re referring to is Psychological Distance[1]. Customers are psychologically distant if either they or their needs appear abstract as opposed to concrete to service centre people. There are many factors that cause customers to become abstract – this is depicted our infographic below, “Barriers To Customer Empathy”:

Is it a big problem?  

This design flaw has a big impact. It’s one of the root causes of service failures, employee apathy and unethical behaviour.  

Psychological distance is the enemy of Empathy. If your service centre people can’t empathise with customers, they’re likely to care less and take less responsibility for the welfare of customers.

Consider how it affects our everyday behaviour:

• People are likely to spend 56% more on impulse purchases when paying with credit cards instead of cash[2]. This is because credit cards are one step removed away from cash[3].
• When a patient’s photo is attached to CAT scans, radiologists said they worked more meticulously because they felt more empathy towards the patient. In an experiment by Turner and Hadas-Halpern, radiologists failed to report 80% of incidental findings when a photo is omitted[4].
• Behavioural scientist, Dan Ariely, says that it’s much easier to be dishonest and rationalise poor behaviour when the victim is faceless[5]. People are more likely to make false or exaggerated claims on their tax return, or in making an insurance claim, than they would in a face-to-face situation.

How is psychological distance in-built?

Psychological distance is created when bank leaders:

• Centralise operations to realise economies of scale (thereby creating physical distance away from customers, and possibly adding intermediaries)
• Capitalise on labour cost arbitrage (i.e. moving work to lower cost states or countries thereby creating physical and social distance);
• Reorganise how work is carried out (e.g. transferring activities from frontline staff to the back-office staff thereby reducing personal proximity)
• Leverage technology such as web, mobile, artificial intelligence and chat interface (thereby create a layer between the customer and the bank). See diagram “Chat Bot Failure”
• Remove dependency on individual team members and achieve faster turnaround times by moving away from case-file ownership i.e. anyone can handle a case (thereby creating the risk of the bystander effect)
• Put in place service level agreements (thereby misaligning objectives e.g. service centre staff focus on meeting service level agreements and ignore the customer’s urgency.)
• Rely on standard operating procedures (policy and processes are important, but they can have the effect of distracting service staff away from customer’s need e.g. a service centre staff might be preoccupied with: “what process should I follow?” as opposed to “what do I need to do to get the job done for the customer?”

On the whole, these strategies are a boon for customers – they improve speed and accessibility, and significantly lower cost and risk of failure. However, empathy for the customer is an unfortunate casualty of these efficiencies. 

Service leaders try to overcome this by putting in place governance, reporting, standard operating procedures, workflow, production management, service level agreements, communication channels and customer excellence service programs – to name a few.

In our view, these process and technology focussed systems are necessary, but insufficient. It’s easy for service centre staff to forget who the customer is, rationalise poor behaviour or be distracted from customer outcomes (as depicted in our “Barriers To Empathy” infographic).

Closing the Psychological Gap

Strategies to close the psychological gap will be the focus of Part II of this article. You can find the article here: Fixing The In-Built Design Flaw in Service

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If you enjoyed this, check out:

• Are banks really that bad?
• How bank leaders can supercharge employee-driven change using behavioural science

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How do you help your team members become more empathetic to customers?

I'd love to see your questions and comments below.

By sharing you benefit other leaders as well as increase your profile amongst them.  

Footnotes:

[1] Trope, Yaacov and Liberman, Nira. 2010. Construal-level theory of psychological distance. Psychological Review. 117 (2) pp. 440-463.

[2] Harrison, Paul. 2014. The psychology of making purchases with cash and credit. https://www.abc.net.au/radionational/programs/archived/talkingshop/the-psychology-of-making-purchases-with-cash-and-credit/5595972

[3] Ariely, Dan. 2008. Predictably Irrational: The Hidden Forces That Shape Our Decision. Chapter 14, pp.295-308.

[4] Turner, Yehonatan and Hadas-Halpern, Irith. 2008. The Effects of Including a Patient's Photograph to the Radiographic Examination. Quoted in Pink, Dan. 2012. To Sell Is Human. P.208.

[5] Ariely, Dan. 2012. The Honest Truth About Dishonesty. Harper Collins.