For Halifax Direct in Leeds, England, the telephone banking subsidiary of Halifax PLC, all the attention has been a trifle bewildering. Not that winning the coveted 1997 European Call Center of the Year award and hosting a parade of admiring executives from Japan, Australia and the United States hasn't been flattering, mind you. But the adulation seems a bit ironic to Mike Riley, project manager of the team that created Halifax Direct. The very reason the call center has drawn attent ion is that the technology itself is invisible to the people Halifax is most concerned with impressing！customers. "The customers who call to use the center have no idea about the technology behind it," says Riley, Halifax Direct's controller. "And frankly , it's better that way. They just know that their calls are answered quickly and professionally."
The call center, operational for almost two years now, is the embodiment of a truism that many companies have yet to heed: Technology is at its finest when it can be ignored. With Halifax Direct, the bank has managed to satisfy both its own needs t o maintain a flexible business model and expand into new markets as well as its customers' appetite for convenience and service. So while the neato-keen technology running the center is indeed cutting edge, what the bank is doing with it is even more impr essive.
The impetus behind the call center was a startling loss in market share in 1994 to two new competitors: A telebank that conducted business solely over the phone！no branches, no tellers！delivered a hit to Halifax's loan and personal bank account bus iness; and an insurance company that sold over the phone knocked the wind out of Halifax's insurance line. The company realized it had to counter customer losses to these startups. If its 20 million customers wanted the convenience of telebanking, Halifax would deliver it, by golly.
But Riley, selected to head the project with his boss, Dick Spelman, director of distribution, was suspicious of the return on investment for a call center that provided only support and service. Sure, the move would prevent the bank from shedding more customers. But the savings on branch costs as customer traffic shifted from standing lines to telephone lines would be minimal, given that the company preferred to transfer rather than lay off the 1,300 branch employees the system could replace.
To cover the project team's collective flank on the ROI question, Riley looked for ways that the call center might bring in new revenues. What he and Spelman came up with was using the call center as a new way to pitch bank products. Although bank telemarketing is not rare in the United States, outbound calling in England verges on heresy. When Riley and Spelman first mentioned the idea, executives at the bank thought they were nuts. "I think at that point the mood was fairly conservative, and we w ere seen as a bit of a couple of wild men," Riley says. "So it was a deep breath and a swallow."
While Halifax executives were skeptical, none could find a good reason to turn down the proposal, Riley says. The additional outbound calling capabilities would account for only ♀300,000 of the ♀24 million ($38 million) price tag, which included bu ying and renovating a building as well as assembling the appropriate technology and staff. Besides, if the nutty plan worked, it would provide a clear return for building the call center as well as launch the bank into new markets.
The outbound calling strategy has been an unqualified success so far. The 12-month-long pilot of the strategy generated ♀22 million ($37 million) in loan business, Riley says.
But Halifax isn't achieving such results because it's one of the first British banks to ring up prospective customers at the dinner hour. It's successful because it's ringing them up with offers they want to hear. Halifax mines its own customer databases to find consumers likely to be interested in its various products, Riley says. For instance, reps contact people whose loans are almost paid off and offer to extend the loan if the customer needs money for anything else. They contact people whose tax-exempt savings accounts have reached maturity and discuss reinvesting the funds in various Halifax products. Reps also call people who carry a high balance in their checking accounts and recommend more lucrative investments！in Halifax products, of course.
Halifax executives are a little incredulous about the strategy's success, Riley says. "There is a certain element of surprise," he says. "I think people still don't realize the full potential of outbound calling."
The setup of the call center also allows the bank to be more flexible. Many call centers divide up phone representatives according to product lines. So one group of service reps would handle calls on Visa accounts, another would handle checking acc ount inquiries, etc. At Halifax Direct, all 550 representatives are "multiskilled." Each rep who logs on the system enters his or her four top areas of product knowledge, and calls are routed to the most knowledgeable rep available. That means when Halifa x adds new products to its portfolio, it does not have to recruit a slew of new operators and train them on the system; it need only retrain a group of seasoned call center reps. In other words, time to market is reduced substantially. "Halifax Direct is an example of a company that is very adaptable to changing business needs," says Donald Jones, chairman and CEO of Emerging Technology Solutions International, which assembled the technology for the project. "If they want to add a product line, they're ab out a week away."
The other benefit of multiskilling is that it opens the door for an incentive program to get reps to learn more about the products they are servicing. Halifax Direct pays reps based on the number of products for which they can field calls and provi des the necessary training, support and testing to ensure they can learn as much as they take on. Finally, fielding calls on multiple topics helps reps stave off the boredom that can accompany the repetitive nature of the job. "The last thing you want to be doing is taking the same call all day long," says Customer Liaison Officer Wayne Brown. "It breaks your day up to be switching from [product to product]." That benefits the customer, who is less likely to get a laconic, just-woke-up-from-my-nap voice o n the other end. Multiskilling also means that customers with questions that span several products don't have to be transferred or put on hold listening to Barry Manilow Muzak indefinitely.
The new sales channel and flexibility provided a win for the bank; the inbound calling capabilities gave customers something to rave about. Building customer-oriented technology seemed to Jones a matter of simple common sense. Although no market re search or testing was done, the team charged with building the call center asked itself questions such as, "Do I like being on hold forever?" Since no one likes being left on hold, the team concluded it should find a way to avoid treating its customers th at way, Riley says. The result is a logical and swift system for processing calls efficiently that is absolutely invisible to the customer. Any information a customer enters in a phone tree menu will follow the call to a representative's terminal. A custo mer who makes two mistakes in the automated system immediately gets connected to a rep, who can see what the customer was trying to do. If a rep needs to transfer a call to a more skilled rep, any information typed into the system follows the call. All of that is possible because of sophisticated computer telephony integration software that Jones himself coded.
The project team also decided to use case-based reasoning (CBR) scripting to help reps process calls more efficiently. In part, they did so to maximize the scant 35 reps that the team had been able to recruit and train by the aggressive deadline fo r getting the call center up and running; they had wanted to open with 400. The software package from Inference generates scripts for inbound calls that automatically jump to the correct responses and follow-up questions. The software also tracks the top 10 customer questions of the day so that common queries related to news or the season appear on a rep's first screen. CBR has enabled the call center to deftly handle increasing call volumes. Within the first month of operation in 1995, the call center ha ndled 20,000 calls. A year later, it took 450,000. Today it averages between 30,000 and 40,000 per day. While the number of reps has increased to over 500, the technology has not changed. And the CBR software allows Halifax to resolve most calls！whether c ustomers are calling to check a balance, transfer funds or get product information！in about two to three minutes.
Best of all, 30 percent of Halifax's 20 million customers now do their business over the phone instead of at a branch. That has reduced branch costs, enabled the bank to close some branches, and has earned Halifax customer loyalty as well！98 percen t of the customers using the telebanking service rate it as excellent, though they've no idea how it works, Riley says.
The project team also made several investments in the design of the center that at the time might have seemed like frills to bean-counter types. But they have more than paid off in the long term. From Riley's perspective, the smartest thing the pro ject team did was to pay attention to the needs of the people who would be working the phones. Most call centers are digital sweatshops！operators crammed into cubicles like sardines, headsets glued on, eyes glazed from staring at tiny monitors. That was e xactly what Halifax Direct did not want to build. "We believe that if people enjoy what they're doing, they do it better," Riley says. "We wanted to give them the right tools and technology to do things properly."
So rather than build a maze of cubbyholes for the operators, Halifax Direct built curved pods that allow operators to see each other and interact. The lights in the former armored tank factory are bounced off the ceiling to reduce screen glare, and green plants are everywhere. "If they are feeling they need to get up and stretch their legs a bit, the headset cords are long enough so that they can do that," says Callum Woodhams, a team manager at the call center. "They don't have to sit in front of their PCs all day long."
The same concerns informed the setup for training and workflow. Operators are divided into teams of eight, with one team leader who helps answer questions and handle problems. These teams have become social groups as well as workgroups. Halifax Dir ect routinely chips in for munchies and pints for meetings outside work hours or if the crew wants to get together at a pub. "We're basically friends who work together," says Brown, who has worked at Halifax Direct for almost two years.
Managers have no offices, and they work the same schedules the reps do！including coming in on Christmas day. Last year for the holiday, one of the managers came in dressed as Father Christmas, and the company sprang for salmon and mince pie. "Nobod y wants to be working Christmas day," Brown says. "It's nice to know that the managers who are asking you to do that are doing it themselves."
All of this equity keeps people happy at Halifax Direct. "It's a very open place," Woodhams says. "People are prepared to constructively give their opinions, and there are no hidden agendas flying around. I wouldn't change jobs unless someone offer ed me lots and lots of money."
So what's the bottom line for all this warm fuzziness? Incredibly low turnover: between 5 and 6 percent, according to Riley. Compared with the annual turnover rate of 130 percent at one call center the project team visited！or even with the average of about 15 to 20 percent in U.S. call centers！the figure is impressive. Low turnover translates to better customer service from more experienced reps and lower costs for training and recruiting.
Managers at Halifax Direct expect the hoopla over the call center's technology will eventually die down. Even Jones admits that Halifax Direct will likely be leapfrogged by something cooler, newer and more cutting edge within the next year. That's just fine, Riley says. What matters to the bank is that the sound strategy behind the center will remain intact. After all, though technologies come in and out of vogue, good business sense never goes out of style.
Associate Editor Cheryl Dahle can be reached at cdahle@cio.com.
A Close Call
Advice from the trenches
When Donald Jones was hired to help Halifax Bank build its call center, he was working for Digital Systems in Seattle. He had collaborated with project leader Mike Riley before in Halifax's loans reclamation area. So when Riley needed help building the call center, he tracked down Jones on another continent.
Two months into the task, supervisors from Jones' employer came to visit the project. Alarmed that Jones was being given such a prominent role in the process and fearing additional liabilities for the company should something go wrong, they pulled him from the project.
"They called me up one night when I was at the pub having a few drinks with the team and said they were canceling the contract," Jones recalls. "My response was, 'I'm faxing you my letter of resignation, then. I've given these people my commitment. '"
Dick Spelman, Halifax's director of distribution and other executives decided to put the project in Jones's lonely hands, and the rest is history. That was the start of Jones's company, Emerging Technology Solutions International (ETSI), now a flou rishing business with branches in Leeds, Glasgow and Seattle.
Jones, who has worked on more than 120 call centers in his career, has this advice for anyone thinking of building one:
If a company can't get a call center up and running in six months, it should abandon the project; the technology will be obsolete by the time it's finished. (Halifax Direct was conceived and built in just five months.)
Part of the reason Halifax Direct was successful was that the project team was small (six people), and it had a lot of authority. Management's only criteria was to get the job done.
Don't build a call center based on what your business is today. Build it based on the way your business is changing.
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