We have reason to lament the rise of mechanization and the diminished role of human beings in the delivery of the helping or so-called “soft” services. As this author writes, those who purchase these services for others would do well to reflect and ask if they themselves would be happy with the quality of service delivered.
In the fall of 1984 I sat in a darkened ballroom of the Hilton Hotel in midtown Manhattan, watching on a twenty-foot screen a short video of my father, Murray Roman, talking about the early days of the company he founded in the late 1960s. When the screen went dark, the hundreds of attending members of the Direct Marketing Association honoured him with a minute of silence. On his passing away the previous spring, the Committee of Corporate Telecommunication Users had placed in The New York Times a notice of his death, mourning him as “The Inventor of Telemarketing.” Indeed, as far as I know there were no other contenders for the title.
Two years before, living in New Jersey, I had left a first-level management job (my first in the private sector) at AT&T, then the largest company in the world, with one million employees, to cross the Hudson River and become Vice-President, Operations, in my father’s — and the world’s first — telemarketing company, Campaign Communications Inc., or CCI, on West 57th Street in New York City, Business Journal Personal The industrialization of service: A personal journey employing 500. Sitting in the dark in that ballroom, I had already returned to AT&T, which was just breaking-up, while CCI itself, like my father’s flickering image on the screen, would soon vanish. In the midst of rapid economic and social change, he had been more successful at building a foundation for an entire industry than a lasting platform for his own company.
Today, while I’m glad I crossed that river (wider than I had ever imagined, between corporate and family business, between old and new economy), I am both very proud of what my father accomplished-proud of his vision, his tremendous drive, intelligence, and salesmanship-and deeply concerned about some of the effects of the larger trend, of which he and his company were among the early pioneers. That trend was given its name in 1976 in an article in the Harvard Business Review, by Theodore Levitt, entitled “The Industrialization of Service.” In a long list of other examples, Levitt cited my father as “the world’s foremost specialist in offering telephone marketing services.” (Theodore Levitt, “The Industrialization of Service”, Harvard Business Review, September/October, 1976 p. 72.)
The occasion for my writing this article is my having come to realize that “industrialization” has spread too far, reaching beyond business services to services to individuals, helping or so-called “soft” services, where its characteristic efficiencies do harm by doing insufficient good. In the first part, I discuss “industrialization” as it has shaped telemarketing; in the second part I discuss the form it has taken in the very different business in which I’ve been employed for the last dozen years, career management consulting.
The sales call as widget
Now that it is so pervasive, we may hardly notice fresh instances of “industrialization,” by which I mean the systematization of a human activity either by a machine, or by a process modeled on the machine, ostensibly to make that activity more efficient (faster and therefore cheaper) and effective (predictable). From voice-mail menus to ATMs to do-it-yourself checkout at the supermarket, there is very little that we do day-today that isn’t touched by mechanisms directed to what the subtitle of a book published a few years ago called, The Acceleration of Just About Everything – an acceleration often accomplished by the replacement of service personnel with machines. (James Gleick, Faster : The Acceleration of Just About Everything, New York: Vintage Books, 2000)
Much of this is helpful and even feels necessary how, we hear ourselves asking, did we ever get along without this or that?-as most of us struggle to keep up with the intensifying complexities of making a living, raising families, and pursuing ever-expanding economic and social opportunities (for those fortunate to be making a good living) in 21st century North America. At the same time, there are losses as well as gains that come from systematizing our lives, and there is a distinguished history of criticism and resistance in the West, from those who opposed the land enclosures in late medieval England, to the Luddites who smashed machines in the early days of the Industrial Revolution, to Charlie Chaplin in his hilarious — and not a little frightening – depiction of the perils of the production line in Modern Times.
In this tradition, journalist Simon Head, in The New Ruthless Economy, reports the results of recent field research that finds early-industrial practices such as “the standardization, simplification, and measurement of tasks; the preoccupation with monitoring and control; the persistence of hierarchical relationship between managers and employees; and the unceasing efforts to speed up ‘business processes’ with ‘business process reengineering’. . . have also crossed over and colonized the service industries which now dominate the U.S.,” and of course the Canadian economy. (Simon Head, The New Ruthless Economy: Work and Power in the Digital Age, New York, Oxford University Press, 2003. The chapter, “The Roots of Mass Production,” is a useful summary of the lead-up on the manufacturing side to the cross-over into service.)
Head’s book goes on to investigate the negative impacts of this crossover on a number of fields, including medicine, the funeral business, customer relation management, and what has come to be called the call centre industry. A number of his negative examples mirror precisely those praised so highly by Levitt, of whose seminal work Head gives no indication he is aware. I will side with neither one in trying to get at what the call centre tells us about the industrialization of service.
What my father invented was the subjection of the sales call to the rigours of industrial standardization, simplification, and measurement. His system, based on a pre-tested script for answering questions and objections, made the outbound telephone sales call into a widget, something with a predictable cost, with a predictable value-so many sales or qualified leads per so many calls-that could then be sold at a predictable margin. Of course, because people are not machines, and demographic analysis of call lists can never predict the response of any single individual, not every call was successful, but they were successful a predictable percentage of the time. That was the key to my father’s, and the industry’s, success.
While the “do not call” movement makes headway in the United States., as it will, no doubt, in Canada, there are clearly a vast number of people who do not resent the intrusion of sales calls into their home life. The telemarketing industry has grown exponentially, expanding from the first call centre in my father’s bedroom to at least 60,000 call centres in the United States alone, employing from 3.5 to a possible 6 million Americans (compared to 11 million in manufacturing), and at least a proportionate number of Canadians, with an estimate of more than 150,000 in Ontario alone. (Murray Roman, Telephone Marketing: How To Build Your Business by Telephone New York: McGraw Hill, 1976, p. 72, for a picture of the first call centre cubicles; Head, p. 82, for the U.S. call centre statistics; and The Globe And Mail, February 19, p.B9, for the Ontario employee total.)
My concern-and it must play some part in the also widespread negative response to telemarketing callsis that in the industrialization of the sales call, what had been a conversation between two people is transformed into what is in essence an exchange between a person and a machine posing as a person. Some people, many people apparently, are not bothered by this. There are studies that show people can respond warmly to conversation with a computer, at least for a while. In fact, I heard a representative of the call centre industry claim on the radio that it will be made even more efficient by the “do-not-call” lists screening out the more resistant respondents. At the same time, I would argue that the massive application of industrialized speech can only degrade over time the general trust in person-to-person exchange. And what does it do to the people making the calls to so de-personalize, hour after hour, their conversations with other people, people they cannot see at the other end of the phone line, but who are otherwise like themselves? (Arlie Hochschild, in The Managed Heart: The Commercialization of Human Feeling, Berkeley: University of California, 1985, studies the training of Delta Airline stewardesses and the impact of “industry speed-up” (the smile as widget) on their emotional health.)
Not seeing them helps, of course-but how much will change if the call centre industry figures out how to exploit the capacity of the Internet to stream both voice and video? The new “stealth marketing,” where, for example, undercover sales people are planted in bars to talk up a particular brand of beer, is a disturbing extension of the industrialized sales call. What sounds, or even looks like a person, is really a sales or marketing strategy sitting on a bar stool. So far, what strikes me as literally the farthest extension in this direction is a development described on a recent “60 Minutes” segment, where telemarketers in India, using false American names, are trained to mimic American regional speech. And as North America becomes increasingly multicultural, perhaps even the introduction of video would not be a barrier to globalized call centres located wherever there’s an English-speaking and cheap workforce.
In my father’s day, there was some room for individual initiative on the phone. I remember monitoring the call of one of our employees (yes, there was monitoring from the beginning) who, instead of playing a tape of Julia Child talking about her latest cookbook, would do an over-the-top riff of her extraordinary accent and get away with it. But my favourite was the tall handsome black man in dread-locks and flowing theatrical robes and beads, who was extraordinarily successful in selling whatever there was to sell to the American Midwest, and who, when I asked him how he did it, said he imagined himself in a rocking chair on a porch in Springfield, Illinois-imagined himself, that is, as Abraham Lincoln! My father staffed his first phone rooms with off-off-Broadway actors, and that made for a special energy and creativity that I can’t imagine being tolerated in the call centres Head describes or, for that matter, that Levitt (if he had known) would have promoted.
What’s at issue in the industrialization of service is summarized in an earlier Levitt article entitled “The Production-Line Approach To Service,” in which he contrasts it with “ancient, pre-industrial modes of thinking”:
The concept of “service” evokes, from the opaque recesses of the mind, time-worn images of personal ministration and attendance. It refers generally to deeds one individual performs personally for another. It carries historical connotations of charity, gallantry, and selflessness, or of obedience, subordination and subjugation. In these contexts, people serve because they want to (as in the priestly or political professions) or they serve because they are compelled to (as in slavery and such occupations of attendance as waiter, maid, bellboy, cleaning lady). (Theodore Levitt, “The Production-line Approach to Service”, Harvard Business Review, September/October 1972,p.43.)
“In short, “he concludes, “service thinks humanistically, and that explains its failures.” He contrasts this “humanistic” approach to what he calls the “technocratic,” and his first example is McDonald’s and “the technocratic hamburger.” There is much to ponder in Levitt’s language-the words “ancient” and “opaque recesses of the mind” suggesting the Industrial Revolution of the 18th and 19th Centuries freed humankind from the stone axe and the cave-but it’s the phrase “personal ministration,” and its two categories, that is most illuminating.
Certainly, we neither expect, nor want, charity, gallantry, or any higher selflessness from the teenager handing over our foil-wrapped burger. McDonald’s, at least until recently, has been an extremely successful enterprise, with billions of satisfied customers worldwide. At the same time, the low-level jobs, what came to be called McJobs, created by McDonald’s and the call centres, while not slavery, belong in Levitt’s second category of “occupations of attendance” that he associates with slavery. The call centres-not always, but often-are the last resort of people who cannot get other forms of work. So rather than freeing people from the failures of humanistic service-that is, in Levitt’s definition, from the menial or servile-they have only recast that failing in another form for those who do the work. As Simon Head documents, obedience, subordination, and subjugation are alive and well in industrialized services the world over.
It’s also fair to say that we do not expect or want charity, gallantry, or higher selflessness from a stranger calling into our home to sell us something. But if we are going to get a call, perhaps we do want – not a small minority of us, at least – full respect for ourselves as persons. And what would that look or sound like? Well, like nothing that would meet the requirements of either my father’s, I have to say, or today’s telemarketing industry. It would have to be a real conversation between two people, with unpredictable give-and-take, for unpredictable lengths of time, with unpredictable impact on the bottom line. So “personal ministration” is not possible in the sales-focused call centre world (where in any case a service-to-business poses as a service-to-customer), and that is both telemarketing’s strength, as Levitt observes, and its weakness: its strength for the owners or shareholders of the business, its weakness both for the people making the calls, and for those of us who do what we can to avoid them.
Production-line “consulting”
The break-up of AT&T caused extreme turbulence in the company, and “executive development” (the work I returned to after CCI-having been a Vice President after all) was hard going; most everyone was hanging onto their desks by their fingernails. I was fortunate to find a job after that leading a training and consulting department in a hospital in Toronto, and then another in an administrative and consulting role in social service. With my early career being in university teaching and then government, I had, by the time I began working for a career transition company in 1992, experienced a wide range of service professions in an equally wide range of organizations.
Over the last dozen years I have come to realize that there is a pattern in what has been happening in education, government, health care, and social service-to all the human services, in fact, and perhaps in all the professions; if not to the priesthood and politics, then to the other “higher” callings, as Levitt conceives of them, in his first category of “personal ministration”-consisting of people who “serve because they want to.” Think of the impact, for example, of billable hours as the performance measurement in law, public accounting, and management consulting. Under the pressure of scarce public funds, or the pressure for greater profit, workplaces in the human services and the professions generally have come, to lesser and greater degrees, to take on the characteristics of industrialization promoted by Levitt and decried by Head. In the career management industry-and there are parallel processes in related businesses such as executive recruiting and employee assistance-the industrialization of service is making significant gains, particularly in the global firms for whom a key measure of success is their closely watched ROI.
When I entered the industry in 1992, it appeared to be flourishing, as it expanded to provide service to the large numbers of people whose careers were interrupted by the recession. In the late ’70s, when the industry started in Canada, and throughout the ’80s, it was mainly senior executives who received what was then called “outplacement” service, one-to-one consultation with unlimited time available from senior consultants, most often for as long as they needed until they got a new job. With the recession, however, came pressure to make such service available to lower levels in the organization, and with that expansion, a concomitant pressure on fees.
Different companies, of course, reacted differently, and for a while, with the volumes so high, it almost didn’t matter what the companies did; everybody made money. But as the economy picked up and big downsizing projects declined, and with competition from both new entrants attracted by the high volumes and who charged low fees, and the global companies who also competed on price to maintain their volume and sustain their infrastructure, it became impossible for quality-focused companies to raise fees, even as their costs increased. Across the industry, margins either shrunk or would have were services not degraded. While there were constraints on service even in quality-focussed companies (out-of-pocket extras curtailed or eliminated, floor space and number of client offices decreased, some rise in client-to-consultant ratios-I know because I had to implement these myself), in the global “shareholder-value” driven companies, the reductions in service, to protect those margins, were necessarily much more drastic.
The situation today shows a widening divide between those companies maintaining their focus on one-on-one consulting service and those who have industrialized with tools, techniques, and practices such as: heavy reliance on the Internet; heavy reliance on group programs; sales people instead of consultants meeting with people immediately after their termination meetings; strict limits on the duration and frequency of consultant time with clients; no proactive setting of meetings with clients; one consultant on-call for whichever clients are in the office on a given day; a high proportion of occasional stringers making up the consulting corps; and consultant-to-client ratios that go from 1/75 and up to 1/150 or more for a large project. The quality-focused company I worked for in the ’90s managed to 1/25-40 clients; my current company, counter-trend to what much of the industry is becoming, manages to 1/15-35, depending on client level. I’m sure there are other owner-operated companies on both sides of the border trying hard to maintain “personal ministration” –ancient as that mode of thinking may be –the bedrock of their service, who have not resorted to reductive practices. But it’s difficult when large global companies are selling what amounts to a radically different service –the technocratic hamburger – by the same name, as if career management services were all the same, and price and technology was the only difference.
How are they able to do this? For one, they invest heavily in professional sales forces (which they can afford because they invest so little in service delivery). But perhaps the main reason is that these sales forces, rather than selling to the people who receive the service, sell-because of the nature of our industry-to the companies who pay for it. This unusual distinction between the customer paying for, and the customer receiving, service opens a very wide door for the intentional blurring of differences. There are, of course, some companies who just don’t care about the quality of service to their ex-employees (to them I want to say that the message they send to those that are leaving becomes the message they send to those that are staying). But I believe most companies do care, and when they purchase industrialized service, they simply don’t know-don’t know down to the ground, where their ex-employees experience it-what they are buying.
And there are a number of reasons why many don’t know: they have sometimes moved the decision on their career transition supplier to a junior member of their Human Resources staff, sometimes to a line manager, and sometimes to a Strategic Sourcing (procurement) department. Sometimes, they outsource the decision entirely.
It startled me when I realized that my own human service industry seems to be moving to an automation of contact and relationship parallel to if not point-by-point replicating-what I experienced firsthand two decades ago in my father’s telemarketing company. In this case, industrialization is not a mere nuisance, nor a threat to something as seemingly abstract (though nonetheless real for all that) as general trust in person-to-person exchange. Here, the substitution of mechanization for a human relationship threatens to deliver immediate and substantial harm to people by withholding substantial support from them at what for many is a truly vulnerable point in their lives. At least the call centre industry provides millions of jobs and enables the effective promotion of what are often valuable goods and services. What does an industrialized career management business add to the general good, other than employment for few, and wealth to the very few? And if this degraded version of the service is increasingly perceived by the paying customer as the norm, who’s to say they will-or should-keep paying for it?
One of the often-heard selling points of the technocratic companies is that people don’t need the one-on-one service anymore. Losing your job has become commonplace. One-on-one service is expensive, unnecessary, touchy-feely handholding. People just need to get on the Net and get on with it!
My response is to ask in return: while losing a job has become even more commonplace than divorce, does anyone really think that, for the individual experiencing the loss of a job or break-up of a marriage, the pain is therefore so much less that the direct support of other people-particularly skilled and knowledgeable people-is of less value?
I wish those who think so could sit in my office, or the offices of any one of my colleagues, for a few weeks and listen to people at all levels from all walks of life deal with job loss. Sure, some are fine, and a few are absolutely devastated. Most are temporarily hurt, angry, and disoriented, and have testified again and again that help from an experienced, fully available consultant was crucial to their achieving objectivity and moving on. And similarly, as the search continues, it is highly unusual to meet people – again, at whatever level-who would have conducted it with the same clarity and control had they done it on their own, or in the company of nothing more than a software program or a few sessions in a group with a scripted trainer.
When a consultant and a service client forge a strong relationship they become a team, and the strength of the team builds on the different experience, knowledge, skills, and energy of both. The consultant has been there before, and can see bends in the road and obstacles before the client can, hopefully in time to handle or avoid them. The client has the steering wheel, the brakes, and the gas-the process is in their hands, it is their life-while the consultant is in the passenger seat, with maps and knowledge of the road. They go through the search together-most often a hard time, one way or another-shoulder to shoulder. No machine, or mechanized “human” contact, can replace this. “The opposite of the word professional is not unprofessional, but technician, “one thoughtful commentator has written. (David H Maister, True Professionalism, P. 16, New York: Touchstone, 1997) Who wants a technician-never mind a process mimicking a machine, or a machine itself-sitting in their passenger seat through a tough time?
My purpose in comparing what from other points of view are certainly apples and oranges, that is telemarketing and career transition, is to show that the standardization, simplification, and measurement of the one-taken from the manufacturing model in the first place-has unfortunately been misapplied, in the case of the other, to a service meant to help people at a critically difficult moment in their lives. And to show as well-while I feel ambivalent about the pluses and minuses of telemarketing in relation to my father’s extraordinary achievement-that I am certain that this misapplication to career transition is, ultimately, to the detriment of all.
In our economy, one continuously roiled by change, any one of us may need this service at any time. My hope-as I choose to be optimistic-is that increasing numbers of corporate customers of career transition will look further into the service their ex-employees are receiving-asking, as they scrutinize the degree of direct human support the service is based upon, if they themselves would want it. To the extent this happens, I have no doubt that “personal ministration”-by professionals in career management firms fully committed to their client’s successful re-employment-will win out.
