A typical telephony sales team will handle between 800 and 1200 telephone calls per day. The recordings of these calls contain a few examples of outstanding success, some repeated and easily repaired failures, and also, lots and lots of calls with little opportunity. Within this 1000 odd calls there are probably 10 to 15 calls (nuggets) which if used well, could significantly improve the sales effectiveness of the individuals within the team.
To try and find these nuggets, Sales Managers often ask their sales agents to code their calls after completion using a button on the telephone or a drop-down on the screen. This creates an index which can be used to find interesting calls. However when we have tried to use the indices created by these wrap-codes on various projects, their quality was invariably disappointing. Often compliance was patchy, many calls with no codes, often wrap-codes were inaccurate or misrepresented. For example; calls with opportunity but which were not converted, while very interesting, were seldom coded correctly (people tend to hide their failures!).
So on a recent project we decided to try something new, something to improve the quality of these codes. As a result, we saw a massive improvement in wrap-code accuracy and completeness. And consequently, we found interesting calls more rapidly and more reliably, thereby immediately improving the quality of agent coaching. Sales markedly improved within 4 weeks (up more than 10%). The solution was not a new technology, but a new psychology!
The solution was not a new technology, but a new psychology!
Behavioural Economics is a relatively new field in psychology and its insights have just started making their way into mainstream business uses. We found an example in this field that was successfully used to increase compliance, that sounded like an interesting starting point to us! In this experiment, a company wanted its employees to carry out a health risk assessment. This was a voluntary programme and employees needed to take the time to get the forms, fill them in and return them. Compliance was initially low. To increase compliance experimenters started by dividing the employees into groups and ran random monthly lotteries where each person in the winning group would win £70.
Having set up the game, here is where the new psychology came in, the theory used was “regret aversion” – this says people will work much harder to avoid regretting a loss than they will to achieve a similar sized win. The lottery was set up so that if more than 80% of the winning group had filled in their forms, then the prize would rise to £90 per person. People were so anxious not to be the person who lost £20 for each of their team mates that compliance rose massively. Detail on the experiment is here: www.tinyurl.com/regretaversion.
We replicated this experiment pretty closely. We were already helping Team Leaders coach their teams in small groups using recorded calls. So we had some ready made teams. We implemented some new wrap codes to identify customer type, opportunity call or not, and sale/no sale. Rather use than a lottery, we used gross sales figures for each team over a fixed period to choose a winner. To implement the regret aversion, a process was put in place to choose two members of the winning team at random and 10 calls from each of them were listened back to and their wrap-codes checked. For very high compliance a bonus was paid to each team member, for acceptable compliance the team simply won the prize. However, if compliance dropped below a threshold, the prize switched to the losing team!
if compliance dropped below a threshold, the prize switched to the losing team!
Compliance and accuracy rose massively. Calls with no codes dropped from 22% to 3%. Calls with incorrect codes went from 29% to under 5%.
Sometimes a change in accuracy can have qualitative effects on how a team works. A new index had been created that was reliable and line managers were able to find useful calls for coaching in a quarter of the time it had taken them before. As well as group coaching, this also improved one on one coaching, and, in an unexpected effect, new KPI’s became available on the number of calls with genuine opportunity – the number of calls with opportunity but which had not closed a sale was completely hidden before.
The intersection of Behavioural Economics, Coaching and Performance Improvement has a lot of opportunity, I am very interested to hear of others who have explored this space.