Is Conventional Customer Service dead already?

Is the Customer service model that serviced and managed millions of customers & their expectations efficiently for so many companies already dead or will be soon?

The negative sentiment of job market after the onslaught brought on employment by a hasty consolidation indicates that there would not be a return back to ‘normal’ anywhere in near future.

 In fact what looks more imminent is that the defining change that has occurred does not have a U-turn. The impact of consolidation, the adjustments made by the organizations to face it are mostly final. The design, the landscape of service itself and the servicing has metamorphed into a new design, a new landscape, even if done forcefully. 

Just to give a perspective, we will take a quick glance of how customer service evolved in India in last 2 decades.

Customer service model in India shaped up largely with industry like telecom, banking, and insurance booming in late 90s continuing till recent times. We will focus more on telecom since it really expanded customer service model in a very large scale set up fuelled by rapid growth of industry and mass adoption of mobile phone.

This service model had 4 prominent elements - people, process, technology& lot of regulatory compliance. There was more emphasis on people & process in this model. In a society where personal touch mattered a lot to consumers the service model was built with large Call centres, back end operations, Collection & Retention agencies and Retail service stores as the main pillars. People, process and technology like IVR, ACD, CRM, Predictive tools like SAAS and many home grown solutions to manage process, voluminous transactions and deliver service at the end point. In last decade, with regulatory bodies setting up numerous service and regulatory parameters, it became a key deliverable for customer service function.

In a nutshell, customer service function over all these years became something of service, logistics, IT, SCM, Operations and voluminous transactions keeper. But the function quite efficiently evolved and managed these diverse expectations and deliverables.

Now coming back to what the evolution of service did was - it provided employment & impetus to dreams of thousands of aspiring young grads. The model also cultivated hundreds of aspiring green field ventures by aspiring entrepreneurs in form of large/medium/small agencies in tier 1/2/3 towns, villages. The multiplier and accelerating effect on economics was phenomenal, undoubtedly. People in their early twenties got opportunity to have a prospering career and this very well continued to next 15-20 years. They got a job, they got married and found a complete life.

The 1st round of consolidation in industry happened in 2010 when due to revenue pressure & court directives licences of telecom operators were cancelled. Some of these were actively operating, some were planning to launch and others looking at better valuations. The impact was not large scale however.

Circa 2016, when the first real consolidation started off in India and quickly many companies folded up resulting in thousands of those who started their career in last 20 years ending up unemployed. This happened when most of them had their kids in schools, colleges. A good lifestyle suddenly got choked. Many vendors had to exit after losing clients and making losses. Suddenly the sunrise customer service industry which had very large stakes in telecom was blinking into an uncertain future.

Lower margins have always hit service aspect of business first which is the case in industry right now where voice and data are selling at prices lowest in the world. Besides, operators which have shut down or chose to merge with incumbents, the ones who have survived have decided to focus on core aspects like network expansion and technology up gradation. The investments in service have got diverted to other critical areas.

High ARPU Postpaid business which is the premium segment of retail business in telecom had operators jostling amongst each other with differential services to grab customer’s attention is now equated with low ARPU prepaid segment. This has brought down the service levels significantly across operators.    

While the focus on self-service and automated service was always there and had gathered momentum off late, the sudden demise of margins had forced operators to shift focus from human/direct service to self-service and automated service at a high speed. Technical advancements like e-wallets and apps have helped operators to manage delivering services to their customers, the tech-way than the erstwhile human-way.

So moving on from the impact of consolidation to the outcome, my assessment is that the customer service landscape has got re-shaped forever now and the old model of delivering service through people is out dated and obsolete. I do not see any chances of that past returning back now not even if market correction in terms revenue and margins happen after few quarters.

Some service provider may experiment with that approach for some time in near future for differential service sake but the whole model making a large scale comeback cannot be foreseen or predicted with ease.

The present era of Customer Service is undergoing a lot of re-shaping right now with every company trying to find innovative ways to service customers, a way which certainly keeps cost in check so that more vital areas of business can be kept well irrigated as the differentiators now or technology, speed, reach.

What more has happened is in the life of a customer is that he has been hit by a deluge of content & almost free high speed data, free voice. This has been probably the most defining moment for consumers who are completely awestruck for many quarters now. The phone is now a receiver of a sea of content anywhere, anytime, right from songs, movies, sports, news and full internet access.

The service expectations of customers in an era of unlimited voice and data packs have really got altered dramatically. From the era of handling billing and balance depletion complaints, tariff related issues, 2G/3G speed issues we have quickly moved to an era and availability of a variety of content on mobile phones spurred by high data speeds. This has created another avenue of delighting and exciting customers. All operators have tied up with big media and content players and are providing this to their customers in innovative ways. Besides this, the apps which allow subscribing and unsubscribing services besides chat features have made service more of a self-service game. On regulatory front with Adhaar card becoming mandatory for taking a connection the load of managing regulatory compliance have started lowering and it might become almost nil in near future. Need to maintain large footprint of retail stores for service would not exist and we may find many such stores either shutting down or turning into full scale sales outlet. Net-net, human based servicing is not the name of the game.

I clearly see that gamification of services has already begun and it will define the future of customer service to a good extent. In this new future customer service will be well integrated with marketing, sales, technology, analytics from a different point of view.

I will share my views on gamification of service and how can organizations leverage from a gamified service strategy in my next article.

Till then, happy reading : ) 

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