Freedom, Inc_ - Brian M. Carney [94]
A call center is also one of the unlikeliest places, you would think, to find a liberated workforce. It’s one thing to think of talented salesmen such as Burt Chase, Karl Fritchen, and Jacques Szulevicz, when freed to act on their own initiative, seizing the opportunity and becoming natural leaders. But what about the majority of “ordinary” people, who are less prepared to do so by training, disposition, or current occupation? Whether these people can also become natural leaders is a critical question for a liberated company. In these companies, there are no bosses to grab the helm, so it falls on whoever is closest to a problem or opportunity to deal with it. And call-center operators are as “ordinary” as it gets. But at USAA, McDermott was convinced that if he provided employees with the right conditions for growth and self-direction, they would reveal their talents for natural leadership no less than the “extraordinary” people do.
Most of us cringe at the thought of calling “customer service”—even the most helpful operator at the other end of the line is usually powerless to address our problems. Savvy veterans of call-center battles know that they have little hope of more than a perfunctory “I’m not authorized to do that” unless they can get their call bumped up at least one, and possibly two, levels above the frontline employee who first took their call.
USAA is different. The San Antonio, Texas-based insurer has the kind of call center that customers actually like to get on the phone with. Not only are the customer service reps happy to help, but they are able to. Many claims are settled and problems resolved on the spot, on the first call, with the first person a customer talks to. This, by the way, is their key performance measure—not the number of calls answered.
There’s no arguing with the results. In McDermott’s twenty-five years as CEO, USAA grew its owned and managed assets four hundredfold, with only a sevenfold increase in the number of employees. In 1995, it was named the Best Bank in America by Money magazine for its outstanding financial services. And in 2007, it topped Business Week’s first-ever customer-service rankings as number one in the country, a feat it repeated again in 2008. Today it is the fourth-largest home-and car-insurance company in America, despite voluntarily limiting its core insurance business to current and former military personnel and their families.
But it wasn’t always like that.
When Robert McDermott took over as CEO of USAA in 1968, the insurer was bloated, inefficient, and underperforming. The hapless employees, many of them wives of servicemen, were tightly controlled—it took no fewer than fifty-five separate steps to do even routine tasks, such as add a child to a policy. McDermott explained the routine: “The first person would open the envelope and pass it onto the second person, who would take it out, and so on—like the assembly lines in Detroit for the automobiles.” Employees were controlled down to the length of their pencils—literally. Much of the work was done in pencil in those days, and you couldn’t get a new one until your old one was shorter than an inch and a quarter—and yes, they measured them. Alfred’s latitude in exchanging his old gloves at FAVI looks like freedom in comparison to this.
It’s little wonder, then, that employees were leaving in droves. “Attrition was high at USAA,” the retired general told us when we interviewed him one warm late-winter Texas night.1 That was putting it mildly. Employee turnover “was 41 percent, while