Until the 1980s, companies like Rochester Telephone Corporation, a $804-million, diversified telecommunications company headquartered in upstate New York, operated in a regulated environment that shut out virtually all the competition.
As a strong, independent telephone company that was not part of the Regional Bell Operating system, Rochester Telephone weathered the first few years of deregulation well. Over the years, it established several competitive lines of businesses — including long distance and wireless — and is now the 13th largest telecommunications company in the nation, with 45 operating companies and nearly a million customers in 23 states. But to ensure its long-term growth, Rochester Telephone is getting ready to take an unprecedented step: Under a plan it recently proposed to the New York State Public Service Commission, Rochester Telephone will be the first telecommunications company in the nation to surrender its monopoly on local telephone service.
ADDRESSING THE COMPETITIVE REALITY
To be sure its strategy succeeds, the company must help many of the employees of its local telephone operation make the transition to a competitive environment — no group will be more profoundly affected than the customer-contact personnel in telemarketing positions. James Loughlin, Rochester Telephone’s vice president of customer service, looks to these employees to maintain high customer satisfaction and build longterm customer relationships. To prepare them, during the past year, the company has committed to a process of continuous training, which Loughlin likens to the total quality management practices the company embraced several years ago.
“Continuous training and quality processes are certainly tied hand in hand,” said Loughlin. “You do it, you check it, you modify it, and you come back and do it over. You view training as a cycle, as opposed to a linear series of activities that go on and on into the future.
“Continuous training — particularly in interpersonal skills — represents a strong commitment to provide better service and value to our customers. We need to look at each customer interaction as an opportunity to generate long-term cash flow, not just to complete an individual transaction,” Loughlin continued. “In other words, we need to build lasting customer relationships.”
Previously, Rochester Telephone’s telemarketing and other customer contact personnel relied on technological advances and task completion to build relationships.
“Just getting the service in and keeping it running was what counted,” Loughlin explained. “Given that we’re in a technology-based industry, we tended to focus on the mechanical aspects of our business. We taught our installers, for example, how to climb a pole, run a drop wire, terminate an inside wire and put an instrument on it. Once they did that, the training was over. Repetition of the task — not additional training — was what increased proficiency and productivity over time. We never gave much thought to the human dimension of customer interactions.”
However, deregulation in the 1980s changed all that. “Before, we had a captive audience; customers had only one place to go for service. Since then, customers have been given more choices in products, services and providers, so our focus has had to change,” said Loughlin.
No longer could the company’s telemarketers function as order takers; they now had to take on the larger role of service and sales consultants. “Customers will buy when they see a value in either money or time,” observed Loughlin. “In our customer satisfaction studies, customers said the top factor in their satisfaction is value. In particular, business customers said the ability to get meaningful knowledge from a qualified person is most important.
“Five years ago, a typical conversation between an inbound telemarketing rep and a customer would be a fill-in-the-blank sort of exchange — name, address, service. Today, that information is still important, but we also want to know what’s important to customers. We want our people to relate the customers’ needs to the products and services we offer and demonstrate to them the value we can provide,” Loughlin said. FIRST STEPS TO MEET THE COMPETITIVE CHALLENGE
Changing the company’s telemarketers into sales and service consultants didn’t happen overnight.
“First, we tried just changing the script. We wanted our service representatives to ask customers more questions about their needs. But they didn’t have the time to do it — or do it well — since minimizing the average call-handling time was still their performance objective,” explained Loughlin.
“We soon realized our telemarketers needed to put the emphasis on demonstrating and providing value to customers, rather than counting the minutes they spent on the phone,” Loughlin continued. “The problem was that we didn’t have the proper training resources internally to achieve this.”
In 1992, Rochester Telephone decided to look to outside suppliers to train their customer-contact people in the relationship-building skills they needed. The company selected Learning International and began implementing a curriculum of fundamental service and selling skills training for its telemarketers and other customer contact personnel.
“It didn’t take us long to figure out that we had just hit the very first edge of the training cycle,” Loughlin observed.
“When you have an organization that has been a monopoly for 90 years, you can’t change the culture with a product training session dropped here and there,” said Ketha Weron, Rochester Telephone’s coach to the in-bound telemarketers of the company ‘s Business Accounts Office (BAO). “To truly change a culture, you have to show people a new way of thinking and put the reinforcements in place to let them know that, in fact, they are going to be held accountable for the new knowledge and skills they’ve gained.”
A PLAN FOR CONTINUOUS TRAINING
Rochester Telephone has built a continuous training process on the foundation of the basic sales and service skills training it implemented in 1992. To do this, in 1993, the company began coaching activities, including three to four observations per service representative per month. The observations are followed with immediate feedback from the supervisor. At the end of each month, Heron conducts a longer coaching session with each representative to jointly develop an action plan for continued skill improvement.
In addition, Heron periodically conducts “lab classes” for small groups of representatives. During these sessions, the representatives describe recent experiences with customers. The group analyzes each situation and discusses alliterative approaches the representatives can use in the future to increase the effectiveness of their customer interactions.
In a third effort to sustain top performance, every other week Heron calls together six representatives and a supervisor for a coaching session in which a single issue or challenge is discussed. Last fall, for example, a number of business customers reported errors in the Yellow Pages listings. During a coaching session, the group focused on specific aspects of its service skills training to develop an approach for dealing with these customers that all BAO reps could put into practice.
POSITIVE RESULTS FROM THE SYSTEMATIC APPROACH
Sylvia Harrison, a BAO telemarketer who has been with the company for 26 years, was among the earliest of the trainees. “Initially, I had a tendency to fall back on what I was comfortable with, but then I started working with the skills and getting the information I needed,” said Harrison. “That’s when it became easier to incorporate the skills. Now I find that once I explain to customers why I’m asking these questions [about their need for additional products or services], they don’t hesitate to provide the answers,” Harrison continued.
Since the training was implemented, Rochester Telephone’s inbound telemarketing areas, such as the repair answer bureau and the BAO, have seen steady increases in the number of customers who rate the company’s telemarketers as “excellent” in overall performance, courtesy and helpfulness. Loughlin noted that emphasis is placed on “excellent” ratings because customers at this level of satisfaction have stronger loyalties than those who rate performance as “very good” or “good.”
And according to Heron, a good indicator that the BAO telemarketers have taken to their new role as sales and service consultants is that they’ve increased their outbound calls to customers — a practice that would have been discouraged in the old days.
“Once the reps have had a chance to ask the customer about their business and telecommunications needs,” Heron explained, “they may need to do some additional research or analysis before providing an answer or making a recommendation. So they go off-line, get the information they need, and then make an outbound call to the customer.”
The new enthusiasm will serve the representatives well in 1994, when to underscore the importance of incorporating sales efforts into their customer interactions, the BAO representatives’ sales performance will account for 50 percent of their appraisal rating, up from 12 percent in 1993.
“The easiest way for me to see the benefit of the training and the skills and knowledge these reps have gained,” said Heron, “is to imagine what our situation would be like if they hadn’t gone through it. If they didn’t have these skills and tomorrow open market became a reality, our competition would walk all over us.”
According to Loughlin, Rochester Telephone’s ability to create and nurture long-term relationships will take on even greater value and significance in the open market environment the company has proposed. If the Public Service Commission accepts Rochester Telephone’s proposal, the company’s half-a-million local access lines will be up for grabs. Business and residential customers will choose their local telephone service provider from among certified competitors by ballot, much the same way customers choose a long-distance carrier today.
“We’ve got our future sitting right in front of us,” said Loughlin, “so we have to establish that relationship to the best of our ability now because there’s so much at risk. In the open market, we are going to ask all our customers, ‘Who do you want to provide your local service?’ If they feel that we’ve been able to provide that value, they’re going to choose us.”
Learning International, a provider of service and sales consulting (and training, is headquartered in Stamford, Connecticut. The company has offices on six continents, in 27 countries and is part of Times Mirror, the media communications organization.
Copyright Technology Marketing Corporation Feb 1994
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