The Electronic Retailing Association

Future Impact Article: The human side of digitalisation: the effects on customer service result in a shift from transaction to interaction and learning


by Felix Müller, Managing Director, Henley Business School, Germany

Wherever you turn, no industry, organisation or country is left out of the effects of digitalisation.

Luckily, players in the multi-channel marketing arena can say that digital has played a major role in their operating models from the beginning. Compared to other, more traditional retail businesses, they are ahead. However, digitalisation, while putting IT solutions at the forefront, also means strengthening and redefining the human element in marketing and sales.

Felix Müller, Managing Director, Henley Business School, Munich, Germany

Felix Müller combines more than twenty years’ experience as leader in international organisations with a deep interest in the inner workings of people. He holds a business degree from the University of St. Gallen, Switzerland, an MBA from Duke University, USA, and an MSc in Coaching & Behavioural Change from Henley Business School at the University of Reading, UK. He has more than 20 years’ experience in senior leadership and management positions in British, French, German, Swiss and US companies. For several years, he has been coaching leaders in middle to high positions up to C-level in German and English.

Contact details:

Tel: +49 151 46764080

One main consequence of digitalisation is the automation of processes where activities currently performed by people are replaced by robots. The rule seems to be that, as soon as a job can be done by a robot, it IS done by a robot. And while the people who lose their jobs won’t appreciate this change, one has to acknowledge that most of these jobs are less-desirable as they are repetitive, boring and where one sees that the human body quickly wears out as it is not intended for such mechanical tasks. So what is the human being intended for?

Humans, compared to most other species on earth, have the unique capability of being creative and innovative. Thus, the future of the human being in a digitised world lies in moving away from mundane, repetitive tasks towards creative and innovative work.

Let’s look at a typical example in multi-channel marketing to illustrate what is happening: the customer service department. Traditionally, requests have been dealt with by phone through customer service agents, regardless of the nature of the request. With automation, (chat) bots have been introduced, dealing with routine requests, reducing the volume of requests that required a ‘real’ human being. This trend is also illustrated in a 2013 study in which it has been predicted that by 2033, 99% of all telemarketing jobs will be gone. We know that this does not mean that telemarketing is gone but that these jobs are taken over by bots. So, what happens to the people whose jobs are becoming redundant? One solution is to simply fire them but the better solution is to give them a different purpose, to be creative and innovative, since they are the key people who actually talk to a customer in an otherwise strongly impersonal business.

From efficiency-led transaction to learning-led interaction

If a customer service agent moves from the previous role to the new role, their tasks change. Previously, when they dealt with all requests, volume was the biggest issue. Every call could cover all kinds of topics and since many requests dealt with routine topics like returns, efficiency was key: the less time spent with a customer (beyond a certain basic threshold), the higher the value of the agent. To support this, standard call protocols were developed and technical tools assured that there were hardly any waiting periods for agents. The agent's performance was assessed by quotas in a mechanistic, industrial process of transacting with people. Hence the result that through automation the industrial part of their work is taken away by robots.

What is required is an agent who is empathic and can build rapport, let the customer let off steam, asks questions to fully understand the issue and has a natural curiosity.

In the new world, the routine requests are dealt with by robots. What’s left are the non-routine requests that cannot (yet) be automated. These requests cannot be put into a standard call protocol (else they would be done by robots) but require the capacity of dealing with complexity, ambiguity and a highly emotional starting point: when calling, customers have a request that often comes from their dissatisfaction and, since these now are only non-routine tasks, they may appear more challenging to the customer as well. What is required is an agent who is empathic and can build rapport, let the customer let off steam, asks questions to fully understand the issue and has a natural curiosity. The former industrial ‘getting things done’ approach is replaced by an ‘understanding the issue for learning’ approach, with a different focus: yes, we still have to solve the customer’s request, but the call is a unique opportunity for deepening the relationship and learning about issues that could become automated. This requires understanding of the issues and their source, obtaining feedback and documenting them in a way that can be used to decide about what next will be automated. Thus, the customer-agent relationship moves from transaction to interaction to retain and learn.

Task-oriented brain mode Socio-emotional brain-mode
Uses logical, spatial, mathematical reasoning People see and feel themselves
People seen as numbers Capacity to see and feel others
Analytical Intuitive
Slow thinking Fast thinking
Ability to process Ability to learn

Changing purposes of agents and managers

This change of role also changes the purpose of the customer service agent: it is no longer about efficiency and getting things done but about spending meaningful time with the customer to learn. This also means that their manager’s role changes. In the old system, the manager’s role was to provide systems and processes for efficiency and to incrementally improve their effectiveness. To this end, every agent was like a small cogwheel that had to fit into a bigger system that was constantly optimised. Individualism and creativity were usually put behind standardisation and optimisation. In essence, managers were transacting with their agents.

...the customer service agent in the new world, wanting to be empathic, creative and interested in learning, has to be in the socio-emotional brain mode.

In the new automated world, managers have to start interacting with their agents. This starts with considering them as human beings. To be clear, old world managers were no inhuman monsters but is it worth pointing out that transaction and interaction use different brain operating modes. For transaction, one uses the task-oriented brain mode, which as the name indicates, is useful when working on tasks. It uses logical, spatial and mathematical reasoning to check-off tasks. However, it does not allow people to see the human element: they can neither feel how they are themselves nor sense how other people are. In essence, being in the task-oriented brain mode excludes the truly human capacity of empathy. This capacity, like being creative and able to learn, is only available in the other socio-emotional brain operating mode. By the way: probably all of us know the socio-emotional mode from own experience: it is active when, under the shower, we suddenly find a solution for a problem we tried to solve for ages.

Therefore, the customer service agent in the new world, wanting to be empathic, creative and interested in learning, has to be in the socio-emotional brain mode. Fortunately, each of us can easily detect when we are in this mode: it is active when we 'feel'. Thus, when we are happy or stressed and can feel it, we are in this mode.

The key factor keeping us from moving into the socio-emotional mode is the environment in which an agent works and their manager. If the environment reminds the agent of task-orientation and the manager measures the performance by ‘number of tasks performed’, the agent is not able to move into the socio-emotional mode, since the two modes cannot operate at the same time. The manager’s purpose moves to facilitating and encouraging their agents to move into the desired brain mode.

The human side of digitalisation

...this redefinition of the role of customer service agents requires a different management style, away from the ‘process manager’ towards the ‘learning enabler’.

In summary, the big changes required in customer service from the human side of digitalisation are threefold:

First, transactional routine tasks are automated; here, efficiency and effectiveness are core factors. Second, the remaining non-routine tasks are a great opportunity for learning and deepening relationships; these tasks require true human capacities of creativity and innovation that only are available in a socio-emotional brain mode. Third, this redefinition of the role of customer service agents requires a different management style, away from the ‘process manager’ towards the ‘learning enabler’.

For this to work, organisations may have to considerably reconfigure their customer service operations. Both managers and agents have to reflect on how they like the new roles. People good at transaction may not be good at interaction. People good at structuring and assuring adherence to processes may not be good at dealing with the free-flow of non-routine tasks. And the biggest challenge lies in the metrics to assess manager’s and agent’s performance. Moving away from a quantitative ‘calls per hour’ to a qualitative ‘using the interactions to learn’ metric is demanding and poses challenges for most people involved, as they lose a clear frame of defining their value and self-worth.

While the last factor has the potential to keep psychologists, neuroscientists, managers and all people busy for quite some time, one can start working on the other ones today. Doing so, assures the sustained competitive advantage and combines the benefits of automation and the human element.