No one likes calling a call centre. And from the research, telephone agents aren’t very happy there either.
Ironically, BT’s (British Telecom) call centres were the perfect environment for a new observational study on the effects of positive mood on productivity. Happiness in the workplace is often a reflection of what values an organization holds or the type of company culture it creates. However, sometimes it’s something as simple as the weather that can make a big difference.
I’m a statistician at heart, and I still get excited to see newly published research about happiness in the workplace. This recent report published by Oxford University’s Saïd Business School is one of the best designed observational studies of the effects of positive mood on productivity I have ever had the pleasure of reading.
“Does employee happiness have an impact on productivity?” is led by the well-respected Oxford Academic, Jan Emmanuel De Neve. The study found that happy employees made 13% more sales than unhappy ones. Not only that, happier employees were better listeners and negotiators.
These in themselves are great benefits, but De Neve and his team were also able to tease out causality effects and the types of sales happiness had the biggest effect on.
The study found that happiness lead to increased sales, rather than the other way around. How they learned this was through a distinctly British way: by using weather data. In weeks where the weather was better, people naturally felt happier (and the data demonstrates this). This extra happiness translated into increased sales, and with a particularly delightful piece of statistical dexterity, they showed that this wasn’t because customers were happier when they called. Calls were randomly assigned to different call centre locations across the UK, illustrating that it was local, not national, weather that drove the boost.
Positive Mood and its Effect on Sales
From a customer perspective, we prefer to speak to someone that is cheery. But does their mood influence us to buy more? The researchers found that if the call was simply order taking, then the happiness of the telephone agent had no effect on sales at all. Though their mood may have depressed or cheered up the caller, it ultimately had no effect.
However, if it was a more complicated call – TV and phone upgrades, or contract changes (Yikes!) – then happiness had a strong positive effect. What the research suggests is that happy employees are also better listeners and negotiators so are more able to find a good solution for the customer.
This happiness effect was amplified in weeks where there were more unhappy customers. When a systemwide outage occurred, customers arrived on the calls less happy (bad holding music no doubt adding to their mood). It must be really hard for telephone agents in these circumstances. I know I’ve been guilty of getting cross with a call centre agent when it wasn’t their personal fault that my SIM card wasn’t working.
Yet, it’s in those situations where employees who were naturally happy are able to manage their emotions, displaying what psychologists call self-regulation. Happy agents showed empathy and were able to find a solution for themselves and the caller.
A Note about Research Methods
The study is innovative in two ways. Firstly, the researchers persuaded BT to let them track the weekly happiness of over 1,800 sales staff in 11 call centres across the UK. Secondly, they were given access to performance data including the number of calls and total sales.
It’s an exceptionally novel way of tracking weekly happiness because most research tends to be focused on either immediate mood or overall experience.
For example, experimental research tends to be based on manipulating participants mood (by showing them a video or something similar) and then setting them tasks to complete. This is useful as you can compare and contrast how people perform when happy or not, but they tend to lack a real-world setting.
Population research, meanwhile, tends to ask about workers overall experience of work – with a question such as, “Overall, how satisfied are you with your job?” This is a good enough question, but people’s answers tend to get influenced by how well their immediate work is going – so it isn’t really a clean measure of their overall experience. The Oxford researchers, however, asked about weekly happiness. To observe employee happiness, they posed the question, “How happy were you at work this week?” The similarity between their question and our own “How happy were you at work this week?” is striking. We both seek to observe and measure happiness, but one of the reasons I founded Friday was to also use the data to improve employees’ experience.
The Effect of Happiness in the Workplace
One of the key strengths of the study is its narrowness. Call centre employees have very little autonomy. Calls are directly routed to them and they have very little influence over the type of activities they do. The study showed that over 90% of their time is spent answering calls routed to them. This narrows the potential impact of people’s moods (happiness or unhappiness) in what they do and choose to do.
When employees are allowed to choose their work or who they work with, they’re more likely to succeed and perform well – after all, who wants to work with a miserable toad? Since they weren’t allowed to choose what they did, the pure effect of happiness on what they did is visible. Happy employees comply with the task, unhappy ones resist. The effect of happiness on performance was strictly limited to the way the agent interacted with the caller.
Because a call centre is a unique environment, the effects of happiness on productivity is likely to be much stronger in a typical office environment. Our own estimates suggest the effect is 3-4x stronger than this study. This is because most workers have more discretion on how to work so their sense of urgency and confidence has a much larger effect. They also work more closely with colleagues, so they need to collaborate and negotiate much more.
Should BT Focus on Happiness in the Workplace? The Findings
How unhappy is a call centre?
Over 30% of employee responses were “very unhappy” – the most common response. A further 17% said that they were “unhappy”. To place that into some context, one our clients with an excess of 100,000 responses over three years only had 16% as “very unhappy” or “unhappy”.
The reality is that shifting a person from “very unhappy” to “very happy” is difficult. It’s much more realistic to shift “unhappy” people to “OK”, or from “OK” to “happy”.
Basic calculations suggest that there could be a very healthy return on investment if BT were to focus on happiness. If they shifted half of the “unhappy” people to “OK” and half of the “OK” to “happy”, then this would translate into significant extra revenue — estimated at £330,000 per week or over £17,000,000 annually.
As well as generating extra revenue, BT would also benefit from a reduction in staff turnover. Call centres, according to the latest employment stats, have a staff turnover of 3-4x the national average and from our research at Friday we know that a similar positive shift in happiness translates into 17% lower staff turnover across the next quarter.
For BT this would likely reduce the recruitment and training costs by over £500,000 per year*
(*based on the assumption that recruitment and training for a new employee cost 25% of annual salary – estimated here at £15,000 per year).
Maybe call centre work by its nature is not very happy. However, if I were BT I would see this as a wonderful opportunity for a win-win situation – better jobs for employees and an increase in revenue for BT.