Sometime in the last decade or so, as the cellphone and credit card market began attracting people who could not previously afford either, the executives at these companies decided that they could expand the bottom line by moving callcenter operations overseas. Most of the callcenters went to English-speaking countries such as India or the Philippines, Spanish-speaking customers would be routed to Costa Rica or Mexico. It was a fool-proof idea to these executives, people were signing contracts left and right to get subsidized cell phones that were previously status symbols of the business elite. Once these people were signed up for the contracts it was easy to go over on the bill every month, meaning more money for the cell phone companies.
Up until the 2007 recession, the money kept rolling in but customers weren't happy. First of all, overage charges were extremely expensive and an unlimited cell service plan could cost $250 or more monthly for just one line. Second, billing systems were far from being even close to perfect and customers with incorrect bills would be routed into infuriating automated callcenter queues to wait for long periods before speaking with well meaning but poorly trained representatives 12 time zones away. These outsourced reps had no authority to do anything for a customer other than take a payment, change them to a new phone plan or slap a new service on an account which so many times was done without the customer's consent. This would prompt yet another call next month to be handled by yet another powerless rep on a call time limit who would eventually hang up on the customer or transfer them off to another department to tell their story of woe all over again.
Yet, the companies kept making money, executives slapped each other on the back and it seemed that everyone was happy, except for the exasperated front line employees here in the US who had to spend most of their days undoing the errors made by the outsourced reps and dealing with customers who were probably popping Xanax at the thought of calling their cellphone company one more time.
So what was the problem that these companies could not seem to comprehend? Why were customers constantly complaining, why oh why did all the satisfaction surveys state that Company X had the worst customer service? Why were there websites popping up that constantly harped upon how bad the company was? Never mind, we'll just change the survey questions and then make employees jobs and commissions count on them convincing frustrated callers to rate the company 5 stars on random survey calls. Can't solve their issue? Just transfer them to some other department at random, they'll take the hit. Keep drinking the company Kool-Aid and making the inflated goals, however you have to do it.
What they failed to grasp, or did but didn't want to admit, was that cheaper did not equal better. Second, due to high stress and unreasonable sales standards, it was hard to retain quality, ethical reps who actually cared about taking care of customers. Third, it seemed that incompetent and dishonest employees were given entirely too much power and very little supervision. At least this was the case at the major cell phone company where I worked for 5 soul sucking years. I assume it would be the same in many other places considering most outsourcing companies such as ACS, Teletech, Convergys, Teleperformance, IBM and others handle calls for multiple companies. If an employee was found to be unsatisfactory they would just "remove them from the account" which meant they would no longer handle calls for Citigroup or Verizon and just be switched to take calls for Sears or any other account that the company had signed an outsourcing contract for.
In addition to a huge cultural and accent barrier between foreign reps and American clients, companies were often paid not on customer satisfaction but on the number of calls taken. If Teletech for example, did not meet the goal of 50,000 calls taken in a month, they could possibly lose a lucrative contract and therefore, agents would be forced to take as many calls as possible. So, even if they were in a position to help a customer, it was just easier to throw a credit at the error or dump the call off to another department instead of spending the time to actually fix the issue once and for all, especially if there was no way for the agent to make any type of sale. Many times this did not stop reps from "slamming" customers, which is an industry term for placing services on an account that were not requested.
And so, the cycle continued. Customers kept calling each month, reps made money, often fraudulently; and the execs kept patting each other on the back about how many accounts they had. Then, the recession hit.