Corporate Mergers and the End of the Customer

We’ve all heard it, and many of us have grown up with it:

“The customer is always right!”

Today, with telecommunications corporations, banking and financial corporations, insurance companies, newspaper companies, and companies we don’t even understand gobbling each other up at a rate that makes Pac-Man look like a child’s game (oh, wait – Pac-Man is a child’s game!), the new mantra is:

“What customer?”

Today’s CEO runs a vague, profit-driven organization that shields itself almost completely from that distasteful bottom tier of human beings once known as “customers.” That is why every corporation, from your bank to your phone company to even your doctor’s office, now uses an annoying phone tree that makes you press a lot of buttons and answer a lot of questions before being transferred to hold music for five or ten minutes.

When you finally do reach a person, you instantly wish you hadn’t.

If that person is in India, you may or may not be able to understand anything they say to you except perhaps their pretend, Americanized first name. Nevertheless, you should restrain your rage. If you’ve reached India, the person you are speaking to is working third shift under very unpleasant conditions and is empowered to do nothing for you except tell you restart your computer even if the problem is with your refrigerator. At some point, you will definitely hear the phrase:

“I am now going to [fill in this blank yourself], and this will fix your problem.”

If you’ve never dealt with an Indian CSR before, you may feel temporary glee, as in, eureka! This nice person is actually going to fix my problem!

This nice person is not going to fix your problem. Calm down for goodness’ sake! No, no, this person is trained to tell you your problem is fixed, then give you a confirmation number that is at least 18 digits long in case you have to call back. (Trust me, you will have to call back.) When you start all over with a new person 8,000 miles away who goes through all the same motions and gives you yet another 18 digit confirmation number, you will resolve to never, ever call again.

And that’s the whole point. Mission accomplished.

Call centers have become the sweatshops of the 21st century; whereas 19th and 20th century sweatshops actually produced a product, 21st century sweatshops produce nothing but frustration. Call centers are frustration factories. Call centers, in case you haven’t figured this out already on your own, are designed for two purposes only: 1) to shield corporate management from, ick, customers and thereby from experiencing directly any of the human consequences of their decisions and 2) to make you, the, ick, customer, go away.

It’s enough to make you want to summon the ghost of Ronald Reagan and ask him directly, “What, exactly, is trickling down here, Saint Ron? Because it’s running down my leg, and it doesn’t feel like rain.”

At a recent meeting at the large corporation where I work in a very small Dilbert-like cubicle, I was raising concerns about customer retention. I’d seen customers pull over $1.5 million out of our financial institution in the preceding week over policies designed to provide no help and no service to customers. We’ve lost billions in the first couple of quarters alone this year, so I thought (silly me) that this was a valid question.

The answer was quick, sharp, and a tad bit threatening:

“Look, from a management perspective, the customers we have just don’t matter. We want new money and that’s all we want. Get some new money out of them for us or get them off the phone. It’s not your job to worry about them. If you start solving even one of their problems, they all start to expect it, and what we are after is new money here, not talking with existing customers all day.”

I work in the “customer service” department, not sales. In the US of A. My, my.

But seriously, haven’t you suspected as much for a long, long time? I have. It was weirdly refreshing to hear someone in a position of moderate authority say it out loud so baldly. The truth! And in an election year, too! What a rare and special treat.

Credit card companies and banks, skittish about the credit crunch and facing more huge write-downs over the sub-prime debacle, are now looking for new ways to pad profit by doing even less for their customers than they were doing before. Most of these ways involve new fees, increased fees, hidden fees, and fees that are charged for spurious reasons.

But financial institutions are by no means alone in wanting to go straight for the wallet, bypassing customers entirely and “forgetting” to provide any service or product at all along the way. Cell phone companies routinely charge exorbitant contract cancellation fees to customers whose contracts have expired years and years ago, then turn their former customers over to collections when they refuse to pay. What do they have to lose if the longtime customer is leaving anyway? Sprint is a great example of this spurious practice. No wonder it is hemorrhaging money on its way down.

I think we’ve given laissez-faire capitalism, supply-side economics, or whatever you want to call it more than a fair chance to work for us for over the past couple of decades. Instead, just as a certain 19th century political theorist once theorized (hey, I’m not saying his name out loud! Are you nuts? Not while Gitmo is still in operation!), capitalism is now in the process of eating itself and its own alive as all the money floats to the top and the people at the bottom become bitter, angry, and finally, violent. Next comes complete social collapse. I’m not kidding. And I’m not alone in forecasting it, either.

It doesn’t have to be this way though. Regulation is not the dirty word some would have us believe that it is. At the very least, Congress needs to take a long hard look at credit companies, banks, and mortgage lenders and their slippery practices. It is so obvious it pains me to have to say it out loud. They got us into the sub-prime mess that is currently destroying entire cities (Cleveland, am I right?). We don’t have to just keep letting them do whatever they want to do because one dead president said it was a good idea.

Yes, Saint Ron’s ideas have created tons of new, low-paid jobs in call centers around the world. I’ll grant him that.

Want one of those jobs? I didn’t think so.

3 comments to Corporate Mergers and the End of the Customer

  • While I do agree with you that the optimization calculus run by most large corporations has very little to do with maximizing customer experience and more with ensuring longevity of internal corporate processes and political structures, I vehemently disagree that the answer is legislation.

    More legislation means higher overhead for customers like me, customers who actually take the time to read and comprehend and agreement before getting into it. “This subprime mess” is a result of people engaging in greedy speculation of their own volition; they were not little victims forced into transactions from which they’ll need protection in the future from some bloated governmental body. Legislation in this context will not create market efficiencies but instead lard transactions up.

    If consumers are sick of call trees, then they need to end their relationships with the companies that stick them in said call trees. That’ll learn ‘em; funny how that happens in a free market, eh?

  • Hi Anittah,

    The mantra that a free market is self-regulating is so patently false and so easy to prove false that it makes me nuts that people still chant it. Reagan started this free-market supply-side nonsense and look where it has gotten us. The money floats to the top, CEOs respond (sort of) to stockholders who want to squeeze more and more profit out of the marketplace without providing any additional value. In that world the customer is just an inconvenience at the bottom of a profit pyramid.

    Try replacing your bank, insurance company, or mortgage company with a friendly little hometown institution that has no call center. Good luck. If you find such a creature, it will almost certainly be on the verge of being gobbled up by something bigger and meaner. Mergers and acquisitions are a prime tool for artificially pumping up profits, at least one paper, and that’s we have fewer and fewer competitors in the marketplace and less and less real competition in certain industries.

    As to the subprime mess, the cause, as I see it, has more to do with speculative investment products created by noncommercial banks like Bear Stearns. It’s so easy and tempting to blame individual homeowners, but what really froze the market up (and continues to wreak havoc) are all the SIVs and creative investment products that chop up these bad loans so that no one can trace who holds what debt. That should indeed be regulated. Even Bernanke knows that Wall Street has figured out how to evade banking regulations and that this is the result—and he’s hardly a pinko. Those regulations were put in place after the Depression to prevent another wave of bank runs.

    I really appreciate your comments though. When I can’t provoke people here in America without getting hauled off I’ll know the end is near. Thanks to forums like this, it’s not.

    All the best to you.

  • Mark Lav


    Aren’t you yourself a testament to free market enterprise at work? While corporations gobble up and destroy newspapers the free market created an alternative medium through bloggers and the like and this will eventually be corporatized and be gobbled up until the next great thing the free market will develop.

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