Stoffer's Soapbox

Thrown in the Fire or Learning Slowly?

Prior to now, my strength has always been strategic planning, identifying market opportunities, and persuading people to approach problems in different, more creative ways. Now, I am implementing one of those big ideas and I have a whole new respect for operations. I always used to wonder why operations folks acted in what seemed to be a rash way - but now I know it's harder to always use a rigorous A/B test when you have to hit revenue targets. It's also harder to manage a project involving hundreds of people than a discrete few people on a project team.

I wish I could give more details (oh the woes of working for a public company), but the project I am am piloting right now is one that can change the face of how my company operates.  I suppose when I was doing venture investing our funding decisions affected dozens of lives - but this is one where thousands could be affected. As we muddle through, my project team and I are constantly making and learning from mistakes. I wonder - is it best to learn by getting thrown in the fire or better to learn by working for a great mentor who's an industry expert? My project definitely falls under the thrown-into-the-fire approach.

I look forward to sharing with everyone how it goes.

Ending Call Center Scripting as We Know It

I have shopped all the major online schools and the only consistent thing across them all is the scripted nature of the conversations with admissions advisors. In the vast majority of calls to schools like UOPX or DeVry, there are several minutes of conversation that are scripted - so scripted in fact, that many admissions advisors seem to place their primary focus on asking the next question on the script rather than listening to the potential student. The best advisors are very different - they concentrate on building rapport with the potential student and addressing that person's specific situation and concerns.

I came across a great article from Brazilian publication RC&C, titled "Is It Time for Call-Center Workers To Ditch the Script?", which addresses this very question.

There is a balance to strike between scripted and free flow conversation, but I believe - if you hire high quality inside sales professionals - that a simple call flow guideline works far better than a script. Of course, this call flow can be combined with call monitoring & coaching - regular monitoring will balance any concerns about advisors getting the university into regulatory problems and calls from your best advisors can be broken down to determine the best practices that can be coached to increase productivity.

What experiences have others had moving to this less scripted environment?

Best Buy: Succeeding in a Virtual Office Environment

As someone who has always gone into the office each day and values face to face contact I have  been somewhat skeptical about whether a virtual office is viable. I understand the benefits of expanding your labor pool and attracting/retaining talent that wants more flexible work hours, but I have trouble grasping how it all operates. After reading this article on Yahoo! about the success of Best Buy's virtual office, my skepticism is quickly fading. Highlights are as follows:

Virtual Office is Becoming More Prevalent in the Fortune 1000

• At IBM, 40% of the workforce has no official office;
• At AT&T, a third of managers are untethered.
• Sun Microsystems Inc. calculates that it's saved $400 million over six years in real estate costs by allowing nearly half of all employees to work anywhere they want

Best Buy's ROWE ("results-only work environment,") Virtual Office Program

• The goal at Best Buy is to judge performance on output instead of hours.
• No schedules and no mandatory meetings
• Productivity is up an average 35% in departments that have switched to ROWE.
• Employee engagement, which measures employee satisfaction and is often a barometer for retention, is way up too, according to the Gallup Organization

UI Changes Global Campus to Non-Profit Model

The University of Illinois bowed to pressure from faculty and students and agreed to launch its Global Campus online education initiative as a non-profit entity, according to an article in the News Gazette. The original plan was to have a fourth UI campus - for profit - and funded by $15-$20 million in capital raised from private sources. UI President Joe White wanted to compete directly with the University of Phoenix.

For me, this confirms my belief that it is very difficult, if not impossible, for a traditional state university to launch a successful for-profit online subsidiary. However, experience to date shows that traditional schools can succeed offering online education with a not-for-profit structure (see my post Umass Online: Benefits of a Non-Profit Model). 

The deck is stacked against for-profit education at traditional schools: faculty members want to retain control over curriculum, often want to keep teaching courses at their current pay rate and are likely to be philosophically opposed to for-profit education.

Terry Bodenhorn, a professor of history at UI's Springfield campus, said “The administration could have moved ahead with its own model, but it would have had no faculty support.” Bodenhorn, who has taught online, stressed that the faculty opposition to the original plan was based on concerns about governance and academic values, and not opposition to online education. He said that many professors who have been involved in the effort to kill the idea of a for-profit unit within the university system are in fact excited about the university offering more programs online.

New Resource for Public Policy Wonks: University Channel Online

Four renowned public policy schools have launched the University Channel Online, a new online resource for free, on-demand access to a wide range of public policy lectures, panel discussions and events from academic institutions all over the world. This is just another example of the power of online learning to make formerly proprietary content easily available to students, researchers, policy makers and citizens world wide.

According to the press release, the four charter members are:

• The Rohatyn Center for International Affairs at Middlebury College
• The Woodrow Wilson School of Public and International Affairs at Princeton University
• The School of International and Public Affairs at Columbia University
• The Lyndon B. Johnson School of Public Affairs at the University of Texas at Austin

Recent broadcast-quality audio and video selections include Stuart Bowen, special inspector general for reconstruction in Iraq, speaking at the University of Texas at Austin on Oct. 27; retired Lieutenant General William Odom, director of the National Security Agency from 1985 to 1988, speaking at Middlebury College on Oct. 11; and United Nations Secretary-General Kofi Annan, sharing his parting policy address at Princeton University on Nov. 28.

Skill-Based Routing: How Much is Too Much

Wouldn't it be beneficial if a mutual fund company had representatives who specialized in certain types of asset classes? How about an online education company - shouldn't they have admissions advisors who are experts at business, IT or health care? Well, today's telecom technology allows calls to be routed to agent groups with specified skill sets - via an IVR, using caller ID to pull customer data from a CRM system or via a telemarketing front end where a low skilled individual screens the caller to determine which agent can best meet the caller's needs.

However, skill-based routing also has its downsides - if all agents are cross trained to handle all calls, required staffing levels and customer hold times will be much lower than if only 10% of agents have the skills to handle a certain type of call.

A great example of skill-based routing's upside and downside is in the quote from a white paper titled Skills Based Routing: An Industry Survey, published by the Customer Service Group. "One company discovered the impact of using Skills Based Routing was to divide their call centers into 60 to 70 virtual teams. The number and complexity of the virtual teams changed each time an agent logged in or out. With these large numbers of teams, call centers lose the efficiencies of having 700 to 2,000 agents."

I encourage you to read the white paper to learn more about the benefits and risks of skill-based routing.

MIT: Free Courses Online

I have  known about MIT offering its courseware for free online for a while, but I never realized just how powerful of a resource it is until I perused it today. Check out the link to MIT's OpenCourseware project here.

How often do you have a pressing business (or other) question and just use google. Well MIT may be a much better source. Let's say you want to learn more about logistics and supply chain - you can download the lecture notes for an entire graduate-level course. Let's say you are starting a company and want to raise cash - there is a whole course on raising early stage venture capital.

Kudos to MIT for making this great resource available to the public.

University of Illinois: Haphazard Plan for Online Learning?

The financial plan for the University of Illinois's for-profit virtual campus is aggressive, calling for a profit of $27 million in its 5th year of operations, according to an article in the News-Gazette.

• Assuming a net margin of 20%, estimated year 5 revenue would be ~$135 million.
• This would mean a year 5 student population of ~7,500 students if revenue per student was $1,500 per month ($18K annually).

In today's competitive online learning environment, the school's plan seems overly aggressive . In the third year of operation, the cumulative loss could reach nearly $16 million, according to the financial plan. There is no reason they can't ramp marketing slower and have a lower burn rate to achieve profitability.

In addition to the financial plan issues and difficulties garnering faculty support (see my post on this), the school seems to be taking a somewhat haphazard approach to crafting its business plan. Rather than bringing on an experienced leader with a vision, they seem to be using a hodge podge of consultants to craft a vision while simulataneously looking for a chief marketing executive. The consultants include Compass Knowledge Group of Orlando, Fla., at $29,000 to assess the market for online nursing degrees - I have no idea why you need a consultant to do this - all you need to do is look at government published data for nursing degree growth and speak with large health care providers like Kaiser Permanente. Other consultants include Pamela Pease of Santa Fe, N.M., a former president of the online Jones International University ($83,500 contract through June) and Eduventures ($38,000 contract to assist with planning and marketing).

Most importantly, rather than pushing ahead aggressively with a rather haphazard plan, UI must work harder to build consensus amongst its constituents and find a plan that works for faculty and students without eroding their existing brand.

Online Education Database

You can expand your Internet research beyond Google without the need to pony up for expensive proprietary databases like Factiva. Check out this great list of resources for research from the Online Education Database (OEDB), titled Research Beyond Google, 119 Authoritative, Invisible and Comprehensive Resources.

OEDB points out the importance of expanding your search, stating "Google, the largest search database on the planet, currently has around eight billion web pages indexed. That's a lot of information. But it's nothing compared to what else is out there. Google can only index the visible web, or searchable web. But the invisible web, or deep web, is estimated to be 500 times bigger than the searchable web. The invisible web comprises databases and results of specialty search engines that the popular search engines simply are not able to index."

Check out just a few of these sources below:

• Internet Archive — A database of tens of thousands of movies, live music, audio, texts, and home of the Wayback Machine that allows you to find old versions of web pages, over 55 billion.
• The National Gallery of Art — A searchable catalog of all of the museum's 110,000 objects, with images of more than 6,000 available online.
• Project Gutenberg — A searchable online catalog of more than 19,000 free books with full text available online.
• Regional Economic Conditions (RECON) — A database of economic data available by state, county, and MSA.
• International Data Base (IDB) — A computerized data bank of statistical tables and demographic information for 228 countries and areas.

Ruby Tuesdays: Getting Charged for Bug-Covered Nachos

I ended up in Ruby Tuesday's today - restaurants like Ruby are not my first choice, but I was waiting on my future brother-in-law Doug's appointment at the Apple store and NFL playoffs were a calling.

Doug ordered -  and when the plate was delivered, there was a bug in the middle of his nachos. The manager brought out a new plate and apologized, but we were we were still charged for the nachos. What restaurant manager in their right mind would not comp the bill if a customer  found an insect in their food. If I want to the local taqueria, the owner would be mortified and do everything he could to keep me as a customer (or at least prevent me from reporting it to the public health department). Given I can get better service in my neighborhood, why would I possibly go back to Ruby's, ever.

This poses an interesting challenge - how as a chain restaurant, or any chain retail operation for that matter, do you get your employees to act as owners and actually care about the customer experience. In my next posting I will talk about the Apple Store, which creates what I would consider the best customer retail environment in the market today.