Capital One Terminates Its Indian Call Center Relationship

Last week, one of India's largest call center service providers, Wipro Spectramind, announced that U.S. credit card provider Capital One terminated a telemarketing contract after agents were allegedly caught misleading customers during sales calls. While the news adds to the mounting criticism of the service quality of offshore outsourcing companies, according to analysts this situation was not a cultural problem but a management issue. "Agents had been advised by team leaders and group leaders to make false claims about free gifts and membership fees while making their sales pitch," said Parvathy Ullatil in the story "Capital One ends deal with Spectramind" on business-standard.com, a New-Delhi, India e-zine. The story explained that Wipro's quality assurance team, which evaluates agent performance, was "asked to stand back for two weeks every month so the agents could carry on undetected." An internal audit at Wipro reported the findings to Capital One. Subsequently, in January Capital One opted not to renew its telemarketing contract for outbound calls with Wipro. A Captial One representative could not be reached for comment at press time. Of the 250 Wipro agents working at its Navi Mumbai and New Delhi centers for Capital One, 65 resigned, Wipro stated. However, the outsourcing company maintains that Capital One continues to work with Wipro to handle inbound calls. Wipro also stated that it will not change its revenue guidance for the current quarter. The contract termination proves to be yet another blow to Wipro, which lost a help desk contract with Lehman Brothers following complaints about the quality of service. Some pundits, however, say Wipro is not entirely to blame: "If you're going to put [agents] under too much pressure on the financial side, they will start behaving this way," says Lior Arussy, president of Strativity Group, a call center consultancy in Livingston, NJ. "This is a classic case of aggressive sales incentive programs, starving [agents] on the base [salary], keeping ethical codes vague, and not monitoring behavior." (Arussy told CRM magazine that neither Wipro nor Capital One is a client of his.) Arussy maintains many quality-of-service issues are often compromised when incentive plans are not in line with corporate strategies. Watch for a feature story in the May issue of CRM magazine in which Arussy and other industry experts reveal how to create incentive compensation plans that both support corporate goals and motivate agents and salespeople to reach desired results.