Issue 3. Whether AT&T has reformed its processes and procedures to ensure that the abuses found in C.98-04-004 do not occur.
AT&T explains that, since the 2001 Rule 12 Decision, it has either changed or created a number of tools employed by its Customer Service Representatives when responding to a call from an existing or potential customer. The tools include:
a) The Customer Rules35
b) HOMERUN36
c) Call Center Transformation Program (CCTP)37 CCTP is a desktop application that obtains information from a calling customer via the customer's responses to prompts from an Intelligent Voice Recognition (IVR) system. CCTP "routes the call to the most qualified agent available." On the agent's screen, CCTP displays information about the customer including the customer's reason for calling. This allows the agent to immediately address the customer's reason for calling. The application also contains an embedded Help screen so that the agent can look up information relevant to the reason for the call.
d) Sales Assistant and Discovery Questions38 Sales Assistant is a customer relations management tool that uses consumer-specific information (including information about the products available at the customer's residence, products the customer subscribes to, and products the customer is credit-qualified for) to provide service representative with product and service options "that are likely to be of interest to the customer."
e) Bundles Calculator39 The Bundles Calculator is a tool the service representative can use to quickly calculate and compare what customers are currently paying for their services (or what another company has offered them) versus what they would pay if they subscribed to the same services from AT&T. The tool calculates the bundle price for any available bundle of services.
AT&T argues that these tools, taken together with training and supervision of consumer service representatives who employ the tools and the scripts the service representatives are trained to use, ensure that the kinds of marketing behavior enjoined by the Rule 12 Decision do not occur. In particular, AT&T argues that these tools ensure that: (i) the customer's reason for calling is addressed first; (ii) the customer is told that he can obtain the stand-alone price for any bundled service; and (iii) the customer is only offered those services he qualifies for and which are of potential interest to him.
DRA and TURN counter that AT&T has failed to show any changes in its processes and procedures that will ensure the abuses of the past will not re-occur.
Specifically, DRA and TURN refute AT&T's assertion that its customer service representatives "resolve" the customer's request before making sales offers. DRA and TURN point to the language of AT&T's current Tariff Rule 12 (as modified by AL 28982), which "does not contain the word `resolve.'"40 DRA and TURN acknowledge that in some cases, there may be certain calls (such as those for a new connect) where the customer service representative may begin marketing prior to "resolving" the customer's stated reason for calling. However, they assert that AT&T should resolve billing and service inquiries prior to engaging in marketing and that "the only way to insure that the customer's stated concerns have indeed been resolved, and do not become hostage to AT&T's marketing, is the now abandoned `recap and bridge' procedure."41
Moreover, they allege that AT&T has resumed all of the following practices which it was directed to abandon or modify in the Rule 12 Decision, including:
a) Pushing for sales on every call, regardless of whether the call was from an existing customer or new customer or related to a problem with existing service.42
b) Commingling sales and service. AT&T service representatives no longer summarize the resolution of the issues that caused the customer to call and obtain the customer's permission before they begin marketing additional services.43
c) Failing to meaningfully disclose the lowest price services that meet the customer's needs and selling the most expensive bundles first. They allege that AT&T service representatives offer the most expensive packages first and only offers lower priced packages or stand-alone services if the customer specifically requests to hear about them.44
d) Confusing Sales Scripts. The service representatives do not clearly explain terms such as "basic service" and "discounted bundles" in an effort to persuade customers to buy more expensive bundles.45
e) Implying that the service representative is an "expert" who will give disinterested advice to the customer rather than a commission-earning sales person who has a financial incentive to sell the highest-price products.46
f) Disciplining service representatives for failing to meet sales quotas. Neither this fact nor the fact that the service representative is a commission salesperson is disclosed to the customer.47
AT&T vigorously disputes each of these characterizations of its methods of dealing with customer inquiries. AT&T makes the following arguments in response to DRA and TURN:
a) With regard to the alleged impropriety of pushing for sales on every call, AT&T responds that the Rule 12 Decision explicitly permitted AT&T to offer services on every call so long as the service offering did not interfere with "providing customers with information to which they are entitled."48 As discussed more fully in Section IV of this Decision, AT&T argues that its current marketing scripts ensure that customers receive all information to which they are entitled as part of any call.
b) AT&T argues that its evidence demonstrates that this allegation by DRA/TURN is simply false. The customer service training materials introduced in evidence "require service representatives to first resolve the customer's reason for calling and to base any offers on the customer's needs."49
c) AT&T argues that by having customer service representatives (CSRs) mention flat rate and measured rate service at the same time as they recommend bundled services, it is giving customers adequate notice that stand-alone basic service is available:
If a customer qualifies for Lifeline service, the service representative always provides the Lifeline prices for Flat and Measured Rate Service. And if a non-Lifeline customer is interested in stand-alone basic service, the service representative always provides the prices for both Flat Rate and Measured Rate Service. Thus, the basic service options are always given to every customer that calls for a new connect, and the prices for basic service are provided to all Lifeline customers and all other customers that are interested in stand-alone basic service.50
d) AT&T denies that its explanations of these terms are inadequate but admits that it provides explanations only to customers who request them.51 Further, AT&T argues that nothing in the only model script to which DRA/TURN objected is confusing, much less deliberately deceptive.52
e) AT&T notes that in a response to a federal court ruling that it lacked jurisdiction to regulate incentive compensation agreements between AT&T and its union, the Commission eliminated caps on sales commissions from the original Rule 12 Decision.53 AT&T also notes that the average amount of total compensation actually paid to service representatives through incentive compensation in recent years is less than the cap the Commission attempted to impose in that decision.54
f) AT&T notes that there is no legal requirement to disclose employee compensation arrangements to customers and that, in any case, DRA/TURN misread and misinterpret motivational language in company documents designed to encourage high performance by Customer Service Representatives.55
35 Customer Rules are the following objectives "(1) Take Ownership and Show We Care - We Value our customers and we let them know it by all we do; (2) Be Responsive and Deliver - We listen to customers and deliver with speed; (3) Do It Right - We deliver with quality the first time, every time; (4) Make It Seamless - AT&T has many parts, but to our customers we are one team; (5) Meet Our Commitments - We communicate, follow through and work hard to keep our promises." AT&T Opening Brief pp. 20-21.
36 HOMERUN is a mnemonic that stands for:
"Have Enthusiasm to answer the call..."
"Obtain first Call Resolution..."
"Make use of your Sales Tools to provide the right the right offer to the customer..."
"Explain the AT&T Advantages..."
"Really make a Quality Offer..."
"Upbeat and Skillful Close..."
"Need to Follow the Contact Guide..."
Id., pp. 21-22.
37 Id., p. 23.
38 Id., pp. 23-24.
39 Id., pp. 24-25.
40 DRA and TURN Post Hearing Reply Brief, p. 3.
41 DRA and TURN Post Hearing Reply Brief, p. 6.
42 Id., p. 40.
43 Ibid.
44 Id., p. 42.
45 Id., pp. 43-44.
46 Id., pp. 44-47.
47 Id., pp. 48-49.
48 AT&T California's (U 1001 C) Reply Brief, p. 27, citing Rule 12 Decision, pp. 54-55 and COL 33.
49 Id., p. 28.
50 Id., p. 35.
51 Ibid.
52 AT&T Reply Brief, p. 41.
53 Id., p. 45.
54 Id., p. 46.
55 Id., p. 47.
