PEOPLE need to be watched.
Back at the dawn of the Industrial Revolution, Jeremy Bentham, the English philosopher, seized on that basic management precept to design a building that would become a touchstone for architects of a new age. Calling it the Panopticon, he arrayed prison cells in a semicircle. The innovative layout gave a smaller number of guards the ability to watch a greater number of prisoners.
In other words, it cut costs.
The Panopticon design is still in use today, and not just in prisons around the world. It was easily adapted for factories and offices.
But what happens in the information age, when workers are no longer there in front of the manager, but working from home — maybe in their pajamas, or maybe with a cat on their lap and a peppy Lily Allen tune playing on the iPod? In many managers’ eyes, they wouldn’t do as much work.
No worries. Software becomes the new Panopticon. It can monitor workers who, conveniently, do most of their work on computers. It can also measure their efforts and direct work to those who do it best.
LiveOps, a rapidly growing company in Santa Clara, Calif., that operates virtual call centers — agents working from home across the country — has also found that software can perform other management tasks. How it uses that software points to the direction in which technology is taking the workplace.
Founded in 2000, LiveOps fields some 20,000 “home agents,” all independent contractors who take orders for products advertised on late-night TV, sell insurance or transcribe recordings for other companies. The agents even take pizza orders. If there is a storm in a particular city and pizza orders surge because no one is going out, calls to the pizza store are routed to LiveOps agents thousands of miles away. (The delivery boy still has to brave the rain and the wind. Software hasn’t solved that problem.)
The virtual call center is nothing new. A number of companies, like Elance, oDesk and Guru, assemble freelance work forces to take on specific tasks so that companies don’t have to run call centers or hire additional employees. TopCoder and RentACoder have done it specifically for computer programmers. A start-up, Serebra Connect, hires college students in developing economies to do work.
But Maynard Webb, the chief executive of LiveOps, says he thinks that the company’s software gives clients like Kodak, Colonial Penn and TristarProductions, a direct marketing company, an advantage. The software moves a company beyond simple cost-cutting. Mr. Webb says greater efficiencies can be found because the company’s software measures the results from each agent according to criteria determined by the client.
If a client wants agents to persuade callers to buy additional products, the software tracks that — and then directs calls to the agents who do it best. Those agents prosper.
What about the agents who aren’t so good? “No one gets fired,” Mr. Webb said. “They just don’t get work.”
Software becomes a passive-aggressive manager.
He thinks the concept can be expanded to any line of work — like health care, retailing, publishing and law — where the output can be measured.
And the advantage for LiveOps, which Mr. Webb says has been profitable since 2006, is a harbinger of things to come. “The economics are better. No buildings. No benefits,” said Mr. Webb, a former eBay executive. (LiveOps’s 300 employees do get benefits.)
Before everyone wrings their hands at the horror of an economy shifting to workers paid by the minute doing piecemeal work at the kitchen table while monitored by an all-seeing computer, consider that Mr. Webb isn’t having trouble finding workers.
“There are way more people who want to work in this model than we have room for,” he said.
He says that the company accepts only about 2 percent of all applicants, and that his contract work force has an average age and education level higher than at call centers. And attrition, a major problem in the call center industry, is lower, less than 10 percent after the first 300 calls.
Mr. Webb says it’s because his work force is happier. Dawn Linseman, a LiveOps sales specialist in Madison, N.C., says she checks the LiveOps internal Web site every day for statistics on how well she meets the clients’ criteria. “If you keep your stats up, your calls are back to back,” she says.
She started in 2004 and handles mostly infomercial orders from a spare bedroom she converted into an office. She schedules her work around the needs of her family, grossing about $18,000 a year working about 24 hours a week.
“As soon as my son gets his driver’s license, I’ll be working full time,” she says.
Yes, she wishes she had the benefit of company-provided health insurance, which she doesn’t get as a independent contractor. A plan offered by her husband’s employer covers the family. But she says she is much happier than she was when was an accounting manager for a Michigan supermarket chain. “I don’t miss the office politics,” she said.
Indeed, she recruited her sister, who does a lot of work transcribing medical reports.
Mr. Webb says the best workers can bring in about $50,000 a year. “If they get really good, I hire them as managers,” he said.
Software, always on and always watching, remains the real middle manager.
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