What is failure demand in a contact centre?
Failure demand is demand caused by a failure to do something, or to do something right, for the customer. In a contact centre it is every contact that only exists because something went wrong earlier — a wrong bill, a missed delivery, a broken app, a callback nobody made. It contrasts with value demand: customers who want something you exist to provide.
The term was coined by the British occupational psychologist John Seddon in the 1990s, applying the Toyota Production System’s distinction between value-creating and wasteful activity to service organisations rather than factories.
The practical significance is that failure demand is avoidable, and its causes usually sit outside the contact centre — in billing, product, logistics, or the website. The contact centre is where other departments’ defects arrive as phone calls.
Most contact centre improvement work makes failure demand cheaper to handle: shorter calls, better scripts, deflection to self-service. Eliminating it means finding and fixing the upstream defect so the contact never happens at all.
Read the full explanation, including how to measure and price it →