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Outbound Call Centre

Findings from the focus groups

Outbound call centre had multiple functions in HBOS. Agents were not only responsible for selling Credit cards, but also the associated financial products such as Credit Card Repayment Cover (Insurance) and Card Care (Insurance). They also tried to encourage customers to go for Balance Transfers (A balance transfer is the act of transferring debt from one credit card to another assuming the newer card has better terms and rates. (Wikipedia, 2007)).

The uniform consensus among focus group respondents was, that the work environment in HBOS was pressurized as there was a constant push to sell. Financial products like Card Care were deemed profitable and employees were constantly advised to adopt a hard-sell approach to these. Company reports revealed that the the claim rate with Card care was lower than 5 percent which resulted in increased profitability for the company. Employees highlighted that with the credit crisis, there was an increase in the number of credit card declines which led to a reduction in number customer acquistions. This meant that the company had to find other ways of generating revenue and Card Care and Credit Card Repayment Cover were the obvious options. All this had meant an increased focus on these add-on sales. Employees who had experience of working in other outbound call centres did mention that HBOS provided a better work environment. Various reasons were mentioned, while some believed that their efforts were valued with a good reward and incentive program, others believed that they enough leeway during calls and did not necessarily have to stick to the scripts. There was a general consensus that the outbound call centre provided them more autonomy and variation in job roles than the inbound because the inbound had less variability, had little reward for their efforts and work was more routine (stringent script they had to follow). Participants did mention that while they had to follow the script due to compliance and regulatory reasons (Data Protection Act, FSA regulations), they had enough autonomy during the course of the call. None of them seemed worried about the script too much and believed that script following only took less than 10 percent of their call time.

Participants did mention that while, there was some variation to their role but by and large is concentrated around sales. The variability, too, was sales specific. Example, an advisor may have to cold to some customers to sell credit cards one day and may have to sell Card care to existing customers on other days. In other words, the approach to variability concentrated around new customer acquisition, cross-selling and up-selling. Some advisors were also responsible for customer retention at times and were responsible to win back customers who had already left. Employees concurred that there could be more variability to their role. Some of the respondents echoed that ‘they could be used for training new employees’, ‘they should have a knowledge of financial numbers and the profit generated by selling insurances and there was a potential to train them on basic econometrics’. A general belief among employees, was that, even though HBOS tried to vary the role within its confines but they only did so much. Employees did mention that the nature of the job itself cannot be changed, but they wanted to diversify their experience and knowledge. They wanted HBOS to cross train in other areas of business.

Focus group respondents were carefully sampled to include both new and more experienced employees because the author, by his experience, believed that the respondents views could differ according to the time they spent on the job. The views with regards to motivation were somewhat different. While the new employees (less than six months) believed that the incentive schemes and reward programmes keeps them motivated, the more experiences ones were of the view that the motivation dies after the initial spark. As soon as the training gets over, there a general enthusiasm among employees resulting in healthy competition. But, it was difficult to maintain the same level of enthusiasm day in and day out and enthusiasm levels plunged after a certain time. There was a consensus that rewards and incentives, were the best form of motivation while the monotonous aspect of work was the most de-motivating aspect. Appreciation and recognition was another positive aspect of work and HBOS was very good at recognizing good performance. Soft skills (team-working, coordination with team members, communication within the team) also played a role in the assessment of performance and rewards and recognition tried to incorporate all those aspects.

The performance management system was explained to the employees by the author and handouts containing different aspects on performance management in HBOS. It was mention performance management had close correlation with Key Performance Indicators (KPI’s). The KPI’s followed in HBOS is given in the Appendix. There were contrasting views with regards to the PMS. Those who were constantly rewarded felt that the PMS was more accurate than the ones who were seldom recognized. This did not come as a surprise but the views were interesting to hear. Some pointed out that soft-skill such as customer satisfaction, helping team members, training new members of staff, customer empathy etc did not find a place in the PMS as they could not be quantified. The PMS had an out and out sales approach and most parameters such as sales per hour, conversion rate, abandon rate etc were all sales parameters. The employees thought, that while these performance indicators gave a good assessment of an agent salesmanship, it did not reveal much about the call handling capability of the agent. ‘The PMS did not measure whether the customer was satisfied with the sale, all it measured was whether the sale was put through within the time constraints or not’. Participants did understand that some of the measures cannot be quantified and were very difficult to include within the KPI’s, but still HBOS can think of a way to include these measures.

Customer satisfaction is the key to call centres today, as the employees serve as ambassadors to the brand, organizations have to make sure that every touch point with the customer is dealt with professionally to leave customers satisfied. The credit crisis has had a deep impact on the financial services industry and makes the role of call centre agents even more crucial as organizations fight for customer share even more fiercely than before. Motivational issues and having an accurate PMS to motivate employees play an increasingly important role. Also, with tele-sales and inbound sales (on the back of the internet advertising) playing a more crucial role (because of less cost of acquisition than traditional sales channels such as direct sales, TV, radio and print media advertising), it has become all the more important to keep call centre employees motivated. It was mentioned in the review of literature that motivated employees served the customer better and stay with the company longer.

Employees also mentioned that while they knew how their performance was assessed, they weren’t sure how it impacted on the company’s profitability. Participants concurred that they needed a better understanding of the KPI’s. They also stressed the role of job re-design where they wanted to do other tasks to bring some variety to their role.

The focus group responses revealed that rewards can go a long way in motivating employees, thereby increasing productivity. Finding out the most appropriate performance measurement tool to motivate employees has been a bane for organizations over the years. HBOS does not fare too bad on this front but there is still a lot of room for improvement. Arguments against reward and rating system of HBOS suggest that they do not weigh qualitative factors. They only take a one dimensional view of the employee and do not take into consideration factors such as work conditions, responsibility, team-work etc. Also, rewards in the form of financial incentives, at times, can serve as a bribe and do not help to connect the employee to the organization. Rather than encouraging an emotional relationship, it encourages a transactional relationship based on financial incentives. This might motivate employees for a short term but can be more de-motivating when the reward offered is less then what is expected. Advocators of reward system argued in the review of literature that when ratings and reward system are based on a good mix of indicators, they do help in motivating employees and rewards are a fair way of recognizing employees for their efforts. Rating and reward systems do improve employee motivation if they serve to value the employees and are suited to employee conditions. When the rating system is more objective, rates employee fairly, is a good mix of qualitative and quantitative factors and when the rewards relate directly to employee achievements and performance, they will help to motivate employees. But, organizations have to understand that the rating and reward system should not be used as a sole motivator and are no substitute to good management and healthy working conditions.

Findings from the interview

Other motivational measures highlighted during the interview was the fact that managers tried to encourage closer social relations among sales agents, and between agents and themselves, thereby providing social-psychological support for less confident sales agents.

Interviews and focus groups also revealed that while managers thought that late reviews were acceptable because employees were paid retroactively, employees, however, looked forward to their reviews. It was also found out that when employees didn’t get their feedback they began to question their importance to the organization which created false impressions. Employees also mentioned that some of their colleagues left because they thought they had no career path at the company as they had no regular reviews. Interviews also found that some KPI’s used by HBOS was far too complicated and difficult to follow. One of the managers interviewed asked for a custom report that presented only a few metrics (a subset of the present set of KPI’s used).

Analysis of findings

Motivation is a desirable attribute for an employee in any work context but its all the more important in call centres because of the monotonous work that employees have to perform. In practice the motivation of an employee depended on the nature of the work, the fit between an employee’s views of interesting and challenging work and what was provided. It also depended on how relationships with other workers were structured to make work easier to accomplish. Although the call centre job involved a lot of routine work, it could be intrinsically satisfying, with opportunities to pursue challenges and express creativity. It was highlighted in the review of literature that previous researches have shown that agents who experience high intrinsic motivation in their work achieve higher levels of performance. Motivation from pay, financial incentives, level of compensation and the nature of benefits and external rewards based on performance (extrinsic motivation) goes a long way in improving performance.

It was highlighted in the review of literature that job satisfaction and motivation can be classed into three kinds - intrinsic, extrinsic and social satisfaction (Inglehart and Abramson, 2005). Intrinsic satisfaction depended on the nature of work, not only the fit between workers views of interesting and challenging work and what management provides, but also how work and relations with other workers are structured to make work easier to accomplish. The sources of intrinsic satisfaction in call centres lie in management's work-structuring strategies that include clearly defined work tasks and expectations and work-process facilitation. Workers were seen to favour and gain satisfaction from participation in decisions that determined how work was undertaken. Extrinsic satisfaction depended a good deal on employment relations. It dealt with what the employer provided in pay and employment conditions in exchange for workers contributions (Source). Workers' job satisfaction and motivation levels depended on the relative weight that is placed on these three different aspects of work satisfaction and how far these are being met. In addition, by providing opportunities for learning implied by increasing intrinsic satisfaction, workers normally found it easier to expend more effort and hence are inclined to contribute. Additional work-related factors that were found likely to increase workers' intrinsic satisfaction and/or facilitate additional effort leading to more discretionary efforts included effective technology and higher levels of cooperation and support from immediate colleagues and workers in other departments. Greater employee influence at task level also contributed to more discretionary effort through identification with the work process.

Call centres have grown over the years and the growth of IT and frequent changes in systems require familiarity with IT and navigational skills to minimize problems that arise when several systems are used simultaneously. This has, to some extent, enlarged workers' discretion. These and the other features also mean that front-line workers must increasingly be able to unlearn and learn fast and requires them to be knowledgeable and flexible. Focus group sessions and interviews revealed that was not the magnitude of the compensation / reward that mattered, but the belief that the rewards were good. Career prospects within the organizations and structured orientation added to the motivation. Focus groups revealed that long term training in the form of ‘management training programs’ and other opportunities that assist employees to progress up internal job ladders went a long way in keeping employees motivated. It was found out that call centre employees have limited job satisfaction when they have no autonomy to provide customized service and are highly dependent on the company for their future. (Source) believes that discretionary work effort will not be easily evoked since workers are attuned to following rules laid down by management.

The importance of training with the PM framework

Call centres play a more vital role within the organizational context today as improving the firm's competitive edge means higher expectations from call centre agents as they must service customers effectively and cope with uncertainties associated with changes in products, procedures and systems. This puts pressure on the training department as employees require constant education. HBOS used weekly briefs and communication letters to inform customers of the various changes. Due to busy environment, training for job proficiency did not take place as it did not have the time to support training for employee development. The managers did show that they were inclined to carry out regular training programs but the structure did not allow them to indulge in training as much as they would ideally like to. HBOS typically allocated around 6 per cent of its total business unit budget to training. This included one full-time trainer for forty-five sales agents. Training course ran for less than four weeks and was largely aimed at providing employees with the knowledge and skills to work effectively in the shortest possible time. The emphasis was mainly on narrow contextual knowledge; company products, systems, procedures and customer-related skills. Training updates were given only when there were major changes in technology, products or procedures. It was mentioned during the interviews that some sales agents did receive some advanced training as part of employee development strategy. Management paying less attention to career planning of front line workers was one of the other major reasons of lack of motivation.

Call monitoring

Call monitoring also came up in the focus groups. HBOS used silent monitoring, where outgoing calls were monitored remotely and subsequently analysed by the supervisor and the sales agent together, in private. Additionally, there was side-by-side coaching, here monitoring and analysis was undertaken with the supervisor or team leader sitting alongside the sales agent, listening to the calls and afterwards discussing them with the worker. These two forms of training were used as on-going forms of behaviour reinforcement and support. Employees, understandably so, were not very impressed with the call monitoring system and were of the view that it was used as less of a training tool and more of a quality assessment tool within the PMS. The study found out, that even though a sample of outgoing calls were recorded, none of them were listened to assess call quality.

Career and Reward Structure

HBOS’ PMS system was pretty robust and provided management with the discretion to vary rewards in order to keep employees motivated and retain their high performers. But, more variables assessed productivity (for achieving sales figures) and not quality (for satisfying customers, with which workers identify). Annual individual appraisals were conducted by supervisors and/ or managers in a systematic fashion. These were mainly used to provide feedback on individual performance rather than to plan and develop employee competencies. Appraisals also influenced management decisions regarding promotion and selection of employees for project work. HBOS also had an informal career ladders were new starters progressed to the status of experienced worker (sometimes involving more complex work) and then, in time, to team leader. Promotion to supervisor was more difficult since it depended on vacancies being available. It believed in giving its agents a fair chance and made sure that supervisor positions were advertised externally only after internal applicants had been considered. Other horizontal career tracks followed by HBOS were schemes which offered experienced workers the possibility of becoming a trainer

The reward system is an integral part of the performance management framework and combined position-related features with performance-related criteria. Example: the outbound sales agent position was typically situated in a salary band that reflected the qualifications and competencies required to undertake the job. High performing sales agents (judged by the set of KPI’s) received rises of between 6 and 10 per cent. Performance-related prizes for service excellence or for achieving outstanding results in sales competitions were a common form of salary supplement. They were paid in cash or in kind (gift vouchers or restaurant outings) and were sometimes team-based. The monetary returns were usually small, with a tendency for management to view these schemes as conferring recognition and status rather than monetary gain.

From the analysis and the review of literature, it can be definitively concluded that outbound call centre work that involved little room for discretion; training for job proficiency rather than employee development; limited employment security and few internal career opportunities; and reward systems that discriminated in favour of higher performing or more knowledgeable and skilled sales agent, starts to de-motivate employees very soon. More effective call centre organizations are characterized by a system of mutually supporting work, employment and control relations factors. These may include factors such as greater role clarity and more knowledgeable supervision, manifested, in setting clear expectations, giving timely feedback and providing superior training and advice.

A good performance management system is vital for call centres (especially financial services call centres) in this uncertain economy. The constant threat of outsourcing means employers need to obtain the greatest possible productivity and value from their employees. This has made the role of performance management even more significant as the best way to manage performance is to track and measure the right factors and to ensure that all levels of the organization accept the metrics. But, it can be seen from the review of literature that getting the PMS system right is more than revisiting the appraisal form or copying the rating scheme used by the best practice company in that sector. To sustain employee motivation and to put in place an effective PMS, performance management should form a regular part of the organization’s business, not just something done annually or on a quarterly basis during reviews. A good PMS looks at all the critical aspects of employment, recruiting, retention, and relationships. It aligns measures to business needs and makes measures relevant to the goals of the senior management team. Using accurate KPI’s to measure performance opens eyes of executives and senior managers as what is going on in the organization. Accurate KPI measurement can shed light on the entire performance management process. The PMS also aligns the different aspects of the HR function and ensures that recruiting, payroll, employee relations, and other parts of the call centre get consistent messages. (Source) points out, “That’s the beauty of a KPI, it pulls it all together,’

Regardless of the method used for performance management, the important thing is to convey to the employee how his or her day-to-day job helps achieve the organization’s strategic objectives. Creating this employee alignment can help boost the bottom line. Wyatt’s Work highlighted in the review of literature that organizations that do a good job of conveying to employees how their individual role

has an impact on the business enjoy a 21% total return to shareholders over three years, compared to only 5% total return for those companies that do not. For call centres to be a success, they have to create a culture of continuous development by making performance management something that employees value. If they’re invested in the process, they will be more likely to exert pressure on supervisors to provide coaching and guidance. After the employee understands how he or she is connected to

corporate success, the best person to appraise the employee may, in fact, be the employee himself (Warech, 2006). Appraisals help breed commitment among employees because employees feel good about being asked for their opinion. It also allows them to explain to the manager any situational constraints that may be hindering their performance. It has also traditionally been seen that processes done with the employee are much more effective and achieve better buy-in, so employees should be involved in assessing their own performance and, working closely with the supervisor, in setting their own goals and learning and development action plans. It can also be gathered from the analysis that call centres that do a spectacular job of performance and talent management don’t rely on infrastructure but on employees and their managers who believe in the process and who value the giving and receiving of feedback.

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