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Employee motivation in call centers – Case analysis of Scicom
1.1 Company history
Scicom is customer service outsourcing company established in year 1997. With experience in all areas of contact centre operations, including outsource and in-source operations, training, consulting, quality management and certification services, Scicom currently manages customer interactions in 40 languages, covering over 89 countries and delivering “Total Customer Delight” to over 40 million customers worldwide (Scicom-intl.com 2012). With the low cost advantage of the English speaking customer service, Scicom since its establishment has seized the trend of the industrial transferring to obtain abundant business opportunity from the developed economies by receiving the outsourcing of the customer service industry.
1.2 Industrial environment
Malaysia’s Call Center industry continues to experience considerable growth and there are over 600 centers employing over 25,000 people. Global enterprises such as HSBC, Standard Chartered Bank, DHL, and BMW have invested significantly in Malaysia’s MSC, which have yielded very satisfying ROIs. The revenue growth for technology vendors servicing the Contact centre industry has been in the high double digits for years. The opportunities for vendors and services providers in 2010 in Malaysia will remain “good to strong”, as both local and multi-national companies will be upgrading their Contact Center infrastructure, or establishing new Shared Service Centers in 2010 – 2012 (aprg.com 2010).
1.3 CEO – Leo Ariyanayakam
Under CEO, Leo Ariyanayakam’s guidance, Scicom has won several major international industry awards over the years, including the 2011 Contact Centre Service Provider of the Year, as conferred by Frost & Sullivan. The Group is now widely regarded as one of the premier contact centre and BPO providers within the industry, with an unblemished performance record. He has been instrumental in building Scicom as the leader in contact centre outsourcing, BPO, training and customer relationship management consulting solutions in the Asia Pacific region, and is a respected visionary and leader in this rapidly growing industry (Scicom-intl.com 2012). Under his leadership, the core competitiveness of the company, which is the performance and quality of the customer service provide by the company as a whole to its contractual clients.
1.4 Research problem
Motivation is the result of the interaction between an individual and a situation, and according to the definition provided by Stephen P. Robbins (2009, p. 144), motivation is the processes that account for an individual’s intensity, direction and persistence of effort toward attaining a goal. While general motivation is concerned with effort toward any goal, in organizational environment, the definition is narrowed down as concerning with effort toward the organizational goals in order to reflect the singular interest in work-related behavior. And the three key elements of motivation are intensity, direction and persistence. Employee performance and motivation is considered as having a strong casual positive relationship with work satisfaction. A famous theory about employee motivation is two-factor theory of work motivation that Herzberg published the in 1959. According to Frederick Herzberg, the Hygiene Factors do little contribution to provide job satisfaction. He called them “dissatisfiers’ as their absence cause dissatisfaction but their presence is not motivating but only prevent dissatisfaction. The hygiene factors meet man’s needs to avoid unpleasantness but do not motivate them to take more interest in the work. Hygiene factors (when provided) create a favorable environment for motivation and prevents job dissatisfaction. Motivating Factors act as forces of job satisfaction. They create positive and a longer lasting effect on employee’s performance and are related to work itself. Adequate provision of such factors called are ‘Satisfiers’ (Akrani 2010).
2. Research method
2.1 Research design
Through surveys, on site interview, direct observation and also the assistance of the relative theories and researches, in this project, we are working hard to locate the lack Hygiene Factors that make the customer service employees unhappy because of their absence and also the lack of Motivating factors that motivate the employees to pursuit better performance because of job satisfaction. And the most important source of date of this research would be the survey that we have done using the company’s email system with the approval from one of the senior managers of the company.
2.2 Data collection
Data can be defined as the quantitative or qualitative values of a variable. When we are decided to see into the problem of employee motivation in the outsourcing contact centers, we have to have the certain access to the resource and related data based on which our analysis on the human resource issues could be carried out. That is why researches conducted in different fields of study can be different in methodology but every research is based on data which is analyzed and interpreted to get information (gulnazahmad 2009). There are two major types of data, primary data and secondary data, primary data consist of surveys, interviews and focus groups, which shows that direct relationship between potential customers and the companies. Whereas secondary research is a means to reprocess and reuse collected information as an indication for betterments of the service or product. Both primary and secondary data are useful for businesses but both may differ from each other in various aspects (adfoster.com 2010). And in order to ensure that data are sufficient, both types of data would be utilized to assist to come to a more logical conclusion and provide more viable recommendations to the company’s further advancement in the employee motivation area. Three major ways of primary data collection would be utilized: interview, surveys and direct observation. And regarding the secondary data, we would refer to the internet resources, magazines, newspapers, reviews, research articles and journals and stories told by other people regarding the specific HR issues in the company.
To make sure that the survey could reflect the true situation of the company’s employee motivation, a sampling of 20 per cent of the total employees, 200 employees had been surveyed. And the surveyed candidates are chosen randomly to make sure that every one has equal opportunity to be part of this survey.
3. Analysis of employee motivation issues
3.1 Hygiene / Maintenance Factors
Herbergs’ first component in his approach to motivation theory involves what are known as the hygiene factors and include the work and organization environment which could include factors such as Company Policies, Supervision, Relationship with Supervisor and Peers, Work conditions, Salary, Status and Security.
3.1.1 Working Conditions
In Scicom, for an ordinary executive customer service, he or she would spend standardized 8 hours in the office and in front of the computer answering calls (or at least waiting there if no calls are in the queue) and probably around 1 hour in the dinning hall if they choose to have lunch there, working conditions could be a critical factor that results in employee dissatisfaction. By surveying 200 employees, we have found out that three are three major issues that are related to the working conditions. First of all, though the dinning hall is designed to serve as a place where the employees could have a rest during their lunch time or break time because the office has a rather noise environment (many customer service executives are answering or making outbound calls), it is not used as frequently as the company’s senior management and human resource department have planned in the beginning. Through evaluating the answers to the question that “How many times a week on average do you eat in the dinning hall?”, only 65 out of the 200 investigated employees indicated that they would have their meals more than twice in the dining hall within a common week. After interviewing some of the employees we conclude two major reasons for the low usage of dinning all: it is too small to accommodate more than 20 people and also it is not clean and tidy enough as a place for rest. This is also confirmed by the result of another question regarding the rating of the dinning hall and related office entertaining facilities (the office entertaining facilities are also located in the dinning hall) that the average score is ranged somewhere between Poor and Fair. Secondly, regarding the working and office environment, the average score is ranged somewhere between Fair and Good, and the most mentioned key words are noisiness and the low unstable office temperature (too high or too low). Thirdly, the hardware is also not satisfactory. Through evaluating the answers to the question that “What is the most area that improvement of the working conditions could be in your opinion?”, within the four options Hardware (computers), Office environment, Facilities (dinning hall, entertaining services) and Other services the 133 out of the 200 investigated employees choose that the hardware (computers) concern them most. When we look into the hardware problem, both interviewing the employees and direct observation tell us that the aged low performing computers in contrast with complicated and updated software handling and the need of frequent access to the internal knowledge make employees anxious especially when customers are paced on hold and computers respond slowly. Based on these three major reasons, we can therefore apprehend the answer to the question that “How do you agree with the following saying: I think the working conditions are fine for me” is ranged between “Neutral” and “Disagree”.
3.1.2 Salary and compensation
Though salary and other monetary compensation was demonstrated by Herzberg to be a hygiene factor, its importance is still self evident and agreed by many researchers. According to H. Edmund Bergeron (2009) hygiene factors like money can be neutral or create job dissatisfaction, along they can’t create job satisfaction, that is why we can not convince a dissatisfied employee to stay in a firm by offering the individual more money. Money is a powerful tool for a manager but not the only tool. Still competitive salaries and benefits are paid by all employers and have determined in several studies to have little long-term effect on employee motivation and retention. If pay is perceived to be low, it will produce a dissatisfied worker. But there is a different view that is becoming more than more popular that money could have the funtion of being a symbolic value which means that people request for more money not only because they need such money for spending purpose but also because it prices their value, for example a manager would be insulted if paying is too low than he expects because it make him feel that he is not respected by the company by receiving this low amount of money in exchange for his hard and valuable work.
Regarding the salary and compensation in Scicom, there are three major problems that have been figured out through our research. First of all, though the salary is widely agreed as acceptable (more than 70 percent of the surveyed employees choose either Strongly agree or Agree), but the salary increase is widely thought as too little and it takes too long time to achieve. Secondly, the salary increase is based on the length of time in the current position rather than based on the performance. Thirdly, one more issue with the salary and compensation is about the obtaining of the bonus pay. As stated in the company policy, employees or managers who receive compliments through the forms of oral speaking, email, letters or obtain 100 marks in the monitored calls would receive related cash incentives. But as a matter of fact, through the long talks with the employees who complaint that getting 100 marks happens once in a blue moon and they would not even expect to get one done, this is in line with the survey result that 176 out of 200 surveyed employees agree (or strongly agree) that the bonus pay is not reliable or very difficult to be achieved. There is great room for improvement in the bonus pay as the majority of the employees still think that the bonus pay in term of cash incentives is till widely attractive to them. And we will provide our suggestions for improvement in the recommendation part of this study.
3.1.3 Company’s Policies and Administration
According to the Herzberg’s Two-Factor Theory of Motivation, the company policies should not be too rigid. They should be fair and clear. It should include flexible working hours, dress code, breaks, vacation, etc. But in the case of Scicom, a company focusing on the customer service outsourcing industries, there are still some obvious inflexibility. Take the work shift system as an exampel. The current work schedule adopted company wide is a computerized and automatically generated work shift which allows little changes under strict procedure with approvals. For example, when an agent needs an off day in a particular day, he or she has to wait for the work schedule to come out and if the status of that day on the schedule is working, then he or she needs to find another agent who is not working on that day and change the shift with the agent under approvals from the both line managers of the two involved agents. Therefore, through evaluating the answers to the question that How do you agree with the following saying: The current work shift arrangement is satisfactory to me, we see that only 47 out of the 200 participating employees agree with this statement (strongly agree or agree), this means that the majority of employees are not satisfactory with the working schedule making system.
3.2 Motivating Factors
3.2.1 Limit Responsibility
Based on the study done by Mukesh Trehan and Ranju Trehan (2009, p. 465), giving more responsibility can work as motivator for the employees, those who are given more responsibility feel importance in their role and they feel themselves as important member of the firm. And increased responsibility increases dedication, attentiveness and creativity towards the work. And it satisfies esteem needs of the employees which is a high end need in Maslow’s (1943) hierarchy of needs. Through our research on the employees perception about the work relevant responsibilities, we are able to see that there is limited responsibility and authorization among the executive employees in their daily work. When asked whether they have sufficient authorization to finish the majority of their work from the beginning to the end without referring to the management or other department, around 70 percent of the surveyed employees expressed the view that they could not achieve this at most of the work tasks. There are many reasons behind such limited authorization, and different customer service outsourcing projects have different reasons. For example, in the project of Air Asia, customer service executives who answer calls on the floor are not allowed to deliver any promises to customers regarding any form of refund and credit back the balance simply because the client still maintain the fund transferring functions in its own company while only the enquiry and sale functions are outsourced to Scicom. But still in some projects there are room for improvement to increase the responsibility sustained by the individual employees to act as a kind of motivator. And recommendations contributing to this improvement would be furthered discussed later in the recommendation session.
3.2.2 The Sense of Challenging Work
Challenging Work is important if the management want to engage and energize the people in the company’s business. People want to feel that each day a bit more of their potential is realized and utilized as they contribute to the business goals. Regardless of the actual work that is being done, people generally can get some feeling from the challenging work: Achievement, Responsibility, Enjoyment and Recognition. And when the scope of work to be done is increased, to the level of the individual’s capability, then people generally become more engaged and energized (training.com 2011). There are some problems in Scicom that reduce the challenging feeling for the employees that it employs. Firstly, in the customer service center, jobs are all about routine jobs which repeat everyday and when an employee starts to get familiar with the standardized work flow, jobs would become regular and thus less challenging. Secondly, for every call answered, customer service executives would be monitored for their compliance with the standardized procedures, and if any exceptional handing is needed, approval from the management is needed in most case, as a result, the employees would have little flexibility in handling cases and the sense of challenging would be minimized.
4. Concluding remarks
To conclude the above analysis, though from the beginning introduction about the company background we have noticed that Scicom, the company that our study is focusing on, has a glory history in its industry, the contact service center outsourcing industry, there are some employee motivation issues that could be divided into two major issue: motivator issues and hygiene issues. Below are some recommendations to minimise the factors that cause dissatisfaction and maximise motivational factors that lead to satisfaction.
5. Solutions and suggestions
Herzberg’s basic idea stemmed from the fact that not all factors could be classed as motivational factors. He was interested in what caused satisfaction in the workplace and what the causes of dissatisfaction were. If employers could minimise the factors that cause dissatisfaction and maximise those that lead to satisfaction then he believed that an organisation could get the best out of its workers (bized.co.uk 2007).
5.1 Minimise the factors that cause dissatisfaction
5.1.1 Construct a good working environment
Regarding the working environment, as the employees are the most important asset in all companies. A good working environment reduces sick leave, lowers turnover rates and increases efficiency. The key to obtaining a good and sound workplace is to systematically focus on factors that influence the working environment such as ergonomics, noise and chemicals (dnv.com 2011). To achieve this target, there are two major ways to do so: firstly, the company could hire a third party working environment risk management company to perform a regular check regarding the company’s office environment and remove the possible working hazards that lead to employee health issues and also the employee dissatisfaction; secondly, instead of hiring an independent health risk management company which could be costly, the company could let the human resource management department to develop and implement a company fit working environment management system that works in compliance with national and international working environment regulations as well as the company’s relevant regulations. Some techniques could be adopted based on our research findings, for example, computer hardware updating and dinning hall layout redesign could be the changes that could bring immediate positive influence to the improvement of the office environment which concerns the employees very much.
5.1.2 Performance based salary increase and more achievable bonus pay
Regarding the salary and compensation, there are three major ways that the HR department of the company could persuade the higher management of the company to use to reduce the employee dissatisfaction and at the same time relate the employee performance with their pay. First of all, replace the seniority-based pay increase with performance based pay increase. And is believed that the seniority-based pay is the representative of an entitlement compensation philosophy. And it is applicable in the management positions because of the requirements of the related long time working experience in the management of the specific area, but it would discourage the entry of the new fresh employees. Hence it it not very suitable to be used in the common staff positions. Here we recommend that the human resource management department to replace the seniority-based pay increase with performance based pay increase, in another word, by meeting the previously defined conditions, even new employees in their first year could expect a salary increase if high performance is maintained. This will also increase the competition between the employees in term of achieving higher performance in the KPIs (Key Performance Index). For example, an employee may get a pay increase of 200 RM if he or she keeps maintain a position of top 15% among employees for six consecutive months in a low any time after the end of the probation period. Secondly, redesign of the bonus pay scheme would be necessary. As analyzed above, through the long talks with the employees who complaint that getting 100 marks happens once in a blue moon and they would not even expect to get one done, this is in line with the survey result that 176 out of 200 surveyed employees agree (or strongly agree) that the bonus pay is not reliable or very difficult to be achieved. It would be advisable that the company changes the current cash incentive scheme to another calculation method: for example, one who obtain more then 90 marks for 5 consecutive times would receive bonus of 100 RM and this would become more achievable and also motivate employees to keep good performance and help address the customer issues during answering calls.
5.1.3 Build up an automatic shift exchange and leave application system
According to what we have observed, we find out that many employees would need to do a number of manual change of shift with other colleagues after the release of the monthly schedules, and become very inconvenient and low in efficiency to request the employees to changes the schedules each time by referring to the managers for approvals. As a result, we generate an idea of building up an automatic shift exchange and leave application system to enable to people to do the change of shift online. The system functions like this way, in case A would like to change shift with B, A could log into the online shift exchange and leave application system and apply to change shift with B, then B would receive the message and ask whether he or she would agree, once he or she agrees, the change would be done with immediate effect. And for the better management, the company could regulate the exchange of shift could only be applied 24 hours before the starting time of the work shift time. And the similar logic could be applied on the procedure of leave application in which deputy managers in charge of the leave application and censoring could do this through the online system without talking to everyone which is time consuming. There are two major advantages of using this creative and innovative shift exchange and leave application system. First of all, by setting up this automatic system, it will help save the human labor cost because it saves the time of both the employees in application and the managers in giving the approval, and when the managers have more time to be spent on their work rather than censoring the leave application which would not directly contribute to the creation of additional value. And hopefully, more time spent in the work related issues would lead to better performance. The secondly, because inflexible company policy would arouse dissatisfaction from the employees to the company, the implementation of the automatic shift exchange and leave application system could avoid the generation of the employee dissatisfaction.
5.2 Maximise motivational factors that lead to satisfaction
5.2.1 Increase the individual responsibility
As discussed previously, through our research on the employees perception about the work relevant responsibilities, we are able to see that there is limited responsibility and authorization among the executive employees in their daily work and this the reason that when asked whether they have sufficient authorization to finish the majority of their work from the beginning to the end without referring to the management or other department, around 70 percent of the surveyed employees expressed the view that they could not achieve this at most of the work tasks. To increase the individual responsibility, based on our finding and also the knowledge obtained from the company’s reports and managers’ view, we manage to come to two suggestions to increase the individual responsibilities: first of all, in some projects, mergers of some departments could be helpful to increase the individual responsibility of the employees because they have to learn more product knowledge to master the different tasks that are originally performed in another departments. And also another advantage of the merger of different departments could create a more simple organization structure and could increase the efficiency in some cases because less inter departments communications are needed. Another way to increase the individual responsibility is to authorize the individual employees with more power to do tasks that could be done by their own rather than referring to the managers to seek approvals before making any decisions. But negotiations with the client companies and also closer monitoring would be needed while more authorization is given to the customer service executives.
5.2.2 Job rotation
Job rotation by definition is a management technique that assigns trainees to various jobs and departments over a period of time. By encourage limited quota of job ration, the company could achieve two targets. Firstly, by exposing the employees with new department and new product knowledge, it could motivate the employee to focus on his or her job with energy; secondly, the new job could help the employee to find out his or her true interest in the future career development.
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