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Raising the Bar

Understanding the Firm

VertiSoft is a specialized software developer focusing on verticals such as architecture, the airline industry, biotechnology companies among others. Annual sales of more than US$ 1.1 billion.

Growing at 30 to 40 percent per year.

High profit margins. Headquartered in Dallas. Customer service and technical support team in New Brunswick, Canada.

Customer Service and Technical Support Team

Located in New Brunswick due to
excellent education levels in the community high-quality technological infrastructure because of state policy of supporting telecommunications firm grants for training and development provided by the province.

VertiSoft was pleased with the quality of its employees. Future increase in labor costs due to shortage of labor. Hence, greater labour productivity required to drive profits.

Performance Metrics Introduced

Time to Assist to completion Avg amount of time (in minutes) taken to assist a customer.

Avg amount of time taken to refer to a technical support specialist.

Computer-based survey sent to every tenth caller to rate the quality of service.

Random observations of calls between customers and representatives, audited for "quality".

Results of Performance Appraisal System

Call Duration was dropping Customer satisfaction was increasing Time to refer to software experts was reducing

Substantial employees were scoring low on these measures. Many dedicated and cheerful employees scored low.

Using the Numbers- Differing Viewpoints

Wants to publish performance ranking of employees Believes the ranking will instil competitive instincts in the employees Assumes this will lead to people performing better by raising the bar themselves

Jenkins (Manager)

Sunita Prakesh (HR Head)

Does not want to publish rankings Fears its impact due to unions and tight labour market Wants to use the numbers as one of the factors in the semi-annual appraisals

Performance Management
Aims to
Ensure that an employees performance is supporting the companys strategic aims. Improve organisational effectiveness. Build employee motivation Create channels for discussions and platform for feedback and improvement.

Total Quality Management

Modern Performance management systems integrate appraisal and training needs Developmental plans to align the employee objectives with the company objectives in the short and the long run.

Performance Appraisal Process

Define the Job Appraise performance Provide feedback

Goal Setting
Specific Measurable Achievable Realistic

Time bound

Current Approach
Does not employ the correct performance metrics This is having unreliable results
The current performance metrics lack the following characteristics
They are not linear Lead to correct conclusions Performance metrics should Allow accurate and detailed comparisons Be well understood by everyone Have a quantitative basis

They are not

reliable They are not repeatable

They are not

consistent

Action Points
Recommendation: Performance metrics result not to be published
Reason: Will demotivate the lower strata employees and can be counter productive to efficiency of the organization

Alternative Model:
Every employee should know his performance data but not of others Team supervisor should all the performance data of his team members for continuous monitoring Introduction of reward system to top ranking employees to motivate Introduction of a feedback mechanism so that Employee problems and system inefficiencies can be immediately dealt with

Area of concern: To publish the performance results

Action points
Area of Concern: Evaluation of the proposed performance metrics Recommendation: Current evaluation system is too broad and suffers from inconsistencies Proposed Metrics:

Alternative Performance Management System

Employee Effectiveness

What to Measure

BARS Approach

How to Measure

Behaviourally Anchored Rating Scales (BARS) Approach

Critical incidents are written

The critical incidents are clustered into performance dimensions Reallocation of incidents Each critical incident (effective/ ineffective) is rated on 7-to9 point scale

Using ratings scales with labels or anchors reflecting examples of poor, average, and good behavioral incidents

Five step development process

Developing final incident

Performance metrics for call centre employees Service

Blockage Hours of operation Self service availability

Efficiency

Quality

Call-Handling Process

Accessibility

Average time
Average handle time After-call work time On-hold time

Telephone etiquette Knowledge and competency Error/rework rate Adherence to protocol Transfer rate

Speed of service:
Service level Average speed of answer Longest delay in queue

Resource Utilization
Agent occupancy Staff shrinkage Schedule efficiency

Cost Efficiency
Conversion rate Cost per call