April 09 Newsletter Online Final

CUSTOMER REACH®
VOLUME 6, ISSUE 4 APRIL 2009 ISSN 1718-8938

Motivating Without Money…Doing More with None
Motivating agents in a contact center is a perennial challenge for virtually every contact center manager. Just how can we motivate staff to
excel? We know that engaged and motivated staff perform better and create and support a healthy culture within the call or contact center.

Traditionally money has been the primary and in some centers the only answer to this question. Money always seems to be the right size
and colour to address motivational issues. But is money the best or only solution to a motivated workforce? And if we are going to employ
financial compensation as a motivational tool how can we best manage this to get the maximum ‘bang for our buck’?

Lets look at how most contact centers employ money as a motivational tool: often they will establish specific targets or thresholds:
calls/hour, orders per day, AHT, quality scores etc. and then associate a dollar value on reaching these thresholds. This approach is tried
and true; it has been employed in centers for decades and does improve motivation; at least for some agents.

Not all agents have the skills or the experience to reach the thresholds or to achieve them consistently. I have seen some centers where
overall performance and motivation actually decline or are eroded through some ‘incentive’ programs. Ask the agents in these centers and
they will quickly tell you why: “the same handful of agents will get all of the incentive comp”; “I can’t win so why should I try”. As you
can see this type of program can actual act as a disincentive and de-motivate staff. This clearly is not the outcome we are seeking.

Of course monetary programs can be tweaked to expand there scope an application, basing opportunity incentives not on achieving fixed
thresholds, but based upon percentage improvement for example. However even this approach can back fire, are we incenting and
rewarded staff who do as little as possible to keep their jobs each day, but work harder when there is cash on line, over staff that work
hard every day and on the whole are much more valuable staff.

So monetary rewards are less than perfect and in today’s economy more and more contact centers have moved from ‘doing more with less’
and are now being asked to ‘do more with nothing’. Non monetary motivational tools and tactics are increasingly the only options open to
many centers. As a result a number of Contact Center Managers are now in unfamiliar territory as they have only ever employed money or
‘stand ins’ for money (movie passes, restaurant certificates and gift cards etc.).

What guidance and advice can we provide these managers to help them navigate these difficult waters? First, the manager needs to
understand that they while non-monetary tools can be effective, they generally require more planning and structure than cash incentives
do. Most cash based motivational or incentive programs are either: Tactical or Ongoing.

Inside this Issue
Motivating Without Money…Doing More with None ................................................................................................................................ 1
Survey of the Month ................................................................................................................................... Error! Bookmark not defined.
The ART or SCIENCE of the Service Recovery Paradox........................................................................................................................... 4
Newsworthy................................................................................................................................................................................................. 5
Inside TRG................................................................................................................................................................................................... 9
Upcoming Events......................................................................................................................................................................................... 9
Case Study ................................................................................................................................................................................................. 11

Tactical programs are a short term incentive to improve performance opposite a specific KPI, goal, or objective, i.e. increase revenues by

April 2009 Page 1
Copyright TRG, All rights Reserved

5%, reduce handle time to 300 seconds, achieve quality scores of 95% or better, etc. Ongoing programs tend to revolve around
commission sales structures.

Similarly non monetary incentives can also be tactical or structural. Tactical non monetary motivation is not ongoing, though may be term
based: Employee of the Month, Most Improved Agent etc. are both examples (which could include a monetary aspect) of term based
motivational programs. Other engagement programs that can deliver positive motivation would include point program and/or shift
swapping.

Point based programs are modeled after frequent flyer or loyalty programs allowing agents to earn points through various activities and/or
achievements: one point for perfect attendance, 10 points for a quality score above the target, 25 points for a kudos letter form a customer
etc. Such point programs then allow agents to redeem their points for preferred shifts, days off, preferred parking, gift certificates etc.

Your agents are adults, or we hope they are, so treat them as adults. Let them schedule themselves and swap shifts when required based
upon the rules set down. These rules may include program or technical knowledge tenure or points accumulated through a point based
incentive program.

Structural non cash motivation should actually be woven into the structure and culture of the center itself. There can be success with
tactical applications of non-cash motivation. Centers, however, achieve superior and more sustained results from a holistic integration of
non cash motivational elements into the underlying contact center operational structure.

At this point I am often interrupted as a manager will then suggest that they already employ Recognition within their center. The
conclusion that one draws here is that recognition is the only non cash way to motivate staff. Of course recognition is a valuable tool and
can motivate staff. Recognition is not just recognizing the agent with perfect attendance or a well handled call that should be
acknowledged. Recognition should be a fundamental tenant of the contact center operating strategy. Research (The Neuroscience of
Leadership by David Rock and Jeffrey Schwartz) has shown that engagement is a key driver of staff motivation and recognizing and
celebrating a job well done is a great way to engage with your staff.

Often effective contact center employ monetary program (tactical and/or on going), but they also employ recognition programs that value
their agents contribution. The best practice contact centers layer these motivational initiatives on top of a structure that supports employee
engagement and motivation. We are not just speaking of a manager trying to motivate their staff, but of a contact center environment and
culture where the agents are motivated themselves and motivate those around them.

Creating a structure that supports this type of culture requires that each aspect and element that relates and impacts on the agents
employment within the contact center is aligned to create motivated and engaged and effective agents.

If we look at the agents experience of the contact center from their moment of being hired and then chart that experience through to being
a productive and engaged member of the contact center team we can see a number of opportunities to create a motivational culture within
the center and to create and hire agents that support and grow the culture. This process is illustrated below.

April 2009 Page 2

Agent Career Progression

Hiring/Recruiting Career Path/ACM Recognition

Agent Employment Successful Career

Job Description Peer Feedback Monetary Comp

The environment that staff are hired into has an impact on how engaged the staff feels and how effective and motivated they are to
perform. The first element on a career progression is the recruitment or hiring phase.

Hire staff that possesses the skills, competencies and attributes to perform well in a contact center. This results in staff that functions better
in the center. They are more motivated to perform. Far too many centers still today rely on previous call center or customer service
experience as a stand in for demonstrated real skills and competencies. They then wonder why their center is dysfunctional and the staff
unmotivated.

When we look at the skills we desire in staff no two centers are the same. Keyboarding skills, attention to detail, sense of ownership and
responsibility are common to most skill & competency maps created. Some centers add stress testing and resilience, or interest in yoga or
meditation. Other seek those who will fight for the customer at all costs. Perhaps most famously, Zappos asks all applicants to demonstrate
how they are ‘a little weird’.

You must look at the type of culture you wish to create and the type of performance you seek. Mirror these in the hiring and recruitment
processes. Of course these attributes must be testable. You will need to verify that those who claim these attributes and skills actually have
them. Pre employment testing should include: typing, spelling, attention to detail, numeracy, logic exercises and may include personality
tests to determine if the person is a high ‘I’, a peacock or a tiger. The name of the game is to hire staff that can succeed and by succeeding
improve to centers performance and reinforce the culture you have set out to create.

Job descriptions should set out exactly what is expected of an agent in terms of KPI’s. Staff can motivate themselves to achieve and
exceed these goals once they know what you expect of them and how they will be measured or assessed.

It is critically important in this economy and in this ‘age of entitlement’ that staff understand that they are primarily responsible for their
own career. By telling them what is expected of them and by telling them you only hire those who can succeed do you establish a good
basis for motivation and engagement. By extending this through a vision of their career path you cement the goals and hurdles that agents
need to meet before they can proceed within the center.

One model employed is the ACM model or Adequacy, Competency and Mastery. This model recognizes that when an agent is hired and
trained they are Adequate. That is to say that there is no reason to fire them. Over time with experience coaching and learning they should
proceed to the second stage in their agent career: Competent. Now they are valuable members of the agent pool, they can perform most
desired tasks and can regularly meet the desired performance metrics and KPI’s. The next stage along the way is Mastery. Here the agent
becomes the ‘go to’ person for knowledge, help and assistance. They are likely subject matter experts within the centre. They likely coach
and mentor other staff. These same staff are poised to move in a supervisory or specialist role and will likely have completed special
projects or worked on various teams.

By defining and publishing what skills, competencies, achievements and performance criteria are required to move ahead in the center and
in their career, agents self motivate and self identify. A self motivated and engaged agent is the ideal to be sought in any center. Of course

April 2009 Page 3

any career progression with defined performance criteria requires commensurate increases in compensation. Ideally the pay ranges should
also be published. They should include an element of re-earnable incentive compensation in addition to a base salary. By requiring agents
recertify their performance annually it ensures that they stay engaged and motivated and prevents them from becoming lackadaisical or
‘resting on their laurels’.

Into this career progression adding peer feedback is valuable. In a center with an engaged and motivated culture agents want and seek
input and feedback from those around them. Peer quality reviews as a component or in addition to your formal Quality program creates
this feedback. Let the staff review each others calls, provide kudos and feedback to the agents, select the best calls, the most improved
agents etc. This empowerment motivates not only those recognized, but also those involved in the selection process.

Money is and has been the easy answer to staff motivation in the past and while money alone can improve performance building a culture
of engaged and motivated agents will produce results long after the money has run out.

Let us know what you think of this article send us an email at feedback@thetaylorreachgroup.com

The ART or SCIENCE of the Service Recovery Paradox

In any customer facing organization, things are never perfect. Try as we might, by error of omission, commission
and yes even deliberate design, there is a real or perceived discrepancy in the delivery of customer service.

A severe enough dissatisfaction, as we are all painfully aware - can sometimes result in a lost customer along with
the investment put into acquiring and maintaining them as well as the loss of future profit. To add insult to injury
there is also the specter of negative Word of Mouth to multiply those losses.

Academia has been trying to answer the question of whether a successful recovery from a service failure can 'paradoxicallyquot; lead to a
stronger customer bond. In other words can failure lead to success?

There have been many studies with various sample sizes, longitudinal and cross sectional in design and so it’s not really surprising that
some studies will affirm the paradox, others not.

I recently came across this study (http://www.dienstleistungsmarketing.ch/documents/IJSIMParadoxMichelMeuter.pdf ) of online banking
customers at a Swiss Bank which stands out by its sheer size and scope.

April 2009 Page 4

Key sample sizes:
Total customers involved in study: 11,929
Customers reporting no service failure: 9,166 (8174 in study, 452 non response)
Customers reporting 1 failure: 2,638 (1189 in study, 1025 resolution pending, 424 non response)
Customers reporting 2 failures: 125

Its key findings:
1) Consumers are accepting of minor deviations in service
2) Service failures are relatively rare
3) Customer Satisfaction impact hierarchy:
a) Exceptional service is better than
b) Exceptional recovery is better than
c) Nondescript service

4) Recommendation intention hierarchy:
Exceptional service is equal to exceptional recovery in scoring high intent to recommend and both are better than nondescript service

Other studies (Service Recovery Paradox: A Meta-Analysis, http://jsr.sagepub.com/cgi/content/abstract/10/1/60 ) point out that recovery is
possible if the failure is not too severe. If the customer has had a longer term relationship, if the customer perceives that procedural
changes will be forthcoming as a result...

So at the end of the day it seems the studies agree on a few key points, namely that to Err is Human...but divine forgiveness depends on
sincerity and severity. Or as Johnston and Michel have noted there are three outcomes of service recovery: Customer recovery, process
recovery and employee recovery. Many companies have therefore tried to implement process standardization at every critical juncture, but
in the view of Hall and Johnson at Harvard Business Review http://hbr.harvardbusiness.org/2009/03/when-should-a-process-be-art-not-
science/ib

quot;The movement to standardize processes has gone overboard.
Some require an artist’s judgment—and should be managed accordingly.quot;

In their view when a 'standard' input is inherently variable (i.e. humans), or when output variability is desired by the customer, the process
needs to be managed from an 'artistic' perspective allowing for judgment and context while ensuring frequent feedback and mentoring
oversight. Using that guidance, there will be aspects of the customer interphase that can and should be engineered whereas others need to
be open. None of these conclusions should be surprising revelations, but for varied reasons companies struggle to get it right. So what's
your experience with the service recovery paradox, is it something that mostly needs a scientific or artistic approach?

1. What is your incidence of service failure?
2. What escalation processes do you have?
3. Do you allow front line staff to resolve issues directly?
4. Do you have (financial) limits on the resolution, or do you follow the Nordstrom rule quot;do what is right for the customerquot;?
5. What about preemptive measures.
6. Are you proactively informing customers about deviations that they may not even be aware of and the steps you took to correct
the situation?

About the Author- Miro Slodki is a marketing generalist with cross functional and cross sector experience spanning CPG Marketing,
Direct Marketing, Franchise Retail/Travel, Market Research, Rewards, Sales, Relationship Management, B2C, B2B and online marketing.
He’s pursuing his passion for strengthening brand value linkages for over 15 years. Any questions or comments are welcome by
contacting the author at mslodki@bigfoot.com. Please visit Miro’s blog at http://miroslodki.wordpress.com Let us know what you
think of this article send us an email at feedback@thetaylorreachgroup.com

Newsworthy
In this regular column we review the latest news, predictions and trends impacting on the Call Center / Customer Interaction

April 2009 Page 5

Industry.

China cracks down on Telemarketing Fraud

Fraudsters busted over phone scam

Twenty criminal gangs were busted and 601 suspects held in late March for cheating through telemarketing, Beijing police
said yesterday. Fu Zhenhua, Deputy Chief of Beijing public security bureau, said the move quot;showed Beijing police's
determination to fight against property-related crimes, growing in times of the financial crisisquot;.

quot;We are reminding the public to enhance their vigilance against cheating,quot; he said.

Bureau statistics showed cheating through mobile text messages had cost the public 100 million yuan ($14 million) in the first
three months of this year.

Police said criminals were stealing consumers' personal information, like names, phone numbers and addresses from
information collectors, insurance agents and the Internet, as well as exchanging the information with other telemarketing
companies.

They recruit telephone operators to promote ostensibly high-end products, such as 3G mobile phones, jewelry, Rolex watches,
costing significantly lower than the market price. Eventually these turn out to be counterfeit or shoddy products.

A quot;limited edition, golden Samsung mobile phonequot; developed by a tele-shopping company, which claimed to be the
quot;cooperative partnerquot; of the Beijing Olympic Organizing Committee and China Post, and sold at 2,580 yuan apiece, is
unusable.

Ma Wenqing, a victim from Gansu province, said he received a phone call to promote a cell phone model with dual cards and
dual standby functions this January.

quot;They said it was a quality product and offered 1,000 yuan worth of free calls if I bought the phone, priced at 1,980 yuan,quot; he
said.

But he received a shoddy product without the fancy features or the 1,000-yuan worth of free calls promised.

quot;What's more irritating, since I bought the crappy phone, I receive at least two calls a day trying to sell commemorative coins
or watches. They are disturbing my normal life!quot; Ma said.

Consumers were taken in by the unusually low pricing and the callers claiming to be partners of the Beijing Olympic
Organizing Committee and China Post, police said.

The cheaters hired logistics companies to pack the commodities uniformly and send them to China Post for delivery. Beijing
police said they found a logistics company had sent out over 40,000 articles, worth over 55 million yuan.
China Daily

April 2009 Page 6

Why EarthLink Likes Click-to-Chat
By Ken Magill

Is click-to-chat a wise option for every merchant’s Website? No, it’s usually not for those who sell low-consideration, low-
margin products.
But live-chat customer service does make sense for low-margin items if the customer is a high-value customer overall, or if
the contact-center representative can cross-sell or upsell during the process.

And it can work well for certain services, as EarthLink has found. The Internet service provider began offering click-to-chat
customer service in 2001. By 2004 the company was using it to handle 15% of its customer contacts.

“This was really huge for us, because our chat agents handle three concurrent chats,” says Mike Murphy, EarthLink’s senior
manager, online support strategy. And, depending on call time, “if we’re handling the customer with chat as opposed to the
phone, we’re saving anywhere from $3 to $5 per contact.”

That adds up quickly, Murphy notes: “A couple million chats a year for support breaks down into huge cost savings for us.”

Chat is also EarthLink’s highest scoring channel in terms of customer satisfaction and comparable to other channels in terms
of issue-resolution percentages, says Murphy.

A chat agent can handle 80 to 100 contacts a day and no topic, including service-cancellation save attempts, is outside their
scope, he adds.

Chat currently accounts for about 25% of EarthLink’s customer contacts, adds Murphy.
MultiChannel Merchant

Furloughs for L.L. Bean Call Center Workers
By Jim Tierney

Outdoor gear and apparel merchant L.L. Bean will furlough about 75% of its staff at the Bangor, ME-based call center starting
in May, according to the Kennebec (ME) Journal/Morning Sentinel.

All but 50 of the 200 workers at the Bangor facility will be furloughed -- which means they will be out of work temporarily –
under what the company calls an quot;extended lack of workquot; program, according to the article.

L.L. Bean spokesperson Carolyn Beem did not return calls to MULTICHANNEL MERCHANT by press time, but told the
newspaper: “They will remain active employees with seniority and all benefits. Hopefully, we’ll be able to reassess in the
summer and bring them all back.”

The Bangor facility, which opened in fall 2005, was selected for temporary layoffs ahead of three other facilities -- in
Portland, Lewiston, and Waterville, ME, because Bangor was the newest call center to go online. The 50 employees who will
be kept through May and June will be picked by seniority. Workers will be brought back by seniority when L.L. Bean begins
staffing up the call centers for the fall/holiday this summer, Beem said.

L.L. Bean in March released its 2008 financial report, which revealed a 7.8% drop in revenue from 2007.
MultiChannel Merchant

April 2009 Page 7

April 2009 Page 8

Inside TRG
Based upon demand we have elected to extend this offer to Customer Reach subscribers…see below
Recently TRG secured a Management Services agreement with Telepoll a Toronto based Market Research and data gathering company
with 19 years of experience. Telepoll’s services include:
Data gathering,
Market Research,
Customer satisfaction surveys,
Mystery Shopper calling,
Outsourced quality monitoring (3PQM)

TRG has secured preferential pricing for readers of Customer Reach. For a limited time Customer Reach readers who retain Telepoll
services will receive a 20% discount off standard pricing. This discount will allow a company for example to complete a Customer
satisfaction survey for $5,000.

For more information about how your company can take advantage of this discount please contact Christine Schmakies at
cschmakies@telepoll.net .

Looking for a Good Read?
Check out Colin Taylors Blog: Call Center Perspectives at http://callcenterperspectives.blogspot.com

Looking to expand you contact center networking?

Join us on

To join Colin Taylor’s LinkedIn network, just send Colin an email ctaylor@thetaylorreachgroup.com and he will send you an invitation.
To join John Cockerill’s LinkedIn network, just send John an email jcockerill@thetaylorreachgroup.com and he will send you an
invitation.

Upcoming Events
Reinventing Call Centre Management
Colin Taylor is speaking at the 2nd Reinventing Call Centre Management, April 27 to 29th at the Metropolitan Hotel (108 Chestnut
Street) in Toronto. For more information about the event follow this link http://www.federatedpress.com/pdf/RCCT0904-E.pdf. If
you cite my email address (ctaylor@thetaylorreachgroup.com) when you register you will receive a 15% discount off the
basic registration fee.
Topics include:
· Key performance indicators
· Collecting customer feedback
· Recognizing potential leaders in front-line staff
· Latest customer support tools
· Rewards and recognition to motivate employees
· Streamlining response time
· Challenges associated with developing a customer-focused culture
· Dealing with employee resistance to change
· How to conduct a self-service pilot study
· A plethora of insightful case studies from large and reputable organizations

April 2009 Page 9

Motivation without Money
What's the difference between Incenting and Motivating someone? What happens when the money you use as an incentive is
perceived as an entitlement by your team?

Sometimes things that are intended as motivation backfire -or are perceived as a bribe- and actually have the opposite effect.
Colin is also speaking at the CPA Breakfast meeting on April 21st at the Toronto Holiday Inn Airport. For more information
visit the CPA Event web site at http://www.cpacan.com/Calendar/Detail.aspx?id=172 .

The following presentations are available for viewing and/or download at no cost from our Slideshare site
http://www.slideshare.net/colintaylortrg/slideshows

Attrition Management
Contact Center Leadership Strategies ICSA- TRG Dec 2006 Narrowing The Gap

TRG RFP IP PBX Template TRG Credentials 08

April 2009 Page 10

Case Study
In this regular column we review the successes that TRG has been part of.

Assisted a Major bank to review its' Customer Interaction processes and identified more than $5
million dollars of operational efficiencies

The Challenge:
A national network of call centers, significant staff turnover, unhappy customers, uncertainty regarding the benefits of outsourcing and
challenges associated with delivering the value they sought from their call center channel. These were some of the challenges facing one
of the largest financial institutions in Australia when they began speaking to Colin Taylor.

The Process:
Colin and his team of consultants began at the beginning, a Strategic Assessment a full end-to-end review of each of the 'moving-parts'
within the call center infrastructure. The sweeping engagement assessed the people in the call centers, their skills and competencies, the
processes, procedures, operational methodologies, technologies, quality and service practices and business objectives. With a number of
centers and thousands of agents this was a significant exercise in terms of scope.

The Solution:
The bank employed state of the art, best of breed technologies and had invested heavily in self-service and workforce management
solutions. Their operational methodology was based on a very successful internationally accepted model…so what was the problem?
There were fundamental gaps in the process maps and invalid assumptions being employed in defining the objectives and means to
attaining these objectives.

By vetting and re-engineering the process maps, procedures and operational methodology we ensured that the objectives of the
organization could be met. In the process we streamlined the use and application of the existing technology and implemented a limited
outsource relationship, both of which improved efficiency and reduced expense.

The Result:
The bank improved its customer satisfaction, reduced turnover and leveraged enhanced benefits from their technology investments. In
addition they established an outsource relationship that allowed them better control on the call patterns arriving in their captive centers
which improved the center performance, as well as employee morale. The re-engineering process improvement, leveraged technology and
outsource combined to total more than $5,000,000 in annual operational cost savings!

April 2009 Page 11

Customer Reach® is published 10 times per year by The Taylor Reach Group, Inc. Customer Reach® may not be reproduced without
permission.
Subscription requests can be directed to customerreach@thetaylorreachgroup.com or to;
Customer Reach
19 Mercer Street,
Suite 302,
Toronto ON
M5V 1H2
Phone - 416-979-8692
Fax - 416-977-8817
The Taylor Reach Group, Inc. provides Strategic and Operational customer interaction consulting services that deliver Operational
Innovation breakthroughs in Contact Center operations.

Award winning service and more than 100 years of industry experience serving ‘Fortune 1000’ companies. Extensive North American
and International experience with both captive (in-house), home based and outsource centers.

Delivering Operational Innovation to your Contact Center

Contact Center Consulting, Quality Monitoring & Assurance,

Customer Satisfaction Consulting, Outsourcing/Offshoring Assessments,

Contact Center Technologies, Total Cost of Ownership Assessments,

KPI and Best Practices, Service to Sales Migrations,

Award winning service...Reach Beyond!

Phone or email Colin Taylor today at 416-979-8692 ext. 200 or John Cockerill at ext 201
By email at ctaylor@thetaylorreachgroup.com or jcockerill@thetaylorreachgroup.com
Offices in Toronto, Atlanta & Australia
TRG are proud members of:

The Taylor Reach Group, Inc.
E-mail: info@thetaylorreachgroup.com
www.thetaylorreachgroup.com

April 2009 Page 12

April 09 Newsletter Online Final

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April 09 Newsletter Online Final