Hr Strategy

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Balancing the competing objectives of efficiency and service typically requires management compromises to be made. However, they achieve both efficiency and high levels of service at the same time. This is possible because part of the Sacrificial HR Strategy is the deliberate, frequent replacement of employees in order to provide enthusiastic, motivated customer service at low cost to the organization. The paper describes a multiple-case analysis of four call centers and the Sacrificial HR Strategy they used. The contingencies leading to the appearance of this strategy are discussed. 2

The opposing goals of efficiency and excellent service are both central to call centers. High levels of service are important since the number of “completely satisfied” customers is one of the few predictors of long-term profitability (Jones & Sasser, 1995). Efficiency is important since call centers must provide speed of delivery and operate at a low unit cost to remain competitive. In a call center the tension between efficiency and service is more salient than in most service organizations. To achieve efficiency, call center management has focused on the selection, implementation and use of technology (Mehrotra, 1997, and ensuring motivation and commitment. This is especially so when emotional labor is required (Gutek, 1995, Hochschild, 1983). As the employees are critical to service delivery, there is a requirement to have employment security, extensive training and decentralized decision making (Pfeffer, 1998). However, in some call centers excellent service is delivered through the personal efforts of the front-line and not through managerial interventions. In these centers, the technology is still used to deliver and track productivity gains while the service is assured by the personal commitment of the employees. In this way both service and efficiency are achieved, but at the expense of the physical and psychological well-being of the staff. 3

This new way of managing the service and efficiency tension results in what we have termed the “Sacrificial HR Strategy”. It is sacrificial because the enthusiasm and motivation of the front-line are sacrificed by management. It is a strategy because it involves a coherent set of management activities and attitudes, which together solve the efficiency/service conflict. It is new because emotional burnout and high turnover are tolerated, if not encouraged. The structure of the paper is as follows. The results of an analysis of four call center cases are presented and provide contextual background. The Sacrificial HR Strategy is described in detail. A discussion of the conditions that enable the Sacrificial HR Strategy to work is then given. Finally, managerial implications and issues for further research are raised. The Study

A multiple-case study of four large call centers in four different organizations was undertaken. A Bank, an Insurance company, a Telecommunications company and an Outsourced Call Center organization were chosen to be in the study. These call centers had participated in a recent international benchmarking exercise (TARP, 1997) and were all assessed to be in the top 10% of the 227 call centers compared in terms of efficiency, customer satisfaction and employee satisfaction. All four call centers were based in Sydney, Australia and had more than 100 employees. Thirty-one in-depth interviews were conducted, involving four call center managers, ten team managers and seventeen agents. To eliminate sample bias, the managers were requested to select both male and female employees, with a range of tenure duration (four months to three and a half years). They were asked to ensure that all of the interviewees had received at least the basic call center induction training and to include employees who were regarded as poor performers as well as those who were regarded as better performers. Nineteen of the interviewees were female and twelve were male. 4

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