Question

Telbus is an American telecommunications company that provides voice, video, data, internet communications and professional services to businesses, consumers and government agencies. During its long history, TelBus set up operations in international locations in Europe, Asia and Australia. Central Call centre operations for the Australian division were located in Melbourne. The call centre was devoted to inbound calls, which meant that customers could phone in and make a bill or service-related enquiries. Although staff of call centre was required to keep call times within an acceptable range, their primary role was to make sure that customers had their questions answered and to create a sense that customers had been listened to respectfully. TelBus also ran a number of out-bound 'cold call' campaigns where the purpose was to phone existing customers or potential new clients and provide information about new products and services with a view to increasing the sales and market share. These calls were outsourced to another call centre in Sydney that specialised in sales and the arrangement worked quite well.  

  

During routine call monitoring at the Melbourne in-bound call centre, it was noted that there were quite a number of opportunities for the call centre operators to sell new products to customers. Despite call centre operator efforts to provide some information about upgrades and new products, it became clear to senior management that calls centre operators did not push through and close the sale. In response, senior management re-thought the divide between in-bound and out-bound calls and decided to place a greater emphasis on selling as part of the normal in-bound calls taken by the Melbourne call centre operators. Effectively, this meant that each inbound call became a potential sale. Even though customers did not phone up to enquire about new products, it became part of the operators' responsibility to finish the call with information about the latest telecommunications offering and to make suggestions to customers that could result in a sale.  

  

In response to the change in operator responsibilities, new performance criteria were designed and put in place. Previously, operators had been required to keep calls within a ten-minute window, but the changed expectations led to much tighter controls on time, as well as on-target quotas. The new criteria included sales targets, dollars logged per hour, average talk time, adherence to scheduled breaks, and sales call quality. A number of staffs left, and management observed that that "their exit was probably in everybody's best interest". Senior management did recognize the morale problem, however, and decided to invest more heavily in the training of the team leaders. The call centre had always been organized into groups and the team leaders had held a central role in maintaining staff morale and in providing development and training for new members. The training for the team leaders focused on team morale management, but a key objective was also to assist team leaders in getting more out of the team so that sales targets could be met.  

  

A number of team leaders began to question the intention of the training and pointed out that morale was already low and that call centre operators did not need further pressure from the team leader. Eventually, stories of worker stress and two cases of severe bullying were leaked to the media. The union became active in representing the case and the senior management were asked to account for the negative outcomes at the call centre.  

  

Case Analysis Work Sheet  

i. What are the key issues or the problems of the case?  

------------------------------------------------------------------------------------------------------- ii. Prioritize the issues or problems  

1) ------------------------------------------------  

2) ------------------------------------------------  

3) ------------------------------------------------ iii. Is it necessary to identify the cause of the problem?  

-------------------------------------------------------------------- iv. Brainstorm the options available

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v. Evaluate the options  

Option Advantages Disadvantages  

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---------------------------- -------------------------------- ------------------------------- vi. Select the optimum solution  

------------------------------------------------------------------------------------------------------ vii. Describe how the option should be implemented  

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Answer 1

i) The key issue is the strategic calls taken by the management to merge two distinct business strategies into one, and the not so brilliant execution of the same. In the case given, TelBus had two call centers- one in Sydney and another in Melbourne. Melbourne focused on customer problems and the primary role of the workforce there was customer satisfaction. Sydney team focused on Marketing and Sales and their primary goal was to make business for the company. Although the strategic decision for bringing the two models together was good, the execution of the same did not yield good results. The management was too stringent in putting goals and performance metrics to the employees in Melbourne, but focused less on the training and development of the employees in Melbourne, for the shift in their job activities.

ii) 1) Inbound employees trained more to listen to their customers and attend to their problems, whereas the outbound call center focused on cold calls and on Business development. Bringing in market development and sales jobs to inbound call centers was a drastic difference in the goal of the Melbourne team

2) The KPI or the indicators that were enforced on the Melbourne team was a bit excessive. Each employee had their own sales target to achieve and within crunched time created a far more strained work atmosphere than they were used to. Melbourne team had lesser time regulations previously and they were taking customer problems. However, now they had limited time, needed to sell their products along with customer's problems getting addressed.

3) Senior management did notice the employee morale going down and the attrition, however, they still did not address the root cause of the problem. Instead they trained the team leaders to get more from their teams and improve sales. This was another major bad decision.

iii) It is necessary to identify the root cause of the problem. Otherwise, the company will continue to face more problems. The major cause of the problem was TelBus Management failing to execute the strategy properly. They failed to understand the goals of employees and the training given to the Melbourne call center employees was different from the Sydney team. They imposed strict policies and performance metrics that, in hindsight, would have improved performance and efficiency, but was enforced on a group of employees who had no exposure to telephone-sales and the employees could not cope with the pressure and had to resign.

iv) There are two to three options that the company can do:

1) The company should restart its Sydney team, whose core competency is in sales. They should also dial down on the strict performance metrics they have built.  The Sydney team will perform cold calls along with addressing the calls getting forwarded from Melbourne team. The Melbourne team will have to continue to talk with its customers and understand their problems. They will see if there is any scope that a new product or service of the company can help the customer in any way. They will then forward the call to the Sydney team and at the same time remain on the call so that they can learn from their Sydney counterparts on how to close the sales. In this way, the company does not need to spend extra money on training the employees and this also addresses the problem faced by the Melbourne team, that they cannot close their calls. Once the Melbourne team has acquired the necessary skills, the Sydney team can be merged or be shut down.

2) The second option for the company would be to provide training to all the Melbourne team on how to market their products and sell to customers and on how to close the sales. The current performance metrics will be taken off and a new set of metrics, less stringent, will be laid out. The primary focus will be to address the customer satisfaction through the new products and services of the company. The top employees who had closed the maximum sales in an hour will be celebrated and will be given some recognition or another. Gradually, within a period of six months the performance metrics will be tweaked and all the employees will be evaluated on the basis of the sales they have done along with customer satisfaction. By the end of the year, the time taken close the sales will be monitored.and this will also be incorporated. So the rolling out of K PI and the shift in strategy will be executed in phases and not all of a sudden in one go,

3) The third option will be to have a top down KPI system. The team leaders will be initially having target of Sales. They will try to teach and train their team members. In this way, the team leaders will be initially driving the agenda of sales and the team which contributes to the highest sales will be recognized. So the roll out of KPI or metrics will be on team as compared to on individuals. As time progresses, the performance can be trickled down and can be monitored individually at an employee level.

v) In Option 1, the advantage is there is no need for extra money being spent on training, however the Sydney team should still function, in conjunction with the Melbourne team. The management should be ready to reverse or backtrack on their implementation of their performance metrics and take things step by step. However, all employees will son be trained and the entire strategy that the management wanted can finally be achieved after some time.

In Option 2, the company will have to backtrack on its current implementation strategy and take things step by step. However, in this option the company should also be ready to train their employees in Melbourne so that they will have the necessary skills to close the sales. Clear milestones in the implementation can be laid out and performance in each stage can be monitored.

In Option 3, the company will have to spend money on training, but lesser than option 1 and option 2. Team leaders and team will have the performance metrics. The company just needs to tweak their existing metric structure, and enforce it on a team rather than on individuals. This will not be a complete roll back. However, still in this option, there might be undue pressure from the team leaders on their team, which might cause stress for them.

There could also be more options available, like the company continuing their existing policy and just provide training for their employees. However, the transition is not in phases and the employees can still be left feeling clobbered suddenly.

vi) The best option would be option 1, which has benefit for both employees and management. Management does not need to spend money on training, the employees will be learning on the job. The implementation is still in phases and not all of a sudden. The roll out of KPI and metrics will also be in phases.

vii) The roll out of the change will be in phases. The enforced metrics and evaluation structure will be scrapped. The Melbourne employees will continue with the primary task of customer satisfaction and inbound calls and try to see if there is a chance of sales of their products in the calls, since they are weak in closing the call, they will transfer it to Sydney team. They will learn how to close the call from the Sydney team. This process will be active in the initial 2 to 3 months. The Melbourne employees will then be asked to minimize the calls they transfer to Sydney and close the sales themselves from month 3 on-wards. The employees who can close the most sales in a week will be celebrated and recognized. This will continue for 3 months. By the end of 6 months, now you have a team which is ready for the roll out of metrics that the management had initially enforced. All employees will now have individual sales target and closure of the same in minimum time. The metrics evaluation will not be heavily enforced in the initial 2 months of rolling out the same. The employees can come out with feed-backs and support they need for development to the management by month 8. Soon by the end of the year the whole project will become successful.