Human Resource Management in the Service Sector Lectures 4 and 5: Call Centres Nick Kinnie

Objectives Define call centres and understand the reasons for their growth Identify the key characteristics of the nature and management of call centres Analyse their forms of human capital and consider the implications for HR especially recruitment, selection and retention Examine recent changes in call centres especially the moves towards outsourcing and off-shoring Apply the 4 ID model to gain insights into the nature of work in call centres (Refs: Deery and Kinnie, 2004; Korczynski, 2002, Frenkel et al, 1999, Homan, 2004)

Introduction Call centres are… –Fast growing and important sources of employment –Subject to controversy and attention – customer service and movement of jobs and can be defined as… –Dedicated centres engaged in voice-to-voice contact –CSRs interact directly with customers –Involve use of sophisticated computer based systems –Monitoring the pace and quality of their work

Call centre images….

They can be found in… –Private sector – customer service, sales and telemarketing –Public sector – information, advice and support In different locations… –In-house –Outsourced –Off-shored And involve… –In-bound and outbound work

Why have they grown?

Pressures on call centres Product market - Customers and clients Financial success – short and long term Employment market – needs of employees Call centre (Maister, 2003)

Nature of call centre work: contrasting views Assembly line in the head (Taylor and Bain, 1999) –Engineering/manufacturing model dominates –Jobs are divided up into small tasks which are repeated –Technology exerts a powerful influence especially in allocating work –Work is tightly controlled and routinised – use of scripts

Manufacturing model –Target setting, monitoring, measurement and feedback of both quantitative and qualitative (customer based) criteria –Aim is to reduce skill level, improve efficiency and simplify procedures –Leads to low skill, low pay jobs with few career prospects

Critiques of the engineering model Employees are the key point of contact – voice of the firm and quality of their service is critical Employees often need to exercise some discretion and be able to draw on variety of knowledge and skills Customer involvement always leads to some element of unpredictability (Frenkel, 1999)

Service model Firms use a series of HRM techniques in order to manage their employees –Careful recruitment and selective employment –Attention to training and development – especially coaching –Sensitive performance management paying attention to employee needs –Pay systems which are consistent with aims of the business

Contradictions in call centre work Call centres have to be both efficient and provide a high quality service Both logics are important Customer oriented bureaucracy (Korczynski, 2002) Fun and Surveillance (Kinnie et al, 2000) Segmentation of customers and of employees (Batt, 2002)

Links between CSR-customer interactions, HR practices and business performance High - Relationship Management Low - Transaction Cost minimisation High Commitment Management Business performance Pseudo- relationship HR practices CSR-customer interactions

Impact on employees Acknowledgement that employees play a key role in the delivery of the service – the voice of the brand Engage in emotional labour – expressing or suppressing emotions that they feel or do not feel Low autonomy and close supervision and monitoring associated with increased stress, burnout and emotional exhaustion – reduced employee well-being Effect on work-life balance – time and length of working hours

Employee reactions and responses Negative –Employee withdrawal from work – temporary or permanent –Various forms of resistance – manipulating the system to create space, disregarding the rules –Collective organisation – trade unionism Positive –Satisfaction from interaction with customers and peer groups –Acceptance of performance monitoring –Well-being in some call centres compares favourably with sales and manufacturing work (Holman, 2004)

Analysing call centres using the forms of capital/reactor model Use the reactor model to highlight the forms of capital within call centres Which are the most important forms of capital? How do they interact? What are the implications of this for HR practices especially recruitment, selection and retention?

Intellectual Capital Human capital Social capital Structural capital Network Capital Client Capital Organizational Capital Forms of Capital Knowledge skills and experience of staff Knowledge embedded in values, culture and relationships Ways of structuring work Procedures, policies and processes Knowledge of and relationships with clients Knowledge of and relationships with network members

Human capital Social capital Structural capital Network Capital Client Capital Organizational Capital Intellectual Capital Resourcing Job and Work Design Training and Development Pay and Reward Performance Management Involvement Delivery Strategy Structure The HR Wheel Kinnie et al 2006

Types of call centres In-house – part of a wider organisation Outsourced – giving some or all of the work to a third party Off-shore – where the work is carried out remotely – may be directly owned, joint venture or third party

Why outsource/off-shore call centre work? Reduce costs Improve efficiency Provide a buffer against demand fluctuations Give access to specialist knowledge and skills

Multiple sources of identity What are the key sources of identity in call centres? Which of these exert the most powerful pull on employees? What are the implications of this for HR practices? How can this analysis help us to understand the HR issues within the Norwich Union call centres?

Multiple sources of identity Organisation Client Professional Team Employee

Conclusions Call centres are growing but face a series of conflicting pressures and tensions The reactor and 4 ID model can provide insights into the sources of these HR issues are often at the centre of these pressures, especially recruitment, selection and retention