Employee retention

By Leonard Vinz O. Ignacio, 13 August 2009

Labor concerns in the BPO industry Part 4
Read Part 1 | Part 2 | Part 3

"Recently, I was asked if I was going to fire an employee who made a mistake that cost the company $600,000. No, I replied, I just spent $600,000 training him. Why would I want somebody to hire his experience?" ~Thomas J. Watson, American Entrepreneur and Founder of IBM

"Profits are related to customer retention. Customer retention is related to employee retention. Employee retention may or may not be related to benefits, but benefits could be part of the package that causes people to stay and, by the way, engage in discretionary effort. If you go into any organization that’s customer-facing, you can tell in five minutes when the employees are feeling abused. They retaliate on the customers." ~ Jeffrey Pfeffer, Professor of Organizational Behavior, Stanford Graduate School of Business

The call center and BPO industry is one of the most labor-intensive which, based on estimates, currently has a work force of around 200,000 employees for the entire industry and still continues to grow rapidly. Being an industry that relies heavily on labor supply for continued growth, the attrition rate, which has averaged around 19%, is of great concern.

Employee retention is one of the major problems of call centers and BPOs given the unusual work conditions, the unusual work hours and demanding responsibilities on the employees, which many find generally exhaustive and draining. But, since this industry relies heavily on manpower for continued growth, it becomes imperative that they are able to adopt and implement effective talent retention strategies if they want to become competitive in the market.

While employee retention may be a common problem shared in the industry, there is still no "one size fits all" effective solution for all the players since they each have their own unique culture, work environment and needs and priorities. Thus, it is imperative that the call centers and BPOs develop their own customized solutions and strategies to address their unique sets of employee issues and challenges.

Let me share with you some of the best practices that have worked effectively in many companies, which may address the employee retention issues in the call center and BPO business.

"Just the facts please." Access to relevant information and data are needed to guide management in making crucial decisions. For example, information on personnel costs which may include recruitment, training expenses, salaries and benefits, and manpower realization rates, etc., would help management determine an employee’s performance and competency level. Employees who are not performing well may be coached or counseled while the high performers who generate income for the business may be rewarded more or given better incentives.

Conducting meaningful, thorough and exhaustive exit interviews of resigned employees is also important since it gives the employer the opportunity to identify and understand the problems and needs of employees and tailor appropriate solutions to address them. Although compensation has been the common issue of employees, there are still other more pressing reasons that may affect an employee’s decision to leave the company. Such issues may include heavy workload, unpleasant relationships with peers and/or superiors, lack of work life balance, lack of career development, etc.

"Big brother." As the old saying goes, employees leave managers not companies. The managers and supervisors should preserve the self-esteem and dignity of their employees. Majority of the employees of call center and BPOs come from the younger generation, usually the so-called "millenials" who generally because of their age, are more dynamic, impatient, more fast paced even in the planning of their careers, give less premium on loyalty to company, require instant gratification and require a great deal of social interaction with their peers, both in and out of the office. Thus, this genre of employees would expect from their superiors extended hand-holding, efficient mentoring and coaching just like a big brother rather than reprimands. It is thus important that employers have a better understanding and appreciation of the culture and mind-set of the today’s younger generation to help them come up with innovative solutions to address their needs.

Who are you? Employee retention is likewise anchored at the inception of employment. If one recruits and selects the wrong kind of employee, more likely than not, this employee will add up to the higher attrition rate of your company. Call centers and BPOs should determine if a candidate can fit in their company. Does the prospective recruit believe in the company’s vision and mission statement? Can the candidate work harmoniously in a work environment that is mentally taxing with irregular work hours and where face-to-face social interaction is limited?

What’s in it for me? Competitive salaries and benefits, though not the sole factor, is a major consideration among the fresh graduates when joining call centers and BPOs. The relevant rewards and incentives will make call center and BPO jobs more attractive among the younger generation of employees. Some of these are communication allowances that may involve the purchase of the latest celphone gadgets (a must-have in Philippine society); casual and relaxed dress codes that are appropriate when working until the wee-hours of the morning; and on-the-spot rewards on completed sales or high client satisfaction feedback.

Why am I here? Employees also resign because they have no clear understanding and appreciation of the importance of their jobs and what better things lie ahead of them in terms of their career development if they stay on with the company. It is therefore important that management orient their new-hires on company culture, company policies and practices and their career path in the grand scheme of things. Furthermore, to boost their morale, management should let their employees know that they are appreciated. Recognition tools such as newsletters, bulletin board postings, gift certificates, and plaques of appreciation reinforce the employee’s self-esteem and their feeling of importance in an organization.

The leading call centers and BPOs differ in vision, mission and culture and even in the quality of their services. However, they compete in terms of attracting and retaining the best and the brightest people in their organization, who after all, are their most valuable assets. It is therefore a huge challenge for them to be able to develop creative and efficient employee programs and benefits that would meet their employees’ full satisfaction.