Chapter 9 People as Strategy: Managing Service Employees PDF

Chapter 9 People as Strategy: Managing Service Employees  Chapter Objectives Understand the importance of customer facing employees. Understand the inherent stresses and strains faced by the typical service employee. Define the role that a service employee has to play ba...

Chapter 9 People as Strategy: Managing Service Employees  Chapter Objectives Understand the importance of customer facing employees. Understand the inherent stresses and strains faced by the typical service employee. Define the role that a service employee has to play based upon the service strategy. Understand how that role definition can be used to recruit the most appropriate service team. Understand how the role definition is at the center and drives all HR systems in the service business. Understand the role of management in supporting the “climate for services.” 2 ©2011 Cengage Learning. All rights reserved. Opening Vignette: Wegmans The Best Company to Work for In 2005, Wegmans was ranked number one for “The 100 Best Companies to Work for” Privately held supermarket chain that employees over 30,000 employees in its 67 stores located in New York, Pennsylvania, New ©2011 Cengage Learning. All rights reserved. Jersey, and Virginia. 3  Figure 9.1 Service-Profit Chain ©2011 Cengage Learning. All rights reserved. 4  Importance of Service Personnel Service personnel provide a sustainable competitive advantage Major customer complaints about service workers: 1. Apathy/lack of concern 2. Brush-off/rejection 3. Coldness/lack of motivation 4. Condescension/disrespect 5. Robotism/uncountable 6. Rulebook/system doesn’t allow me 7. Runaround/evasive/non-committal treatment ©2011 Cengage Learning. All rights reserved. 5  Service Providers as Boundary Spanners Profession Boundary Spanners links the al service organization with the outside roles world and has two primary purpose: 1. information transfer 2. representation Service provider spectrum ranges from professionals to subordinate service roles Subordinate service roles 6 ©2011 Cengage Learning. All rights reserved. Sources of Conflict on Contact Service Personnel Boundary spanners are likely to conflicts: 1. person/role conflicts: A bad fit between an individual's self- perception and the specific role the person must play in the organization (Ex: serious person for a causal business) 2. organization/client conflicts: Refers to disagreements that arise when a customer requests services that violate the rules of the organization (Ex: eating outside at cloudy day) 3. inter-client conflicts: Refers to disagreements between clients that arise because of the number of clients who influence one another's experience (Ex: restaurant’s music volume, AC, etc.) The contact personnel is then asked to resolve the problem and is now stuck in the middle of two disagreeing clients. 7 ©2011 Cengage Learning. All rights reserved.  Coping Strategies and Implications for Customers Job Stress  Employees Unfavorable Action  Turnover Leads to Employees often adopt a feelings of number of responses in roles stress order to reduce stress: 1. dissatisfaction 1. avoiding the customer 2. frustration 2. moving into a "people- 3. turnover intention processing" mode 3. adding physical symbols in their office to increase control 4. overacting their role 5. Completely siding with (support) the customer 8 ©2011 Cengage Learning. All rights reserved.  Creating a Climate for Service Climate: employee perceptions of one or more organizational strategic imperatives (rules). Three core drivers to create a climate for service: 1. Work facilitation: the provision of the basic infrastructure and technology to enable service providers to deliver the desired service. 2. Interdepartmental support: the support provided by other departments in the service organization that allow a service provider to do their job. 3. Human resource practices: HR Wheel 9 ©2011 Cengage Learning. All rights reserved.  Figure 9.3 The Services HR Wheel The purpose of The Wheel's HR strategy is to integrate - to maximum positive effect for employees and the organisation's culture, people and systems and technical & financial resources so as to meet the organisation's goals. 10  Layers of the Service HR Wheel 1. Recruiting the right people 2. Developing competent service employees 3. Controlling, rewarding and evaluating service employees 4. Retaining service employees 11 ©2011 Cengage Learning. All rights reserved.  Five Customer Profiles “Customers from Hell” 1. Egocentric Edgar (selfish customer) 2. Bad-Mouth Betty (rude customer) 3. Hysterical Harold (wild/uncontrolled customer 4. Dictatorial Idiot (Arrogant or bossy) 5. Freeloading Freda (free-rider/bloodsucker customer) 7 Worst Customers You Will Encounter In Retail: https://www.youtube.com/watch?v=QPGdv8PN6kQ 12 ©2011 Cengage Learning. All rights reserved.  Profile # 1 – Egocentric/Selfish Edgar 1. appeal to his ego 2. demonstrate action 3. don’t talk policy – rephrase: “for you, I can ….(policy)” 4. don’t let his ego destroy yours 13 ©2011 Cengage Learning. All rights reserved.  Profile # 2 – Bad-Mouth/Rude Betty 1. ignore his/her language 2. force the issue (hang-up) 3. use selective agreement (with some statements) 14 ©2011 Cengage Learning. All rights reserved.  Profile # 3 – Hysterical/Wild Harold 1. let him vent/scape 2. take it backstage 3. take responsibility for solving the problem 15 ©2011 Cengage Learning. All rights reserved.  Profile # 4 – Dictatorial/Bossy Idiot 1. break up his game (fulfill his request) 2. stick with your game – be consistent with customers – tell him what you can do for him 16 ©2011 Cengage Learning. All rights reserved.  Profile # 5 – Freeloading/Free- Rider Freda 1. give it to her 2. don’t let the 1% dictate action for the 99% who actually have problems 17 ©2011 Cengage Learning. All rights reserved.  Rewards that Encourage Service Excellence The seven tests of rewards – Availability – Flexibility – Reversibility – Contingent – Visibility – Timeliness – Durability Pay “alone” does not pass these effectiveness tests 18 ©2011 Cengage Learning. All rights reserved.  Empowerment and Enfranchisement Empowerment – turning the front-line loose (empower them) – encourages and rewards employees to exercise initiative and imaginations Enfranchisement – Couples empowerment with a compensation method that pays people for their performance 19 ©2011 Cengage Learning. All rights reserved.  Figure 10.2 Levels of Empowerment INVOLVEMENT ORIENTED High involvement Job involvement Suggestion involvement Production line CONTROL ORIENTED 20 ©2011 Cengage Learning. All rights reserved.  Levels of Empowerment High Involvement 1. train people to manage themselves 2. profit-sharing and employee ownership 3. develop skills in teamwork, problem solving, and business operations 21 ©2011 Cengage Learning. All rights reserved.  Levels of Empowerment Job Involvement 1. “opening up” of job content 2. use more skills, more freedom, and get more feedback 3. extensive use of teams 4. higher level decisions and reward allocation remain the responsibility of senior management 22 ©2011 Cengage Learning. All rights reserved.  Levels of Empowerment Suggestion Involvement 1. empowered to recommend 2. formal suggestion programs 3. quality circles ©2011 Cengage Learning. All rights reserved. 23  Customer Relationship Management (CRM) The process of identifying, attracting, differentiating, and retaining customers where firms focus their efforts disproportionately on their most lucrative clients. – Coding – Routing – Targeted – Sharing – Red-lining 24 ©2011 Cengage Learning. All rights reserved.  All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without the prior written permission of the publisher. Printed in the United States of America. Copyright © 2011 Cengage Learning. 25 ©2011 Cengage Learning. All rights reserved.