Question

A. A call center is using the metric of average time per call when rewarding employees In order to keep their average time low, employees are hanging up on customers when they think that the call will take too long to answer.
b. In a department store, salespeople are rewarded based on their sales volume. The problem is that they are giving substantial discounts and pressuring customers to make unnecessary purchases.
c. All employees at a factory are receiving a large bonus if there are no reported injuries for 6 months. As a result, some employees are hiding their injuries so that they do not cause others to lose their bonus.

What are the reasons for the negative consequences of these bonus s Modify these schemes to solve the problems. chemes?

Answer 1

Answer:

The obvious negative consequence of the two examples is that the customer will not be satisfied, while the consequence of the third is the unethical damage done to the employees. In the first example, customer care agents are not focusing on the actual problem, but rather the time invested in handling a call, which is not the crucial KPI.

a. This example could be modified by creating a new KPI, which is not time related. A better KPI would be the number of satisfied customers after reporting a problem. Time should be taken into consideration as a limit when certain complaints take too much time.

b. In this example, the KPI should be sales revenue, not volume. They should focus on enhancing the benefits of products rather than giving large discounts straight ahead. Also, trying to cross-sell to customers even when it is irrelevant (and bothersome) can negatively influence the long-term customer relationship.

c. This is vastly unethical practice to use the low number of injuries as a means of productivity. There are plenty of other more relevant KPIs for bonus eligibility such as the number of produced items in a day, punctuality, manager reference etc. It is understandable that a company wishes to minimize the injuries (as it is a downtime for a worker and reduces overall productivity), but it is not the best way.