Twenty Ways to Recognise and Reward Service Excellence

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A workforce, which is wholeheartedly and enthusiastically supporting the goals of the organisation, has been a key aim of managers since industrial and commercial organisations began.  Today, that quest is even more important to the modern service organisation, which is faced with a mobile and costly workforce and a demanding customer.  In a call centre, for example, employees are the organisation in the customer's eyes.  Yet bored or burnt-out staff may stay only a year or less.  The ability to fire them up and ensure they present a polished and enthusiastic attitude is crucial.  Retention is a key service issue - it costs One 2 One over £4,000 to replace a customer experience adviser, for example.

Best practice customer service organisations appreciate only too well that a satisfied and committed workforce delivers excellent service, ensuring long-term customer retention and loyalty.  The thorny management question is how to achieve this through a planned management strategy.

• How do you create a motivated and committed workforce? 
• How much is financial reward the answer? 
• If so what form should it take? 
• How do you consciously promote loyalty, recognition, a sense of achievement and a feeling that you will go the extra
mile for the customer and the company?

The authors put forward 20 ways to motivate service employees and discuss what these mean.

Why Employee Satisfaction is so Important: the Service / Profit Chain

This diagram, based on the Service / Profit chain developed by Hesket et al at Harvard Business School, graphically illustrates the central role of employee satisfaction and motivation.

What Do Management Theories Contribute?

The gurus have come up with useful theories and insights on motivation but also have demonstrated the complexity of this area of human energy and behaviour.  For practitioners some points are clear, however:

• Motivation comes from within; it is drawn out of individuals not imposed on them.
• Motivation is multi-dimensional and there is no single universal answer, true for all time and all people.
• Some things motivate and encourage extra effort; others only cause dissatisfaction by their absence.
• Clear goals are an aid to motivation: they enable individuals to know what to aim for, and feedback gives an energising sense of progress.
• The 'stick' and the 'carrot' are both useful, but increasingly 'carrots' are seen as generally more effective to foster sustained motivation.

Ken Lewis, MD of Dutton Engineering in Bedford, sums this up well when he says that employees are less motivated by money than 'by fulfilling their need to contribute, to be valued'.  This in turn leads them to deliver quality service.  At Dutton Engineering employees are encouraged to agree delivery dates with customers, 'to own decisions, to be involved and focused'.

Key Questions for Employee Reward Schemes

If your organisation runs a reward scheme, the type and basis of reward needs to be given careful consideration.  Rewards can be based on customer, peer group, management and external feedback, but above all they need to be aligned to the values of the organisation.

Key questions

1. WHO should be rewarded and recognised? - the company as a whole, groups or individuals?

2. WHY should they be recognised? -  e.g. for outstanding performance or improvement in customer experience?

3. WHEN should this happen? ?  on a one-off or on-going basis e.g. as part of a regular reward scheme or performance management system?

4. WHAT form should the recognition take ? e.g. financial or non-financial reward?

5. HOW should the scheme be administered ? e.g. what should be the method of delivering the reward/recognition?

Top Twenty Action Checklist

Here is a selection of practical exercises you can undertake to help recognise and reward good service in your organisation:

1. Survey Your Staff

It is surprising how many organisations assume they know best when it comes to motivating staff.  Well-conducted surveys are a critical means to challenge assumptions.

First Direct believes it must continue to work at understanding its employees and the culture more deeply.  It has introduced a Culture Critique, using staff focus groups, and one-to-one interviews not just with current employees but past ones too.

A very successful Lloyd's broking group initiated a staff survey to pinpoint a certain unease among staff, despite major growth in its business. Poor communication was identified as a particular de-motivator, between managers and staff and between operating divisions.  This led to missed opportunities for cross-selling and seeing inconsistency.   Staff felt their managers needed to show more understanding, recognise and reward hard work, promote team spirit, improve the working environment and provide clear, fairer working conditions.

Over the next four years goals were set in response to the survey to improve business information in particular.  A follow-up questionnaire revealed that there had been a major improvement in communications - up nearly a hundred per cent from the previous staff survey and clients were seeing more unity and consistency across the business.

At a One 2 One call centre, focus groups were set up to survey likes and dislikes to form an agenda for an action plan.  At Autoglass poor customer perceptions led it to set up staff focus groups, which reported widespread dissatisfaction with the pay structure and insufficient rewards for top performers.  Major changes in pay and hours have resulted in a five per cent rise in the staff survey and substantially better customer ratings.

2.  Develop a Checklist for the Health of Service Quality

Use a checklist for the health of service quality in your organisation and publish the results.

The checklist will vary according to the service sector, size of the organisation and other specific factors.  A financial services call centre devised these practical criteria:

• Response to customers
• Demonstrated knowledge of staff
• Speed and quality of resolution of issues
• Delivery against promise
• Written correspondence against defined time-scales
• Translating customer needs into action

Management Today/Unisys award winner Nichols Foods uses a comprehensive set of 17 measures to track performance, from complaints and compliments, error free invoicing to staff satisfaction.

B.T. is one of  many organisations which  use the  Business Excellence Model as a diagnostic tool for the health of their organisation.

The Model shows customer satisfaction is linked to people issues. Each of the nine elements can be used to assess the organisation's progress along the path to excellence.

3.  Provide Training To Managers In Creating A Motivating Climate

Managers have a key role to play in encouraging motivation amongst their team.  Successful service organisations provide training to managers in leadership and motivation.  Julian Richer, of Richer Sounds has considerable knowledge of building the right motivational climate.  He believes managers should learn to follow  five steps:

1. Making the workplace fun
2. Providing copious and specific recognition for the work which staff do
3. Offering frequent and targeted rewards
4. Making communication regular and all persuasive
5. Rewarding employee loyalty

From scratch he has built up a thriving £50 million plus business on this basis and now offers in this area advice to  other organisations such as ASDA .

4.  Give Positive Feedback

Reinforce in your managers the need to give positive feedback to their staff.   A 'thank you' and 'well done' from the manager is often more meaningful to employees than a monetary or token award.  FedEx rigorously champions managers as servicing their employees to service the customer.  Sometimes feedback has to be negative, but how it is put over can drastically affect motivation.  B.T. Manager Mark Jakeman and author of the Customer Challenge says that when mistakes occur it's better to say 'Okay, it's not the best decision you?ve ever made, but what can we learn from this?'

5.  Tailor Service Awards to the needs of the Employees

Recognition, through token or monetary benefits has got to be meaningful to those who receive it.  Consistent with similar research undertaken by American Express, Air Miles found that its 1,000 employees (80% of whom work in call centres) considered time off work the most significant form of reward.  Air Miles implemented a recognition scheme called 'Time Off Vouchers' where individuals can be given time off in recognition for achievement.

6.  Instigate A "Job Well Done Award"

Sometimes immediate recognition for  everyday good service can do a power of good.  One car retailer runs a 'WOW' scheme where anyone within the organisation can send a 'WOW' card to a member of staff who has gone out of their way to give them good service.  At the end of each month, the number of 'WOW' cards are counted.  Those people with the most number of cards win M & S vouchers as a 'thank you'.  Condant UK (formerly Credit Card Sentinel) runs 'caught in the act' schemes where colleagues nominate others for awards including spot prizes of Easter eggs, turkeys, teddy bears, T-shirts.

7.  Establish A League Table of Service Performance

Many organisations, particularly retailers such as Pizza Hut UK, use mystery shopping as well as customer satisfaction surveys to monitor the performance of their outlets.  Pizza Hut publishes the results in league tables of customer service performance and feeds back the results to the restaurant within five days.  The most effective are those where recognition is given not just to the top performers but to those people who make the best improvements over time.

8. Feedback Customer Comments And Compliments

Kwik-Fit keeps a customer correspondence folder in each Depot reception area, publicising positive letters customers have written.  It rings up customers on a daily basis and publicises the results internally.  At service excellence award winner GEC Marconi Radar and Defence Systems, a customer database is freely available listing customer compliments, perceptions and complaints.

9.  Issue Certificates Of Achievement

When employees attain defined customer experience standards and skill levels, a certificate or token award can help to demonstrate its importance.  A certificate of achievement can become highly prized.   When new outlets are bought, a retail division of a brewery trains staff in service skills and issues certificates of achievements to its bar and restaurant staff to demonstrate the importance of its initial service training.

10.  Publicise Examples of Good Service

Every service job has a substantial routine element and a company newsletter or e-mail should give service contribution the recognition it deserves; sometimes good sales figures seem to be the only thing to get recognised and people could be forgiven for thinking that service mistakes are the only thing to get noticed.  To promote good practice, regular Newsletter features on success stories can be a big help to the individuals concerned and to others.  Organisations such as Scottish and Newcastle Retail  regularly include features on customer experience successes in their newsletters.

Unipart ran an award scheme called 'Mark in Action Award' which recognised individuals and teams who took exceptional actions to look after internal and external customers.  Any customer or Unipart employee could nominate another Unipart employee for the award if service was beyond the call of duty.  To date over half the nominations have been for internal service.  There is a rigorous verification process by a panel of judges.  Selected award winners are invited to monthly formal ceremonies attended by board directors and senior managers.  They receive a token number of shares in the company, gold lapel pins and have photos in reception area.  Winners have also been featured in annual reports and accounts.

11.  Give Departmental Managers An Allowance

Giving a sum of discretionary money, say £1000 a year to  teams to distribute in agreed ways can help promote a healthy, empowered environment.  The team should be able to choose to distribute lots of small awards or fewer larger ones.  Other ideas include non-monetary discretionary awards, such as retail vouchers and team t-shirts to record achievements.  One manager of an I.T. service centre says 'a little thing like taking the trouble to buy ice-creams for everyone on a hot busy day lifts spirits; it's the thought that counts.'

12. Instigate an Award for Good Service to the Internal Customer

Many organisations put all their focus on the external customer and neglect the needs of the internal customer.  Yet a lot of the frustrations of front-line service staff can be traced back to the departments who support them.  These departments are often far removed from the external customer and may well put up defensive barriers which hinder free-flowing processes.

Ways to improve internal customer experience include:
• Workshops to heighten service awareness
• Cross-functional process improvement groups
• Publicity internally and externally on who to contact about what issue
• Cross-training to support greater insight into the workings of other departments
• Improved investment in internal information systems
• Organisational structural redesign, including geographical and layout relocation
• Establishing a problem escalation process to resolve issues
• Encouraging employees to 'own' a problem from start to finish

Avis has devised sophisticated customer satisfaction data measuring internal as well as external satisfaction.  It set benchmarks for internal as well as external service standards to demonstrate the importance of the internal customer.

13. Ensure Team Service Excellence Is Recognised

Effective teamwork is at the heart of good service and train operator GNER encourages team involvement at every level, delegating much responsibility.  It has restructured its on-train crews to remove unnecessary barriers - catering staff are now part of an integrated cross functional team, instead of being looked down upon.  This is reflected in staff turnover down by a massive 66 per cent.   As a part of this, it rewards teamwork.

At Whitbread Inns, an award scheme called 'Team Hospitality' was developed.  The emphasis was on all members of the retail outlet working together to achieve success.  Each outlet could obtain awards based on the team?s performance.   High achieving outlets received a plaque to display in the customer-facing areas of their unit.  This was highly prized.

14. Link Bonuses to Customer Satisfaction

A variable element of pay through the payment of a bonus is becoming more commonplace for service staff not just managers.  Bonuses are often linked to profit achievement, meeting personal service-related objectives, and some have a team as
well as a  personal component.  They are payable quarterly in some instances,
others six monthly or annually.

The criteria for dedicated service success varies from organisation to organisation. At Birmingham Midshires Building Society employee annual bonus, for example, was linked to the attainment of an agreed level of customer satisfaction.  This was determined by the building society's customer survey.

15.  Ensure Support Staff Are Included In The Bonus Scheme

Richer Sounds includes a bonus for all its staff, not just support staff.  It emphases support staff are not a Head Office, they are there to support the branches.

16.  Develop An Award For Good People Management

FedEx's CEO Fredrick Smith comments 'When people are placed first, they will provide the highest possible service and profits will follow'.  Small business service winner the Triple ?A? Animal Hotel and Care Centre makes supervisor of the month awards based on staff ratings.

An award encourages managers to be visibly accountable for the quality of its people management.  It also places a premium on role modelling, publicising and promoting good practice in a very tangible form.

17.  Adopt A System Of 360º Appraisal which includes the Customer

Satisfied customers are closely linked to satisfied employees.  More organisations are encouraging input by customers as well as employees into a manager's all-round (360 degree) feedback.  They are finding it is valuable to take periodic ?temperature checks?.  Every single employee at FedEx is given the opportunity to complete a survey feedback action questionnaire, which translated into a team rating of satisfaction.  Facilitated meetings promote discussion on the feedback which has a defined leadership index, both for the individual manager and the company as a whole.  This enables improvements to be made against clear-cut measurable goals.

18.  Include Customer Experience In Performance Management

Performance management should explicitly hold employees accountable for service delivery.  In organisations such as Boots the Chemist, customer experience is a key measurement in performance appraisal.  Sales assistants are assessed on two critical competences, being pro-active in securing sales and building positive relations with customers.

19.  Develop Customer Experience Competencies

Defining service competencies is the first step in setting out well-defined improvement and development targets.  National Vocational Qualifications in Customer Experience are becoming more widespread and increasingly accepted as a valuable transferable qualification.

20. Ensure Career Progression Is Linked To Good Service

A world-wide express delivery company has developed five competencies for making  management appointments and puts customer interface skills high on its list:
• Customer interface 
• Strategic ability
• Change management
• Operational competence
• Professional expertise

Customer competence puts a key emphasis on the ability to promote, develop and maintain customer awareness and  profitable relationships.

Pizza Hut UK has put a lot of effort into nurturing its service skills and links this to career progression.  In a high staff turnover industry it aims to make 75 per cent of all its promotions from within

Sarah Cook and Steve Macaulay.  Sarah is Managing Director of The Stairway Consultancy Ltd and Steve is a Management Development Consultant at Cranfield School of Management, they can be contacted on 01628526535.

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