There is a persistent view in the UK that customer service roles are played by people with low levels of skill who receive low levels of pay for their work. Yet the market environment of customer service has changed dramatically in recent years. Customer service is vital for the future success of private, public and voluntary sector organisations. People will no longer put up with sub-standard service. If they don't like what they receive, they'll move to another provider or, in the case of the public sector, put pressure on their councillors or MPs.
The research report, Rewarding Customer Service? Using reward and recognition to deliver your customer service strategy, commissioned by the CIPD and the Institute of Customer Service, investigates the crucial role of customer service in organisations. The report researches how appropriate reward and recognition practices support good customer service. The areas of investigation are:
- to identify the impact that reward and recognition practices have on customer service and to highlight which practices are most effective
- to determine the extent to which employees in customer service organisations are satisfied with the rewards and recognition they receive
- to identify those approaches to reward and recognition most associated with employees being committed to their organisations
- to understand how other factors such as organisational culture, the characteristics of employees (eg age, gender) and employment contracts (part-time, permanent etc) affect satisfaction with reward and recognition.
The report is aimed at reward and HR managers and customer service professionals to help them review their existing pay, benefit recognition and wider people management practices. It will also prompt them to considers whether the practices they follow encourage the appropriate customer service behaviours that today's organisations need in order to thrive.
The year-long research project involved analysing the reward and recognition practices in a range of 22 customer service sites. Some 800 staff, in both front-line and management roles were included, located in 15 private, public and voluntary sector organisations.
The findings indicate that:
- Organisations with the best customer service make extensive use of performance-related pay and team-based rewards and recognition.
- These organisations also emphasise the career development of staff and work–life balance issues.
- There are few, if any, differences between reward and benefit policies for managers and customer service staff in these organisations.
- Contingent pay is much more likely to be based on customer satisfaction and service quality than on productivity alone in the organisations providing the best customer service.
- Employees in these organisations generally indicate a high level of satisfaction with their supervision and like a strong emphasis on customer service.
- When employees see their organisation as being fair to, and looking after, them, encouraging open discussions about ways of working and how they can be improved and involving them in decision-making, employees in customer service-based organisations are more likely to be satisfied with their pay.
- When organisations provide a high level of feedback on performance and supervisors are warm and supportive, employees are also likely to be satisfied with the praise and recognition they receive.
- Satisfaction with pay and recognition is associated with employees having high levels of commitment to their organisations – feeling proud about the organisation they belong to, intending to continue working there and feeling a strong sense of attachment to the organisation.
- When they see their organisations as being fair to, and looking after, them and as emphasising good customer service, employees have high levels of commitment to their organisations.
- There is a wide variation between different customer service organisations with regard to employee satisfaction with pay, praise and recognition.
- There is a similarly wide variation between different customer service organisations in the extent to which employees see them as being fair to, and looking after, them.
- Customer service organisations are rated as poor by employees in relation to the extent to which they are involved in decision-making.
The findings show that just getting the reward aspects right isn’t enough. Successful reward and recognition policies can contribute to organisational effectiveness, and the report confirms that team rewards, warm and supportive supervisors, valuing and respecting staff, and providing equitable and fair payment systems all enhance customer service.
But they need the backing of appropriate people management practices, such as involving customer service staff in decisions that affect their work, and the conditions in which they do it. The challenge for leaders in customer service organisations is to develop their organisational cultures in order to implement reward and recognition practices effectively. Customer service organisations must ensure that staff are rewarded and recognised for delivering high-quality customer service. This is easily said, but we frequently don't understand how it's most effectively done.
This is a summary of:
WEST, M., FISHER, G., CARTER, M.. (2005) Rewarding customer service? Using reward and recognition to deliver your customer service strategy. Research report. London: CIPD.
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