• October 1, 2014
  • By Leonard Klie, Editor, CRM magazine and SmartCustomerService.com

Should CSRs Be Paid for Performance?

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titled "Does Money Really Affect Motivation?" conducted by Harvard Business Review. In fact, dangling a financial carrot might actually have a negative impact, the research found. "The association between salary and job satisfaction is very weak," the study's authors concluded. "The more people focus on their salaries, the less they will focus on satisfying their intellectual curiosity, learning new skills, or having fun, and those are the things that make people perform best."

Peterson also criticizes some of the metrics on which compensation is based, stating they are either unrealistic or out of agents' control. "You can tell me as an agent that I need to handle twenty calls an hour to get a bonus, but if the call center doesn't get that kind of volume, there's nothing as an agent that I can do about it," she says. "I can't make the phone ring. Or, the phone system can go down. That's an IT issue, not something I can control."

Peterson also maintains that "far too often" these types of pay-for-performance programs come into conflict with stated customer experience goals. The now infamous Comcast call, Peterson says, "s a perfect example of someone trying to push something that was not in the interest of the customer, just to make a goal."

Agent Compensation Is Not All Bad

Still, there are those who support the pay-for-performance structure when it is executed fairly and ultimately works toward improving the customer experience.

"If the program is fair, it can work," Fluss says. "No matter what, when you reward people, it has to be balanced."

And then, "the rewards need to be tangible," she adds.

But even Fluss tempers her support for these types of programs. "We don't want to motivate employees just to reduce average handling times at the cost of quality or customer satisfaction," she says. "If you want to do it right, you want to reward [the agent] for offering good, quality customer service while also reducing handling time."

Brad Cleveland, a senior advisor and former president and CEO of the International Customer Management Institute (ICMI), agrees. "These programs are usually effective in getting a desired result, but at what cost to the larger customer service objective?" he says. "You will get what you want, but you have to look at the broader picture—did we meet the customer's needs and was it how we want our brand represented?"

Cleveland also says pay-for-performance programs "can have a temporary impact on performance," but the improvements are all too often "not sustainable over time."

For that reason, experts suggest mixing up the rewards a bit. "Programs need to be changed from time to time to keep them interesting and relevant," Fluss says.

Gamification—turning the quest for rewards or incentives into a friendly competition, where employees can see where they are in relation to the goals and other employees—is also one way to build enthusiasm for the program, according to Fluss.

The caveat, though, is that leaderboards could disincentivize the person at the bottom. One way to overcome this, many gamification 

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