As I’ve worked with different organizations, one question has often given me the key to unlocking problems with a particular organization. In a calling center, for example, I’ll sit down with the center manager and ask them to explain how their compensation and especially how their bonus is computed? I explain that I don’t need to know the actual numbers, but just what’s the basis for their compensation and for their incentive bonus program. But this isn’t the key question, this is just the lead in.

Once we’ve discussed WHAT compensation is and how the bonus is computed, I ask what change they could make in their operation that would affect their bonus at the end of the period. Want to know how often I get a blank stare?

Variations on the question might be: If they could improve calling rate by 25%, what would be the impact on their bonus? If they could reduce call times by 25%, what would be the impact on their bonus? If they could get a successful conclusion to 25% more calls, what would that do to their bonus? Very few people could give me an answer and none gave me an answer that stood up to a 2nd look.

In most organizations I’ve reviewed, it turns out that NO ONE knows how changes made today could impact their bonuses tomorrow or next week or next year. In other words, they have no control over their bonus. Even if it there is a way to do what I’ve asked, the people on the front line don’t know it. How good an inventive is it if you create a program where no one knows how what they do will affect their incentive?

Everyone talks about motivating their people, but they really don’t pay a lot of attention to what their compensation systems are motivating people to do. Even worse, they don’t give people a way to take positive action to impact their compensation, because the tie in to actual operational reality is loose at best.

If an incentive program is going to work, then it must be tied to factors that the person actually can control. Sales people working on commission have it better in many cases because they can track their sales and know exactly what they need to do to get more. If something isn’t leading to a sale, they can drop it and move on, working on someone else more likely to generate a sale. However, most compensation programs for people working with Customer Facing Systems aren’t anywhere near that good.

The basic principle then for ANY incentive program needs to be ‘Can my people understand the program and control what they do today to get their bonus?’ If you can’t do that, then face it, you’re not providing incentives, you’re gambling.

Categories: Call/Contact Centers, Customer Service