What are the factors that an organization should consider in managing services employees?

Following factors play a crucial role in increasing the efficiency of employees at workplace.

Clearly defined roles and responsibilities

Employees need to have well defined roles and responsibilities at the workplace. Individuals need to be clear as to in which all areas they need to contribute their level best and what all skills would help them perform better. They need to be aware of their duties and key responsibility areas. Duplication of work decreases efficiency of employees. Responsibilities ought to be delegated as per expertise, knowledge and interest levels of employees. Job mismatch leads to confusions and individuals eventually lose interest in work.

Effective communication

Effective communication plays an imperative role in increasing efficiency of employees, eventually benefitting the organization. Employees need to interact with each other, discuss their problems, brainstorm ideas and gain from each other’s expertise. They need to have an easy access to their manager’s cabins so that grievances and problems can be addressed immediately. Even the minutest problem left unattended may become a major cause of trouble later on. Managers need to sit with their team members, monitor their performances, give them correct feedbacks and help them perform better. As a manager, you need to guide your team as to what all additional set of skills would increase their efficiency and help them deliver results on time.

Rules and regulations/Flexible policies

If you expect an employee to work till late on his birthday, he would never perform and end up wasting the entire day. One needs to be logical. Do not ask your employees to work till late unless and until there is an emergency. Rules and regulations should be same for everyone. Every individual irrespective of his/her designation or level in the hierarchy has to report on time. Allow employees to take small breaks during the day. Let them speak to their colleagues. Strict rules like switching cell phones at workplace, blocking websites, not allowing employees to get up from their workstation and so on can sometimes irritate an employee, who in due course of time starts hunting for a new job. Employees need to be satisfied with their jobs. Give a pat on their backs and make them feel that they have the potential to achieve targets before time. Let them feel special and indispensable for the organization. Trust me; nothing would help, if they do not realize it themselves. Self realization is of utmost importance. After all, you can’t keep a check on your employees every time. Trust your employees.

Salaries/Wages

Money is a strong motivating factor for employees. They would never work if you do not release their salaries on time. Do not hold their monthly bills and other reimbursements. Appreciate their performances and reward them suitably. Bonuses, additional perks, incentives play an effective role in motivating employees to meet deadlines, finish assignments on time and achieve targets on or before time.

Job Security

Job security plays a crucial role in increasing efficiency of employees. Employees would not be able to deliver if they feel insecure at the workplace. Managers need to stand by their team members at the times of crisis and unforeseen circumstances.

Time Management

Encourage employees to manage their time well. Help them plan their day. Ask them to organize their desk once in every week.

Healthy work culture

Employees need a pleasant work environment as they spend maximum part of their day at workplace. Give them the liberty to take some decisions on their own. Superiors should never treat their subordinates as slaves or keep them at arm’s length. They would never respect you. They need to feel happy at the workplace for them to stay positive, happy and confident. Encourage your employees not to participate in nasty office politics, rumours and criticism.

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The article is Written By “Prachi Juneja” and Reviewed By Management Study Guide Content Team. MSG Content Team comprises experienced Faculty Member, Professionals and Subject Matter Experts. We are a ISO 2001:2015 Certified Education Provider. To Know more, click on About Us. The use of this material is free for learning and education purpose. Please reference authorship of content used, including link(s) to ManagementStudyGuide.com and the content page url.

Customer service performance is a key business objective that boils down to making customers happy. But what makes customers happy? In this article, we will present the scientific research on the factors that influence customer service performance. This will help both HR and managers make better decisions that are proven to increase revenue. We also present a list of key customer service performance metrics at the end of this article.

Introduction

The scientific literature (Borucki & Burke, 1999; Bowen, Siehl, & Schneider, 1989) shows that when employees (and businesses) deliver high-quality service, their customers are:

1. Happier
2. More likely to give higher ratings
3. Report higher satisfaction
4. Visit a store more often
5. And buy more products!

Simply put, a business makes more profit when its customers are happy. So how do we make customers happy? In this article, we will focus on the restaurant service sector to answer this question using some very practical examples.

The factors that influence customer service performance can be categorized into two groups. There are individual-level factors, which are the factors that are influenced by individual employees, and organization-level factors, which have more to do with the organizational climate.

Individual factors that influence customer service performance

Let’s first look at the factors that help an individual employee provide better customer service.

Research indicates that restaurant-goers who pay more for their food, perceive it as being tastier. This proofs that perception is everything.

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The fact that people rate the same food differently based on its price means that the customer experience is often more important than the product itself.

Customer experience is formed by the unique interaction between the customer and the employee. Employees try to accommodate a customer’s every wish because they know that when a customer feels like a king, he’ll be happier and spend more money.

According to literature, the employee’s personality is an important factor in providing a better customer experience.

Personality traits like conscientiousness and extraversion impact customer service performance. Conscientiousness individuals are organized, dependable, responsible and hardworking. They’ll usually do what is expected of them.

Extraverted people are sociable, talkative and active. These individuals usually show high-energy when they interact with others (customers) and are better at making people feel at home.

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Organizational factors that influence customer service performance

There are also factors on an organizational level that influence how customers feel about the service level. This is demonstrated by Ployhart, Iddekinge & Mackenzie (2011).

The easiest way for a company to improve customer service performance is by providing a “climate for service”.

A climate for service is an organizational climate in which good service performance is valued, facilitated, and rewarded. Employees are able to thrive in this climate and thus provide better service.

The aforementioned paper showed that stores with higher service climate had higher customer service performance. In this case, service climate was measured by asking employees to rate their restaurant’s service climate (more about this later).

The second factor was perceived autonomy. The degree to which an employee can influence decisions at work was related to higher customer service performance.

This could be caused by multiple factors. Employees with more autonomy are more likely to feel responsible and thus be more assertive. In addition, autonomy could lead to more decision latitude, which helps these employees to solve problems faster.

Training and performance incentives

Interestingly, in this same study (which focused on restaurants) service training was not associated with a higher service level.

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The fact that an employee attends training does not necessarily mean they will learn or apply new skills to the job.

The reason is unknown. It could be that there is not much to train when working in a restaurant, or that training practices in the sector (238 restaurants were examined), in general, are ineffective.

Performance incentives were also not related to superior service.

Next, the researches looked at the outcome and asked the question: why is customer service performance important?

Customer service performance in a store was related to how happy customers where and how often they would return. In other words: higher customer service performance meant higher customer satisfaction and customer loyalty (Ployhart et al., 2011).

This model shows a direct relationship between selection practices and revenue, through multiple other contingencies.

In the same study, we encounter a few other interesting findings.

The customer’s age and sex are both related to how they rate an employee’s service level. Older customers are milder and give higher ratings. In addition, females are more satisfied with service and are more likely to come back and recommend the restaurant to others (higher satisfaction and loyalty) compared to males.

Customer service performance metrics

In order to evaluate superior customer service, we made a list of the relevant customer service performance metrics mentioned in this article. The following 11 metrics can act as indicators and/or predictors of customer satisfaction.

1. Extraversion

Extraversion is a big-five personality trait. Extraverted people are sociable, assertive, talkative and active. Extraverts also have a higher desire to excel. Research has shown that extraverts perform better in service and sales jobs. Extraverted individuals have higher (individual) customer service performance compared to introverts.

2. Conscientiousness

Conscientiousness is the second big-five personality trait associated with superior customer service performance. Conscientious people are dependable, responsible, work hard, and strive for achievements. Besides being related to superior customer service, conscientiousness is also related to superior job performance in general.

The three other big-five personality traits (openness, agreeableness, and neuroticism) were not associated with superior customer service performance.

3. Cognitive abilities

Another indicator of better customer satisfaction is an employee’s cognitive ability. Employees with a higher cognitive ability (often measured in IQ) tend to provide better customer service (Ployhart et al., 2011).

People with greater cognitive abilities will learn faster, absorb more information and generalize knowledge more effectively. Cognitive ability is, therefore, our third customer service performance metric. A fairly accurate proxy for this metric could be the employee education level.

4. Employee training

Training increases the speed at which employees learn specific knowledge (Hatch & Dyer, 2004). Training is aimed to improve the employee’s skills. More skilled employees tend to provide better service (Ployhart et al., 2011). However, this does not hold true for all jobs. Employees with less complex service jobs (like waiting tables) seem to benefit less from training compared to employees with more complicated service jobs (e.g. working in a high-end restaurant).

5. On the job experience

On the job experience is another customer service performance metric, as more experienced employees are better equipped for their job and thus provide better service (Ployhart et al., 2011). For example, a rookie mistake, such as a waiter who fails to balance his/her tray and spills a drink on a customer, can lower the customer service experience and produce less satisfied customers.

6. Store service climate

The organization’s climate is an important factor that impacts employee behavior. When an organization has a climate of excellent service, employees know that creating a great customer experience is desired, expected, and rewarded. Such a climate helps employees provide better service.

Store service climate has been proven to impact service quality and customer satisfaction. It can be easily measured by asking employees to rate the climate using a short scale. An example item for this scale is: “The restaurant measure and track the quality of work and service”.

7. Local competition

Local competition influences how customers rate a store’s customer service performance.

Local competition can be defined as the number of restaurants within a certain distance. When local competition is higher, customer satisfaction and ratings on service quality where higher, and customers came back more often.

An explanation for this is that when local competition is fierce, establishments push their service level higher to compete effectively.

8. Individual customer service performance

Individual customer service performance is a metric that indicates the level of service performance of an employee. A common way to measure this is by asking “how likely are you to recommend [person]’s service to a friend or colleague?”, or by measuring it through a 360-degree feedback form, in which the client is asked to rate the employee’s service level.

Individual customer service performance is an outcome variable that is influenced by the previously mentioned variables 1 – 7.

9. Team-level customer service performance

Team or store-level customer service performance is a metric influenced by individual customer service performance. A study by Liao & Chang (2014) found that when individual customer service performance (8) was above average, that specific store outperformed the other stores in the sample.

In other words: there is a bottom-up effect of individual customer service performance to team-level customer service performance.

10. Customer satisfaction

Customer satisfaction is one of the most important customer service performance metrics. All previous metrics are antecedents of higher customer satisfaction. Customer satisfaction can be measured in different ways. An increasingly common way to do this is by rating the service with a smiley face or thumbs up/down via a computer.

11. Customer loyalty

Customer loyalty represents the likelihood that a customer will return, and will recommend the establishment to others. Customer loyalty is closely related to a financial outcome as returning customers will spend more than customers who only visit once.

Customer loyalty can easily be measured by keeping a record of customer purchases in a (reservation) system. An additional benefit of these systems is that they can help to provide a better customer service experience. For example, most sun studios record a customer’s previous tanning intensity and session duration to provide better tanning advice based on their history. An alternative could be a (scannable) customer loyalty card.

Conclusion

This article gave an overview of multiple studies all focused on the restaurant sector. Using this research we were able to show which people factors contribute to excellent customer experience and more revenue.

We ended with 11 customer service metrics that influence how your customers perceive your service. You can influence most of these factors through smart business policies, including data-driven recruitment, better measurement of performance, and a better employee performance management process.

To learn more about how to improve business results through smarter, data-driven HR decisions, visit the AIHR Academy!

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