IT IS A CASE STUDY

Companies often divide up work as a way to improve efficiency, but specialization can lead to negative consequences. FlowFix is a company that for years has effectively used specialization to reduce costs relative to that of its competitors, but rising customer complaints suggest that the firms strong position may be slipping. After reading the case, suggest some ways the company can create more interesting work for employees while improving customer satisfaction rates. You will also need to tackle the problem of how to find people qualified and ready to perform the multiple responsibilities required in FlowFixs jobs.

Major Topic Areas Job design (Chapter 5) Job satisfaction (Chapter 3) Personality (Chapter 2) Emotional labour (Chapter 2)

The Scenario

FlowFix is a mid-sized residential and commercial plumbing maintenance firm that operates in the Greater Vancouver area. It has been a major regional player in plumbing for decades. Tyron Johnson has been the senior executive at FlowFix for about two years. He used to work for a newer competing chain, Lightning Plumber, which has been drawing away more and more customers from FlowFix. Although his job at FlowFix pays more, Tyron is not happy with the way things are going. He has noticed the work environment is not as vital or energetic as the environment he saw at Lightning Plumber.

Tyron thinks the problem is that employees are not motivated to provide the type of customer service Lightning Plumber employees offer. He recently sent surveys to customers to collect information about customer service performance, and the data confirmed his fears. Although 60 percent of respondents said they were satisfied with their experience and would use FlowFix again, 40 percent felt their experience was not good, and 30 percent said they would use a competitor the next time they had a plumbing problem.

Tyron is wondering whether FlowFixs job design might be contributing to its problems in retaining customers. FlowFix has about 110 employees who are divided into one of four basic job categories: plumbers, plumbers assistants, order processors, and billing representatives. This structure is designed to keep costs as low as possible. Plumbers, who are licensed, make very high wages, whereas plumbers assistants make about one-quarter of what a licensed plumber makes. Using plumbers assistants is therefore a very cost-effective strategy that enables

FlowFix to easily undercut the competition when it comes to price. Order processors make even less than plumbers assistants but about the same as billing processors. All work is specialized, but employees are often dependent on those in other job categories to perform at their most efficient level.

Like most plumbing companies, FlowFix gets a lot of residential business from people who consult the Internet. Corporate clients also use the companys online interface to make nonroutine maintenance requests. Customers either call in to describe a plumbing problem or submit an online request for plumbing services, receiving a return call within 24 hours with the information required to solve the problem. In both scenarios, FlowFixs order processors determine from the customers description of the problem whether a plumber or a plumbers assistant should make the service call. The job is then assigned accordingly, and a service representative goes to the location. When the job has been completed, the information is relayed to a billing representative. The billing representative forwards the invoice to the service rep via cellphone, and the service rep then presents a bill to the customer for payment by credit card, debit card, or cash (corporate clients remit payment via monthly invoices rather than on-the-spot).

The Problem

Although specialization cuts costs significantly, Tyron is worried about customer dissatisfaction. According to his survey, about 25 percent of customer contacts ended in no service call because customers were confused by the diagnostic questions the order processors asked or because the order processors did not have sufficient knowledge or skill to explain the situation. That means fully one in four people who call FlowFix to hire a plumber were worse than dissatisfied: They did not become customers at all! The remaining 75 percent of calls that did end in a customer service encounter resulted in other problems.

The most frequent complaints, Tyron discovered via the customer surveys, were about response time and cost, especially when the wrong person was sent to a job. A plumbers assistant cannot complete a more technically complicated job. If a plumbers assistant arrives on site and cannot do the work, the appointment must be rescheduled (with a licensed plumber) and the customers time and the staffs time have been wasted. The resulting delay often caused customers to decline further contact with FlowFixmany of them decided to move forward with Lightning Plumber instead.

When I arrive at a job I cant take care of, says plumbers assistant Kiera Fritz, the customer gets ticked off. They thought they were getting a licensed plumber, since they were calling for a plumber. Telling them they have to have someone else come out doesnt go over well.

On the other hand, when a plumber responds to a job easily handled by a plumbers assistant, the customer is still charged at the plumbers higher rate. Licensed plumber Philip Wong also does not like being in the position of giving customers bad news. If I get called out to do something like snake a drain, the customer isnt expecting a hefty bill. Im caught between a rock and a hard

placeI dont set the rates or make the appointments, but Im the one who gets it from the customer. Plumbers also resent being sent to do such simple work.

Louisa Gomez is one of FlowFixs order processors. She is also frustrated when the wrong person is sent to a job but feels she and the other order processors are doing the best they can. We have a questionnaire were supposed to follow with the calls to find out what the problem is and who needs to take the job, she explains. The customers dont know that we have a standard form, so they think we can answer all their questions. Most of us dont know any more about plumbing than the caller. If they dont use the terms on the questionnaire, we dont understand what theyre talking about. A plumber would, but were not plumbers; we just take the calls.

Customer service issues also involve the billing representatives. They are the ones who are responsible for continuing to contact customers about payment. Its not my fault the wrong guy was sent, says Susan MacArthur. If two guys went out, thats two trips. If a plumber did the work, you pay plumber rates. Some of these customers dont get that I didnt take their first call, and so I get yelled at. The billing representatives also complain that they see only the tail end of the process, so they dont know what the original call entailed. The job is fairly impersonal, and much of the work involves recording customer complaints. Remember40 percent of customers are not satisfied, and its the billing representatives who take the brunt of customers negative reactions on the phone.

All employees have to engage in emotional labour and it is not clear that they have the skills or personality traits to complete the customer interaction component of their jobs. FlowFixs employees are not trained to provide customer service, and they see their work mostly in technical, or mechanical, terms. Quite a few are actually anxious about speaking directly with customers. The order processors and billing representatives realize customer service is part of their job, but they also find dealing with negative feedback from customers and co-workers taxing.

	FlowFix Plumbers	FlowFix Plumbers Assistants	FlowFix Office Employees	Average Plumber	Average Office Employees
I am satisfied with the work I am asked to do	3.7	2.5	2.5	4.3	3.5
I am satisfied with my working conditions.	3.8	2.4	3.7	4.1	4.2
I am satisfied with my interactions with co-workers	3.5	3.2	2.7	3.8	3.9
I am satisfied with my interactions with my supervisor	2.5	2.3	2.2	3.5	3.4

FlowFix Plumbers FlowFix Plumbers Assistants FlowFix Office Employees Average Plumber Average Office Employees

The information that appears above about average plumbers and average office employees is

taken from the consultants records of similar companies and published industry data about

skilled tradespeople. The comparatively low averages for FlowFix employees are not exactly

surprising given some of the complaints FlowFix employees have made. Tyron is worried about

these results, but has not been able to formulate a solution. The traditional FlowFix culture has

been focused on minimizing costs, and the soft stuff like employee satisfaction has not been a

major issue.

A couple of months ago, a human resource management consultant was hired to survey FlowFix employees about their job attitudes. The results, shown below on a scale of 1 to 5, indicated that FlowFix employees were less satisfied than employees in comparable jobs. The table below provides a breakdown of respondents satisfaction levels across a number of categories.

The Proposed Solution

The company is in trouble, and as revenues shrink and the cost savings that were supposed to be achieved by dividing up work fail to materialize, a change seems to be in order.

Tyron proposes using cash rewards to improve performance among employees. He thinks if employees were paid based on work outcomes, they would work harder to satisfy customers. Because its not easy to measure how satisfied people are with the initial call-in, Tyron would like to give the order processors a small reward for every 20 calls successfully completed. For the hands-on work, he would like to have each billing representative collect information about customer satisfaction for each completed call. If no complaints are made and the job is handled promptly, a moderate cash reward would be given to the plumber or plumbers assistant. If the customer indicates real satisfaction with the service, a larger cash reward would be provided.

Tyron also wants to find a way to hire people who are a better fit with the companys new goals. The current hiring procedure relies on unstructured interviews, and Tyron has realized that he, his senior office manager, and his most experienced lead plumber are not very consistent when interviewing. Furthermore, they often rely on their gut instinct when making hiring decisions. Tyron thinks it would be better if hiring methods were standardized and customer service skills were evaluated during that process to help them identify recruits who can actually succeed in the job.

Question:

What types of hiring recommendations would you make to find people better suited for these jobs? Which Big Five Personality Model traits would be useful for the customer service responsibilities and emotional labour