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ACCA Strategic Professional · Advanced Performance Management · Performance and reward

Halden Group introduces performance-related pay for call centre staff based on the number of calls handled per hour. Customer satisfaction scores then fall sharply. Which revised approach best addresses this using sound reward design principles?

Adding balanced targets such as customer satisfaction and first-call resolution is best. The current bonus rewards speed alone, so quality suffers. Including quality measures aligns behaviour with strategic objectives while keeping the scheme within staff control, unlike a higher volume rate or company-wide profit.

  1. AIncrease the bonus rate for calls handled per hour
  2. BAdd balanced targets such as customer satisfaction and first-call resolution to the bonus criteriaCorrect
  3. CReplace the bonus with an increase in basic pay only
  4. DBase the bonus solely on the company's annual profit

Explanation

The single volume measure encouraged rushing calls. Adding quality measures balances the incentives and links reward to the full set of desired outcomes. Raising the rate worsens the problem, and company profit is largely outside operators' control.

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