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Employee Lifecycle, Shrinkage and Performance Management

Published on 18 October 2021

Employee Lifecycle, Shrinkage and Performance Management

What are the top 3 challenges for contact centres? Speaking to a large a sample of our 150 member organisations, we have identified the following three:

  • Recruitment and retention
  • High absence and other shrinkage factors
  • Performance Management

Some organisations have always had these challenges, but not necessarily all at the same time. Likewise few organisations would have ever claimed to have perfected these. However, organisations who are finding recruit and retention easy, not suffering from high absence or negative shrinkage and have reset all performance expectations are few and far between (we would love to speak to them).

The close fourth place challenge is customer behaviour and volatility of demand. This will be the follow-up article.

High absence has been a challenge for many organisations over the past few months. A combination of factors, including COVID, “Ping-demic”, general sickness, mental health issues, have pushed absence up with some of our members experiencing 20%+ absence for multiple weeks. This has been further challenged by attrition and difficulties finding replacements. Added to this, it’s been Summer and people have deserved a break from work as well as being able to actually travel this year.

This doesn’t feel like a temporary problem, unfortunately it feels like things will get worse before they get better. Uncertainty remains due to the Pandemic. As of September ’21 Covid is still with us, so what have we done and what do we need to do to get through this Autumn, through Christmas and into the New Year?

We want to know why these issues are happening and introduce new ideas to prevent them. However, do we truly understand the root cause?

We want to know which aspects of these issues just require a tactical adjustment, which will only be a short-term issue versus new trends/behaviours that need to be managed and treated differently.

Attrition and recruitment are a major challenge, during our virtual conference in September 2020 Kier Greenwood from Arise spoke about the expected “War on Talent” for 2021. At this point, many thought “they’d be OK” and didn’t respond. However, when you look at the employee life-cycle it’s very easy to understand how a slow-down, or stopping of one part can impact the others.

Stopping recruiting in March 2020 was common, organisation wanted to take stock and understand the impact of the Pandemic. At this point there were huge contrasts in customer demand, some industries needed more people than ever, whilst others literally turned off the lights. For many organisations customer behaviours changed but not to any great highlight. Volumes may have dropped a little, but not enough to be a worry.

Hidden attrition, or internal promotion, is another reason why organisations often react too late to staff shortfalls. I’m exaggerating to make the point, however too often HR attrition numbers will hide internal moves and as we all started on the phones, these entry level roles are critical for the rest of the business. Losing the odd person here and there soon adds up. I wanted to make this point, as although the challenge is attraction and recruiting of the right people, we need to be mindful of the employee lifecycle and career pathway for our colleagues. The shortfall in the contact centre now could mean a shortage of Back Office administrators in two years, or in the Team Leader population in three years, or even the Planning team in five years.

Attrition & Recruitment

Generally speaking attrition slowed down during the start of the National Lockdown. Late March 2020 the first 3-week lockdown was introduced, at this time we didn’t expect what actually followed. Many thought this was just a short-term inconvenience, with Furlough in place to protect jobs. Many organisations decided to freeze recruitment due to uncertainty and the job market slowed. However, it wasn’t long before there was a need to start recruiting and by Autumn of 2020 organisations were needing to recruit and finding it hard to find the right talent. Have people taken stock of their lives and realised that they don’t need to work, or at least in the same type of role, to live a happy life?

Recruiting has never been easy and in a hybrid environment this needs very careful attention.

Bringing new starters into the office for a 6-week induction, then graduation-day before joining their team isn’t easy. So, when you add in flexible working arrangements, part-time and/or home-based, this adds further complexity that needs consideration. Virtual interviews, inductions and working have all been proven however this needs decisive thinking and a commitment to technology and new skills. Dithering around with ambiguous working in office and home arrangements, induction from the office then you can work from home, along with the mindset that one way is better than another means that people find it hard to choose you.

Another factor that appears to be common, is the preferred working pattern of Monday to Friday days shifts, with a bigger challenge than ever on evenings and weekends. At a recent discussion group it was felt there was no coincidence that the organisations recruiting for weekday shifts were finding it much easier to recruit than those who need evenings and weekends. Yes, salary also plays a part, however when there isn’t much financial variance shift choice was a deciding factor.

In addition, it is not uncommon for the induction training process to still be office based and during weekday shifts. Imagine finding a job that suits your part-time evening and weekend needs, then being told your first 6-weeks are Monday to Friday day shifts. Added to this, you want to be home based, but the induction training is onsite. This is a major blocker for some people.

Finally, it was recognised that an uncertain hybrid offering was another factor to finding recruitment and retention difficult. It is absolutely fine to not be certain of your offering, as uncertainty still remains. However, there are still instances where typically the Senior team is making grand statements like “everyone in the office 3-days per week” without any real thought. For example, does this apply to full and part-time staff? Do you have to be in for a full working day? Incredibly in one example, due to office closures, there aren’t enough desks to accommodate this rule.

Shrinkage

Unfortunately, shrinkage can too often fall into the category of being detailed for some, with high level assumptions being used and then no accountability to deliver. For many years The Forum has looked at the 100% of time being paid and not just the factors which “shrink” away time. This 100% view helps to demonstrate when one category goes up, another goes down. Sickness increasing could mean a decrease in customer contact time and poor service levels, or a drop in offline activities which in turn drives up customer contact which means advisors suffer burn-out. Vicious Cycle. The bottom line is the problem is bigger than high sickness, this is just the visible category.

Questions to consider

  • What is your current staff short-fall and what will this be by the end of the year?
  • What is your attraction and recruitment strategy? How has this changed?
  • What is your hybrid working offering? Is it easy to understand?
  • How do you distinguish yourself in the job market?
  • Do you advertise for a job, or a career pathway?

Questions to consider

  • How does our current sickness policy support your employees? Is your existing policy still relevant? Does your previous 3 instances, or Bradford-Factor score still apply? How will you re-set your sickness policy management?
  • What could, or should you change in your policy to reflect current conditions and circumstances? Are there any temporary solutions which could be introduced?
  • What needs to change in sickness policies for the future? For example, should people be allowed to work at home with cough and cold symptoms?

Sickness

Generally speaking sickness rates have fluctuated over the past 18 months. At the start of 2020, with uncertainty around COVID-19, pre-National Lockdown, the advice was to isolate if you had certain symptoms. We won’t name any of the organisations however these are all real-life examples. Some organisations experienced 40% sickness, with one of the highest being 60%. However, once working from home became an option along with lockdown restrictions, many organisations started to experience very low sickness. The lowest was 0% for a week, many were experiencing around 2.5% for long periods. It wasn’t until late 2020 that sickness began to increase back to pre-covid levels (5%-8%). Early 2021 saw a gradual increase with many organisations experiencing above 10% sickness. Summer ’21 has been a challenge with sickness ranging between 12% and 17% for many organisations with a number experiencing 20% for many weeks. As a general rule, less than 10% for September is regarded as good, less than 5% is exceptional.

Other

Anyone who plans for shrinkages knows the catch-all category for “Other”, a way of recognising some things happen outside of the broader planned activities. As a general rule-of-thumb none of the individual other categories should exceeded 2% or 3% on their own and typically “Other” was never higher than 5% collectively. As the temporary working conditions of COVID were forced upon us, we didn’t re-set our shrinkage categories, however many organisations have now seen “Other” increase with some reporting this is close to 10%. One of the main causes are IT and system issues, for example equipment not working and downtime.

Hidden sickness and emergency leave can often fall into “Other”. This is why we must always look at shrinkage as 100% of time and not as individual categories. There have many stories of people being too ill to take a call but able to work Back Office tasks, great they are working, but masking sickness and performance. We need to support parents as they get used to schools being open, but have policies been clearly defined to state what to do if they are caring for child who is ill? Can the parent still work some tasks?

Questions to consider

  • Do you track and report “Other” alongside sickness?
  • How do you capture what is really happening to develop understanding?
  • Have your people policies been updated to reflect emergency leave?
  • Who takes responsibility for IT issues?

As mentioned, “IT issues” often gets unfairly used, however with so many technology platforms changes and process changes in the past 18 months. There are more to come so how are you tracking this impact? Do you need to create another category and educate your workforce how to categorise different types of down time? It can be easier to just create a “catch-all” which is easier for advisor to use, however we need to understand the difference between a local broadband issue versus a system issue, a new process change problem versus user error.

Annual Leave

As we all know 2020 was a strange year. Typically, January and February are quiet times for annual leave, who wants a cold, wet, dark day off in Winter when you are still paying off Christmas! The school February half-time often starts the annual leave cycle. With COVID creeping up on the horizon in February and then the lockdown in late March, many people didn’t have chance to book any leave and then didn’t need or want to. The government then suggested that everyone can carry their annual leave over or kick the can down the road to move the problem to another year.

Every year we mention Christmas planning and the huge employee engagement benefit for doing this early. By late Summer, we should know opening hours and have a baseline forecast to help understand required staffing levels. Leaving this until late Autumn, or even worse December to finalise creates unnecessary worry for employees and ultimately drives poor behaviour. This is important to some, so recognise this and act early.

Questions to consider

  • How have you adapted your annual leave policy?
  • Can annual leave be carried over, bought or sold?
  • How have you managed annual leave amendments, e.g. for cancelled holidays?
  • Have you allocated annual leave for Christmas 2021? If not, when will you do this?
  • Have you started annual leave planning for 2022? If not, when will you do this?

Its really important that you review your annual leave policy alongside your working patterns and hybrid review. This is a workforce strategy and not a set of policies that are related to one another. Have you defined the new rule for carrying over annual leave, selling leave or even buying more leave? Again, acting early is always better, making this transparent and one also drives out the exception questions which help you to understand and develop the policy.

On acting early, start thinking about Summer 2022 as soon as you can. The traditional holiday booking season used to be in January and February. The holiday brochure would have been looked at over Christmas, with the 2-week package holiday booked early in the New Year. Times have changed, and not as many holiday brochures will be flicked through however people will want time off over Spring and Summer.

Rightly so, back in late March 2020, the “eye” was taken off performance management. We all recognised, or at least should have, that performance levels would change and likely range across our people. However, 18-months in have management expectations been re-set? What new habits have been bred ? Which old habits still remain? Which measures are still treated with a “blind-eye”?

Back in “Planning for Covid series 1 “we spoke about the importance of resetting measures and targets and even more importantly retiring old targets. Again, we are at a point where measures and targets need to be re-set, with old ones retired. There needs to be a “line-in-the-sand” where it is recognised that some temporary behaviours are no longer allowed. This shouldn’t be mis-interpreted as “bring back 1990s management techniques “with hard metrics. This is about understanding why someone who works from home and is repeatedly late has consequences. The person who has more “system issues” than entire departments can’t get away with it. We still need to be understanding that life isn’t back to normal, however there should be fewer exceptions now.

Questions to consider

  • What are your current key performance indicators? How are these different from previous indicators?
  • When did you last update your reports with the new targets?
  • How are measures and targets distinguished and explained to stakeholders?
  • Do you still manage to an average performance level?

Author: Phil Anderson

Date Published: 18th October 2021

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