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The report focuses on how DrainFlow can improve in three areas: job
structure, incentive structure, and hiring practices. The main contents
include an introduction to the problems DrainFlow is encountering,
analyses of the current business, and recommendations on how DrainFlow
can overcome these issues to foster a long-term competitive advantage.
The LIGHTNING Consulting team is comprised of four individuals with a
broad array of expertise in both engineering and business. The team has
proven record of accomplishment and commitment to serving clients attests
to the high quality service provided. Not only does LIGHTNING Consulting
provide solutions to an assortment of business problems, but also
assistance in the execution of developed recommendations. The team is
passionate about results and the opportunity to implement the long-term
strategies and recommendations outlined in this report.
To successfully address the overarching strategic issues, LIGHTNING
Consulting has outlined two important goals to consider. First, DrainFlow
needs to increase employee satisfaction. DrainFlow must also increase
customer satisfaction to foster customer retention and increased revenue.
LIGHTNING consulting will address these goals in the business analysis
section and in the ensuing recommendations. These goals will enhance the
overall well-being of the company and the bottom line.
Background
DrainFlow is a large residential and commercial plumbing maintenance firm
that operates around the United States. In recent years, the company has
been losing customers to competitors while experiencing a decline in job
satisfaction and job motivation across various job functions within the
company. This dissatisfaction among DrainFlow customers as well as
employees is attributed to the overspecialization of certain jobs within the
company that, in the past, has allowed the company to operate effectively
with low costs.
In recent years, this overspecialization has led to various issues including
incorrect order processing, customer service issues with billing
representatives and customer service issues with plumbers and plumbers
assistants. A few years ago, DrainFlow hired a management consulting
company to assess DrainFlow worker attitudes. A survey found that
qualified, more motivated employees who want to stay with their current
organization.
It is also important to examine how DrainFlow is currently paying their
employees. Recently, Lee Renaldo, a new manager, proposed a cash
reward system to increase the performance of her employees. In Lees new
system, order processors would receive a small bonus for successfully
completed calls. For on-the-job work, if a job is completed promptly with no
complaints, the plumber or plumbers assistant would be given a small cash
reward. This variable pay system is a variation of piece-rate pay, in which
employees are paid a fixed sum for each call or visit completed
successfully. Because of DrainFlows customer retention issues, quality not
quantity should be emphasized in a rewards system. Her proposed solution
drives employees to complete orders, not ensure their customer is
satisfied.
Furthermore, DrainFlow must weigh the costs and benefits of a cash
rewards system. Financial incentives can have certain negative impacts by
fostering unethical behaviors to obtain personal objectives. These might
include, but are not limited to, billing work performed at a lower price to
make a sale, offering free parts at company expense and coercing clients
into non-complaint and positive review situations. Therefore, a cash
rewards system should not be the only basis of DrainFlows incentive
structure. Renaldo does not mention finding a balance between intrinsic
and extrinsic rewards. Examples of intrinsic rewards include private and
public recognition, employee of the month awards, or even a personal
thank you note. Some research shows that while financial incentives
provide short-term motivation, intrinsic or nonfinancial rewards motivate
long term. This helps employees feel valuable and needed in a dynamic
environment and would be valuable in DrainFlows incentive structure.
Hiring Practices
It is imperative in any place of employment to hire individuals suited for
specific positions, particularly for positions involving customer service.
Organizational structure and clarity is required to ensure that DrainFlow is
attracting the right type of potential employees. Interested candidates must
also fully understand company goals and all job responsibilities.
foster teamwork. The job rotation will also provide another informal training
opportunity for the account executives.
3. Plumbers: Plumbers will also remain a job category at DrainFlow. They
will continue to service all complex plumbing jobs. As previously discussed
in the account executive section above, we recommend adding some
variety to the plumbers current tasks. Plumbers will prepare and execute
plumbing training for the account executives. The training sessions should
be interactive and provide some technical knowledge about how to respond
to common plumbing problems. Plumbers are encouraged to draw upon
their own experiences and give many examples during each training
session. This will aid the account executives with diagnosing customer
problems during service calls. As a result of the interactive training
sessions, the plumbers will also gain some valuable feedback on how to
deal with common customer complaints.
Using these jobs categories the employees will share information among
each other, understand other peoples job responsibilities, and be better
equipped to react given many different situations. Each group will receive
feedback regarding the job they performed from coworkers allowing them
to improve and perform better under similar circumstances. In addition, this
new structure will allow the office workers some freedom and
independence when servicing customers on the phone. Collectively, the
new structure scores higher in the Job Characteristics Model. The
motivating potential score will increase for each one of the job categories
by increasing the values of skill variety, task identity, task significance,
autonomy, and feedback.
Incentive Structure
In order to increase employee satisfaction and in turn productivity,
DrainFlow needs to implement a new incentive structure. This program will
be made up of a rewards system and an employee recognition program. In
combination, these portions of the new incentive structure will motivate and
energize employees to provide a better service to their customers.
The rewards system will be based on both skill and merit. The skill-based
rewards will be given to employees who strive to attain more skills relating
to the companies services. DrainFlow should reward skills such as training
cost to the customer and the time wasted in visiting a customer twice.
While this is just a small example of the analysis LIGHTNING Consulting
would perform, full bottom line reviews will be conducted to review revenue,
cost metrics, and return on investment.
Conclusion
The above proposal outlined how DrainFlow can improve in three areas:
job structure, incentive structure, and hiring practices. The
recommendations are relatively easy to implement at little to no cost to
DrainFlow. The proposal utilizes the current talent within the organization to
manage employee satisfaction and trains employees on vital technical skills
that are currently lacking. A new incentive structure will motivate
employees in all positions and foster productivity and customer retention.
Both concepts lead to increased profit long term. Lastly, by modifying hiring
practices, DrainFlow will find and train employees that fit with their business
model. With the support of LIGHTNING Consulting, DrainFlow will see a
positive increase in both employee and customer satisfaction and lasting
success in the plumbing industry.
Appendix
1. Customer Survey
When Your Drain Wont Go, Call DrainFlow
On behalf of DrainFlow, we would like to thank you for choosing us to
satisfy your plumbing needs. We would like to ask you to take a moment of
your time to fill out a brief survey to help us better serve our customers.
Please answer the following questions on a scale of 1 to 5; 1 is strongly
disagree and 5 is strongly agree.
1. The person processing my call was very knowledgeable regarding my
plumbing problem.
*1
*2
*3
*4
*5
2. The person processing my call was friendly and courteous.
*
*1
*2
*3
*4
*5
3. The Plumber or technician who serviced my home was knowledgeable
and adept regarding my plumbing needs.
*
*1
*2
*3
*4
*5
4. The Plumber or technician who serviced my home was friendly and
courteous.
*
*1
*2
*3
*4
*5
5. My overall experience with Drain Flow was positive.
*
*1
*2
*3
*4
*5
6. I would use DrainFlow again for my plumbing needs.
*
*1
*2
*3
*4
*5
Please answer the following questions on a scale of 1 to 5; 1 is strongly
disagree and 5 is strongly agree.
7. If you recall, Please list the name of the person processing your call:
____________
8. If you recall, Please list the name of the Plumber or technician who
serviced your needs: ______________________
9. Please add any additional comments.
____________________________________________________________
____________________________________________________________
____________________________________________________________
____________________________________
2. Original Survey
| DrainFlow Plumbers | DrainFlow Plumber Assistants | DrainFlow Office
Workers | Average Plumber | Average Office Workers |
I am satisfied with the work am I 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 coworkers | 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 |
3. Sample Interview Questions for Interview Consistency
1. What types of products and services have you dealt with?
2. How many orders have you processed on a typical day?
3. How do you verify that have understood the customer's request?
4. Describe a situation where you had to deal with a dissatisfied customer.
5. Describe a situation in which you were upset with a customer and how
you responded.
6. What satisfaction do you get from successfully aiding a customer?
4. Financial Analysis
5. Current Process Map
6. Future Process Map
7. Current Org Structure
8. Proposed Org Structure