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CHAPTER 2

REVIEW OF LITERATURE

2.1 INTRODUCTION

Due to the revolution and rapid development in economy and

especially on the service industry, the customers are given importance. So

build, manage and maintain relationship with customer, the call centre and the

measurement of call centre has gained prime importance among the business

and academia.

2.2 RESEARCH STUDIES ON CALL CENTRE

Since, the application of measurement of call centre performance

has gained prominence throughout the world in both developing and

developed economies, business and academia started focusing on issues of

call centre performance.

2.2.1 Key Performance Indicators

Katz et al (1991) in their study concluded that the aspect of time as

part of performance was often regarded as important in many service

situations. They also showed that as waiting time increased, satisfaction

decreased, and that customers tend to over estimate waiting time which had

an equal, if not greater, effect on satisfaction.

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Eric et al (1992) found that first call resolution (FCR) had been

defined as the percentage of callers that does not requires any further contacts

to the company. They had argued in favour of FCR as the major determinant

of call center performance.

Stephen and Michael (1993) confirmed the significance of FCR by

arguing that caller satisfaction would drop at an average of 15% in every

callback a customer made to the call centre. And that top industry firms were

defined in terms of those that their caller satisfaction ratings were at an

average of 86%.

Morgan and Hunt (1994) defined trust as existing when one party

had confidence in an exchange partner’s reliability and integrity. They also

tested that communication between a customer and firm representatives might

increase trust by resolving disputes and streamlining the satisfaction

formation process by aligning perceptions and expectations. So,

communication was an essential antecedent of satisfaction and trust in

buyer-seller relationships and it was a key performance indicator for

performance evaluation.

Anderson and Martin (1995) found three components such as

attentiveness, perceptiveness and responsiveness were important in

performance measurement. If customer needs were met, they would be

satisfied and if these needs were not met, they were likely to be dissatisfied

with their experience. When a customer was satisfied with a supplier, it also

meant that they knew that the supplier was able to deliver what was expected,

thus the perceived risk associated with choosing a familiar supplier (who

fulfils expectations) was less than the perceived risk associated with choosing

an unfamiliar supplier, or a familiar supplier who had not met expectations in

previous experiences.

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Frenkel and Donoghue (1996) addressed the quality versus quantity

issue in a US based case study which examined what they saw as a significant

shift in focus of call centres from a cost reduction strategy to a customer

interface strategy. They contend that as the role of call centres becomes more

sophisticated, managing them becomes more complex. In the case study, the

organisation had espoused values of service excellence and identified high

quality service provision as its only sustainable competitive advantage. The

call centre employed performance standards including a service quality

checklist, which aimed to promote consistency of service. Besides, call centre

agents were caught between the needs to deliver quality customer service and

to maintain productivity. Work routines were tightly structured, agents just sat

and took calls, only being able to take breaks at predetermined times.

Although call handling statistics were not being used to manage staff to

higher call volumes, they were being used to monitor agent occupancy and

there was evidence of increasing management emphasis on achieving and

maintaining higher call volumes.

Anton (1997) had suggested the KPIs of call center by classifying

into the operation related indicators, income related indicators, cost related

indicators and service quality related indicators. He had emphasized on the

key indicators of influencing on customer satisfaction in the inbound call

center namely the percentage of calls closed on first contact, adherence to

schedule, average time in queue, average abandonment rate and average

response speed.

Tax et al (1998) found that generally, recognition to the company

by customer was greatly influenced from the interactions with employee when

customers presented a complaint to the company. Accordingly, call center

agents that had directly in contact with customer play an essential role in

determining impression over a specific company by customers. If call center

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agents were haughty or did not understand well about customer complaints,

the company may experience a great loss from losing customers.

Bain et al (2002) examined the dichotomy between quantitative and

qualitative targets within call centres. From consideration of case studies of

four call centres in Scotland, they concluded that target-setting was virtually

institutionalised in the call centres and the targets involved what they

described as ‘hard’ measures such as number of calls answered, as well as

‘soft’ measures such as the call centre agent’s level of rapport with the

customer. They concluded that the measurement of both the hard and soft

measures was deeply rooted in the Taylorist scientific management

methodology.

Feinberg et al (2000) mentioned that if customers were satisfied

with the company by responding properly to them, the profits of the company

would increase by influencing on the repurchase behavior of customer.

Miciak and Desmarais (2001) found that the success of the call

center was pronounced or denounced on a regular basis depending upon its

workers' abilities to meet the goals. However, if the strategic advantage that

call centers were supposed to afford business revolved around, customer

satisfaction, the most common metrics stressed many of the things that were

counterproductive to these goals. They also found that a complex

environment that must effectively combine knowledge, technology, and

workflow to provide quality customer service. A call center was a locus for

customer satisfaction. When customers contact a call center, they expect the

phone to be answered promptly and to be treated courteously by

knowledgeable CSRs who can resolve their issue quickly.

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Feinberg et al (2002) studied the KPIs of call center related to caller

satisfaction. They have suggested the 13 KPIs such as average speed of

answer, percent of calls closed on first contact, average abandonment rate,

average talk time, adherence to schedule, average work time after call,

percentage of calls blocked, average time before abandonment, average calls

per agent shift, call center calls per year, agent turnover rate, average time in

queue and service level.

Carlaw et al (2003) in their book mentioned that the driving force

behind call center management was the hundreds of metrics produced on a

regular basis.

Franklin (2004) in his research found that call center metrics were a

critical tool used to manage staffing levels and budgets, but these numbers did

not tell the entire story of the call center ability to meet the customer needs.

He also affirmed the importance of measurements in managing a call center

and the need to balance that with an understanding of the importance of the

human element. He concluded with the quote “If you cannot measure it, you

cannot manage it” and “But, no matter how wonderful the technology was?,

You should not forget the people component”.

de Vericourt and Zhou (2005) modeled a call center in which calls

that were not handled successfully cause the customer to call back. This paper

examined heterogeneous agents, each of which had potentially different call

handling times and call resolution rates and develops a strategy for routing the

two different classes of calls across different agent groups.

Mehrotra and Grossman (2006) described process improvement

methods for a consumer software company’s technical support call center.

Utilizing CRM data captured during customer phone calls, analysts were able

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to quantify the impact of specific issues on call volumes and work with the

product marketing, engineering, and documentation groups to eliminate

specific problems from future software releases. The result of these processes

was, a lower per-customer call arrival rate as well as increased customer

satisfaction.

Sun and Li (2007) used CRM data about service durations and

customer retention in conjunction with an adaptive customer learning model.

They suggested policies for distributing calls from different types of

customers across heterogeneous on- and off-shore call centers within the same

network, while considering both short-term and long-term customer economic

implications for the firm.

SoonHoo So (2007) identified that service level, average speed of

answer, average time in queue, percentage of response, average abandonment

rate, percentage of calls closed on first contact, adherence to schedule,

average talk time, average after call work time, agent turnover rate,

percentage of calls blocked and customer satisfaction were the KPI of call

centers in Korea.

Jodie Monger (2009) found that customer satisfaction was the best

performance indicator in the call centers. Besides, service level, average speed

of answer, average time in queue, percentage of response, average

abandonment rate, percentage of calls closed on first contact, adherence to

schedule, average talk time, average after call work time and agent turnover

were also considered as other key performance indicators in the call centers.

Greg Levin (2010) found that first call resolution was the key

performance indicator in call centers followed by the various KPIs such as

abandonment rate, percentage of calls closed on first contact, adherence to

25

schedule, average talk time, average after call work time and customer

satisfaction.

Oliveira and Joia (2011) found that The “First-Contact Resolution

Rate” and the “Average Handle Time after the Call” indicators presented a

statistically significant relationship with customer satisfaction. Some

alternative call center operational performance indicators were proposed, in

an exploratory way, so as to convey an enhanced relationship between call

center performance and customer satisfaction.

2.2.2 Service Quality

Parasuraman et al (1988) in his research developed a list of

characteristics that defined service quality in general. They combined these

attributes into five major dimensions of service quality, namely; tangible,

assurance, responsiveness, empathy and responsiveness. These authors

subsequently tested these dimensions through SERVQUAL; a 22-items scale

measuring customers’ expectations and perception on five dimensions to

evaluate service quality.

Bitner (1990) in his study found that the service contact can affect

the perceived service quality. The perceived service quality also can promote

to affect repurchase intention, word of mouth, switching channels or stores,

and customer loyalty in studying service contact model.

Brucks and Zeithaml (1991) found that four product quality signals

that have received the greatest attention in the telecommunication marketing

and consumers were branding, pricing, physical features and retailer

reputation.

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Hawkins et al (1992) mentioned that through the research of

consumers lifestyles, enterprises expected to get hold of their demands and

develop products from their perspectives. Moreover, they can also forecast

consumers behavioural models and product services to ultimately win more

customers in their competitive markets.

Teas (1993) suggested service quality dimensions of service

outcome, consumer-employee interaction and service environment. The

notion of service product/service outcome and service delivery/consumer-

employee interaction was consistent with the idea of technical attributes and

functional attributes.

Holbrook (1994) mentioned quality was concerned with the overall

assessment of performance, features, conformance, reliability, durability,

serviceability, aesthetics, and customer perception of quality based on service

provider’s image. Measuring service quality enabled organization to know its

position in the market and provides a strategic advantage to enhance its

competitiveness. Measurement of service quality presented areas of strengths

and weaknesses that offer opportunities to the organizations to initiate

appropriate response to focus and improve salient attributes of customer

perceived service quality.

Berry et al (1995) in their study argued that SERVQUAL was an

effective tool to steer organization in its pursuits of quality improvement by

focusing on those areas that significantly contributes toward improvement.

SERVQUAL was one of the most commonly used measures of

service quality. However, many scholars have cast doubt on its applicability

and validity when it was applied to the retail industry, saying that it could not

be extensively applied across a variety of service industries. Therefore,

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Dabholkar et al (1996) proposed a hierarchical model (DTR) of service

quality for the retail industry and defined retail service quality as composed of

multiple levels and multiple dimensions. They divided retail service quality

into three levels. The first level was consumer perception and judgment of the

overall service quality.

The second level consisted of five dimensions, including physical

aspects, reliability, personal interaction, problem solving, and policy. The

third level was the sub-dimensional level, which mainly presents the

multi-dimensionality of service quality, because three of the five main

dimensions also contain two sub-dimensions. For instance, the physical

aspects have two sub-dimensions, including convenience and appearance;

Reliability included correctness and commitment; and personal interaction

involved confidence and courtesy/help. In the empirical research of this

model, they integrated qualitative and empirical research methods to analyze

the collected results.

Through observation and in-depth inter-views, they recorded

consumer activities in an attempt to identify key factors affecting consumer

evaluation of retail service quality. Finally, based on the 17 items selected

from SERVQUAL, 11 new items applicable to the retail Industry were added

to develop a scale comprising 28 items, called Retail Service Quality Scale

(RSQS).

Parasuraman et al (1997) developed that consumer’s perception

evaluation of service quality could lead to many changes for behavior

intentions and to be positive or negative effect on channels. The positive

effect included “recommendation to others”, “increase customer loyalty”, and

“repurchase intention”. The negative effect included “customer complaint”

and “customer turns to other channel or brand consumption”.

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Kandampully (1998) in his research found that service quality had

an effect on customer loyalty. Loyalty was experienced by the organisation

when the perceived service quality experienced by the customers exceeded

that which was offered by the competitors. The delivering of service quality

to customers was required in the long term if the organisation was to

experience the benefits of customer loyalty.

Walker and Craig-Lees (1998) in their conference paper have

characterized the services in which technologically assisted transactions may

be open to negativity. These include: where there is high importance placed

on personal contact, where a high degree of personal attention is required,

where risk is perceived to be reduced by direct personal contact, where

customers feel unable to use the technology, and where the technology is not

seen to add value. Just like other aspects of service quality, these factors

cannot be treated as ``absolutes'' ± they will vary across customers and time,

so detailed and up-to date knowledge of the customer base of any business is

required for the planning and monitoring of service design options.

Stafford et al (1999) found that reliability, availability, security,

assurance, simplicity, and flexibility as criteria of service quality. They

argued that, from customers’ perspective, it was not appropriate to separate

network quality from the other dimensions of quality.

Prahalad and Ramaswamy (2000) in their study found that in

dynamic business environment, the role of customer was changing. The

changing paradigm of business has made the provision of quality of services

as top priority for organizations. Customer-focused strategy has become a

means of competitive advantage and survival for organizations. Perceived

service quality and its measurement has become essential focus for the

organization in designing and implementing a customer oriented strategy.

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Pontes and Kelly (2000) in their research concluded that the quality

of the service provider cannot be separated from the service offered as it can

be during a face-to-face purchase of goods for example. For this reason, in a

call center services encounter, the competencies of an agent were likely to

have a particularly large influence on the customer's perception of service

quality.

According to study by Leisen and Vance (2001), indicated that

service quality helped to create the necessary competitive advantage by being

an effective differentiating factor. Service quality was essential and important

for a telecommunication service provider company to ensure the quality

service for establishing and maintaining loyal and profitable customers.

Johnson and Sirikit (2002) stated as service delivery systems have

the ability to allow managers of a company to identify the real customer

feedback, expectation and satisfaction on their telecommunication service.

Wal et al (2002) indicated quality reflected the extent to which a

product or service met or exceeded consumers’ expectations. If the services

were more than expectations of consumers, then the consumers were highly

satisfied with the services of telecommunication.

Wang and Lo (2003) in their research studied on comprehensive

integrated framework for service quality, customer value, and customer

satisfaction and behavioral intentions of customers in China’s mobile phone

sector. Customer perceptions of the quality of a service were traditionally

measured immediately after the person had consumed the service.

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Draganska and Jain (2003) in their paper stated that a common

strategy for a company extending their product or service was to differentiate

their offerings vertically.

Crosby et al (2004) examined in their study on, Manage Your

Customers’ Perception of Quality” how perceptions of quality were created

and maintained in the minds of consumers. The first thing the authors noted

was that an understanding of quality was not necessarily something that was

perceived, let alone established, in the mind of the consumer upon the first

impression. In fact, a consumer’s perception of service quality at the time he

or she next decided whether or not to buy the service may better explain

repeats buying behaviour.

Xia et al (2004) in their research concluded that the price

influenced consumers' satisfaction about service quality perceptions as well as

potential consequences of these perception sand fairness was the important

thing to make customer satisfy.

Malhotra and Mukherjee (2004) found that in a telephone

interaction, all of the tangible aspects of service delivery were removed. The

product being purchased was the service interaction. Thus, for call center

customers the evaluation of a service depended on the evaluation of a service

encounter with a contact employee. Such intangibles as knowledge and

accuracy, responsiveness, assurance and empathy took on greater importance.

Boyer and Hult (2005) in their study found that customers preferred

service quality when the price and other cost elements are held constant in the

market. Since, the customers were price sensitive, the services should be

delivered at the lowest prices to the customers of telecommunication sectors.

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Marandi et al (2006) tested a model on the relationships between

service quality, customer satisfaction and loyalty in supermarkets in HCMC

and found that retail service quality composes of five dimensions: goods

assortment, personnel, appearance, physical aspects and safety.

Yeh et al (2007) in their study explored that the Taiwanese

semiconductor Industry implements effectively enterprise resource planning

(ERP) to improve service quality by evaluating expected and perceived

service quality for both upstream manufacturers and downstream customers

through questionnaire survey.

Vlachos et al (2008) in their study found that the influence of

seven service quality determinants on overall service quality perceptions,

employing a qualitative research design. These determinants were embedded

in a holistic nomological framework depicting the complex interrelationships

between prominent service evaluation constructs and behavioral intentions.

The model was tested employing partial-least squares structural equation

modeling in the context of a field experiment involving the delivery of music

content over real-world mobile networks and devices. The study also found

that content quality, contextual quality, device quality, and connection quality

and privacy concerns have a strong positive influence on service quality

perceptions. Overall, service quality, value and satisfaction had a

simultaneous direct effect on behavioral intentions. So as to adopt mobile

e-commerce services consumers required to be rewarded with high levels of

outcome quality (e.g., wide selection of music songs, sonic and video quality),

anytime and most importantly at any place.

Hsieh and Tung (2008) argued that branding and brand perceptions

affected the consumer’s perceptions of products characteristics, attributes and

their service quality.

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Nakhai and Neves (2009) found that service quality was more

difficult for the customer to assess than product quality; the measure of

service quality perceptions was to compare customer expectations to real

service performance; and the assessment of service quality were not found

only on the results of a service but also included the delivery process

assessment of the service from three decades of service quality research.

Sandhya Joshi et al (2010) found that network quality,

responsiveness, empathy and assurance were important factors influencing the

service quality of telecom sector. In addition, network quality had the

greatest effect and influence on service quality followed by responsiveness

and others factors.

Muhammad Asif Khan (2011), in his study concluded that the

adapted SERVQUAL with additional dimensions was found to be a valid

instrument to measure service quality in mobile phone services. The

dimensions of tangible, assurance, responsiveness, empathy, convenience, and

network quality found to have positive and statistically significant

relationship with mobile phone users’ perceived service quality. Convenience

and network quality dimensions found to be relatively most important

dimensions affecting users’ perception. The dimension of reliability did not

reflect significant effect on customers’ perception of quality.

2.2.3 Customer Satisfaction

Kohli and Jaworski (1990) found that satisfied customers were also

likely to tell others of their favourable experiences and thus engage in positive

word of mouth advertising. Dissatisfied customers, on the other hand, were

likely to switch brands and engage in negative word of mouth advertising.

The significance of customer satisfaction and customer retention in strategy

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development for a ``market oriented'' and ``customer focused'' firm thus

cannot be underestimated. Customer satisfaction was often described as the

essence of success in today's highly competitive world of business.

Yi (1991) concluded that customer satisfaction operated in two

different ways: transaction-specific and general overall. The

transaction-specific concept concerned customer satisfaction as the

assessment made after a specific purchase occasion. Overall satisfaction

referred to the customer’s rating of the brand, based on all encounters and

experiences. In fact, overall satisfaction can be viewed as a function of all

previous transaction-specific satisfactions.

Fornell (1992) argued that the relationship between customer

satisfaction and customer loyalty was affected by many factors, including the

industry type, switching cost and the differentiation level of products in a

category. The results also showed that there was a weaker relationship

between customer satisfaction and customer loyalty in market segments with

high perceived switching cost than in those with low perceived switching

cost. In short, perceived switching cost had a moderator effect on customer

loyalty: as it increases, customers’ sensitivity to satisfaction decreases.

Hoffman and Ingram (1992) determined a significant positive

correlation between overall job satisfaction, satisfaction with work, co-

workers and supervisors, and customer orientation. This customer-oriented

behavior was yet another example of the importance of the human element of

call center service satisfaction.

Spreng and Olshavsky (1993) found that customer satisfaction was

based on the disconfirmation of expectation theory, in which the customer

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compared expectations with perceived quality resulting in confirmation or

disconfirmation.

Anderson et al (1994) found that cumulative customer satisfaction

was an overall evaluation based on the total purchase and consumption

experience with a good or service over time. Whereas transaction-specific

satisfaction may provide specific diagnostic information about a particular

product or service encounter, overall satisfaction was a more fundamental

indicator of the firm’s past, current and future performance.

Rogers et al (1994) found that empathy, which can be described as

one's ability to match another's emotional state and provided appropriate

sympathy, had been identified as a key component in a satisfactory call center

environment. The level of empathy expressed during a service encounter

would have a strong impact on the quality of the service encounter and the

attractiveness of the work climate. CSRs who were very empathetic would

produce the highest quality service encounters and would experience the

highest level of job satisfaction in a customer service role.

Heskett et al (1995) in their work concluded in a customer service

role, the key duty of an employee was to provide satisfactory customer

service. Failure to do so not only left the customer displeased but also resulted

in disappointment and frustration on the part of the service provider. The

desire to succeed at ones job was a core need of humanity. Those employees

who felt they met the customer's needs registered job satisfaction ratings

nearly twice as high as those who felt they were not meeting customers'

needs.

Goode and Moutinho (1995) in their research found that a great

deal of attention has been paid to the confirmation paradigm which concerned

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the comparison of product or service performance expectations and

evaluations. The confirmation model treated satisfaction as meeting customer

expectations and was generally related to habitual usage of products.

However, customer satisfaction had moved towards the disconfirmation

paradigm which viewed satisfaction with products and brands as a result of

two cognitive variables: pre purchase expectations and disconfirmation.

Anderson (1996) concluded that no matter how customer

satisfaction was assessed, it reduced sensitivity to price by lessening price

elasticity minimized customer loss from fluctuations in service quality in the

short term.

East (1997) mentioned that customer satisfaction (the full meeting

of one's expectations) had been a critical concept in contemporary marketing

thought and in research related to buyer behaviour. It was generally argued

that if customers were satisfied with a particular product or service offering

after its use, then they were likely to engage in a repeat purchase and tried line

extensions.

As Palmer (1998) in his book asserted that customers would not

hold a favorable attitude towards the service provider compared to other

alternatives available in the absence of some degree of satisfaction. The

customer satisfaction positively affected the customer’s loyalty.

Zemke (1999) in his book quoted that once a service failure

occurred, it became crucial that service recovery, as the action taken by the

service provider to seek out dissatisfaction and as a response to poor service

quality be effectively carried out to reduce the damage in relationship and to

pacify the dissatisfied customer. It had also been suggested that effective

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service recovery had led to higher satisfaction compared to service that had

been correctly performed on the first time.

Anderson and Mittal (2000) in their research suggested that

attributes of products and services can be classified into three categories,

must-be factors, one-dimensional factors and excitement factors, which all

affected customer satisfaction and dissatisfaction differently.

Sergeant and Frenkel (2001) found that just as an employee who

expressed empathy to a customer reduced tension and increased service

satisfaction, so did empathy expressed by management to employees decrease

tension and increase job satisfaction. A work environment where employees

felt supported led to their satisfaction, which led to customer satisfaction.

Johnson et al (2001) in their study found that customers made

repurchase evaluations and decisions based on their purchase and

consumption experience to date, not just on a particular transaction or

episode. At the same time, services offered to GSM subscribers were

continuously in flux. Therefore, customers’ general evaluations were not

based on satisfaction or dissatisfaction relating to a particular service

transaction, bur on all the service encounters involved in being a subscriber to

date.

de Ruyter et al (2001) in their study found that basis for effective

communication was empathy, the ability to understand, and predicted how

others might respond in a given circumstance. This empathetic ability was

essential in both internal (management to employee) and external (employee

to customer) communications. A lack of effective communication can be

linked to several key components of employee satisfaction: an increased in

role conflict, a decreased in role clarity, an increased in job tension and a

37

decreased in overall job satisfaction. As role conflict increased, role clarity

decreased and job tension increased thereby reducing job satisfaction.

Ranaweera and Prabhu (2002) showed that customer satisfaction

and trust have strong association with repurchase intentions and loyalty.

While linkages between trust and customer satisfaction were investigated in

business market literature, the relationship between the two has not yet been

explored in consumer market context.

Oh et al (2003) observed that an individual-level factors were

affecting the adoption of broadband access by combining factors from the

extended technology acceptance model. The constructs of this model

(perceived usefulness, perceived ease of use, and perceived resources) were

proved to be affected by opportunities in adopting a new technology which

would satisfy or dissatisfy the customers of broadband services.

Matzler et al (2004) found that must-be factors were attributes that

customers took for granted and did not increase customer satisfaction. If the

product or service, however, did not meet expectations, then customers would

be dissatisfied. One-dimensional factors were attributes for which the

relationship between attribute performance and (dis)satisfaction was linear.

The more (less) an attribute fulfilled the requirements, the more (less)

customers were satisfied. Excitement factors were attributes that make

customers very satisfied or even delighted if products or services achieved

these factors fully. Customers were, however, not dissatisfied if products or

services did not meet these requirements.

Gronholdt and Martensen (2004) found that the mobile phone

supplier Nokia achieved a customer satisfaction index of 69 (on a 0-100

scale), while Sony Ericsson achieved an index of 63. However, as the study

38

only focused on adolescents over 17 years old, the question was if this

customer satisfaction level also applied for tweens. There was nothing

obvious that spoke for neither a higher nor a lower level of mobile phone

satisfaction among tweens than among adults.

Chiou (2005) in his study developed a model examining the

antecedents of consumer loyalty toward ISPs, as assessed by relational selling

behavior, network quality and service recovery on loyalty intention.

Moreover, the impact of critical factors, like prior IT experience, on the

aforementioned relationships in ISP service had been analyzed. The ISP

industry was characterized by fierce competition and low-profit margins in an

environment of rapidly changing technologies. Furthermore, ISPs did not only

face uncertain demand, but they were also directly affected by the current

conditions of the overall telecommunications sector.

Singh et al (2005) in their report investigated a comprehensive

assessment of the satisfaction of consumers encompassing quality of technical

service, quality and operational aspects of gadgets; and social / psychological

costs due to unsolicited promotional calls/SMSs etc. Sometimes, the

strategies of service providers / producers to ensure customer satisfaction by

serving them in a better way or providing quality gadgets use to be based on

erroneous theoretical and partially tested empirical postulates. The study

aimed to provide inputs to testify few of such postulates in order to provide

the service providers / producers afresh insights on the consumer behavior.

Chebat et al (2005) in their research found that the vast majority of

dissatisfied customers did not complain but were nevertheless at much greater

risk of abandoning their relationship with the company as a consequence of

their unhappiness. The importance of the call center in this relationship was

underscored by their study that asserted that 80% of a firm’s interaction with

39

its customers was through call centers and 92% of customers formed their

opinion about a firm based on their experience with call centers.

Henkel et al (2006) found satisfied customers of telecom sector had

high extent of usage and intentions to repurchase in future. Greater the level

of satisfaction of customers greater would be repurchase chances of customers

and reduced customer whip.

Baumann et al (2006) in their research found that affective attitude,

empathy and customer satisfaction led the customers towards further

recommendation to other users. Responsiveness led to short term retention

while affective attitude and empathy had long term impact on customer’s

satisfaction and retention.

Turel et al (2007) found that adoption decision of usage was

determined by price, social, emotional and quality provided by the service

provider. They also found that satisfaction along with perceived service

quality and service value created positive intentions of customers for usage

and retention.

Iqbal et al (2008) found that the satisfied customers would also

recommend others to use the service provider and customer’s satisfaction led

them to use current service and created loyal customers for future. The

customers who were loyal reported to produce higher retention rates, tend to

commit a higher contribution of their category spending for the firm and were

more likely to pursue others to be a part of customers of the firm.

Ravi Kumar et al (2008) found that the complaints received from

the customers were mostly regarding rental and excess bills and present

BSNL rental plans were not affordable. Most of the customers are satisfied

40

with the services of new service providers and most of customers were not

satisfied with BSNL billing system.

Shirshendu Ganguli (2008) in his research said that hardly any

study that attempted to take into account both service quality and features and

measure their impact on customer satisfaction. The importance of such a

study which discussed the impact of service quality and features on customer

satisfaction from the cellular users' viewpoint - to one of the fastest growing

cellular services markets like India can not be overstated. After extracting the

variables of service quality and features from studying a body of literature on

services such as cellular, banking, fast foods, etc., done in a similar context of

exploring the drivers of customer satisfaction, this study attempted to find out

the underlying constructs (using factor analysis) of these service variables for

Indian cellular users. Then the variables (factors) extracted were used as

independent variables and an attempt has been made to explore the impact of

these factors on customer satisfaction (dependent variables), which was

divided into three parts - satisfaction from usage, repeat buying intention and

recommendation of service to others.

Atalik and Arslan (2009) in their research found that creating value

and offering quality of service offered to customer created loyal customers.

They also further found that loyal services offered to customers fulfilled both

present and future needs of customers. Customer’s loyalty and trust was

gained by service provider s commitment to provision of services, quality of

services. Dissatisfied customers had no bond of loyalty with the organization.

Balaji (2009) in his study investigated the antecedents of customer

satisfaction with Indian mobiles services. The American customer satisfaction

Index (ACSI) model was used as the framework to examine the causal

relationships among customer expectations, quality, value, satisfaction and

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loyalty. The responses were collected using a structured questionnaire from

199 post-paid mobile subscribers in a major city in India. The results from

structural equation modeling showed that perceived quality was an important

predictor to customer satisfaction, which ultimately resulted in trust, price

tolerance and customer loyalty.

Ishfaq Ahmed et al (2010) found that customers were slightly

satisfied from the service quality of SMS service providers where tangibles

and assurance score more than other dimensions and empathy had the lowest

score. At the same time the correlations showed that dimension empathy was

negatively related with satisfaction while other four dimensions tangibles,

assurance, responsiveness and reliability were positively related with the

satisfaction.

Muzammil Hanif et al (2011) in their study found that the

subscribers of telecom sector or the mobile service providers like Ufone,

Mobilink, Telenor etc operating in Pakistan were targeted as the population

while Price Fairness and customer services were the taken as predicting

variables towards customer satisfaction as criterion variable. The results

showed that both the factors significantly contributed to explain customer

satisfaction but comparatively price fairness had the larger impact on

customer satisfaction than customer services.

2.3 STATEMENT OF THE PROBLEM

Evolution on the mode of business had paradigm shift from

physical store to virtual store. People buy and sell product and services over

internet. Initially call centre were used for promoting the product over the

phone. So there were outbound call centres where the customers are

contacted. Now the customers are contacting call centres for after- sales

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services and other services and they are inbound call centres. Inbound call

centre management is the art of having the right number of people and

supporting resources in place at the right times to handle customer within

optimum cost.

Call centres are generating huge revenue. Business people are

inspired by this fact. The call centres are generally outsourced to third parties

who need to run and continue the business based on the service level

agreement they made with their outsourcing parties.

Call arrival rate is more dynamic due to raise in customers in

inbound call centres which cannot be controlled. A significant amount of

information is required to effectively manage and monitor the performance of

this inbound call centre. The reports of many such indicators on the call

centre’s performance have the potential to mislead when they are interpreted

together. The management must device the proper metrics to assess the

performance in various domain of decision making.

The call centres need to monitor the performance indicators

vigorously to sustain in the market. Even though many researches were

conducted to study the major key performance indicators, indicators for every

call centre vary according to their type and business that they do.

As reported from few researches, first call resolution is considered

as the one of the best measure considered to the performance of the

organisation. Employee satisfaction is considered as one of the factors which

influence the attrition rate. Most of the companies have considered customer

satisfaction to be the important indicator. Currently, performance monitoring

is back-loaded as the feedback to the agent is given after the call is

terminated. In the case of a sub-performance interaction, the cost in terms of

43

customer dissatisfaction has already been incurred, in addition to the costs

involved in the monitoring itself.

Researcher found that different indicators are used to measure

various dimensions of performance (agent’s performance, operational

performance and measures of quality of service) in the call centre. Researcher

aims to identify the suitable indicator which could measure different

performance (agent’s performance, operational performance and measures of

quality of service) in turn to measure the overall performance in Indian call

centres.

2.4 RESEARCH GAP

From the above analysis, it is felt that some of the gaps which could

be certainly carried out in the present research. The research gaps had been

taken into consideration and included in the research are: identification and

prioritizing the performance indicators specific to Indian call centres and

influence of specific HRM practices, trainings in call centers, service quality

dimensions on customer satisfaction.

Most of the previous research studies were carried out on

performance indicators, service quality and customer satisfaction in call

centers. But there is no in depth study on prioritizing the performance

indicators and analyzing the interrelationship between performance indicators,

service quality and customer satisfaction of call centers.

With this back ground, the present research is attempted to study

“Empirical investigation on the influence of employee related and service

quality attributes on prioritized key performance indicators in Indian

call centres”.

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2.5 OBJECTIVES

The main focus of the study is to empirically investigate the

influence of the employee related attributes and service quality attributes

factors on most preferred Key Performance Indicator (KPI) specific to Indian

call centre. The objective of the study is as follows:

1. To identify the Key Performance Indicators (KPI) applicable

to Indian call centres.

2. To Prioritize the identified KPIs

3. To analyze the influence of selected indicators on the most

preferred KPI.

4. To analyze the influence of service quality dimensions on

most preferred KPI.

5. To develop a model to examine the interrelationship between

service quality and selected indicators on most preferred KPI.

6. To prioritise the service quality dimensions in call centre.

7. To understand the existing level of trainings and its impact on

most preferred KPI.

8. To study the specific Human Resource Management Practices

(HRMP) and its impact on most preferred KPI.

2.6 RESEARCH FRAMEWORK

The research objectives are achieved through the following

research framework (Figure 2.1).

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This research is done in two phases as described in the Figure 2.1.

Figure 2.1 Research Framework

PHA

SE I

I PH

ASE

I

EM

PIR

ICA

L IN

VE

STIG

AT

ION

Man

agem

ent p

ersp

ectiv

e

AH

P FO

R C

AL

L C

EN

TR

E

PER

FOR

MA

NC

E

IDENTIFY KPIs SUITABLE TO INDIAN CALL CENTRE BY

IDENTIFY KPIs THROUGH LITERATURE

PRIORITISE KPIs

MOST PREFERRED KPI

EMPLOYEE RELATED FACTORS

SERVICE QUALITY ATTRIBUTES

KEY PERFORMANCE INDICATORS (incl. Customer satisfaction)

PRIMARY DATA OF MOST PREFERRED KPI

Empl

oyee

per

spec

tive

46

Phase I : Identification of preferred KPI with reference to Indian call

centres

The preferred KPI is identified by following steps:

1. Identify exhaustive list of KPIs from literature

2. Identify KPIs suitable to Indian call centre by brainstorming

3. Prioritize them by AHP methodology.

Phase II: Empirical analysis on the influencing factors (employee related

and service quality attributes) of preferred KPI.

The sequence of activities is given below:

1. Collect the primary data reflecting the most preferred KPI is

collected.

2. Based on the above data establish, the influence of various

factors in the most preferred KPI.

Finally the importance of service quality attributes from employee

perspective is compared with management perspective.

2.7 SIGNIFICANCE OF THE STUDY

The interrelationship between key performance indicators, service

quality dimensions and customer satisfaction in call centre would be helpful

to improve the performance of employees and increase and improve customer

satisfaction through the provision of an appropriate service quality

instruments.

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The prioritization of the service quality dimensions and the

influence of service quality dimensions on customer satisfaction in call centre

would aid to understand the emphasis on customer satisfaction through proper

understanding of the importance of service quality dimensions. Thus the

emphasis on more influencing service quality dimensions may be focused in

the training.

The trainings received by the employees, association between

demographic features of employees and trainings received by them and the

impact of employees trainings on customer satisfaction in call centres would

be helpful to revamp the trainings needs of employees

The specific human resource management practices, association

between demographic features of employees and specific human resource

management practices and the impact of human resource management

practices on customer satisfaction in call centre would be useful to understand

the effectiveness and impact on employees’ performance.

2.8 ASSUMPTIONS AND LIMITATIONS

The key performance indicators are taken as performance measures

of the call centres.

The influence of employee related attributes and service quality

attributes on most prefered KPI is dealt separately. Combination effects are

not taken in to consideration.

Specific human resource management practices and training

received are taken as employee related attributes.

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The service quality attributes are collected from employees to know

the importance of service quality attributes for the improvement of call centre

performance.

The magnitude of service quality dimensions is measured from

management perception to prioritize them.

2.9 SUMMARY

With this background, the present study has been designed suitably

to undertake the research work on empirical investigation on the influence of

employee related and service quality attributes on prioritising key

performance indicators in Indian call centres. Through this extensive literature

survey, the researcher has also found the research gaps, the research

objectives are identified and the framework for achieving the objectives is

designed.