CHAPTER 2 REVIEW OF LITERATURE

19 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.

20 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.

21 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

22 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.

23 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

24 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.

26 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/consumeremployee 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,

27 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.

28 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.

29 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.

30 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.

31 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.

32 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

33 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, coworkers 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

34 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

35 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

36 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

41 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

42 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.

44 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).

45 This research is done in two phases as described in the Figure 2.1. IDENTIFY KPIs THROUGH LITERATURE AHP FOR CALL CENTRE PERFORMANCE EMPIRICAL INVESTIGATION IDENTIFY KPIs SUITABLE TO INDIAN CALL CENTRE BY PRIORITISE KPIs MOST PREFERRED KPI PRIMARY DATA OF MOST PREFERRED KPI EMPLOYEE RELATED FACTORS KEY PERFORMANCE INDICATORS (incl. Customer satisfaction) Employee perspective Management perspective PHASE II PHASE I SERVICE QUALITY ATTRIBUTES Figure 2.1 Research Framework

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.

47 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 of the call centres. The key performance indicators are taken as performance measures 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.

48 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.