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Christopher Martin

Customer Care

Questioning Quotas

When the number becomes more important than the original goal

Published: Thursday, May 3, 2018 - 12:03

A couple months back I stopped at a local fast-food place for a quick kid’s meal (not for me) after picking up one of my little ones from school. Inside, we were greeted by an employee in an otherwise empty dining area, and no line. As we approached the counter, he asked how we were and if we were ready to order; when I indicated that we were, he left the counter and walked behind me. Figuring he might have left something on the dining floor area, I continued to look at the overhead menu, waiting for him to return. After a few moments, his voice emerged, but he did not.

“What can I get you?”

Turning around, I was shocked to find him standing in front of a newly installed self-serve kiosk, prepared to take my order. At the time, this chain had installed these in about 10 percent of its locations, with plans to put them in half its diners by the end of 2018. This particular diner was one of four in my town for this franchise, but the only one that had these new kiosks, presumably due to its close proximity to a high school. The school leads to a lot of in-store foot-traffic during peak times instead of drive-thru traffic, but this wasn’t one of those times.

Yet here we were, the self-serve kiosk being operated by an employee as I, the customer, awkwardly looked past him to see him fumbling through the process. After he completed my order, which took about three times as long as it would have taken him at the front counter, I couldn’t resist inquiring about the whole situation.

“Did you process my order over here as a way to train me to use this next time instead of ordering at the counter?” I asked.

“No,” came the blunt reply. “I did it because I got yelled at for not having a high-enough transaction percentage on the self-serve kiosks.”

Clearly, the corporate strategists were paying close attention to the rate of use for these new machines to make sure customers not only knew what they were, but were also using them. Somewhere along the chain of command, though, a target percentage was put in place, and managers became responsible for making sure it was achieved—apparently by any means necessary—or be reprimanded.

Strip away the specifics, and this story sounds all too familiar. Instead of receiving valuable data about a new sales initiative, the stress of making a quota led to bad, false information of no use to anybody. It led to a stressed-out employee making a poor choice, and, worst of all, it led to poor customer service that only hurt the consumer’s experience and desire to use the service.

In this specific case there could be numerous reasons for the low percentage rate of kiosk use. Are they in a good location? Are they intuitive enough? Is the diner busy enough to warrant them? None of these questions can be answered, or even asked, if the machines are falsely used for the sake of making a goal that has become meaningless. The corporate strategists know this, obviously, but the focus is lost in the chain of command, and the actual goal shifts to a number. Nobody wins.

Much research has been done about the idea of quotas and how, when they are implemented poorly, employees essentially are asked to weigh their own livelihood against the customers’ best interest. As Wells Fargo has infamously shown us, oftentimes employees feel like they must manipulate the numbers as a means of survival, or else be reprimanded for missing what might seem like an impossible goal. In Wells Fargo’s case, this led to forged signatures and unwarranted accounts and credit cards (millions of them) set up in customers’ names without their knowledge. Bad for the consumer, bad for the business... and only temporarily beneficial to employees.

So why does it keep happening?

The whole idea of sales quotas is to help the company meet its goals. The basic logic says rewarding employees with more money for hitting a certain goal will motivate them to work harder and attain the company’s goals, but this logic immediately implies that employees won’t work hard if they aren’t motivated beyond their established compensation. The company feels that workers have to be given additional incentive in order to perform at the desired level; otherwise, they’ll simply do the bare minimum, right?

We’re off to a bad start already. Costco has shown that employees who are actively engaged with the company at a high level, who believe in the goals and the programs, who are well-compensated, and who are happy to work for their company will go above and beyond as a standard practice. If they like and respect the company they work for, and in turn feel respected, they will strive for excellence. In Costco’s case, its per-employee sales are considerably higher than both Target and Walmart, and its turnover rate is the lowest in the entire retail industry. This isn’t a coincidence.

The problems with a traditional sales model continue when the quota and the company goals are disassociated. To the company, the quota means profit and longevity for everyone; to the employee, however, the quota only means something to them on a personal level: Hit this, and I won’t get in trouble. Hit this, and I get more money. Hit this, and I might get a promotion. Hit this, and I’ll be better than the other employees. These are all short-sighted, selfish objectives that aren’t about the company, only the employee in question. But it isn’t the employee’s fault; this is what’s conveyed to them by management.

It’s the company's responsibility to establish a connection between the team and the company as a whole. There must be context and reason for the goals given to the employees. There needs to be real motivation that isn’t a “do-or-die” situation; what does it mean for the company for this goal to be hit? How can we implement rewards in a way that doesn’t instill fear of failure in the team? Why is this the company’s goal, anyway?

If you’re in a business that relies heavily on meeting specific number goals, a good starting point is to bring employees in on the process. Pick their brains about what the customers are saying, what they want. Salespeople need to believe in the product they are pushing, first and foremost. Beyond that, where do your employees see the company going? How can they help get it there? What do they think are fair goals and objectives? Upper management and frontline employee disconnect is a real thing, and resentment can build easily when one is setting goals for the other that aren’t understood or agreed with.

Bridge the gap! Don’t ask employees to use the self-serve kiosks for self-serving reasons.

Discuss

About The Author

Christopher Martin’s picture

Christopher Martin

Christopher Martin is an account manager at Quality Digest and a freelance journalist in his nonexistent spare time. With roots in covering the entertainment industry, he has expanded his reporting to include the ever-growing and ever-important role of quality management in everyday life.  

Comments

Dr. Deming is smiling in agreement

This is so spot on, and a modern manifestation of what Dr. W. Edwards Deming stated so succinctly in his famous 14 points. Point 11: "Eliminate numerical quotas for the workforce and numerical goals for management." I remember attending his famous four day seminar in the late 80's, packed with hundreds of people, where he must have cumulatively spent hours on this particular point. And it was featured prominently in his classic red bead experiment, as he hilariously ridiculed a vice-president from Ford about the use of quotas--I'll never forget how the audience howled at this poor VP trying to get the workers to meet their quotas.

In your example of Costco, much of the credit must be given to 82-year-old co-founder Jim Sinegal (who stepped down from the board earlier this year) as he refused to surrender to the demands of investors to follow the Wal-mart model of employee compensation, i.e., as low as the market will tolerate. It's no mistake that the quality of the skills you see in Costco personnel is driven by a desire for superior performing staff vs. a boost in profits by keeping wages as low as possible. I've spoken with people that work at Costco, and they are accutely aware that they are being paid as much as their employer can afford, vs. as little as is needed to retain them, and their loyalty in turn is legendary, as you so clearly pointed out.

Dysfunctional performance metrics

"Be careful what you wish, for you will probably get it." This is true of dysfunctional performance metrics such as the one discussed here. The purpose of the kiosk is to eliminate the duplication of effort involved in the customer stating his/her order and the employee processing it, rather than to take the employee's time to use the kiosk. If customers order directly from the kiosk, the employees can do value-adding work (for which they can be paid, as opposed to non-value-adding work) such as food preparation.

Quotas!

To put it succcinctly: Quotas bad, reasonable goals good, unreasonable goals might as well be quotas