In 2005, I was a growing professional in the outsourcing and BPO industry. I can't help remembering how far removed I was of PPJ (Pay Per Job) pricing models, at a time where the traditional PPH (Pay Per Hour) model was and (still to some effect) has been a common standard in the industry.
My thought process was simple, it was the most commonly used model because it diminishes the complexity of managing an account; and to this day, PPH models are risk averse, we accommodate to the managing of specific KPI’s and fall into a bit of a lull in the process.
Don’t get me wrong, there is always complexity on any type of work, however, while removing the “skin in the game” portion at both levels (client and team members) you lose on a key component that helps modify human behavior, the want to get more, traditionally, variable compensation on Pay Per Hour models have a ceiling.
Fast forward 13 years, as an Executive, and most importantly as a stakeholder in the business and industry, I have to think more creatively, to design and innovate in areas of data visualization, leading high-performing teams, in order to make them part of everything as stakeholders as well. In this way, my optics and vision transform dramatically into a mind that thinks critically.
This reflection dawned on me as a result of a disruptive, but enlightening 6-month process of change I recently went through. A client of ours proposed to change the pricing model from a traditional Pay Per Hour model to a transactional based model, on the fly to say the least. We accepted
The process started nothing short of troublesome mainly because of our own skepticism on how financials would turn out, and, if the partnership would eventually make financial sense at all.
One thing we knew which would later become a key success factor in the equation: we had to know to measure productivity differently, and how to equate the way we were being paid to how we incentivized our team.
Halfway through the project, when analyzing productivity numbers through advanced statistical models, as it turned out, we were driving more productivity with the newly adopted model than our previous Pay Per Hour-based approach, behaviours were changed, team members were looking to exceed their performance, there was more in it for them, for our client and for us.
We saw an increase of 25% in productivity and our margins improved by 11%.
After these learnings, I can say without a doubt that we evolved, and emerged as an innovative team. Allied Global was able to solve a riddle by taking a chance and by matching the transaction-based model to an incentive program for team members through a thorough process of analyzing the data, understanding the needs of our agents and giving this way of doing business a chance.
An old practice that was frowned upon, made us a better partner.