Cornered by conning: agents' experiences of closure of a call centre in India

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The International Journal of Human ResourceManagement

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Cornered by conning: agents' experiences ofclosure of a call centre in India

Premilla D'Cruz & Ernesto Noronha

To cite this article: Premilla D'Cruz & Ernesto Noronha (2012) Cornered by conning: agents'experiences of closure of a call centre in India, The International Journal of Human ResourceManagement, 23:5, 1019-1039, DOI: 10.1080/09585192.2012.651336

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Published online: 07 Feb 2012.

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Cornered by conning: agents’ experiences of closureof a call centre in India

Premilla D’Cruz and Ernesto Noronha*

Organisational Behaviour Area, Indian Institute of Management, Ahmedabad, Gujarat, India

Call centres have been initiated primarily to reduce organisational cost whilesimultaneously providing high-quality service. However, it is now well established thatthe twin objectives of reducing costs per customer transaction and simultaneouslyencouraging the employees to be quality-oriented are fundamentally contradictory. Thiscontradiction could have serious repercussions for an organisation’s survival. In thecontext of the organisation studied, the imbalance between efficiency and customerservice was the primary reason for closure complimented by a lack of resources, poorleadership and weak HR systems. Qualitative interviews with call centre agentsimpacted by the closure also revealed that the HR practices followed by the managementduring the process of closure could be labelled as non-socially responsible. Not only wasthe decision not communicated in advance to the employees, but they were alsodeprived of their salaries and incentives for the last few months that they worked withthe organisation. Nonetheless, given that the closure took place in a buoyant economymost of them were able to find jobs almost immediately in well-establishedorganisations with higher salaries, albeit with the shift of priority from high pay to highjob security. The job search criteria used by participants’ post-displacement emphasisednon-economic criteria, probably providing answers for the problem of high labourturnover rates witnessed in the IT-enabled business services–business processoutsourcing industry.

Keywords: call centres; closure; HRM; India

Today, customers are seeking to obtain services that adapt to their needs and requirements,

yet at the same time are inexpensive and can be supplied efficiently (Frenkel, Korczynski,

Shire and Tam 1998). Call centres were set up primarily to meet these expectations

of enhancing customer service while simultaneously reducing organisational costs

(McPhail 2002). Not surprisingly then, most call centres espouse a strong desire to achieve

low customer waiting times and provide high-quality service while at the same time

minimise call handling and wrap-up time (Deery, Iverson and Walsh 2004). However, these

twin objectives are fundamentally contradictory. On the one hand, organisations seek to

reduce costs per customer transaction by increasing the speed with which calls are

processed, yet on the other hand they extol the virtues of customer service and encourage

their employees to be quality-orientated (Korczynski 2002). This tension between

management’s goals of customer satisfaction and customer throughput serves as a stressor

for employees (Deery, Iverson and Walsh 2002) and impedes their ability to provide

high-quality service, apart from leading to emotional exhaustion (D’Cruz and Noronha

2008; Noronha and D’Cruz 2009a).

ISSN 0958-5192 print/ISSN 1466-4399 online

q 2012 Taylor & Francis

http://dx.doi.org/10.1080/09585192.2012.651336

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*Corresponding author. Email: [email protected]

The International Journal of Human Resource Management,

Vol. 23, No. 5, March 2012, 1019–1039

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The tension between management’s goals of customer satisfaction and customer

throughput could get exacerbated in the Indian context as the fundamental motive behind

offshoring is cost reduction (Taylor and Bain 2005). Wallace (2009) states that the

outsourcing providers in India are under constant pressure by their clients to reduce

operating costs and improve service levels. So great is the outsourcing providers’

preoccupation with the completion of service-level agreements that they work out targets

that were higher than those specified by clients and pass them over to agents to deliver

(Noronha and D’Cruz 2009a). In this manner, Indian call centre organisations seek to

retain clients as well as compete successfully with other call centre operators resulting in

employees being squeezed between the objectives of the clients, their employer

organisation and the needs of the customers with whom they interact (D’Cruz and

Noronha 2011).

In this paper, we argue that the inability of achieving customer orientation with cost

efficiency resulted in closure of an organisation we choose to call Ringbell. We then

analyse the process of closure and the role of HRM in this process; finally, we try to

understand the consequence of this closure for employees. In the light of these objectives,

we now refer to the literature that deals with the reasons for closure, the role of HRM in the

closure process and the consequences for employees impacted by closure.

Displaced workers and closure

Since the 1980’s research on closure has received special attention in the West as

manufacturing industry moved to other countries and offshore locations resulting in the flight

of capital (Pike 1999; Norris 2003; Kletzer 2005; Shuttleworth, Tyler and McKinstry 2005;

Bardhan 2006). This research conducted on the reasons for organisational closure has

focussed on the economic necessity to expand and efficiently reorganise production

(Dennis 1978; Stafford 1991) while exploring capitalism’s uneven development, more

specifically, how transnational corporations choose between their manufacturing plants to be

closed (Healey 1982; Watts and Kirkham 1999). In this regard, particular characteristics of

the enterprises and the nature of plants such as size, investment strategy, autonomy of plants,

age of the organisation, corporate geography, horizontal mergers, loss of market share,

collapse in demand, over-capacity, product nature, regional variables, lack of innovation,

profitability, sunk costs, levels of output, levels of capital investment, organisational

structure, plant technologies, ownership status and multi-unit organisations were the focus of

the studies on closure (Henderson 1980; Healey 1982; O’Farrell and Crouchley 1983;

Stafford 1991; Clark and Wrigley 1997; Pike 1999; Watts and Kirkham 1999; Colombo and

Delmastro 2001). Besides this, plants deemed to be in areas of poorer labour relations and/or

higher labour costs are more likely to be selected for closure (Stafford 1991). In fact, plant

closing threats and actual plant closings are extremely pervasive and effective components

of employer anti-union strategies (Bronfenbrenner 1997).

Given the significance and the impact of a decision to close an organisation, it is

surprising to discover that there is a limited literature on organisation closure management

or how the process of organisational closure unfolds (Hansson and Wigblad 2006;

Butler, Sweeney and Crundwell 2009). Nonetheless, based on the HR activity undertaken

in general during the closure process, Hansson and Wigblad (2006) identify two distinct

periods of the closure process: the period of advance notice and the countdown period.

At first, there are negative psychological reactions amongst the workers. This generates

negative performance outcomes, in turn decreasing productivity. At this stage, advanced

notification would help to keep workers informed of the likelihood of their displacement,

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enable them to overcome the initial shock, help them to plan for options and decide

between alternatives reducing the duration of unemployment resulting from closure

(Ehrenberg and Jakubson 1989; Addison and Portugal 1992; Magnani 2001). As

negotiations regarding the agenda and timetable for the closedown are set, the organisation

enters the countdown period and productivity increases due to the impending threat of

closure. In some countries, the legislatively regulated closedown periods are between three

months and half a year (Hansson and Wigblad 2006), while in India, under the Industrial

Dispute Act, 1947, only if the organisation employs more than 100 workers permission is

required to be taken from the government for closure or retrenchment or layoff of

employees (Noronha and D’Cruz 2005).

Although each organisation closure requires specific type of HRM activity (Butler et al.

2009), the necessary HR activity common to all such organisations during the period of

advance notice and the countdown is the management of displaced employees. Hansson and

Wigblad (2006) state that HR can handle those displaced in principally two different ways: a

socially responsible (SR) displacemnt programme or a non-socially responsible (non-SR)

displacement programme An SR retrenchment programme takes into account the demands

of the labour union and cushions the impact of the decision on employees. SR-closures

support the workers’ search for alternatives, provisions of severance pay, educational and

re-training programmes, outplacement assistance and counselling (Richbell 2001;

Hansson and Wigblad 2006). Further, a guarantee that no one needs to be compulsorily

out of work, providing employees the opportunity to choose the time when they wanted to

stop working and the opportunity to transfer according to their tastes or requirements, eases

the process of plant closure (Guest and Peccei 1992). Other issues could relate to modifying

the severance package based on workers’ aspirations, providing assistance and advice about

investments during the process of separation, communication with the union about closure

and having the union agree to the severance package provided confidence to HR managers

implementing the closure programme (Noronha and D’Cruz 2005). In contrast, a

retrenchment programme is non-SR when management moves towards the final shutdown

without considering the demands and requirements of the labour union and the workers

(Hansson and Wigblad 2006). Unfortunately non-SR-closures are the dominant pattern in

practice, because management tends to anticipate a downturn in productivity during the

closedown process (Hansson and Wigblad 2006). However, this distinction between SR and

non-SR polices cannot be compartmentalised in real life situations, since there could be a

considerable mix of HR policies that organisations adopt during the process of closure

(see Noronha and D’Cruz 2005).

Post-closure most of the research on displaced workers argues that those who become

re-employed receive lower rates of pay than they would have if they had not been displaced

(Fallick 1996). One of the reasons for this is that displacement often entails a substantial

loss of industry-specific human capital. Therefore, those with more tenure on the old job as

well as those who change industries or occupations to get re-employed face greater

non-employment and larger wage losses (Podgursky and Swaim 1987; Carrington 1993;

Fallick 1996; Kletzer 1998). However, displaced workers who find new jobs in their

pre-displacement industry earn significantly greater returns to both their pre-displacement

experience and tenure than workers who switch industries following displacement. This

can be interpreted as evidence that workers receive compensation for some skills that are

neither completely general nor firm-specific, but rather specific to a set of firms that produce

similar products and services (Neal 1995).

As a result, some duration of joblessness varies greatly amongst displaced workers.

Some experience no joblessness at all, while a significant number experience very long

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spells of unemployment. Much of this variation is related to the workers’ degree of

attachment to the old sector and the likelihood that the workers would lose something by

moving (Fallick 1996). Thus, improvements in the prospects for employment in their

previous industry induces displaced workers to reduce search intensity or increase

reservation wages in other industries (Fallick 1993). Conversely, an increasing risk of job

loss in the industry of current employment appreciably increases the relative odds of

industry mobility and decreases the relative odds of intra-sectoral mobility (Magnani

2001). With regard to individual characteristics and the labour market conditions, some

argue that individual characteristics play a smaller role than industry conditions and other

economy-wide factors (Carrington 1993). Outcomes for all displaced workers are heavily

influenced by the economic conditions surrounding them (Pinch and Mason 1991).

For instance, poor local and industry conditions increase wage losses, and a weak

macroeconomic environment increases non-employment (Fallick 1996).

Besides, economic cost displaced workers also suffer from non-economic cost such as

lower levels of occupational status, job authority and job autonomy and employer-offered

pension and health insurance (Brand 2006). Moreover, there are also socio-psychological

costs of job loss. Displaced workers experience complex affective reactions akin to the loss

associated with bereavement. A sense of meaninglessness and desperation, loss of self-

esteem, depression and reduced sense of mastery which may culminate in violence or self-

destruction. Victims often resort to defensive coping and recount instances of ill health

(Buss, Redburn and Waldron 1983; DeFrank and Ivancevich 1986). In this regard, social

support clearly reduces stress and mitigates its negative consequences for both health and

psychological outcomes (Sarason and Sarason 1985). The family is a special case of social

support. The family may help the unemployed by offering helpful information and comfort,

material help, decreased consumption or themselves taking jobs and providing an

alternative income to the households (Kahn 1964; Buss et al. 1983; Blustein 1992).

Studies on worker displacement in the Indian context highlight the acute distress that

workers and their families experience. Not only are they unprepared to accept involuntary

unemployment, but they find it difficult to get re-employed because of lack of skills,

oversaturation of the labour market, lack of awareness of opportunities or age-related

factors. Depletion of savings and benefits leads to falling standards of living and

vulnerability, besides impeding the well-being (and hence employability) of offspring.

Loss of self-esteem and meaning in life is also acutely felt (Sharma 1983; Patel 1988;

Noronha and Sharma 1999). Consequently, displaced workers were often deprived of their

dues such as salary, encashment of earned leaves, bonus, gratuity and retrenchment

compensation. Those displaced do not find jobs or found poorly paid jobs with long hours of

work in the informal sector (Patel 1988; RoyChowdhury 1996; Howell and Kambhampati

1999; Noronha and Sharma 1999). As a result, displaced workers made adjustments like

reducing their quality and quantity of food, selling their property, postponing marriages,

withdrawing children from school or putting them to work and so on (Sharma 1983;

Noronha and Sharma 1999).

However, such studies in the Indian context are few, conducted several years ago and

focussed on blue-collar workers in the depressed textile sector. Even in the western

context, not only has little research been done on the impact of closure on white-collar

workers (Hansson 2008), but this work has been predominantly concerned with workers

made redundant by manufacturing firms in older industrial regions and has largely ignored

redundancies in more buoyant labour market areas (Pinch and Mason 1991). Therefore,

this research on call centres is particularly important because it is focused on white-collar

employees in a buoyant labour market.

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The Indian ITES–BPO labour market context

The macroeconomic policies initiated in 1991 resulted in growth rates of over 6% between

1991 and 2004, touching over 8.5% for years between 2003 and 2007 (World Bank 2010).

At this point of time, it is predicted that the Indian economy would grow at 8.5% in

2010–2011 and 9.0% in 2011–2012 (GOI 2010). Besides trade and GDP indicators, the per

capita GDP growth, a proxy for per capita income, has also shown marked improvement in

recent years. From 3.3% per annum income growth for 1998–1999 to 2002–2003, it

increased to 7.3% per annum in the years 2003–2004 to 2007–2008. The growth of real

national income between 1992–1993 and 2005–2006 increased by almost 125% and the

per capita real income increased by almost 77% over the same period. Similarly, the

savings and investment rates grew from a long-time average range of 22–25% to over 30%

in the recent years. In addition, low inflation rates and the external debt burden being

amongst the lowest in the developing world are considered to be laudable achievements of

the Indian economy in the last few years. To a large extent, the ‘miracle’ of India’s

economic growth performance has hinged on the tertiary sector, much of which is

accounted for by the impressive growth in information technology (IT), and in particular,

the export of software and IT-enabled business services–business process outsourcing

(ITES–BPO) (Jha 2009). The industry is estimated to aggregate revenues of US$73.1

billion in 2010, with the IT software and services industry accounting for US$63.7 billion

of revenues. As a proportion of national GDP, the sector revenues have grown from 1.2% in

1998 to an estimated 6.1% in 2010. Its share of total Indian exports (merchandise plus

services) increased from less than 4% in 1998 to almost 26% in 2010 (NASSCOM 2010). In

terms of employment, the ITES–BPO witnessed growth rates of above 25% between 2003

and 2007 (Taylor, Scholarios, Noronha and D’Cruz 2007). Even during the financial crisis

(while many export-related sectors witnessed negative growth rate of employment) the

ITES–BPO sector grew at 4–4.5% between 2009 and 2010 (NASSCOM 2010). For the

financial year 2010, the direct employment in India’s ITES–BPO sector (not including

employment in the IT industry) was at 768,000 (NASSCOM 2010) and was expected to

increase further.

With this backdrop we will now discuss the method and findings of the study.

Method

As discussed earlier, very little is known about the closure processes and the role of HRM.

Further, within organisation studies, closures are assimilated into the literature on

organisational decline or downsizing, often without considering the appropriateness of this

assimilation. This may be due to the fact that from the perspective of the firm, such

closures are a downsizing but from the perspective of the employees they are closures

(Hansson 2008). Nonetheless, we examine the closure of a single unit in the call centre

industry and try to draw lesson from the same for HR practitioners and policy-makers.

The data collection process started as soon as the researchers received news about the

closure. Newspaper cuttings were accessed through the union leaders in Bangalore and the

websites of newspapers like Mid-day and Times of India were gleaned. Moreover, for

several months the World Wide Web was thoroughly searched for all the possible

information available on Ringbell. The organisation website was also accessed and all the

information available, including the picture of the proposed office and the business details,

was downloaded.

Simultaneously, efforts were made to contact all the 93 employees affected by the

closure. However, collating a list of those who worked for Ringbell and their addresses

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seemed impossible for several reasons. First, Ringbell had shut down for at least a month

after which data collection was initiated; second, by this time employees had dispersed and

were involved in their own activity; third, given that closure is a politically sensitive issue

in the Indian context, the CEO was not initially available for a conversation; fourth, after

closure some agents were upset and were not keen to share their insights; and finally, the

lifespan of the organisation that we studied was less than 1 year making it difficult to

contact the displaced employees through institutions like the Provident Fund (PF)

commissioner’s office. Under these circumstances, the only method feasible was a

qualitative study with recourse to snowball sampling.

The effort resulted in conversational interviews (lasting for about one–three hours)

with 22 employees who were working for Ringbell at the time of closure. Those included

were 16 customer service representatives (CSR), 2 quality analysts (henceforth referred to

as verifiers), 2 team leaders (TLs), an acting operations manager (with designation of TL)

and the chief executive officer (CEO). The employees (excluding the CEO) were in the age

range of 20–44 years with the average age being 25 years at the time of closure. They had

worked for about 3–11 months with the average work experience of about 10 months.

Amongst those interviewed, four were women and the rest were men. There were 15

graduates and rest undergraduates pursuing their graduations. Besides the interviews with

those employed at the time of closure, we interviewed four former employees, the canteen

and the transport contractors and union leaders. We also attended the conciliation

meetings between the employer and employees at the labour commissioner’s office. Thus,

methodological rigour in the study was maintained by triangulation of data from various

sources (such as newspapers, websites, interviews with various stakeholders and

conciliation meetings) and through prolonged engagement (Lincoln and Guba 1985) of

about three years in the field.

Though most of the interviews were conducted during the two–three months after the

closure, it took a lot of time and effort trying to engage as many employees as possible.

Except for one interview which was done via chat mode all the other interviews were

conducted face to face in English. Permission to record the interviews on audiocassette

was sought, and participants agreed to the same. All interviews were later transcribed

verbatim by the research staff.

The treatment and analysis of data were carried out as described by van Manen (1998).

That is, thematic analysis was employed to grasp and make explicit the structure of

meaning of the lived experience prior to and post-closure. Each transcript was read

repeatedly, and significant statements relating to and illustrating the various dimensions of

the essential theme were identified and demarcated using the sententious (where we attend

to the text as a whole and capture its fundamental meaning) and selective (where we

repeatedly read/listen to the text and examine the meaning of statements that are

particularly revealing) approaches. Labels were then assigned to these categories/pat-

terns/themes and later standardised across transcripts. Within each transcript,

categories/patterns/themes were examined for their inter-linkages. A comparison across

transcripts was undertaken to highlight congruence in the patterns/categories/themes and

their linkages across participants. Next, across transcripts, those categories/pat-

terns/themes that dovetailed together in meaningful, yet distinct ways were developed

into major themes. Finally, the core theme and its constituent themes were joined into a

text that captured participants’ lived experience in its completeness. The present paper

puts forth overarching core theme of ‘cornered by conning’ that captures participants’

experiences. The sub-themes like ‘attracting the workforce: the dream and the reality’,

‘conning the customer’, ‘financially paralysed’, ‘the closure process – delaying the

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inevitable’, ‘finally cornered’ and ‘beyond closure’ all contribute to the understanding of

the core theme. Finally, to protect the identity of the organisation all the names have been

changed and pseudonyms adopted. However, like most other studies on closure it is

recognised that the findings of this research are based upon a single case study making

comparative analysis difficult. Moreover, a small sample size for the reasons stated above

inhibits generalisations.

Findings: cornered by conning

Company background

Your Telecom Limited (YTL) is a 30-year old ICT solutions company based in Bangalore,

with wide-ranging business interests in telecom networks, e-governance networks,

banking and solutions for the transport sector. In 2003, YTL invested $12 million in the

BPO venture called Your Inter-Active Centre Limited (YICL) to build a 250,000 square

feet office space at Whitefield in Bangalore. An advisory board drawn from Your

Telecom’s other businesses was constituted to advise the BPO venture. YICL began

operations in 2004 with the revenue targets in the first year being $25 million that it hoped

to triple to $75 million in the following two years. By 2007–2008, YICL expected to be a

$250 million entity. In 2004, the company also announced ambitious plans of becoming

the second largest BPO company in India after General Electric (GE), growing from an

operation of about 100 seats to 4000 seats in three years by adding 250 seats every 60 days.

YICL identified IT and telecom, travel and hospitality, utilities, healthcare, HR, retail, and

banking and financial services as verticals for its BPO business. To achieve these goals,

Mr Mahesh Ghori was appointed as CEO of YICL. However, by July 2005 Mr Mahesh

Ghori in collaboration with one of the YICL clients’ M/s. Ringbell Communications Ltd

(UK) set up their own company M/s. Ringbell Communications (India) Ltd (henceforth

referred to as Ringbell).

Attracting the workforce: the dream and the reality

Ringbell was a third party centre which was in the business of reselling 3G and T-Mobile

phones to UK customers under the identity of ‘promotions today’. Though the organisation

began operations on 11 July 2005, the company was formally launched in September 2005

with celebrations at a five star hotel, Le Meridian, in Bangalore. In contrast to YICL, which

invested in building and equipment, Ringbell, except for owning about 5–10 computer

systems, rented out both the factors of production. Some agents alleged that Ringbell

operated from centres that were vacant but not technologically efficient. Initially, the

Customer First (a call centre in Bangalore) premises at Jal Bhavan were rented out, but by

December 2005 Ringbell moved (for reasons discussed later) to premises of Nirvana

(another call centre) situated at Whitefield on the outskirts of Bangalore.

To begin its operations, Ringbell recruited the first batch of 25–30 agents who had

worked on the same process at YICL. The vision of the CEO Mr Mahesh Ghori (who

moved from YICL to set up Ringbell), as well as the rumours of YICL closing down,

compelled the agents to join Ringbell. The rest of the workforce was recruited from

reputed companies like 24X7, Dell, Firstsource, HTMT and Transworks, through

consultants, referrals and advertisements in local newspapers. Being a start-up

organisation, the organisational structure was flat; there were two trainers, two HR

executives, four verifiers, three TLs, three IT specialists, an operations manager and a

CEO looking after the day-to-day functioning of the organisation. Ringbell mainly

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operated out of Bangalore with minor operations being initiated from Delhi and

Chandigarh only a few months before closure.

Ringbell being a start-up, the founders tried to construct normative, pragmatic and

cognitive legitimacy by deploying evocative symbols (Dowling and Pfeffer 1975;

Suchman 1995) and by conforming to the dominant isomorphism prevalent in the industry

(Golant and Sillince 2007). Accordingly, at the launch, it was highlighted that one of the

partners in the venture was Mr Manuel Bended’s (English football player) brother-in-law

Mr Flyden Instead, who had married Mrs Winner Bended’s (Bended’s wife and pop star)

sister, Elisa. A grand picture was constructed of the organisation wanting to build and

move into its own premises in the near future. The future building depicted on the website

of the company was supposed to be one of the most modern and spacious, state-of-the-art

spaces to be built at the electronic city on the outskirts of Bangalore. All this convinced

agents attending the launch about the genuineness of the organisation. Second, the

legitimacy of Ringbell was emphasised by trying to implement socially acceptable/desir-

able norms, standards and values through its high-commitment management (HCM)

practices. In this effort to gain legitimacy, Ringbell copied existing organisational form

with a few modifications, signalling a tendency towards a mimetic isomorphism. Ringbell

was portrayed as a captive centre of UK’s ‘largest mobile phone company’, paying salaries

above the prevailing market rate for a five-day working week. The most attractive

proposition was payment of incentives and commissions to Ringbell employees. These

were considered to be 150% above the market rate and were proposed to be paid at the end

of every week. At the time of induction, agents were told that an average of two sales per

day for an entire month would fetch an incentive of Rs 14,000, while for an average of

three sales per day for the same period would make them richer by Rs 25,000. Besides this

there were prizes which that included TV, DVD players, etc., for the top performer, cash

prizes of Rs 2000 to the top five performers, power hours with on the spot incentives that

ranged from Rs 50–300 depending on the plan sold and public acknowledgement of

outstanding performance. Other distinguishing features included payment of salaries

between the first and fifth of every month, career growth within six months of joining,

choice of vegetarian and non-vegetarian meals and the provision of good cab facilities

(whereby the travel time to office was reduced to no more than 45 minutes to an hour) and

regular open house meetings with the CEO. By December 2005, Ringbell was to expand

both in terms of number of seats (to a 1000 seats) and also in terms of processes.

These claims of legitimacy were evaluated by the employees. To the credit of

Ringbell, it did strive to pay salary and incentives above industry standards, an open house

was held every month, it provided good cab facilities and spent Rs 75 per head on a

five–seven course meal for the employees, especially in the early part of its life cycle.

The employees savoured the team bonding and collegiality that existed at Ringbell.

The colleagues on the floor were referred to as family and supported each other. They went

to the extent of transferring sales from their own accounts to that of their colleagues’

account so that those not performing could keep their jobs.

However, the policy of on the spot dismissal was criticised by managers, agents, TLs,

with even the CEO blaming the UK management of cultural indifference. Agents could be

dismissed without notice and without payment of salaries for failing to meet targets. Even

fresh recruits were not given time to settle down. Failure to meet targets not only led to

withdrawal of breaks, but also to a volley of abuses laced with threats of not sending the

cabs to pick them up for work the next day. Besides this, the payment of salaries was

always delayed, incentives disputed, heavy fines imposed for carrying mobile phones on

the floor, no locker facilities provided, deduction of two days of salary for one day of

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absence, there was no cafeteria, no proper training equipment provided, feedback was

ignored, there were long hours of work and a six-day working week. Moreover, the HR

department was not only inadequately staffed with underpaid and unqualified personnel,

but was as good as non-existent, with the function being centralised at the level of the

CEO. Thus, HCM practices could not camouflage the organisational interest embodied in

the ‘sacrificial HR’ (D’Cruz and Noronha 2011) strategy implemented at Ringbell.

Conning the customer

As mentioned earlier, Ringbell was a telemarketing company that sold mobile 3G and

T-Mobile phones to UK customers. There were no dedicated teams selling 3G or

T-Mobile. Agents were expected to have knowledge of both the products and switch from

one product to the other depending upon the customer preferences. At Ringbell the sale of

3G was emphasised over the sale of T-Mobile. The reason being that the commission that

Ringbell earned from the sale of a 3G connections was higher than that earned from the

sale of a T-Mobile connections. Moreover, Ringbell received quick reimbursement from

3G as compared to T-Mobile. T-mobile products were sold to only those who were

contacted for 3G connections but did not have a credit card (a prerequisite for those who

wished to acquire 3G phones).

In July 2005, the operations began with M/s. Ringbell Communications Ltd (UK)

making available to the Indian colleagues a database with thousands of records of

telephone numbers in the UK. This information was held on a network server, with links to

all agents logged in. The same network server was linked to a predictive dialler. This

dialler worked through the dialling lists and used call-progress detection to understand

whether the call was busy, received by an answering machine or answered by a person so

that the agent could focus only on live contacts. However, there was always a possibility of

abandoned or mismatch calls being generated when the dialling system (automatic or

predictive) got more live parties on call attempts than there were agents available to take

those calls, and consequently disconnecting calls that could not be distributed to an agent.

At Ringbell not only was the abandonment rate high, but very often the number of

employees available for the shift exceeded the equipment available, as a result agents were

expected to grab the headsets if they wanted to call. Moreover, some employees also

accused the management of being biased with some agents getting good leads, while

others struggling. The former operations manager stated that this was because campaigns

were fine-tuned at Ringbell. Automatic lead selection or lead steering was used to improve

efficiencies, whereby management designated what type of leads go to which agent based

on factors, such as skill and past performance and percentage likelihood of closing a sale

or generating a lead. Nonetheless, according to the former operations manager, the

industry sales per day per agent average was 1.1 or 1.2, but at Ringbell it was 1.7–1.8

sometimes touching 2 sales per agent per day. The stuck deal rate was around 0.7 and the

average for the industry was 0.3–0.35.

Even if one discounted con sales which were about 25%, the average sales per agent per daywas higher than the industry benchmark.

Agents used their skills and ingenuity, whereby the stuck deals1 were leveraged by

calling back customers who were happy with the product and could provide fresh leads –

references to other customers. However, this took a turn for the worse, when agents began

to game the system. This meant typically an agent would entice customers to cancel

existing connections and to reconnect with better offers which were put up as fresh sales to

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the client organisation. Not only did the client organisation not expand its customer base,

but customers who cancelled their original connections also found that they had been

cheated by the agents. Thus, soft discourse of caring and quality failed to find any genuine

commitment (Mullholland 2002) as the market saturated.

I think false sale here meant calling a customer who I had sold to a few months ago and tellinghim/her that I have a better plan this time. ‘Why don’t you take this plan and cancel the earlierone’. Those kind of sales were made and those were the sales which came back, because as aclient you given me one customer, then you call up the same customer again ask her/him tocancel the previous plan and subscribe to a fresh plan. This is gaming the system, its false,that’s what they did. So as a client I do not profit. I am paying you commission for giving meone customer and you bring back the same customer again and again. ‘Why should I pay youagain and again? Instead, I fine you.’ That’s what happened.

However, part of the reason for con sales was because there was no silent monitoring

of agents’ live calls, while a heavy reliance was placed on evaluation of recorded calls.

This practice was contrary to the observations that those call centres which are more

target-focused are the most heavily monitored, while those which incline towards the

service, quality-focused end of the spectrum are less likely to observe the full application

of the full range of surveillance mechanisms that technology permits (Taylor and Bain

2001). Besides this, the procedure for the verification of the agents’ call was weak.

Generally, after a sale is made, the verifiers’ reconnect with the customer and confirm the

information provided by the agent after which it is sent out to the client for final dispatch.

The reason for this evaluation is to simply ensure that every sale is verified as an actual

sale, and that a customer is not billed for something that they truly did not want nor

ordered. This process ensures quality and a higher customer stick rate. At Ringbell, the

information provided by the agent was not verified and only the terms and conditions were

checked with the customer. Further, verifiers who had to check the authenticity of the deal

were directed by the CEO to either convince the customer or pass the sale hoping that

the client (in this case 3G) would fail to recognise the bluff. In this way, the agent and the

organisation (Ringbell) saw in it a win-win situation. The agent got an incentive and

the organisation could increase its income at the expense of the client. Thus, while

management often seeks to achieve both high customer service quality and high customer

processing levels, it is the output targets that invariably take precedence over service

quality (Taylor and Bain 2001; McPhail 2002). In fact, although employees are often

monitored for service quality, there is normally greater pressure placed on productivity.

In addition, customers of Ringbell were not enlisted by management to jointly supervise

employees through the feedback mechanisms instituted as in other organisations. They

could not lodge complaints about poor quality with the service provider.

However, soon the UK client (3G) identified a pattern in the deals struck by Ringbell

agents with their customers and refused to make payments for such sales. In fact, media

reports suggested that the suppliers sued the company for 300,000 pounds. The verifiers

accused the CEO of passing the sales in spite of bringing it to his notice that things were

not right in the organisation. According to them, careful monitoring and surveillance with

the aim of providing agents an opportunity to get constructive feedback on their

performance (Callaghan and Thompson 2001; Lankshear and Mason 2001) would have

salvaged the situation. Those giving 15 sales in two days were immediate suspects;

however, action to stop reference sales was only taken in May 2006, a bit too late. Thus,

the dishonest agents was not only rewarded, but got away without being punished. Though

employees acknowledged that some of their colleagues were responsible for the poor

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quality, it was the CEO and the UK partners who were ultimately liable. The CEO in his

defense blamed the UK office for not conducting the verification at the point of dispatch.

The biggest mistake was made in the UK. Our quality department use to check our sales whichwould then go for dispatch. The dispatch department then requires to verify the order even ifthe quality approves the sales. This process was stopped in the UK.

Nonetheless, at the organisation level too, Ringbell ran fraudulent programmes such as

‘freedom to fun’ so designed that the conditions laid down would never allow the customer

from availing of those schemes.

I don’t know anything about this but there were lot of catches. Like you know there is aholiday package free for you, absolutely free of cost and the catch is unless s/he provides XYZdocuments, s/he is not eligible. This bit of information is never conveyed on the call . . . everysale is like that. It’s a disease.

To conclude, an agent summed up that ‘the closure of Ringbell was everyone’s fault’.

The agents, the verifiers, the operations managers, the HR, the CEO and the UK-based

managing director were involved in conning.

Financially paralysed

Apart from failing to balance customer satisfaction and customer throughput, the closure

of the organisation, according to the former operations manager, was also due to the poor

leadership of the UK-based entrepreneur which got reflected in autocratic management,

lack of branding, no planning, no direction, lack of vision, lack of experience, lack of

investment and unethical practices.

Instances of these were in abundance at Ringbell. To begin with, Ringbell had no call

back facilities and agents were directed to provide phone numbers (to customers who

asked for the same) of the 3G captive centre operating out of Mumbai. This led to a lot of

confusion, when customers contacted by Ringbell got in touch with agents at the 3G

Mumbai office. To overcome this problem, the ‘promotions today’ introduction used by

Ringbell agents was dropped, but this did not overcome the problem of lack of call back

facilities to customers.

Apart from failing to invest in appropriate technology, Ringbell also failed to invest in

training of HR. Agents complained that they had to extensively rely on their own abilities

and skills rather than learn through organisational training. The CEO while confirming this

practice stated that training was not required to be imparted to those who had sufficient call

centre experience. However, interviews with agents revealed that even those with no prior

call centre experience were expected to brush up their selling skills on the job. Thus,

Ringbell seemed to operate on a small budget even though it is well established that

outbound call centres require a good amount of working capital.

The most embarrassing incident was witnessed when the organisation decided to move

from Customer First premises at Jal Bhavan to Nirvana. The Ringbell employees were

advised by the management to vacate the Jal Bhavan premises surreptitiously. However,

when the Customer First officials got to know about this move, they locked up the Ringbell

employees and confiscated their computing systems. Though there were valid reasons for

Ringbell to resort to this action which was related to the unresolved dispute between

Ringbell and Customer First about the payment for downtime and quality of systems

provided, the operation manager admitted that this incident was very embarrassing.

Nonetheless, this incident uncovered the desperation to implement cost-cutting

measures which finally led to the dismissal of 35 employees who belonged to the pilot

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batch in November 2005. These agents were told to improve their performance within a

week failing which they would be dismissed. However, even before a week elapsed, agents

were told to discontinue their association with Ringbell and their pickups were

immediately discontinued. Agents dismissed argued that there was a deliberate attempt to

get rid of them as the organisation could not keep the promises made at the time of

opening. They were targeted since they had begun to voice their displeasure about salary

increases, incentives and the promised career growth for those staying beyond six months.

Managers who were party to the decision to dismiss the agents confirmed the accusation.

In fact, initially the agents were dismissed without payment of salaries with the CEO

challenging them to go to court, it was only after the union (UNITES Professionals – see

Noronha and D’Cruz 2009b for discussion on the union) intervened that the agents were

paid their 15-day salary in lieu of one-month notice which is generally the industry norm.

Further, the agents who were not dismissed were told that the operations once shut at

Jal Bhavan would be restarted at Mahatma Gandhi road in the centre of the city. However,

this did not happen; the operations were revived at Nirvana which was located at

Whitefield on the outskirts of the city making travel to place of work very inconvenient.

To compensate for this distance, all the agents were initially told that they would be paid

Rs 1000 more, but later this facility was limited to senior call centre agents many of whom

were already dismissed by then.

Nearer to the closure, food provided by the organisation deteriorated; floor incentives

initially provided to employees were discontinued or were reduced to foodstuffs such as

wafers, chocolates or biscuits; employees were threatened that if they did not meet their

requisite sales targets the cab would not pick them up for work. Unlucky draws were also

held to get rid of agents who were not performing.

The roots of this financial crisis can be traced to the inception of the organisation.

Ringbell had defaulted in the payment of Rs 5,852,220 to YTL. YTL filed a civil suit

before the City Civil Court, Bangalore, against (1) Ringbell Communications Ltd (UK),

(2) Mr. Mahesh Ghori, and (3) Ringbell Communications (India) Ltd for recovery of the

aforementioned amount and restraining them from contacting any clients of YTL and from

carrying on the business of Ringbell during the subsistence of the agreement between

Ringbell Communications Ltd (UK) and YTL.

All this presented Ringbell as a young organisation which was resource-strapped,

having little experience, few constituencies of support and social capital, unable to bear

the costs of learning new tasks and processes or the cost of investing in new roles, lacking

the co-ordination between roles, the absence or weakness of formal structures and the lack

of stable links with customers.

Finally cornered

Delaying the inevitable

Not surprisingly, when salaries for May 2006 were not paid on time there were rumours

that the organisation would shut down, these were denied by the CEO time and again.

In fact, there was constant effort by him to camouflage the eventual closure. The agents

alleged that in the third week of May 2006 the CEO was summoned to UK following

which agents claimed that his behaviour had changed making them suspicious of the

eventuality of closure. However, the CEO later in the open house maintained that all was

well with the company and it was expanding operations by acquiring a mortgage process

and increasing the seats to 200. They would also immediately move to new premises on

Church street in the centre of the city. When questioned by the agents on Monday, 5 June

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2006, about their salary, the CEO guaranteed full payment by Wednesday, 14 June 2006.

Later, on Sunday, 11 June 2006, the CEO as usual organised a cricket match with all the

agents. The cricket match played put the agents completely off guard. Only, when on

Monday, 12 June 2006, the cabs were not sent to pick the agents for the shift on the pretext

that the dialler had developed a malfunctioning, that some agents began to doubt the

continuity of Ringbell since dialler malfunctioning did not require closing down of the

process for the entire day. The dialler had worked efficiently at Nirvana and any

malfunctioning could be repaired in less than 20 minutes. Finally, their suspicion was

confirmed when the cabs did not turn up on Tuesday, 13 June 2006. On 14 June 2006, the

CEO finally convened a meeting of the acting operation manager and a few TLs and

conveyed to them the message of closure. Prior to this the TLs or the acting operations

manager claimed that they had no hint of closure. When interviewed the CEO

acknowledged that the closure was discussed with the UK management a day before the

cricket match on 10 June 2006, but he could not convey the same to the agents as he was

still trying to salvage the situation. However, the agents disagreed and stated that the

closure was on cards since 16 May 2006 as Ringbell had not renewed its contract to use the

facilities at Nirvana. The CEO insisted that he had no knowledge of the closure was in

sharp contrast to the discomfort experienced by managers who intend to convey this

message to those impacted by closure (Noronha and D’Cruz 2005).

Facing the music

In any case, closure mobilises the employees to seek wider support for their resistance and

address the perceived sense of injustice (Hardy 1985). In the case of Ringbell too, the

immediate response to the closure was to initiate some action against the employer, but the

employees because of the lack of work experience were directionless. Some agents who

discussed the matter amongst themselves contemplated police action. However, a large

number did not want a police probe as they were afraid of the CEO’s influence and money

power. Moreover, approaching the police station would attract unnecessary media

attention hampering their job search besides it being a waste of time. As a result, on 14

June 2006 about 10–15 employees spent the whole night trying to file a case of fraud

against the CEO at police station. These agents stated that had they found the CEO that

night they would have belted him. They went searching for him at all the known locations

that he frequented as there was a rumour that he would flee to Singapore. These reactions

were similar to those observed elsewhere where workers adopted harsh tactics in the form

of threats and abuses towards the management, stoning their cars and making threatening

death calls (Noronha and D’Cruz 2006).

The next day when the CEO got to know about the attempts to file a case against him,

he threatened the employees that he would not only withhold their salary but would also

charge them with false cases of drug abuse or even arrange to kill or beat them up. Instead

of succumbing to the threats from the CEO, the employees took the issue to the press and

several newspapers covered the case for at least a week. The impact of the media coverage

resulted in the CEO trying to placate the employees with cash payment of Rs 2500 per

employee if they withdrew the case. However, the agents refused the offer as this was a

meagre amount as against a total amount of Rs 60 lakh (which was salary for the month of

May and June 2006 and incentives for the month of May 2006) as per their calculation.

When the overtures and threats made by the CEO to the employees failed to make any

impact, the CEO claimed that he was just an employee and was in the same boat as the

agents. Rubbishing these claims the agents insisted that the CEO was a partner in the

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venture and could not escape responsibility. Agents argued that since the CEO was an

appointing and a disciplinary authority he was liable to pay them their full salaries. In all

this, it was clear that the CEO did not want a complaint to be lodged against him so that his

career would not be impacted. Instead he held Ringbell Communications Ltd (UK)

responsible for defaulting on payment of salaries. Clearly then, these management

strategies used approximate a non-SR closure procedure with a total disregard for

employees welfare (Hansson and Wigblad 2006).

An unfair deal

In fact communication which is probably one of the most significant aspects of the closure

process was totally absent. By being accessible and interacting frequently with employees,

the management is in the position to provide reassurance to those in need of it by clarifying

the situation and being honest and open about its consequences (Noronha and D’Cruz

2005). On the contrary at Ringbell, the employees felt cheated, bluffed and hurt because

there was a constant denial that the organisation was going to close, while the numerous

events only enhanced their suspicion. They were a bit shocked because they had begun to

plan the first anniversary celebrations of Ringbell. Those who had left better organisations

for Ringbell rued their decision, while others were upset about having referred their

friends to Ringbell. For most, the shock was related to not getting their salary rather than

losing their job since their relationship with Ringbell was merely transactional. The loss of

salary made it difficult for them to take care of their immediate expenses such as daily

rations, payments to maids, newspapers, house rent and loan installments. Those

particularly affected were migrants to Bangalore with some of them being asked to vacate

their paying guest accommodation immediately.

Whatever be the reason for closure, managers and employees held that the firm should

have closed down in a fair manner giving due notice and paying the employees their dues.

Some agents argued that gone were the days when employees would take to the streets

and resort to violence against the closure of the organisation. In fact, citing an example

from an earlier organisation in which they worked employees stated that the move to

inform in advance about the impending closure was well appreciated by the agent and

helped the agents to not only search for jobs, but also plan their future as observed

elsewhere (similarly see Ehrenberg and Jakubson 1989; Addison and Portugal 1992;

Magnani 2001).

When I was working in Vguarding the same thing happened. The company was kind ofsinking. Then our Ops Manager called a meeting and told everyone directly that the companywas likely to shut down. ‘So whoever would like to look for other options please could goahead’. This was a decent way of informing people and we were expecting the same atRingbell.

In the case of the present closure at least a month’s salary should have been paid to

the employees in lieu of the notice. Thus, there was willful inaction to honour the terms

and conditions of employment by Ringbell. Moreover, instead of informing them

about the closure in the middle of the month, such information would have been welcome

in the beginning or at the end of the month. Apart from not informing employees

about the impending closure, the Ringbell management had not issued form 16

(a document needed by employees to file income tax returns) that was a proof of the

amount of tax deducted at source by the employer. Ringbell had also failed to deposit

the PF after January 2006 with the PF commissioner’s office though it had deducted

the same.

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Beyond closure

The economic losses did not overshadow their coping strategies. Most of the agents

observed that they had to think positively and stay calm to overcome the financial trouble

that they had been ambushed with. The employees comforted themselves by feeling lucky

that their losses were insignificant compared to employees suffering from closure

elsewhere. Some drew strength from astrology, while others were more realistic about life

not being a bed of roses, accepting that bad patches were a part of life.

Since the savings that they had at the time of closure could only last them for about a

month or two. They now realised that it was important to save for a crisis. Agents alleged

that the CEO enjoyed in five star hotels of the city while they had to curtail their

expenditure. Some adjustments were made to their dietary habits by reducing their

non-vegetarian intake while simultaneously curtailing their expenditure on travel,

cigarettes, parties, marriages, social occasions, dining out, going to movies or pubs,

meeting friends and use of personal vehicles. Their dreams of buying cars and homes were

shattered. They borrowed from friends, parents or used their credit cards during their

financial crisis. Women employees stated that they had lost some of their economic

independence in spite of having supportive husbands. However, not being married to an

employee in the same sector or organisation helped them to cope with the financial crisis.

The analysis of how the family responded to the employees losing their jobs was

contingent on the nature of the relationship. Some found it difficult to explain to their spouse

why they were not paid for the days they attended office, while others told their parents about

losses only because they ran out of money. Some parents were happy that the organisation

had closed down so that their wards would further their education, while other parents

consoled their children that they would find another job easily. For migrants, it was easier to

keep the information about closure to themselves as compared to non-migrants who lived

with their families. However, those migrants who sent remittances home were upset that

they could not support their families anymore. Similarly, migrants with close family ties

wished that their family members were around to help them in this hour of crisis. Employees

who constantly informed their families about the happenings at Ringbell found it easier to

cope as they got sound advice. Like elsewhere, this type of support helped to better appraise

career-related information and adapt to the novel circumstances (Blustein 1992). It was rare

that employees shared information about closure with relatives (other than close family

members) and neighbours as they were ashamed of being associated with a company like

Ringbell.

Apart from the family and friends the only other source of support through the crisis

came from UNITES Professionals who took up the case with the labour commissioner.

This action of the union made its relevance felt amongst the agents. Even the operation

managers argued that unions were relevant to the sector so that they could intervene and

guide or monitor organisations. Areas in which the union could act as a watchdog were

identified as hours of work, PF, timely payment of salaries and issues of harassment. Union

could prevent the recurrence of Ringbell by addressing the issues of inequitable power and

injustice between employers and employees. However, most employees in their post-

displacement jobs were not ready to reveal to the management that they were members of

the union as they feared victimisation.

On the whole, employees were not too unhappy with their experience at Ringbell. It

provided them a launching pad for their careers in call centres and the incentives paid were

better than those prevailing in the industry. Though despondent, many stated that there was

no time to feel depressed and jobs had to be found immediately.

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Job search: from high earnings to job security

Except for one agent, those interviewed mainly looked for jobs in Bangalore within the

ITES–BPO sector. One reason could be that displaced workers uproot themselves from

their network of family and friends only as a last resort (Anderson 1980). While the ITES–

BPO sector was booming, the other sectors were not an option because of the lower salaries

and the inability of undergraduates with little or no technical skills to get employment

(Budhwar, Varma, Singh and Dhar 2006; D’Cruz and Noronha 2006; Poster 2007).

Another reason for job search within the same industry was that the specific skill set needed

for a job in the call centre was not sufficiently valued by those outside the call centre

context (Belt, Richardson and Webster 2000; Buchanan and Koch-Schulte 2000).

Moreover, the confidence levels of those displaced were high as they were sure of

finding good jobs given their positive perception of the external labour market. For them,

the closure of Ringbell did not signal the doomsday for the sector. Jobs were available and

the experience at Ringbell helped them to find jobs elsewhere given the high-attrition rate

in the ITES–BPO industry. Such was the demand for the agents that some organisations

did not even interview them. Agents provided their salary slips to organisations and in

return were given a joining letter. Some were even able to get ex gratia payments from

their new employers to tide over their financial difficulties. In fact, as soon as Ringbell

closed down agents got calls from consultants and other call centres offering them a job.

For many of them, it was just a matter of entering different doors at Nirvana.

Though they had several calls for interviews most of the Ringbell agents took up the

first offer letter they got because they had not received their salaries and incentives for

one and a half month and had exhausted all their savings. However, the agents continued to

prefer the UK processes over the US processes while as found elsewhere, women and men

did not differ in their chances of reemployment in an expanding local economy (Perrucci,

Perrucci and Targ 1997). Nonetheless, the process of searching for a job was complex. It

varied from person to person depending on the emphasis that employees placed on job

security, future career prospects and job designation at the time of closure.

Job designation played a very important role in job search, especially in the case of

those who had been promoted to TLs or were acting (performing jobs at a higher level

without a formal letter of appointment to the post). Some of them in order to maintain their

position preferred to shift to the domestic call centres where they would get similar

positions and maintain their salaries. Moving to an international call centres with the

designations that they had achieved at Ringbell was next to impossible, though they were

likely to maintain their present earnings. A new job would certainly entail an increase in

the basic salary of about 10%, irrespective of whether the recruiting organisation knew

that they were urgently in need of a job. This was in sharp contrast to the loss of earning

hypothesis for those displaced discussed earlier in the literature (see Fallick 1996).

Agents for whom designations did not matter found jobs with well-known names such

as Aviva, HP, HSBC, HTMT, Nirvana and Unisys with better salaries, terms of

employment and job security. This was especially the case with verifiers, who had no

choice, as promotions in their sphere of activity were limited, while for others job loss was a

blessing in disguise (Zikic and Klehe 2006) as they achieved their aspirations of moving to

technical processes in keeping with their qualifications. Rather than higher earnings,

regularity of income seemed important given the experience in Ringbell (where they were

always concerned about getting their salary on time). For most of them, job security and

regularity in the payment of salary were inter-related. These employees looked to join

organisations which had a large number of processes providing them with enough of

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options in times of crisis. They also looked at the longevity of the company, its reputation,

infrastructure and the attrition rate before joining the company. Clearly, they now only

wanted to work for well-established branded fortune 500 firms having captive call centres

rather than start-ups. As a part of their strategy to work in well-established organisations,

former employers were contacted and caution was exercised when searching for a new job.

The agents preferred referrals to other sources of recruitment as they considered this

information to be more authentic while verifying the credentials of the prospective

organisation. However, they could not rule out the possibility of experiencing a similar fate

in their new organisations. In spite of this clarity, some worked with small organisations

providing high incentives but left immediately once they found the resemblance to Ringbell

to close for comfort.

Those who could rely on family financial support were not enamoured by job security.

For these agents, what mattered most was a collegial culture which existed at Ringbell.

Moreover, security was not an issue as jobs were available in plenty and one could keep

moving from one job to another in search of better positions and higher salaries. They had

made investments and formed social ties making it onerous for them to move

(Fallick 1996). Only when the process of revival looked slim, agents began to search for

jobs. Nonetheless, for most displaced workers any proposal of working at Ringbell again

could only be considered once they received their full salaries and incentives.

Conclusion

It is now well established that the twin objectives of reducing costs per customer

transaction and simultaneously encouraging the employees to be quality-orientated are

fundamentally contradictory. In the context of Ringbell, the inability to manage this

conflict was the primary reason for closure resulting from an adverse action such as

conning of the customer. This was complimented by a lack of resources and an overall

neglect of HRM practices resulting in poor performance management systems, lack of

training and poor leadership. Moreover, at Ringbell, rather than management using its

discretion about whether to implement any or all of the monitoring capacity of the ICTs in

a call centre (Lankshear and Mason 2001), financial constraints limited the installation of

appropriate technology. A careful monitoring and surveillance with the aim of providing

agents with constructive feedback on their performance (Callaghan and Thompson 2001;

Lankshear and Mason 2001) would have prevented such a situation from arising.

Mimicking the industry-level HCM practices could not camouflage the underlying

organisational interest of making quick profits (D’Cruz and Noronha 2011). Not

surprisingly then, the HR practices followed by the management during the process of

closure can be labelled as non-SR policies confirming to the dominant trend noticed by

Hansson and Wigblad (2006). Not only was the decision not communicated in advance to

the employees, but they were also deprived of their salaries and incentives for the last few

months that they worked with Ringbell. In fact, expecting the management at Ringbell to

implement SR-closures policies such as supporting the workers’ search for alternatives,

providing for severance pay, educational and re-training programmes, outplacement

assistance and counselling seemed ridiculous.

Most employees, post-displacement, searched for jobs within the ITES industry. Given

that the closure took place in a buoyant economy, in most cases they were able to find jobs

almost immediately. This seemed the best way of coping with the situation. Further, given

the buoyant ITES economy, these jobs were better paying in well-established

organisations. This is in keeping with Neal’s (1995) observation that displaced workers

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who find new jobs in their pre-displacement industry earn significantly greater returns to

both their pre-displacement experience and tenure than workers who switch industries

following displacement. In fact, some thought of the job loss as a blessing in disguise with

the only dissatisfaction being non-receipt of salaries and incentives. Further, those who

had moved up the ladder at Ringbell preferred to wait until better opportunities came by.

Non-economic factors such as career progression, regularity in payment of salary and job

security seemed far more important than economic factors during the period of job search.

Implications

Given that the growth of Indian call centre industry has been driven by the motive of

reducing costs (Taylor and Bain 2005) with overwhelming pressure for clients

(Noronha and D’Cruz 2009a, b; D’Cruz and Noronha 2011), there is always the

temptation of neglecting quality. This was particularly so in the case of Ringbell where

employees resorted to conning the customers to meet targets and be eligible for incentives.

The situation was exacerbated by no proper HR systems. This implies that organisations

with poor HR systems unwittingly invite closure. In the present case, the lack of an

adequate performance management system was primarily responsible for organisational

failure. The role of HR practices becomes all the more significant when organisations are

faced with closure. In such circumstances, the cornerstone of any SR retrenchment

programme has to emphasise clear-cut communication and advance notification to

employees faced with closure. Other SR policies could emphasise help related to

job search, provisions of severance pay, educational and re-training programmes,

outplacement assistance and counselling. The job search criteria used by displaced

workers in this study provides some insights for the problem of high labour turnover faced

by the buoyant ITES industry. Probably, non-economic factors such as career progression,

regularity in payment of salary and job security may provide some of the answers to the

problem.

Note

1. At Ringbell any deal with a customer who kept the product for more than 21 days wasconsidered a stuck deal. If the number of customers keeping the product increased due to qualityinitiatives higher was the stick rate.

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