The Phonemin Company is a distributor of men's and women's casual clothing.

It sells exclusively through its merchandise catalog, which is published four times

per year to coincide with seasonal changes in customers' apparel tastes. Custom-

ers may order merchandise from the catalog via mail or over the phone. Currently,

70% of orders are phone orders, and the organization expects this to increase to

85% within the next few years.

The success of the organization is obviously very dependent on the success of

the telephone ordering system and the customer service representatives (CSRs)

who staff the system. There are currently 185 CSRs; that number should increase

to about 225 CSRs to handle the anticipated growth in phone order sales. Though

the CSRs are trained to use standardized methods and procedures for handling

phone orders, there are still seemingly large differences among them in their job

performance. CSR performance is routinely measured in terms of error rate, speed

of order taking, and customer complaints. The top 25% and lowest 25% of perform-

ers on each of these measures differ by a factor of at least three (i.e., the error rate

of the bottom group is three times as high as that of the top group). Strategically,

the organization knows that it could substantially enhance CSR per for mance (and

ultimately sales) if it could improve its staffing "batting average" by more accu-

rately identifying and hiring new CSRs who are likely to be top performers.

The current staffing system for CSRs is straightforward. Applicants are recruited

through a combination of employee referrals and newspaper ads. Because turnover

among CSRs is so high (50% annually), recruitment is a continuous process at the organization. Applicants complete a standard application blank, which asks

for information about education and previous work experience. The information

is reviewed by the staffing specialist in the HR department. Only obvious misfits

are rejected at this point; the others (95%) are asked to have an interview with the

specialist. The interview lasts 20-30 minutes, and at the conclusion the applicant

is either rejected or offered a job. Due to the tightness of the labor market and the

constant presence of vacancies to be filled, 90% of the interviewees receive job

offers. Most of those offers (95%) are accepted, and the new hires attend a one-

week training program before being placed on the job.

The organization has decided to investigate the possibilities of increasing CSR

effectiveness through sounder staffing practices. It is not pleased with its current

methods of assessing job applicants; it feels that neither the application blank

nor the interview provides an accurate and in- depth assessment of the applicant

KSAOs that are truly needed to be an effective CSR. Consequently, it engaged the

services of a consulting firm that offers various methods of KSAO assessment,

along with validation and installation services. In cooperation with the HR staffing

specialist, the consulting firm conducted the following study for the organization.

A special job analysis led to the identification of several specific KSAOs likely

to be necessary for successful performance as a CSR. Three of these (clerical speed,

clerical accuracy, and interpersonal skills) were singled out for further consideration

because of their seemingly high impact on job performance. Two new methods of

assessment provided by the consulting firm were chosen for experimentation. The

first is a paper- and-pencil clerical test assessing clerical speed and accuracy. It con-

tains 50 items and has a 30-minute time limit. The second is a brief work sample

that could be administered as part of the interview process. In the work sample, the

applicant must respond to four different phone calls: a customer who is irate about

an out- of-stock item, a customer who wants more product information about an

item than was provided in the catalog, a customer who wants to change an order

placed yesterday, and a customer who has a routine order to place. Using a 1-5 rat-

ing scale, the interviewer rates the applicant on tactfulness (T) and concern for cus-

tomers (C). The interviewer is provided with a rating manual containing examples

of exceptional (5), average (3), and unacceptable (1) responses by the applicant.

A random sample of 50 current CSRs were chosen to participate in the study. At

Time 1 they were administered the clerical test and the work sample; performance

data were also gathered from company records for error rate (number of errors per

100 orders), speed (number of orders filled per hour), and customer complaints

(number of complaints per week). At Time 2, one week later, the clerical test and

the work sample were re- administered to the CSRs. A member of the consulting

firm sat in on all the interviews and served as a second rater of performance on the

work sample at Time 1 and Time 2. It is expected that the clerical test and work

sample will have positive correlations with speed and negative correlations with

error rate and customer complaints. Results for Clerical Test

Time 1 Time 2

Mean score 31.61 31.22

Standard deviation 4.70 5.11

Coefficient alpha .85 .86

Test-retest r .92*

r with error rate -.31* -.37*

r with speed .41* .39*

r with complaints -.11 -.08

r with work sample (T) .21 .17

r with work sample (C) .07 .15

Results for Work Sample (T)

Time 1 Time 2

Mean score 3.15 3.11

Standard deviation .93 1.01

% agreement (raters) 88% 79%

r with work sample (C) .81* .77*

r with error rate -.13 -.12

r with speed .11 .15

r with complaints -.37* -.35*

Results for Work Sample (C)

Time 1 Time 2

Mean score 2.91 3.07

Standard deviation .99 1.10

% agreement (raters) 80% 82%

r with work sample (T) .81* .77*

r with error rate -.04 -.11

r with speed .15 .14

r with complaints -.40* -.31*

(Note: * means that r was significant at p < .05)

Question :

What final recommendations would you make to Phonemin Co. on their selection process? When making your recommendation, consider the following: which of the existing selection activities should they continue to use? Should the process be changed? If so, how?