Next step in call center recruitment

i.t. matters
Friday-Saturday April 07-08, 2006 | MANILA, PHILIPPINES

News

Next step in call center recruitment

'Referral' for a fee

By MARICEL E. ESTAVILLO, Reporter

Huge demand for skilled manpower amid a diminishing pool has pushed call center companies to resort to "referral" scheme in hiring, wherein they let their employees recruit friends or relatives in exchange for a considerable sum.

The amount of incentives, per successful hire, vary depending on the position sought for by the applicant and on the company hiring.

Now, the average industry referral rate for an entry-level agent position starts at P1,500 to P5,000, according to call center agents polled by BusinessWorld. They say some companies give at least P1,500 upon contract signing and add another P1,500 upon the regularization of the successful hire.

Then, there are companies, mostly the big ones, which have bigger incentive packages in their referral program. One company headquartered in Makati City gives P2,000 for the first recruit, and then double this amount, P4,000 for the second recruit and so on -- doubling the base each time an employee gets a new recruit.

Minus the incentive offer, the practice of referring one's friend or relative is expected from Filipinos, said Glenn K. Miyataki in an e-mail, president of the Hawaii-based Japan-America Institute of Management Science. Mr. Miyataki is a recognized global expert on business and culture.

"I am not surprised that this is being done in the Philippines since it is part of the culture to support the family in all endeavors. In the western world, nepotism in public companies are frowned upon, although it does happen to a limited extent. However, when it comes to family businesses and private companies, hiring friends and relatives is the usual practice," Mr. Miyataki said.

In eTelecare Global Solutions, about 25% of its present workforce of 4,100 came from its referral program. "The referral program gets our employees excited. In our company, almost 25% of our people are referred. That will be a hard number to beat by anyone. This only shows that you really have to be proud of your company for you to be able to refer your company to your relatives and friends," Benedict C. Hernandez, eTelecare vice-president for Philippine operation and general manager, said in an interview.

Mr. Hernandez said that, at one point, the company had four siblings all working for them and a mother with her two adult daughters. Fred Ayala, eTelecare chairman, said the referral program fits well into the vibrant culture of this young industry, which took off five years ago. "This fits in the culture of the industry. Our workforce are [sic] young people [between 23 to 30], with lots of them belonging to a barkada [group of friends]. Most young people like to work with their friends," Mr. Ayala said.

Among available traditional means of recruitment -- television, newspaper and online -- PeopleSupport, Inc., ranked the referral program as its top source of skilled labor.

"In our experience, our best source of labor now is referral because this means that our employees are happy with the organization, otherwise they will not be referring their relatives or friends unless they are their enemies," said Raneiro M. Borja, PeopleSupport (Philippines), Inc. President, in a separate interview.

He added that the referral program is a very "targeted" way of getting agents because the employees themselves already know the requirements of the company.

"And this benefits also our existing employees. But the new recruits need to be hired first before the employees get the benefits. And depending on the position [agent or management level] and the number or people referred, one can earn as much as P60,000," Mr. Borja said.

To prevent nepotism and conflict of interest, most companies like eTelecare and PeopleSupport do no allow the new hire to join the department where his friend or relative belongs.

"This is not a negative practice for as long as the new hire has the skills set for the job. The main thing that we do to avoid conflict of interest is to make sure that they are not working in the same department," Mr. Hernandez said.

This, Mr. Miyataki said, has been modeled after public corporations, where the practice of hiring friend or relative is common.

Mr. Miyataki said usually a safeguard is laid out to insure that the hired persons do not work for the relative directly. "But when it comes to friends, however, it is more difficult to discern when the friend turns out to be competent. On the other hand, an incompetent person will be discovered quickly; and when the person who did the referral or hiring does nothing about that person or continues to support incompetence, then, it becomes a bad precedence and practice," Mr. Miyataki said.

"In a nutshell, it is not a bad practice to hire friends and relatives if the circumstances and culture tolerate such behavior. There are safeguards to keep hiree and hirer from reporting directly to each other, but the more important issue is the competence or incompetence of the person hired," he stressed.

With an estimated P1.2 billion in total revenues as of last year, the call center industry, with 105 company players to date, is one of the country's fast-growing industries. This sector now has an estimated 70,000 seats and a workforce of 100,000.

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