Company: $7.8M residential and commercial HVAC service provider.
Problem: Market integrity reputation was impacted by the quality and type of work performed by technicians.
- The company had installed an incentive program for the technicians as a way to reduce employee turnover.
- This strategy included a low entry level pay rate with an incentive to sell more to the customer even when they didn’t need it.
- Also the incentive rate for product sales by the technician paid as much as three times their normal pay rate.
What was done:
- The incentive program for the technicians created a culture that rewarded the technicians to sell items to the customer that they did not need.
- It also rewarded the technician not to perform the services thus resulting in the company selling the customer a new unit prior to when it needed to be replaced.
- Introduced a new pay structure and incentive plan for the technicians.
- Identified the market pay rate that would allow the company to hire and retain a higher quality technician.
- Pay structure included several different levels of expertise with an appropriate rate based on qualifications, testing and experience.
- Incentivized the technicians to provide exceptional service and customer relations.
- Market reputation turned around reducing customer turnover rate.
- Quality of service dramatically improved resulting in securing new business from referrals.
Value Driver: By reducing customer turnover, improving employee retention and increasing customer retention rate, marketing, sales and hiring expenses were significantly reduced, the value of the company experienced a sizable increase and a much improved reputation, directly increasing value.