I’m finishing up my quarterly visit here in our « home base » delivery center of Iloilo, Philippines. As Rethink Staffing begins its expansion in earnest here in 2019, where we’re in the process of doubling the size of our center, I’ve come to call this Philippines center first, our « proof of concept » and now our prototype center. I’m happy with our progress — we’re doing a lot of things right here in Iloilo to make a BPO delivery center an anti-poverty weapon.
But I’ve also been really frustrated by something I learned in my focus group discussions this week — when I met with small groups of our Agents individually.
Prior to this week, I thought that it was all of the things we did to use economics to attack poverty through a BPO job, including our COLA, skills-based earnings system, capacity building (not training) system, guaranteed account reassignment, were the reasons why we got such good performance from our agents.
But I’ve been shocked and disappointed by how badly we’ve failed to communicate to our Agents the basics of how these programs work. As I’ve learned this week, they’re simply happy to have a regular, sustainable job, where their managers treat them with respect and they feel safe at work. Like Easterly describes in the White Man’s Burden, I made the classic white man’s mistake of assuming that those with so little would only be happy when they had as much as I did.
And on this visit — we’re undergoing our biggest test — as we’ve just launched our own micro finance program, funded by company funds.
I’ve just finished reading Poor Economics by Abhijit Banerjee and Esther Dulfo. In their excellent book, the authors state that the first reason the poor stay poor is because they lack access to critical pieces of information and believe things that are not true. The economic development world is populated by thousands of earnest people and they have spent billions of dollars trying to design programs that help the poor, but if the poor don’t understand these programs or don’t believe them, where are we in the fight against poverty? We’re pissing in the wind.
I am one of those earnest people, and I’ve chosen the BPO industry as my anti-poverty weapon of choice. But as successful as we’ve been in getting people into the middle class in Iloilo with their BPO job, we seem to suffer from an information gap, too. In my focus groups, our people don’t know how they can break the cycle of poverty for their family, even with something that seems as simple as saving money and investing it.
This week, we tried to give a motorcycle to an Agent who has a 1.5-hour commute to work. He is a 22-year-old who is the sole breadwinner for his mother, father, sister, and brother. In our microlending program, Agents can borrow interest-free for up to two years to either a) start a business or b) buy a motorcycle. Doing so would save this Agent 2 hours a day, which he could use in doing work that’s more profitable, such as starting a small business.
But he said no. It was a shock to me because the whole idea for the microlending program came from him and another agent. Why? The motor could do him such good. When Paul Gonzaga, our Impact Director, asked him — the answer shocked him, too.
With the entire family to support, this Agent’s household was already living in a position of negative cash-flow, and now they’ve been borrowing to make ends meet. The motorcycle payment, even though it was interest-free, would have created more negative cash flow.
This is the opposite of the outcome we want for Agents in our centers. But with 5 people to support on his salary, he determined it was too much risk, even though he’s currently spending 75% of the monthly motorcycle payment on public transportation going to and from work.
Negative cash flow is death to anyone’s financial life. It doesn’t matter if you’re in Philadelphia or the Philippines. But the information gap that exists in our Agents’ financial lives, and the financial lives of the poor in general, as Banerjee and Dulfo explained in Poor Economics, is extreme, and they point out that this is one of the key reasons aid programs fail.
So, I am writing this post for my Agents. You may not know it, but you, valued RTS agent, have six ways TODAY to make more money within RTS that can add cash flow to your monthly budget, and help break the cycle of poverty for you and your families. Here they are:
1. Take our Free English Classes and Level Up.
When an Agent applies to RTS, they have to take an English Proficiency exam that determines their English level. Based on this English level (and other skills), they’re eligible for certain jobs within RTS. Clients pay for better English skills when they’re hiring Agents in the developing world. So, better English means more pay.
At RTS, we give free English classes every month. We pay for a permanent English trainer on staff, who is constantly running two classes of about 20 people in total and scheduled to work with Agents’ shift schedules.
At the end of this training, Agents can re-test to get a new English proficiency score. Regardless if we have a position available at that new, higher score level, Agents receive a P1,000/month raise in their salary, automatically, just for leveling up. This raise is typically equal to a 7% to 10% bump in salary, depending on the Agent’s starting base salary.
To my Agents — are you going to level up?
2. Apply for higher level work / management.
RTS is growing, bringing on new clients, and expanding with existing clients. We prioritize hiring from within. In our dynamic environment, there are always open positions at a higher skill level, or even new teams forming that need new team leads.
It’s very easy to apply — with just an email. And since we always benchmark people’s skills, both our HR and hiring managers know where an agent is within our skills matrix. So, a higher salary can literally be an email and interview away.
To my Agents — are you going to step up?
3. Work overtime.
In its contracts with clients, RTS charges the same price for an hour of overtime as an hour of regular time. Why do we do this — because we want to incentivize clients to buy overtime hours from us when their workload requires it.
Of course, labor law in the countries in which we operate requires that we pay a higher rate for any hour past the regular schedule — 45 in the Philippines, 40 in the US. Why do we do this? Because we know that overtime can be a great way to make more money and add to the monthly budget of our Agents and help them do more things in their lives. When offered, our OT take-up rates are generally over 80%, so we know that Agents can do it.
It’s good for RTS too — as most of our policies are. Every extra hour of labor billed into an existing contract or seat in our centers helps spread out our fixed costs over more billable hours, thus increasing our profitability. It’s a win-win-win for everyone.
To my Agents — are you going to step up if asked?
4. Get a Microloan from the Company.
This week we announced the launching of a microlending program, funded by the company, for the purchase of motorcycles (to help Agents gain control of their time — and thus their lives), or for investments in small businesses, in direct support of our vision.
If you get a loan for a motorcycle, you have greater control of your time, and you’ll find it easier to get to work on time. That greater control of your time will allow you to pursue other efforts in your lives that will either a) make your more money or b) progress toward your long-term goals.
For a small business loan, Agents have to submit a business plan, financial projections, and risk profile. We also only take applications for businesses of some substance. Unfortunately in the developing world, and as Banerjee and Dulfo have showed, someone running a fruit stand is technically an entrepreneur, but that business is really a replacement for a job that the person can’t find.
Most importantly, a viable small business is capital ownership. Capital ownership and the income from a business adds to the overall income of the household, not just providing more income, but most importantly providing more than one income stream, which further safeguards the family against calamity.
To my Agents — are you ready to step up and become capital owners?
5. Join the apprenticeship program.
On May 15th of this year, RTS will start its first apprenticeship program based on the model of the Renaissance Italian masters — with Apprentices paid during their apprentice period, and slowly contributing to billable work that is to be delivered by their mentors to clients.
We’re starting small. Four Web Developer and two QA positions. Forty percent (40%) of all Agents at RTS are IT graduates, though most would agree, both in the Philippines and out, that Philippine IT education does not prepare students well enough for working at global standards.
Existing Agents are given priority in applications vs. outside candidates. The best part? A Junior Web Developer makes as much as a Level 3 CSR, and a mid-level web developer makes as much as team leads. Both salary levels are in the middle class.
To my Agents that are IT graduates — are you going to step up?
6. Join an account with an irregular schedule
In the contact center industry, domestic or overseas, Clients often prioritize English proficiency, not just in which Agents they select, but also in which Agents they want to keep on the account.
We were recently taught something by a client who has operations with an irregular, and at times, unpredictable work demand schedule. While English Proficiency is important, it’s not the only thing they need. This may seem straightforward, but as operations matured, we were surprised at how much clarity they themselves gained at what was the right mix of skills.
One thing they prioritize is someone who can handle in their lives the change of schedule. Plus, this client has five busy periods a year, where lots of OT is offered. The client argued, correctly, that an Agent who can not just do the job, but tolerate the schedule was worth more to them, and we should pay our Agents accordingly.
I agreed with them. And so, recently we have offered a new class of compensation to Agents where they earn 10% to 17% more salary if they agree to work on an account where their schedule is irregular.
To my Agents — if you’re able to deal with an irregular schedule — you can make more money. Are you going to step up?