Service on call

The consumer goods giant behind brands as diverse as Marmite and Persil
outsourced its call centre operations to better serve its customers. Nathalie
Towner looks at the crucial role played by HR at Unilever and at service
provider Merchants

When it became clear that the in-house call centres at Unilever were unable
to respond to business needs, management decided to have a rethink.

The consumer goods giant behind brands as diverse as Marmite, Calvin Klein’s
Obsession and Persil wanted a more complete picture of the Unilever consumer,
but under its existing system this proved to be impossible.

The organisation’s three operating companies, Unilever Bestfoods UK, Birds
Eye Wall’s and Lever Fabergé, are based at five sites across the UK and each
was operating separate consumer care lines for their brands, with different
management structures and separate overheads.

Outsourcing the call centres would enable Unilever to create one team to
manage the hundreds of products, making it possible to build an accurate
profile of consumer shopping preferences across all of their brands.

The initiative was called Consumer Link and Samantha Walker was appointed as
business manager to investigate the merits of outsourcing the scheme. Her 17
years of working in various HR roles combined with her operational
responsibilities made her ideal for this role.

Although cost-cutting certainly played a role, Walker is emphatic that the
key driver was adding value to the brands.

"We already felt we were giving excellent service to our consumers, but
we really needed to improve the business side," explains Walker. "We
didn’t have the expertise in IT functionality so we couldn’t make predictions
about our consumers that we could feed back into the business."

Walker and her team drew up a shortlist of 11 call centre companies, and as
it became increasingly clear that outsourcing would go ahead, Walker had to
decide how and when to break the news to the in-house operations.

"I had to consider how open to be with the teams as we were looking at
a 12-month lead time. In the end, we decided to tell them what was going on. By
keeping the communication channels open, we succeeded in keeping them on

All staff were offered an outplacement service to help them find new work
and were also given loyalty bonuses for staying to a certain date.

After narrowing down the options to three call centre operators, Unilever
plumped for contact centre company, Merchants. Walker was attracted by the way
it managed its staff.

"We really wanted to avoid outsourcing to a sweat shop and we saw some
bad stuff when we were looking around. Merchants has a below industry attrition
rate and this went very much in its favour."

The new call centre is based in Milton Keynes, which is a significant
distance from any of the in-house operations, so unsurprisingly none of the
existing staff took up the option of transferring to the new office.

The Milton Keynes’ branch of Merchants is a multi-client site, but staff are
dedicated to one client and this is reflected in their contracts.

However, according to Estelle England, group HR manager at Merchants, a key
requirement for her HR team is to ensure all staff understand who they work for
and, in particular, that the client is clear on staff ownership.

"There are cases where the client believes that because the outsourcer
is carrying out work for them that the staffing issues are also their concern.
This is not the case. The very nature of outsourcing means these concerns are
also passed over from the client," she explains.

However, this does not mean Merchants does not accept input from the client
when drawing up contracts, but this does have to be carefully managed.

"It is crucial to ensure fairness and equality is balanced across the
board for all call centre agents. Individual agents from two separate
operations who sit side by side should not be exposed to different levels of
benefits," says England.

"At the contract stage, negotiations around benefits and rewards
schemes need to be clearly defined and agreed with the client."

Unilever did want the option of extending staff shift patterns over a
seven-day period, so although staff are currently working over five days, it
was made clear to recruits from the beginning that this could change.

Unilever has also been able to extend certain benefits to the call centre

"Unilever staff receive a home and car insurance scheme and they have
extended the reduced premiums to staff here working on Consumer Link. This is
an excellent way of fostering the feeling of being part of a culture as opposed
to just working on their behalf," says Adrian Garton, call centre HR

Merchants’ HR is also developing retention schemes that apply across the
whole organisation. In January, it set up a graduated benefit scheme to reward
long service – for every year an employee stays, they receive an additional two
days of holiday up to a maximum of 10 days.

Staff who were recruited to Consumer Link were a mixture of existing
Merchants employees and new starters. As they were recruited specifically to
the programme, candidates had to offer not only the usual range of
communication skills, but had to be able to offer specific skills that would benefit
the Unilever operation.

"We were looking for people with a background in customer care who
would be able to deal with a range of issues. Ideally, they would have
experience of the retail industry or use the Unilever products
themselves," says Garton.

As part of the recruitment process, candidates had to answer a lifestyle
survey on what products they bought and why. They also had to complete a test
featuring brands, washing instructions and cooking ideas. This helped slot the
successful candidates into the right Unilever teams. Although staff do not
specialise in a product, they do concentrate on a sector such as frozen foods
or home care.

Empathy with consumers was a key requirement, but one of the key concerns
for Unilever was the industry knowledge it would be losing with its out-going
staff. Some had been with the company for more than 15 years and knew
everything about the products, but unfortunately none of their know-how was

As part of the handover process, the outgoing staff actually helped approve
some of the new processes. They also went to Milton Keynes to help with the
simulation part of the training.

Stephanie Bauer, Consumer Link business manager at Merchants, works directly
with the staff and oversees their training requirements.

"The training is carried out in conjunction with Unilever. Brand
managers explain who their target consumer is and we design the processes and
system navigation side of the programme," she explains.

Training of staff for this project took an average of six weeks, compared to
the norm of two, and is one of the most challenging and complex operations that
Merchants has ever run. Development is on-going and the operations team leaders
review the training needs of the team on a weekly basis.

"There is a level of multi-skilling so staff can develop and be given
the opportunity to move if they wish," explains Bauer. "The options
are not just to become a team leader. Staff can focus on particular products,
so if they worked on the Slim Fast range, they could specialise in nutrition
and provide advice on a balanced diet."

Alongside the call centre is a fully-equipped kitchen, where staff can
simulate any of the queries they have received. This has resulted in sessions
to see how to remove deodorant stains out of clothes, and sometimes staff go on
visits to factories to see how a bone might end up in a fish finger so they can
explain to a consumer why it is unlikely to happen again.

Unilever staff are not based permanently at the Milton Keynes site, but on
any working day there will normally be a member of Unilever staff present.
Milton Keynes was chosen as the location as it had to be within half a day’s
travel of all the operating sites.

Unilever employs three delivery managers who work for business manager
Samantha Walker, and all of them are regular visitors to the call centre. They
manage the relationship and information flow between the three Unilever
operating companies and Consumer Link.

As a result, the communication channels between the two groups are strong,
with frequent contact between Unilever operations and HR at Merchants.

"My role is to work with Unilever’s head of operations," explains
Garton. "So when they wanted to introduce a change to the shift patterns,
we introduced this to the team."

The on-going partnership between the two companies has been essential to the
success of the handover.

Unilever has succeeded in maintaining a level of control without getting
involved in the technical side of the operation. And by tapping into the specialist
resources provided by Merchants and combining this with their in-house product
knowledge, Unilever has made outsourcing a viable long-term solution.

Company profiles


– Unilever is an Anglo-Dutch group, specialising in consumer

– Annual UK sales of more than £2.3bn

– Headquarters: Unilever House, Blackfriars, London

– Number of employees globally: 247,000

– Number of UK employees: 12,500

– Number of UK HR staff: 375


– Merchants, established in 1981, is a contact centre partnering

– Clients include Edexcel, HBOS and National Australia Group

– Turnover per year derived from contact centre activity in the
UK is £20,749,000 and combined with overseas turnover the total turnover for
2002 is £28,853,000

– Merchants employs 823 staff across the three sites in Milton
Keynes, Kilmarnock and Cork (Ireland)

– There are 15 staff within the Merchants HR team, of which
seven are employed in Milton Keynes

Anatomy of the outsourcing deal

In 2001, Unilever decided to outsource its three call centres.
Each call centre was dedicated to a different operation and Unilever wanted to
change this to create a shared service.

A four-year contract worth around £8.5m was signed with
Merchants in September 2002. All of the original staff were made redundant and
Merchants recruited the new team for the centre based in Milton Keynes.

The operation went live in December 2002, with the operating
companies rolling out until March 2003 when the centre became fully operational
with a team of 50.

The contract has saved Unilever money, but currently these
savings are being reinvested into the programme.

Lessons for HR

Samantha Walker, Unilever business
manager for Consumer Link

‘I would have liked more lead-in time before we went live. We
had a fixed deadline of 31 March 2003. We were running the old team next to the
new team and there was a real concern that the new recruits would not be able
to absorb all the information. The training was very intense’

Estelle England, group HR manager
for Merchants

‘The bigger the account, the greater the need for sufficient
time to ensure all statutory requirements are fully met for all employees, and
the needs of the client are also achieved. It is important to focus on
balancing commercial contracts between Merchants and its clients with statutory
regulation and requirements’

Adrian Garton, call centre HR
manager at Merchants

‘There is no reason the client’s HR staff can’t work with us
when they outsource. People look at TUPE and see it as a minefield, but like
anything it is easy once you really understand it’

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