Proposed Business Topic
The existing gap in research, dealing with high staff turnover in face-to-face marketing, needs to be addressed to provide an understanding into both the causes and possible solutions to this issue. Current research focuses on the various types of operations (direct marketing, social media, etc.) or the ways in which social media can be embedded in face-to-face marketing to make it more efficient (Rogers & Davidson 2015; Sacristan 2012). More of a focus on the causes of turnover could provide researchers with an explanation as to why turnover rates are so high, as well as possible solutions to this problem. The company needs to examine whether its internal policies or human resource management are related to high turnover rates among new and experienced employees.
The overall objective of this study is to understand how staff turnover can be reduced in the face-to-face marketing business and why new employees leave the company so soon. To achieve this objective, the following research questions are employed.
- RQ 1: What are the causes of high employee turnover?
- RQ 2: What measures are needed to reduce high turnover rates?
The Appco Group is a marketing agency that provides its customers with face-to-face customer acquisition and sales solutions; it is the world leader in the sales and marketing industry (Appco Group n.d.). It is a subsidiary company of the Cobra Group of Companies, an organization that develops small start-ups into established, successful businesses. Although it has become the leader of face-to-face consumer product sales, it is still facing the serious issues of high turnover rates and the unwillingness of new employees to continue working in the company. The company experiences high turnover rates both among new and experienced staff (Glassdoor 2015).
Despite its success in the market, the Appco Group was accused of various unethical actions and poor employee management. Jeong and Safi (2014) attested that the Group withheld 7 million dollars (out of a total 12million) that were raised through Australian charities for the Special Olympics. Furthermore, the company was also accused of unethical behaviour towards employees, who were humiliated when unable to meet sales quotas (Koehn 2017). Moreover, another issue in the Group’s process of hiring seems to be its preference to hire employees as independent contractors rather than as permanent company employees (Koehn 2017). This way, the hired contractors are prevented from receiving appropriate entitlements open to normal Appco Group’s employees (Koehn 2017).
Such approaches to human resource management can be one of the reasons to explain the high turnover rate, even though the Appco Group stated that it would terminate contracts with any companies that allowed bullying and humiliation of employees (Appco Group 2017). According to the company, such allegations were “part of the class action against Appco Australia” (Appco Group 2017, para. 8).
Besides face-to-face customer acquisition and sales solutions, the Appco Group also provides expert advice and fundraising solutions for charities. Employees in the company are hired as independent contractors, and their wage is performance based. Staff work “on the street”, performing door-to-door charity fundraising, which implies that if no donations are made, the employees are not able to earn any money.
The company has to contend with high turnover rates but does not address the issue from a scientific point of view. Face-to-face marketing can be efficiently used in social media (Rogers & Davidson 2015). Employee skills’ need to be evaluated correctly to ensure they are suitable for the job (Sacristan 2012). These discoveries are not used by Apprco Group as a scientific base for their HRM practices, but they could enhance the performance of Appco Group’s employees.
The internal business factors that affect the company are the following: the unregulated position of the employees (they are hired as individual contractors and not as Appco employees), the unaddressed high turnover rates, the neglected needs of employees (working under minimum wage, unfair work-life imbalance), humiliation, bullying, poor treatment and mismanagement (Bateson et al. 2014; Glassdoor 2015). Despite the company’s media releases about the unacceptance of bullying and humiliation of employees, there is evidence that such situations still exist at Appco and are not addressed by the executive managers of the company unless they are discussed by the media (Koehn 2017). Performance management is directly linked to employee efficiency, and the company needs to consider this fact to avoid further scandals (Long & Perumal 2014). Furthermore, the company will also need to address the accusations of being a pyramid scheme rather than a legal fundraising company to ensure that employees will not be negatively affected by such allegations (McKeith 2016).
Another internal issue at Appco that I aim to address is the lack of a specific recruitment process for new employees that would help managers evaluate their suitability for the job. Face-to-face marketing requires specific skills from employees that cannot be found in every employee the company hires. Bateson et al. (2014) suggest using psychometric sifting procedures to facilitate the recruitment process. Thus, I aim to investigate what psychological profile is needed to become a successful face-to-face marketer.
Theory and Conceptual Tools
The theory used in this study is the influence of HRM practices on employee turnover. According to Long and Perumal (2014), HR Mismanagement can negatively influence employees and increase their intent to leave. Since HRM is responsible for compensations, benefits, training, career development, and employee relations, it is crucial to understand how these responsibilities are addressed within the Appco Group, and if they are the primary causes of high turnover rates. Employee turnover can have various causes: poor management, lack of coaching, endless reorganizations, no quality in employee relations, etc. (Long & Perumal 2014). Thus, HRM practices have a direct influence on turnover and need to be researched thoroughly.
The concept of psychological profile or psychological portrait is used in HRM as the set of specific abilities, character features, predispositions, preferences, styles of learning, etc. to evaluate the suitability of the potential employee for a position (Zamyatina, Solodovnikova & Denchuk 2013). In order to evaluate one’s psychological profile, various tests (e.g. the Locus of Control, Learning Style, Career Aptitude, etc.) can be used. In this paper, I plan to use the concept of psychological profile to examine whether it correlates with the employee’s ability to be a successful face-to-face manager.
The research method includes case study analysis, observations, and interviews. The case study protocol will include the overview of the problem, ethical considerations, research questions, observations, collected data, and the analysis of the collected data.
To answer the research questions, I plan to use the SWOT analysis and interviews (online or in person) with the former and present employees of the Appco Group. Furthermore, I also plan to use company policy documents in order to evaluate how these policies might influence turnover rates.
Using the collected data, I plan to develop a psychological test for determination of the employees’ psychological profile. This test will be a combination of various psychological tests (The Big Five Personality Test, the Locus of Control test, and the Myers-Briggs Type Indicator (MBTI)) and will assess an individual’s suitability for a face-to-face marketer position.
To understand why Appco Group’s employees remain unsatisfied with the job and why it has high turnover rates, I plan to use online or in-person interviews with former and present employees of the company. The interviews will include both open- and close-ended questions and will address possible internal issues in the company. Although I assume that face-to-face marketing might require specific character features from the employees, it is also possible that the discussed internal issues in Appco Group are the main reasons why the company suffers from high turnover rates. To support these assumptions, I will need to contact the company’s employees and collect the necessary data from them.
Proposed Data Resources
The information necessary for the report is employees’ insights in company’s problems and disadvantages, policy regulations at Appco Group, and any evidence of employee unsuitability for the face-to-face marketing.
Rogers and Davidson (2015) discuss various types of face-to-face marketing and pinpoint possible future directions (i.e. the development of face-to-face marketing in social media and Web 2.0). Sacristan (2012) points out that face-to-face marketing, as we know it, cannot exist anymore since it has become obsolete. The author discusses the advantages of direct marketing in digital media and explains that it is necessary to understand whether direct marketing is a suitable approach for the reader or not by evaluating one’s skills and attributions (Sacristan 2012). Long and Perumal (2014) argue that performance management is the most important part of the HRM and directly influences turnover rates at a company. The use of psychometric sifting procedures is discussed by Bateson et al. (2014) who notice that such procedures make recruitment process easier and more cost-effective.
Appco Group n.d., Appco Group Australia, Sydney, Australia, 2017. Web.
Appco Group 2017, Appco Australia acts on class action allegations, Web.
Bateson, J, Wirtz, J, Burke, E & Vaughan, C 2014, ‘Psychometric sifting to efficiently select the right service employees’, Managing Service Quality, vol. 24, no. 5, pp. 418-433.
Glassdoor 2015, Appco Group, Web.
Jeong, S & Safi, M 2014, Global fundraising company keeps $7m of $12.2m raised for Special Olympics, Web.
Koehn, E 2017, Appco Group hit with claims salespeople were forced into “pseudo sexual acts” for not meeting targets,Web.
Long, CS & Perumal, P 2014, ‘Examining the impact of human resource management practices on employees’ turnover intention’, International Journal of Business and Society, vol. 15, no. 1, pp. 111-126.
McKeith, S 2016, Marketing giant Appco facing $85m class action,Web.
Rogers, T & Davidson, R 2015, Marketing destinations and venues for conferences, conventions and business events, Routledge, London.
Sacristan, G 2012, The digital and direct marketing goose: 16 tips and real examples that will help you lay more golden eggs, Happy About, San Francisco, CA.
Zamyatina, O, Solodovnikova, O & Denchuk, D 2013, Formation and analysis of competencies in elite engineering specialist, Web.