Performance Pay at Safelite AutoGlass

Presented by Dipti Nirbhawane(17/154) Sonali Paralkar(17/175) Imandi Venkata Deepak(17/144) Samya Ray(17/164) Pooja Thakur(17/185) Anuj Goel(17/135)

About Safelite

It was largest nationwide auto glass company in United States 500 stores across country with more than 3000 employees Maintained 12% market share Growth strategy of acquiring smaller businesses in new market Opening of as many stores as possible

Operational strategy for mobile stores

Offered mobile service by 1990 Customer centric approach to replace windshield when and where customer wants it Stores started competing with each other Hence central distribution of windshields from one location (called as market) Each market had DCC and TCU Hence increased efficiency

Relations with Insurance Company

Charging for windshield replacement: 1: Uninsured customers were charged directly 2: Insured customers : repair shop dealt with insurance company Proposed Total Claim Solution program to utilize telephone and data transfer technology for efficient claim processing Customers call handled through CSR for appointment and insurance coverage

Employee Performance

Reasons for low productivity: Less efforts by employees Difficulties in finding windshield repairing location Technician were given wrong directions of location Technician were provided with wrong windshields Cancelling of order from customer due to delay and rescheduling

Performance Pay Plan for Technician

Original plan of providing Piece rate for every windshield technician installed Pay for the week based on the number of windshield installations For 12 weeks , pay according to Guarantee Rate for installations below average and according to PPP rate for installations above average number After 12 weeks, guarantee rate reduced by 30 % to encourage working for PPP

PPP for Store Managers

Managers expected to install certain number of glass units per day Also maintain and motivate staff of technician Stores categorized according to size: largest(AA) to smallest( D) AA level managers not included in PPP plan, paid straight salary D store managers expected both managing and installing and were paid accordingly

Problems with PPP

Lowering the Guarantee rate might result into huge turnover of employees Other shops might provide higher hourly rate to attract technicians Change from hourly rate to PPP is difficult to implement Factors for low productivity like operational problem , miscommunication are not in technicians control Demand for windshield is seasonal

Effectiveness??
Installers also dependent on people not included in PPP plan. Value of performance is relative to employees efforts Chances of increasing the productivity with unethical means of performance Industry is based on hourly wage mode of payment

Thank You