Middle management’s role in BPO industry growth

Problems occurring in outsourcing firms have been partly attributed to ineffective middle managers who seemingly lack many key skills to fulfill their functions. But to try and understand this statement, we should take a look at what middle management actually does. If we’re going by the traditional definition of a middle manager, then he or she is senior staff charged with overseeing day-to-day management details and reporting to top management. At present, however, business and knowledge process outsourcing companies and ICT firms have redefined the role of middle managers. Middle management has been characterized as the “glue that holds organizations together”, according to London School of Economics professor Leslie Willcocks. Middle managers have become important in outsourcing companies as their responsibilities and roles in the company have broadened. They are now tasked to be coordinators, social capitalists, substitute agents and knowledge repositories – roles they need to fulfill aside from working closely with clients, suppliers, and their companies’ senior management.

Now, we can only guess the potential chaos in terms of spiraling costs, sinking service levels and revenue losses that middle management will bring to the company if it is unskilled and ineffective in performing its duties. Because middle management is expected to fulfill a lot of important roles in the company, it’s only logical to assume that middle management is a very essential part of each company as it can make or break deals with clients and can affect the growth of the company in terms of revenue, quality of services and workforce.

So we’ve established that middle managers are important to every company especially to outsourcing firms. But have we ever wondered where these problems with middle management start? In a study conducted by Willcocks, professor of Technology Work and Globalization, and Catherine Griffiths, co-founder of London School of Economics’ Outsourcing Unit, it showed that companies have a limited talent pool from which middle managers can be plucked. The high attrition or turnover rates in many offshore KPO, BPO and ICT firms further limit the talent base of potential middle managers. Aside from the limited talent pool which might not possess the necessary skills to perform middle management duties well, newly-promoted middle managers seldom receive sufficient training that makes them more capable of fulfilling their roles. Many companies invest in training their agents but not in training their managers.

Philippine BPO firms and call centers are taking action to address the high turnover in their companies. While they do that, these companies should also try to address the shortage in effective middle managers. Companies should recognize the value of middle managers and invest in their development. They should know how to spot managers or potential managers who possess certain attributes that will inevitably translate to skills necessary in middle management positions. Recruitment teams should not only look at experience but also look for these attributes in employees from their own ranks when searching for managers and leaders. These attributes include ability to manage risks, solve problems, organize efficiently, build trust, respect and interpersonal relationships, and innovation, among many others. When companies find and hire their middle managers, the companies should make sure that they train the managers some more and make an effort to retain good managers.

Businesses in general should also note that eliminating middle management staff when undergoing cost-cutting will most likely backfire on the companies themselves. As mentioned, middle management is an essential part of the company. Companies trying to cut back on operational costs let go management staff and retain only a few managers to keep operations going. However, doing so do not always mean that operations will be the same as before; managers – especially if they have too many tasks on hand – can get overwhelmed too. Tired people don’t always produce the best quality service. The lack of management talent combined with the lack of adequate corporate structures to sustain long-term growth will undoubtedly lead fast growing businesses to a growth plateau.

It is also imperative to point out that effective middle managers actually hold the future of the company in their hands. In five years, when the organization decides to expand, the middle managers will be the next to spearhead new locations and their years of experience with the company will serve as leverage for them to handle bigger challenges and obligations. Higher management must stress the importance of middle management as they hold a very critical part of the value chain. By improving this link in the chain of command, they might as well be improving the company’s future.