1 Investigating how HR development policies in a Telecom Call-Center may affect company performance: a System Dynamics approach Enzo Bivona ( * ) Abstract In the present economy a growing number of businesses, and in particular those operating in the service industry, are often able to be successful in the market arena on the basis of continuous investments in intangibles assets, rather than only in tangible resources. Tangible resources are those that are typically displayed on the balance sheet of a company such as machinery, buildings and inventory. On the contrary, intangibles refer to people and their experiences, business processes and routines, company reputations and image. Although intangibles assets may constitute the source of competitive advantage, businesses do not often understand their nature (Collins, 1996). In fact, it has been remarked in literature (Bontis, 2002) that managers do not know how organisation key-resources and related acquisition and depletion processes over time are likely to affect a success of a business strategy. This phenomenon may be due to a lack of methods and tools to use which would enable managers to analyse organisation intellectual capital stocks and organisational learning flows (Bontis, 2002). In order to overcome such difficulties, a conceptual framework has been developed and proposed to a Telecom company to investigate – through the lens of the System Dynamics methodology – in particular, how human resources (temporary vs permanent workers) development policies in a Call Centers are likely to affect Customer Satisfaction Index and indirectly the overall company performance. Main key-issues underlying the feedback structure and the System Dynamics model are discussed in the paper, and most significant outcomes from scenarios analysis are commented. 1. Call center management issues In the last decades customer care strategies of many service businesses and, in particular, of telecom companies have received a growing attention. In order to effectively offer to clients a reliable and effective customer service over time, organisations very often decide to provide it directly, through an own call center, or to outsource it. Today most of the companies mentioned in Fortune 500 list have at least one call center and more that $300 billion is spent annually on this service around the word (Gilson and Khandelwal, 2005). The decision to start a call center aims to be successful in implementing a customer care strategy that can balance costs, generate revenues and provide to clients a stable level of service. By achieving such goals a call center can become a primary company strategic asset (Kogut and Zander, 1992; Mahoney and Pandian, 1992; Amit and Schoemaker 1993;) able to provide a competitive advantage and fuel future business growth. However, it has been shown that most of these initiatives have not contributed to keep low costs and to provide to customers a reliable service (Gilson and Khandelwal, 2005). On the last concern, an analysis of US mobile-telecommunications industry (Braff and Leogue, 2004) has shown an extraordinary number of dissatisfied customers. In particular, it has been reported that one of the main reasons of customers complains very seldom arises from any significant problem with phone ( * ) Assistant Professor in Business Management, University of Palermo (Italy), Faculty of Political Sciences, Master Phil. in System Dynamics, University of Bergen (Norway), CED4 System Dynamics Group, enzobivona@sciepol.unipa.it, http://www.ced4.it/