Outsmarting Contact-Center Outsourcing Roadblocks

Updated: April 30, 2009

For many companies there's nothing more challenging — or costly — than dealing with an irate customer. It's no wonder then that the North American contact-center outsourcing market continues to see impressive growth. According to Frost & Sullivan consultancy, market participants reported solid revenue growth in 2006, with overall revenues increasing by 7 percent year over the year. By outsourcing contact-center services, companies are better able to focus on revenue-generating activities like product development, rather than spending time fielding unfriendly calls.

"Outsourcers can do the job just as well or better — and cheaper," said Michael DeSalles, a strategic analyst with Frost & Sullivan. Outsourcing is "driven by the fact that large enterprises do not view call centers as their core competencies ," DeSalles said. But there is a downside to handing over your primary customer-communication channels to a third-party provider. Possible shortcomings include inadequate customer service, clashing corporate cultures, data-privacy issues, tarnished brand equity and customer backlash. Fortunately, there are ways to outsmart outsourcing's most common pitfalls.

Get to Know Each Other

Research shows that 80 percent of customers claim that a service representative has a major impact on their opinion about a company. Yet many organizations fail to consider important factors when outsourcing their contact center, such as finding the right cultural fit, the outsourcer's familiarity with a particular industry, and the outsourcer's ability to handle data-privacy issues and sensitive customer queries. For this reason, strong vendor management is key.

A successful outsourcing relationship requires that representatives from both sides meet regularly to discuss the company's priorities, direction changes and concerns. In turn, the outsourcer should keep the company appraised of common customer complaints, as well as its own internal changes and personnel modifications. By working together, a company and its outsourcer can ensure a positive customer experience time and time again.

Establish Standards

Important factors such as mutual expectations, pricing, time lines and performance metrics shouldn't be left to chance in an outsourcing arrangement. That's why it's crucial that companies develop SLAs (service-level agreements) with vendors before signing on the dotted line. What's more, companies should revisit the agreement every so often to make sure that it reflects growing trends and changing expectations.

Stay Homeward Bound

According to Frost & Sullivan, offshore services represent 25 to 35 percent of total North American outsourcing revenues. Outsourcing is expected to move 3.4 million U.S. service-sector jobs overseas by 2015. It's no wonder an increasing number of customers are getting frustrated with having their calls routed to an agent in India. In fact, many businesses are witnessing a sort of outsourcing backlash, replete with customer tantrums and tarnished brand equity.

There is, however, a solution, thanks to the increased availability of U.S.-based agents. "That's where the work-at-home-agents movement really starts to gain traction," said DeSalles. "The vast majority of work-at-home agents are U.S.-based and are native English speakers." An outsourcer offering home-based agents provides companies with access to quality employees, as well as the ability to oversee infrastructure and operational concerns. The upshot: Companies can deliver superb customer support while addressing brand-equity concerns — and at a reasonable rate — said DeSalles.

Look Inward

So your company is receiving a flood of calls from customers complaining about the exact same product deficiencies over and over? Well, outsourcing your call center isn't going to make the problem go away. Whether it's shoddy merchandise or a flawed business process, an outsourcing arrangement will only compound the problem — and further frustrate customers.

Consider a Hybrid Model

With its combination of perks and pitfalls, it's easy to understand why some companies aren't willing to fully commit to an outsourcing arrangement. For example, businesses that experience seasonal fluctuations in contact-center traffic (ever tried ordering flowers on Mother's Day?) often prefer a hybrid approach to customer service . This entails running an in-house contact center, then ramping up operations during peak seasons by relying on an outsourcer.

Outsourcing contact-center services may have its fair share of shortcomings, but with the right approach, even the most difficult obstacles can be overcome.

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