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Article : The New Contact Centre Economics - Virtual Contact Centres

The promise of virtual contact centres has yet to be delivered and yet the business model and the supporting technologies are now mature. What is holding companies back, asks Nigel Rzemieniecki, Business Development Director of ETC, a consultancy delivering large scale, complex cross-channel solutions.

The last word in call centre management today is Remote Sourcing, pushing UK call centres out to countries where the wages are cheaper - India, China and beyond. 

At first sight, Remote Sourcing seemed like the panacea for what is assumed to be call centres' biggest threat – cost. Why pay UK wages, when a cheap, willing and well-trained workforce lies half way across the world?However, in less than two years, some companies are already having regrets. With entry costs in India now rising, they are already having to look further afield to China.

Nigel Rzemieniecki
Business Development Director
 European Technology Consultants (ETC)

But that is not the real problem; at home, for companies for whom the quality of their sales and service channel is critical to their success, sales and service levels are plummeting as their customers are forced to contend with unfamiliar accents, bad connections, faint voices and bad briefing on the part of call centre agents.

Clearly, while Remote Sourcing may be ideal for companies that must provide customer service and for whom the telephone is not the key sales channel, for others, it is their only channel to market or the only channel by which they provide service that will enable them to retain customers. After all, customer churn in retail, financial services and telecoms, remains high and yet many companies have only the telephone to rely on to connect with those customers.

The fatal flaw in remote sourcing has to sink in. In short, remote sourcing is not a panacea, but only part of the answer to companies' need to accelerate both sales and service levels, while at the same time cutting costs to remain competitive.

These challenges would appear to present a dilemma. In a climate of cost-cutting, a new approach suggests major new investments and greater complexity, but in fact, the answer for most companies lies within their immediate grasp, both in their current workforce and existing systems.

The first problem with current contact management strategies is the assumption that time is money, regardless of the needs of the individual customer. Most call centre staff are measured according to the length of each call, and they and contact centre managers are under constant pressure to reduce call handling times. However, average call length is meaningless unless it is tied to sales and service targets.

More successful is a strategy that allocates staff by customer, and by type of enquiry so that the most expensive staff with the broadest skills are allocated to most valuable customers, while less expensive staff, and this may include staff in India and China, can handle repetitive service tasks. It is relatively simple to create a strategy to do this, backed up by technology that will ensure that calls are allocated correctly, but the goal is not merely to create the mechanics for call handling, but ensuring that the infrastructure meets customers' needs.

Companies need a single, unified view of each of their customers, where each customer is recognised and treated consistently, regardless of which channel or channels he chooses to get in touch using.

The goal is to create a virtual contact centre, far from a new concept but one that is now achievable. The virtual call centre enables companies to integrate together disparate call centre locations along with remote and home workers into a single infrastructure. The immediate consequence of pursuing this goal is generally a consolidation in call centre numbers, where some may be outsourced abroad, and the attendant major cost savings.

There are a host of solutions available to build the virtual contact centre, the limitation of most being that they require significant changes to the existing infrastructure to implement them and raise costs through management and maintenance. Moreover, much of the software available, while it may well be so-called best of breed, is a tool but not a solution. The last thing most companies operating call centres need right now is another piece of clever packaged software to bolt onto an architecture that is in serious need of adjustment.Ultimately, it can be argued, remote sourcing is the final desperate act of a failing contact management strategy.

The limitations therefore of these individual tools is that they do nothing to fix the greater problem. Call centre software was generally designed for a single site. It was then difficult to run single site applications over multiple sites. Latterly, broadband and IP are enabling voice and data to be integrated so that the quality of communications with customers can be improved, leading to richer sales propositions and more effective service solutions.

What is required is a single, scalable and unified application framework based on open standards, backed by tools for measurement and load planning, so that call centre managers have more customer-focused ways of measuring success, which ultimately should be the number of satisfied customers or, where appropriate, the level of sales made over multiple channels.

The strategy required to do this depends firstly on a sober assessment of the current infrastructure and processes, long before technology is even considered. After all, the successful contact management strategy is one that is built around the needs of the customer, not the company, which is why process and cultural issues must be thrashed out first. The subsequent assessment of what tools and processes must be put in place to achieve this must also be backed by a solid business case and Return On Investment (ROI), the kind of rock solid business case that the CFO will insist on before the cheque is signed. Lastly, the choice of software must be rigorously dictated by the strategy, each tool assessed according to overall contribution, scalability, ease of use and maintenance.

About Nigel Rzemieniecki
Nigel Rzemieniecki is the Business Development Director at ETC. He is responsible for developing ETC's cross-channel business within the retail sector. Previously Sales & Marketing Director at MetaPack, a supply chain delivery solutions provider. Before this, he was Managing Director of the ICL Retail Business which delivers solutions to many UK retailers.

About ETC
ETC assists companies in the retail, financial services and telecom sectors to enhance the business value of customers by providing them with integrated sales and service solutions across multiple channels. These solutions give companies a single view of each customer with the goal of reducing sales and service costs, while boosting service quality, leading to higher customer retention and profitability.

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Published: Friday, March 26, 2004

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