Article : To Outsource Your Contact Centre – Or Not?
There are very few organisations that should not consider outsourcing their contact centres because there are very few organisations whose core competence is contact centre operation.
"Although that seems to be an obvious thing to say, three decades into the evolution of contact centres, most executive teams are still divided as to the business necessity and benefits of outsourcing their contact centres," says Sandra Galer, Consulting Director at Merchants, South Africa’s largest business process outsourcer.
"No organisation outsources its contact centre in order to increase the costs of interacting with customers or to make their customer service worse. So, in that sense, the business case for outsourcing is more than clear: it’s very simple. In an era in which the effort a customer must apply in order to do business with you is becoming the new foundation on which customer-facing activities are based, every organisation, small or large, needs to ensure that reducing the customer’s effort doesn’t escalate its own demand on resources.
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"So, if running a contact centre is not your core competency, why would you waste the resources needed to run it when you can reduce costs and gain many other business benefits by outsourcing?"
For those relatively few organisations in which the contact centre comprises a large part of their business and, therefore, competency is high, outsourcing still offers the benefit of scalability, particularly for seasonal events. Also, the use of multiple outsourcers enables spreading of risk and negotiation of favourable operating costs.
Galer warns, however, that playing contact centre providers off against one another carries a risk of fragmenting both the brand and customer service. "It also makes providers reluctant to share customer information or support. This can work against cost savings."
Possession and interpretation of customer data is one of the major reasons executive teams do disagree on the need to outsource the call centre. There is a fear of losing control of customer data and therefore the ability to innovate with products and services to increase customer satisfaction and reduce customer effort.
"In fact, your provider should do some of your innovation for you," Galer says. "If you’ve selected a provider with a proven track record of expertise in your vertical, whether it be in sales or service, and is closely aligned with your own organisational culture, then you will have a powerful business partner.
"Also, medium to large providers are constantly testing new technologies with the specific aim of reducing the customer’s effort. They stay on the cutting edge of customer satisfaction so that you can, too. This includes ensuring that your data is mined to your benefit.
"That said, it makes no sense to hand over your customers to a contact centre operator and not think about your customers again until the time arrives for the annual increase for the provider. You need to plan for integrating contact centre activities back into the rest of your business.
"Internal or external, the contact centre represents your brand. So, it must accurately reflect your values and culture. It must function in a way that enables you to understand your customers better, even though you may not be managing customer information directly.
"The best way to achieve this is to participate in the training of contact centre agents, to provide support from your business units for contact centre operations, and to maintain close communication with the operator.
"These fundamentals apply whether you’re outsourcing or not. It’s just that, with outsourcing, applying the fundamentals comes standard with reduced cost and increased efficiency."
Many organisations defer outsourcing their contact centre because it brings considerable change. There is also reluctance to manage the process of retrenchment or moving internal staff to the outsourcer. In addition, public reaction to offshoring, in terms of the apparent loss of jobs to the local economy, can be negative.
And, there are the upfront outsourcing costs of acquiring premises and recruiting and training staff.
"These are all legitimate concerns," Galer says. "It’s important, however, to come back to the original business case. If your organisation becomes more sustainable as a result of outsourcing, then many more jobs are saved than lost and the organisation’s overall contribution to the economy remains positive. It’s a question, then, of communicating such benefits to the audience at large."
Frequently, an outsourcers’ cost per seat fee is deemed expensive. "However, were organisations to account accurately for the proportion of their building, facilities, and HR overheads consumed by their internal contact centres, they would quickly see how the economies of scale of contact centre providers slashes those costs," Galer says.
"If you’re looking to expand current capabilities, add new divisions, improve efficiencies, or scale with seasonal variances and you don’t know what your existing costs are for an internal contact centre, you will not be in a position to compare provider offerings and make a decision about outsourcing that boosts your bottom line.
Looked at from all angles, Galer believes that the decision to outsource comes down to a question of ‘why’ and not ‘when’. "If you know why you need to outsource your contact centre, the when follows automatically. As with all business issues, your strategy will dictate how your operations are structured."
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About Sandra Galer:
Sandra is the Consulting Director at Merchants. Starting as a call centre agent, she’s held a range of operational roles, including creating and running contact centres for international clients. With over 20 years’ experience in the contact centre environment, she brings best practices and a common methodology to our operations.
Merchants, a Dimension Data Group company, is a provider of bespoke outsource contact centre solutions and has a 25 year track record of delivering customers contact centre solutions for a variety of blue chip organisations, globally.
Published: Monday, April 6, 2015
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