Diversification, in its many forms, protects your business.

By Lance Hale, President, Transparent BPO and Tom Silzell, Managing Partner, CX SolutionSource

The pandemic laid bare a lot of truths in business.

We missed working in the office. We didn’t miss working in the office.

We missed the daily camaraderie of our colleagues. We didn’t miss our colleagues.

In the customer care sector, it showed businesses the importance of diversifying their model to respond to customer demands. During the early days of the pandemic, and sporadically since then, smaller clients – those typically requiring 30 to 100 agents on a full-time basis – found themselves underserved by their large BPO partner. The limited size of their business didn’t command the attention they had hoped their partner would provide.

For good reasons – and bad – the pandemic reinforced the need to diversify your customer care model. While companies are now building redundant capacity into their supply chain models to ensure they get the raw materials or components they need to build their product, they should also consider how they service their customers.

’Business Recovery 101’ stipulates that businesses should consider different locations to ensure a natural disaster in one region doesn’t impact capacity halfway around the world. It also dictates that any facility should have redundant IT and power services. And they should also diversity their partners, again to ensure an unexpected disruption at one single provider doesn’t hamstring your entire customer care operation.

In fact, the industry is actually seeing a ‘reverse consolidation’ of capacity. The trend to gravitate to customer care mega centers and large hubs aren’t attracting the clients they saw several years ago. The reduced appeal can be traced directly to lower service levels stemming from poor training and challenges recruiting talented agents in saturated markets.

Land-locked leadership

And clients aren’t getting the same access to senior leadership at their large provider. All too frequently, experienced leaders are administratively land-locked dealing with budgets, daily firefights and never-ending requests. They rarely have a chance to visit with clients to understand their business and their challenges/opportunities. They may make time to see the top 10% of clients who represent a significant chunk of revenue, but leaders are typically unable to meet with smaller clients who represent a legitimate chance to grow their business. Furthermore, when senior operations leaders are responsible for dozens of centers, it’s impractical and unreasonable to expect a close relationship with site leadership. This can lead to a lack of understanding of the nuances and subtleties of various centers in different regions.

In many cases, large providers become large providers, not because of organic growth but because they’ve acquired smaller providers who provide regional capabilities (i.e., Nearshore) industry capability (i.e., healthcare) or technical capability (i.e., software apps.). However, acquisition upon acquisition presents its own set of challenges.

Successful acquisitions are tough. Rarely do two companies share the same culture and values, or internal operations or sales techniques. Prior to the pandemic, some providers had a good handle on providing work-from-home agents while others didn’t know how to approach this dilemma.

With acquisitions, the question always remains, “what do you retain from the acquired entity?” Blending cultures is challenging but smaller independent BPOs don’t have the legacy baggage that comes with acquisitions. If a smaller company is operating in a defined Nearshore market, it’s because they believe in its potential to provide solid service – from reliable internet to a steady pool of qualified staff.

And clients should ask themselves if the lines of communication are as clear and open as they were with the smaller provider? Clients seek clarity and consistency and this isn’t always easy to provide after acquisition when a smaller client can get lost in the shuffle.

 A diversified model using multiple providers protects a business by building resiliency into the customer care model to ensure a clear line of sight of how your customers are being served.