There are many reasons to consider whether to outsource your contact center. Cost is only one of them.
Before the internet, customer service was typically limited to a brick-and-mortar storefront, letter-writing, or a phone call to customer service. The result is the customer service call center was seen largely as a cost center; it was part of the cost of delivering goods or services. So, what naturally followed was a focus on simply reducing the costs of operating that cost – ah-hem, call – center, which was often accomplished through call center outsourcing.
Thankfully, this perspective on the contact center has shifted significantly. We see leading brands focusing on customer care as a center of excellence (COE), driving positive customer experiences, growth in customer loyalty, and improved profitability. In fact, according to one Deloitte study, the number of service leaders whose top priority was cost reduction will shrink by one-third.
This blog post is not about the technological transformation of the call center into the modern contact center. It’s not even about the shifting view that customer contact is clearly seen as a revenue center – or at least the opportunity to grow revenue. Instead, we will explore the many benefits (and some potential drawbacks) of service outsourcing and several considerations in selecting the right provider.
“The important thing about outsourcing or global sourcing is that it becomes a very powerful tool to leverage talent, improve productivity, and reduce work cycles.”
-Azim Premji, Founder Chairman, Wipro Ltd.
Why You Should Outsource Your Customer Service Operations
Yes, it remains true that there are often considerable cost savings to be had with outsourcing, but these are not always where we might expect – with wage mitigation. And the potential to improve profitability through customer retention and direct revenue growth makes outsourcing an intriguing option, even for smaller to mid-market brands.
Access to Expertise
Outsourcing your contact center to a reputable provider gives you access to expertise that might otherwise be unavailable to you. Just as your organization has core competencies, an outsource provider (OSP) has the knowledge and experience necessary to provide top-notch customer service, leveraging industry best practices to manage customer relationships.
They will also be able to provide insights into how customers interact with your organization. The provider will be able to provide you with valuable data and analytics your brand can use to refine your customer processes for maximum success. Also, a contact center provider will be able to handle contact operations with an eye toward efficiency, resulting in customer interactions being handled quickly and effectively.
One brand using outsourcing to gain access to expertise is Airbnb. Airbnb has been working with its outsourcer to provide multilingual customer service and support to its customers around the globe. Their outsourcer has recruited and trained more than 1,000 customer service agents in 20 different languages to serve customers in more than 150 countries.
Airbnb’s provider also helped them design and implement an improved quality assurance process to increase customer satisfaction. Finally, the OSP provides Airbnb with data and analytics on customer interactions to help continuously improve customer experience and ensure success in the global marketplace.
Cost Savings
Outsourcing your customer care operations can lower the direct costs of wages and benefits versus in-house (or captive) operations. Moreso, if nearshore works for your brand. (HINT: Nearshore servicing can be a great option, with locales closer than you may think, great savings, and impressive performance.) But there is so much more to savings than direct costs of labor!
Customer operations leadership, training, quality, recruiting, workforce management, technology, and other related areas of direct support for customer operations may also be shared, resulting in additional cost reductions. Your brand may also benefit from other decreased overhead expenses, such as eliminating the need to recruit, hire and train to backfill for attrition and staffing for seasonality. You may also enjoy reduced real estate and facilities costs.
Add to this the ability to deploy various technologies at the OSP’s scale, and you’re likely to be able to deploy at lower cost features like an in-queue callback, natural language IVR, AI agent assistance, and a host of additional capabilities.
Freed-Up Resources
In addition to cost savings, contact center outsourcing allows your brand to free up resources. Rather than focus efforts and resources on contact center staffing & scheduling, telephony, and AI, and retaining your customers, your business should be freed up to focus on other areas of the business, like product development, sales, and other core activities to grow your business, stay competitive, and even disrupt your industry.
Considering that the speed of change only continues to increase, an agile OSP can bring the scalability and the flexible & distributed workforce needed to meet everchanging demands that may stall an organization from being able to grow. Partnering with a great outsource provider should set the stage for exactly that – growth!
Regulatory Compliance
While most of the clients we engage with have heard of the TCPA (Telephone Consumer Protection Act of 1991, as amended), many are surprised to find that aspects of the TCPA apply to their predominantly inbound contact center operations. Or they’ve been surprised that their appointment confirmation calls are not getting to customers because of STIR/SHAKEN. And this doesn’t even touch privacy laws.
In reality, many organizations are often subject to more regulatory risks related to customer contact than they know. Having a strong customer contact expert as your partner can help identify and mitigate the business risks associated with customer contact.
Customer Experience Improvement
Many organizations deliver an amazing product or service to their customers. And very often, manufacturing may be outsourced and offshored. Advertising and marketing are commonly supported by an agency. Yet customer care may be held captive in-house, often citing that an outsource provider could not service customers as well as the internal care team.
There are a variety of reasons this perception may persist. However, we have often seen outsourced customer contact outperform captive customer operations. By outsourcing with the right partner, customer service representatives can be better trained and specialize in dealing with customer service inquiries and needs, further increasing customer satisfaction.
Outsourcing should also give your customer service operation access to the most up-to-date customer service technologies, ensuring that customers’ inquiries are answered quickly and effectively. Further, customers often appreciate the extra personal attention they receive from outsourced customer service professionals with specialized skills in handling customer complaints or inquiries.
How might outsourcing contact center functions improve customer experience? Let’s look at a luxury resort in the Caribbean that found its in-house customer service staff overwhelmed by the volume of inquiries and requests.
To remedy this, the resort outsourced its customer service needs to a leading contact center provider. This allowed them to offload some of their customer service workloads and provide customers with 24/7 support, faster response times, increased quality of care, and multi-lingual services. The resort improved customer experience and increased customer satisfaction by outsourcing its contact center.
You may be supporting customers across multiple channels – from voice and chat to email and Messenger. But multi-channel support in itself does not provide for a seamless experience across channels for your customers. An OSP should support omni-channel care, allowing customers to seamlessly transition to the right channel for their needs at the time.
Moreover, your BPO partner should be able to support AI across channels. Serving customers with tech+talent across channels means customers get the same, best response regardless of the communication channel, and when engaging a live agent, that agent has AI assistance to swiftly lead them with ease to the more accurate information needed for the customer.
What to Consider When You Outsource a Contact Center
Understand Your Scope of Services
When looking to understand the scope of services of an outsource provider, it’s important first to assess the individual needs of your own business. So first, take full stock of your existing customer contact operations.
You may start by identifying the varying customer contact types or skills your organization supports, like sales & pre-sales; customer service, technical support, and retention. Note across which channels customers contact your brand, including voice, chat, email, white mail, SMS, social media, or others. Notice the differing tiers of service your customer operation supports and the related complexities.
Beyond the operational or logistical aspects, also identify what is performing well and what could be improved. You may even find it helpful to leverage a third party to evaluate performance relative to best practices and benchmarks. The result of a full assessment is that you’ll have a much better sense of what you really want to accomplish with your outsourcing strategy.
Seek Help
While many large organizations have a mature procurement function, smaller to mid-sized businesses often do not. If your procurement and vendor management functions are not well equipped to support both the initial outsourcing and ongoing management of an OSP, we highly recommend finding a business partner to help navigate this process.
A vendor management outsourcer (VMO) that specializes in customer contact business process outsourcing (BPO) will have a deep understanding of best practices – both for the contact center as well as in outsourcing customer operations. The VMO will help identify and document your outsourcing needs, navigate the RFP, vendor selection and contracting process, and can manage the ongoing OSP relationship.
“Whether you believe you have hired a vendor or a partner, you are right.”
-Bryant Richardson, President, Real Blue Sky, LLC
Vendor or Partner?
Bryant Richardson has stated that, “Whether you believe you have hired a vendor or a partner, you are right.” Meaning your approach with an outsource provider, not what you call them, will determine the nature of the relationship.
In our experience, very large organizations that outsource thousands of seats of customer service work may call their outsource providers “partners,” but in truth, those same organizations actually see the work as a commodity and treat those OSPs like vendors; this approach generally colors the entire relationship as a result.
Conversely, we are working now with a $1B+ publicly-held U.S. retailer with a relatively smaller customer contact operation. Knowing the contact center is not their core competency, they sought an OSP partner and are happily receiving white-glove treatment from a boutique business process outsourcer (BPO) that has their best interests in mind and regularly serves up thought leadership.
Find the Right Outsourcer
Now that you know you are considering outsourcing and how you want to go about it, the hard part begins: finding the right organization to meet your needs and fit your culture. Resist the urge to take shortcuts here.
When choosing a BPO provider, you’ll want to be sure the provider:
- Offers all the services you’re contemplating outsourcing. Example, if your organization is starting with appointment setting with plans to outsource customer retention in the future, be certain customer retention is also a strength.
- Can scale with your organization’s needs over time. If their open-sourced telephony platform doesn’t support more than 128 agents on the same queue, they may be unable to meet the demands of your planned growth.
- Supports the kind of functionality you need for your customers. You may not need natural language IVR to start, but you’ll want to know it’s available when you’re ready. Along with AI, agent assistance, in-queue callback, and a host of other functionality.
- Is able to use your tools, where appropriate. Example, your CRM platform is used broadly across your business; the OSP needs to use it, too, without any technical challenges. Your CRM platform includes chat, and you need their AI tools to support your chat system, too.
- Has training tools and systems in place that support and reward a learning organization.
- Delivers thought leadership and guides clients to continuous improvement.
Complies with your required industry standards. If you handle payment cards, it is likely you want the OSP to be PCI DSS Level 1 compliant, as attested by a qualified security assessor (QSA). Depending on your information security requirements, ISO 27001 or SOC2 may be important, just as HIPAA or HITRUST are for health information.
Another important consideration is the fully-loaded cost of your existing operations. Many organizations only consider the offset of costs like direct labor and telephony. Keep in mind that you may be able to reduce the real estate footprint and numerous related costs by virtualizing and outsourcing, in addition to various technology costs.
Also, know that brokers and VMOs are not the same thing. A broker may help you find your OSP, but this is generally from a set of BPOs with whom the broker already has an arrangement. This is because a broker typically works for no upfront fee, but usually receives a hefty percentage of the OSP invoicing for the duration of the arrangement.
Finally, be sure to check the OSP candidate’s references. Ask some tougher questions in the process, like “What was the biggest service delivery failure you’ve experienced and how did they recover from it?” Ask to speak with the client that most recently left them. Know that if you only ask the softball questions, you will not have the answers you need to make the best selection.
Conclusion
Outsourcing your contact center is a great way to ensure that your customers have the best experience possible. With an experienced and knowledgeable contact center business process outsourcer, you can improve customer engagement, reduce operational costs, improve operational efficiency, and gain access to the latest technologies and processes.
You can also benefit from improved customer service levels, customer satisfaction, and loyalty while enjoying lower costs. These benefits may make outsourcing your contact center an excellent option for your brand.
Want to talk about whether outsourcing your customer contact might be right for your brand? Schedule a complimentary conversation, and let’s talk!