Answers: Should We Outsource Calls?


Question: We run three call centres in the UK and with the economy getting tighter, we have been looking at the possibility of outsourcing our calls – either in the UK or to India. We are a bit worried about a customer backlash. Does anybody have any advice of what we need to do – or any experience of having done this themselves?

Answer courtesy of Mike Purvis, UK MD of Transcom.

mike-purvis

Mike Purvis

Nearshoring to locations such as Lithuania or Latvia has proven a successful strategy for many of our clients who were struggling with similar questions of when and how to outsource in response to changing market conditions.

In the short term (and with the economy in an uncertain state), businesses tend to focus on the decreased cost of outsourcing their call centre needs; however, in the long term, well-executed outsourcing can improve the quality of service which businesses are able to offer their customers as well. Carefully weighing the cost-benefit relationship should be at the heart of your decision making.

Nearshoring allows businesses a rather unique outsource solution, apart from simply outsourcing in the UK or all the way to India.  Nearshoring is where call centres in nearby locations (such as the Baltic region or elsewhere in Eastern Europe) service UK customers.  The operators in these areas are highly educated and well-trained professionals, who have almost flawless English accents and similar cultural backgrounds to the customers they serve.  At the same time, the prevailing operating costs for call centres in these areas, in terms of both salaries and rents, are a fraction of those in the UK. This means that nearshoring centres are able to provide a high-quality and reliable level of customer satisfaction at a significantly reduced cost.

Depending on the size of the business, the most important question to ask is often not whether to outsource but how much and where to outsource.  For many managers, there are a number of business processes which distract them from more important (and commercially rewarding) tasks.  At the same time, managers have to weigh the reputational impact that outsourcing can have on their customer satisfaction and how easily they can change course if their expectations have not been met.

The best advice is to choose an experienced company with a proven track record.  Then, treat your decision to outsource more as a multi-step process rather than a one-off tactical move.  This can make it easier to scale up or scale down in the future once you know more.


Answer courtesy of Neil Robinson, Head of Client Management, Convergys Corporation (EMEA).

Any company setting out to establish a new call centre faces a mammoth task. The fundamental decisions and steps are the same whether the centre has 20 or 1,000 seats, if it’s in-house or outsourced. The advantage of an outsourced operation is that you can draw on the provider’s vast experience, advanced learning curve and resources. But engaging an outsourcing expert by no means absolves you of all responsibility: good outsourcing contracts rely on both parties working in close partnership. So a good understanding of the challenges and processes involved in setting up a call centre will be critical to your success.

1. Plan, plan and plan again

Once the decision to set up an outsourced call centre has been made, the first step is to put together – and agree – a detailed implementation plan. This may seem obvious, but in reality the depth of implementation planning varies considerably. The plan should establish core objectives of the project, along with key milestones and processes associated with the roll-out. It should cover all aspects of the project, from identifying a suitable site for the centre, through technology choices to recruitment and training. The plan should give clear timelines, establish metrics and assign owners to each step of the process to ensure accountability. Likewise, the budget and what is included in the pricing (or not!) should be clearly set out.

2. Finding the right location

A short-list of potential location has to be evaluated from various angles:

  • Human Resources: what is the local skills pool like? How many companies in the area are competing for similar staff? What are the forecasts for wage inflation and staff attrition?
  • Building review: what are the conditions for the proposed site? What state of repair is it in? Is it easy for staff to reach? Does its meet environmental, health and safety requirements? What risks does the location pose to a future operation?
  • Technology: what technology infrastructure is available? What connectivity to existing systems or additional technology investments will be needed? Which suppliers can provide IT and telecoms services at the site?
  • Legal, tax and regulatory considerations: are there local tax incentives? What legal challenges may arise? What industry accreditations and certifications will be required?  Which government agencies must the company engage with (e.g. local investment agencies, county councils)?

3. Technology

Selecting and deploying technology is no longer just a case of getting phone lines and terminals in place. Managing relationships with your customers is becoming increasingly complex in a multi-channel environment. Consequently, you may need to upgrade existing systems and require new tools to deal with all available service routes, including automated systems, email, web or voice.  Your outsourcing provider should apply its experience here to achieve the performance levels, security, reliability and quality that you require.

Policies for dealing with each process or customer interaction need to be agreed and the relevant technology has to be deployed and configured. For example, how should incoming calls be routed? How many IVR (interactive voice response) menus will a caller go through before speaking to a live agent? How will you prioritise high-value customers?

And, last but not least, all systems have to be tested and a training environment has to be put in place before the first recruits arrive.

4. Recruitment and training

It goes without saying that call centres are people businesses, so you should be painstaking in your recruitment process.

This starts with calculating how many agents and what skill sets are needed. Will it be simple transactional jobs such as credit card activation or billing enquiries? Or will you need IT experts for complex tech support? These considerations will feed into the job descriptions and recruitment strategy you agree with your outsourcing provider.

Next you need to think about training plans and materials to get agents quickly up to speed with your company’s products and practices as well as call centre technologies and processes. Generally, you should allow around eight weeks for training, working back from your ‘go live’ date. Training will include programme-specific elements as well as call quality improvement and, if required, culture and communication. Training the trainer(s) is the first priority, followed by several waves of new hire orientation and training.

5. Go Live!

As always, the proof of the pudding is in the eating: before the centre goes live, a ‘nesting week’ will allow staff to settle in, get trained ‘on the job’ and test the centre’s overall readiness in real-life conditions. Ideally, this will give the outsourcing partners enough time to identify any potential issues and tackle them before the first real call is put through.

However, if you have followed the steps outlined above with a professional outsourcing provider to guide and manage the process, your call centre should be off to a good start.

Published On: 27th Aug 2008 - Last modified: 12th Feb 2019
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19 Comments
  1. Hi There

    Outsourcing has become and affordable and efficient meduim to manage a greater demand with reduced cost.

    You also have the oppurtunity to outsource to South Africa.

    Jerome 12 Jul at 8:35 pm
  2. Hi Jerome,
    Often it become difficult and less cost effective to perform all business related activities by the company itself. So the developing countries like India is a best solution for outsourcing the business. Outsourcing services like BPO, back office, telemarketing services to India offers benefits not only in terms of cost reduction, but also in terms of increased productivity and quality. There are no major legislative and taxation barriers to outsourcing. In fact India has a largest number of English speaking people. So there is no need to be concerned for customer backslash.

    Thanks

    Call Center Executive 15 Jul at 8:05 am
  3. Outsourcing is always a feasable option, but yes there are a number of key factors you need to consider before taking such a decision. They might include –

    1. What are your drivers for outsourcing, cost reduction? headcount reduction? cost management through improved efficiency? Have you done a Cost Benefit Analysis, if not, you need to and in detail!
    2. How sensitive is your position in your vertical market and how vulnerable is your future growth relative to market perception?
    3. Have others in your vertical market outsourced locally or offshore?
    4. How sensitive are your customers in terms of loyalty relative to service quality. (NPS score?)
    5. How sensitive or complex is your business, what % could you easily transfer? What % makes sense to transfer?
    6. What would you do with your existing staff if you outsource and how will this effect morale and performance if you have to release a % of your existing workforce?
    7. Transferring work to a non native english speaking market whether India, South Africa or The Philippines will have an impact on your customers and yes you may suffer an initial backlash, however it depends on the sensitivity or value of communications..eg.. I would suggest you do not effect new business sales, upselling or customer complaints through an offshore location! There are significant savings to be made through the use of offshore (>50%), but there are risks involved and you will need to be honest in your appreciation of those risks and weigh them against the potential cost benefits.

    If you decide to outsource the most Critical Success Factor will be your management of the relationship. Outsourcing can be very successful if managed closely and if effected with an open and honest relationship which recognises that your outsourcer is your partner. They are not perfect no more than you are, they are in a people business just as you are and they are in business to make money!!! Respect that, define clear deliverables with a good SOW, have open access to your outsourcers site, manage closely and you can create a true win-win scenario!

    Good luck!!!!

    Donal Crotty 15 Jul at 11:11 am
  4. Hi There

    Recently we had discussion with Mr Ahmed from call an international Centre,listened samples call handling an was very impressed with quality of call agents and rates offered.There sales agent is in UK and his mobile number is 07984 677 535.
    Hope it will help.

    Kevin Morgan 17 Jul at 5:14 pm
  5. I think the best way to resolve this is to allow all the interested outsourcers to forward you a proposal and sample calls.

    This way you dont limit your possibilities.

    Kind Regards
    Jerome

    Jerome 21 Jul at 8:17 pm
  6. The most important thing I have to say is this: Don’t offshore! What’s wrong with the UK? There are some great people out there with the passion to represent you and wow your customers. You will get more of a backlash if you offshore. Pick a good outsourcer in the UK with a good reputation and testimonies and you won’t go wrong.

    Ian Harvey 7 Aug at 11:33 am
  7. I have to agree with Ian harvey…. have you looked at the potential to improve the onshore operations. Many Banks and customer facing service operations are reversing their offshoring decisions, and reaping teh benefits of efficient onshore…. look into applying a Lean Sigma approach.

    Mike Twigg 15 Aug at 8:51 am
  8. Any outsourcing to India will have a serious backlash affect with your customers as the quality service and relationships you have built up with your clients based will be downgraded.

    An option you may want to look into is diversifying your client base by penetrating into the UK’s vast Ethnic non-English speaking community which consists of over 4.9 million people. Alternatively you could think on a global perspective with a potential customer base of 5 billion.

    P.S Think outside the box and you will find success!!

    Matthew Lowe 22 Aug at 2:25 pm
  9. Hi

    There are other avenues to look at before going down the outsourcing route. There are plently of products out on the market at the moment that will reduce call centre traffic before you look at outsourcing abroad. There are ways to help customers use the internet and cut down the amount of calls coming into the call centre. I just thought that if you think outside the box then there is other potential avenues to look at rather than just outsourcing. Drop me a line and I would be happy to talk through some of the other options. 01473 288744.

    p.s. Good luck

    Matthew McArdle 28 Aug at 11:31 am
  10. Hi
    Just a short comment here,Customer satisfaction is paramount to the continued success to any business and whilst outsourcing overseas, may have many benefits it can also have detrimental affects on your business(if customer satisfaction is not monitored closely). From my experience, many Call centre staff in India may be able to speak good English but they have little or no comprehension of our language.
    I was a database system trainer within a very large Uk call centre for a number of years who had call centres in India. One of the worst cases of total customer dissatisfaction was as follows:

    -Operator asks customer a question,
    -Customer replies, I have too much on my plate at the moment, I am really not interested.
    -Operator responds, can I call you back after you have finished you dinner then.

    Another customer was advising an operator that her father had passed away and wanted his details removed from their database, very easy request to process you would think. but boy the response was “so your father has now been extinguished”.

    It may sound funny but to a recently bereaved customer the impact was almost un managable.

    Good luck with your choice

    A Carr 30 Aug at 3:56 pm
  11. Oursourcing calls isn’t a bad idea. However in my experience unless the company has clear and concise policies and procedures it wouldn’t be as great of an idea.

    Unless you don’t have clear and concise policies and procedures in place chances are the calls would get routed back to the main call centre at twice the cost. Therefore your spending more money and no FCR (First Call Resolution).

    Babalu 1 Oct at 7:14 pm
  12. India is not the only place to outsourse. we had a similar problems where costs had to be saved and because of this opened an office in Bulgaira.

    It is Multilingual and the grasp on the English language is superb with the majority of the staff having studied in the UK or America. Unlike the UK the guys on the helpdesk all have at least one degree.

    Whatever you choose just make sure it is not a knee jerk reaction and it is the ideal solution for you!!!!

    Russell Bailey 21 Oct at 1:46 pm
  13. It would be great to get an update on what route you decided to take.

    Ruth Cunningham 23 Oct at 11:10 am
  14. Outsourcing is the easiest way to cut the costs to your business yet retain your Customer base. Providing you get the right partner as opposed to the cheaper option you can not go wrong.

    Being up front and honest with your preferred outsourced partner will find you well ahead of the game and will ensure you retain adequate staffing levels depending on seasonality. This means also that whilst staffing to a quarterly/monthly level you will not be seen to be in the news every time the markets drop regarding job losses.

    Many options have been mentioned however Northern Ireland has not yet been mentioned. In Northern Ireland you have the best qualified workforce who are easily trained and readily available. Cost of living is still relatively low as opposed to the rest of the UK and you will be able to get value for money as well as staff who are on top of the game. Looking for a call centre who will employ graduates is a costly excerise as well as the fact that once a job comes in their chosen field they will not show the same loyalty as someone who you can mould into your perfect member of staff.

    In Belfast there are numerous centres with proven experience such as the-gem (proven multilingual expertise), techmahindra and firstsource. All with strong top down management.

    In my opinion outsourcing is definitely the way forward in the current and future climate and means your overheads internally can be reduced dramatically – ie how many companies have open office space that cannot be filled say 75% of the year. You are paying the costs for this building when you could be paying someone else only for what you actually use? It makes perfect sense.

    Good luck and this has helped.

    Mark

    Mark McLoughlin 9 Dec at 8:48 pm
  15. Don’t outsource…..customers don’t like it. I deal with thousands of Customers a week that complain heavily about outsourced callcentres, I also deal with advisors who constantly clean up after offshore advisors who ‘tell the customer what he wants to hear’ to make a good impression in the workplace, all this does is create repeat calls into the UK and streams of unhappy Customers and UK advisors.
    Do a poll in a local newspaper/radio, that will give you a good idea of your marketplace!

    Debbie 16 Dec at 11:42 pm
  16. In my exeprience, outsourcing is not a good idea. Yes, it will save you money and I hear everyone talking about the ‘quality service by professional and educated people’, but why not think about the benefits with not outsourcing.

    Why not seperate yourself from other companies and show that you are not outsourcing. This may actually gain you more customers and more profits. Most people prefer to speak to someone in their own country, and think that a company is cheap if it outsources to places like India.

    Personally, I dont like dealing with companies that have outsourced their operations, and have stopped being a customer of various companies due to this reason

    Andrew Goodyear 4 Mar at 2:48 am
  17. Hi Neil,

    It’s really informative. I’m a young entrepreneur learning this industry and i bet what you have shared here is helpful not only for the company you wrote this but for all who happened to see this. I highly appreciate your post.

    Cheers,
    Harry Smith

    harry 1 Feb at 11:46 pm
  18. DO NOT OUTSOURCE, DO NOT OUTSOURCE – IT WILL CATCH UP WITH YOU IN THE END. UK COMPANIES THAT HAVE TRIED TO HAVE FALLEN, THOSE THAT HAVE NOT HAVE HAD INCREASED BUSINESS, FROM CLIENT TRANSFERS. Would you like it if you were the customer? I think not

    Steve 22 Feb at 2:17 pm
  19. Outsourcing or not… There’s really no difference in quality. Call Center agents from outsourcing companies are trained the same way or sometimes much better than local call center agents… but sometimes when the call gets too personal, the agent may not connect to the customer when they talk about unnecessary stuff (it may be a good thing so it can reduce handling time cause call centers train their agents to be passive when it comes to ‘personal talks’).

    Remember, even if you let locals handle the call themselves, this does not guarantee that you’ll be able to

    Not patronizing a company that outsource calls… Aww c’mon.. think about it.. Do you think locals can do better? Making your own helpdesk will not only be very difficult and expensive, but also you cannot guarantee that the agents you employ will have the adequate knowledge and reasoning compared to established contact center representatives.

    Triad|Warfare 12 Jun at 8:19 am
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