Outsourcing the customer contact.

by Niels Kjellerup , Senior Partner Resource International May 13th 1998.

In a recent presentation (Why Call Centres Fail) at ATUG ‘98 in Melbourne Australia I created quiet some controversy by stating " that any business or organisations which presented a Business Case for outsourcing their Customer Contact needed to revisit their corporate Vision and decide which business they were in". Let me clarify what I mean so there is no mistake.

Historically the growth of the Call Centre Industry is, in my view, based on the TARP research coming out of the US in the 80’ies, which documented that the Information Age Customer (consumer and business alike) demands easy access to whoever they do business with and further requires "To be Taken Care of "- if not they will walk.

Driven by the Information Technology & Telephony the result was the Call Centre or Help Desk as a cost effective way to facilitate the access the customer was demanding.

Most Call Centres in Europe, USA or Australia are established as cost centers to avoid the initial distribution channel conflicts inherent in integrating the new Customer Contact process with the existing sales and marketing channels. Alas, little or no attempts are made to actually look at the value of the Outcomes of call contacts. The measurements used to determine the success of the call centre are operational and often limited to number of calls, length of calls, an arbitrary service level of calls answered within certain time frames, size of payroll and phone bills. (for more information read the article False Benchmarks).

Management Productivity demands take the Call Centre down the road to the Galley Slave Model i.e. constant pressure to deliver more calls with less people. A challenging (read: bad) place to work... customer satisfaction deteriorates, staff churn grows and the manager is at her/ his wits end.

Firstly, Managements accepts the need to invest in multi layer IVR’s or other expensive IT / CTI equipment to keep live call numbers down. Naturally the Customers are puzzled and revolt.

Secondly, Management in their desperation to improve productivity starts listening to "The Outsource Solution". Why not let a 3’rd party handle the calls at an operational cost of less than operating the current call centre or help desk ????

If you followed my argument you will notice the purpose of the call centre has been lost..... What happened to the importance of giving customers access in real time to the organisation ? It got lost because no one documented the value of Call Outcomes.

The added value of a Call Centre, apart from increased sales at lower cost or lower service costs, is the feedback from the Marketplace which then helps management restructure the organisation to do business smarter and more productively.

My first outsource case from 1991-92 comes to mind. A large, no make that global, IT- company had a history of closing its call centres down every time a head count cut was enforced. To overcome this policy barrier we created a call centre model where we ran the call centre on the clients premises and with their IT equipment, but with our people on a 2 year management contract. This model was very successful for the client and the model is still in operation.

The questions to ask when discussing Outsourcing the Customer Contact process are :

1. Who are our customers, and are they really profitable?

2. How do we identify small customers who will grow with us?

3. Do we have a complete MAP of our Customer Contact Process (CCP)?

4. Which if any of the elements of CCP can be automated? (Typically information specific processes such as Directory services, balance inquires etc).

4a. Taking personal contact out of these contacts, will we miss sales or service opportunities ? and at what cost / benefit ?

5. Which, if any, personal customer contact is generic in nature and is focussed on information collection or retrieval without sales or marketing opportunity ?

5a. Typically such areas would be a) fulfilment of loyalty programs, b) lead generation, c) billing questions etc - just remember the cost/benefit.

For Governments and organisations with a monopoly, the outsourcing question is different -

1) Do we need Client/ Customer feedback to help change the way our procedures and processes work ?

2) Do we have processes in place which will identify important calls and ensure appropriate action.

3) Will outsourcing improve our service levels ? Cost/ benefit remembering to take into account the views of the client/customer, who after all pays the bills.

4) Will we continue to be a virtual monopoly or is their a real need to improve client/customer access to prepare for future competition ?

In summary : Any Business which is not in the business of fulfilling customer needs should ask themselves what business they are really in. Any business which can present a Business Case where the customer is not part of their core business needs to revisit their Purpose for existing. Anyone else needs to carefully MAP out the entire Customer Contact Process and take a hard look at how customer access impacts the profit line before deciding to outsource any interaction with their customer base.

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