Market statistics hide more than they reveal. They tend to create certain perceptions which over a period of time become generalizations and don’t necessarily reflect actual global market realities.
There are a couple of issues or should I say dichotomies in the immediate outsourced contact center business scenario that need to be analyzed closely.
In my previous column I had expressed the belief that come what may, the outsourcing of contact centers isn’t about to abate as yet – customer satisfaction (or should that read “dissatisfaction”) surveys notwithstanding.
Another trend, if I can call it that, I detailed was about businesses the world over passing the buck on cost overheads (now read ``customer interaction by way of simple telephony and one-to-one rudimentary customer interaction’’) as ``non-core’’ to their strategic operations.
The above aspect, more than anything else, is seemingly alarming. Research, surveys and opinions posted on TMCnet.com and numerous other websites, journals and forums have been raising the red flags for a while now. But the reality is that companies the world over seems to have their blinkers firmly on in place. Or so it seems…
From whatever one can glean, hardly any attention is being paid to the simply overwhelming amount of research data that is being thrown at them by way of customer backlash from seemingly reckless outsourcing of customer care operations. Before moving further, here are some significant pointers from research firms and the fourth estate:
The report “Magic Quadrant for CRM Customer Service Contact Center, 2006” by Gartner states that three transformational trends will continue unchecked for the next 18 months. (Of these, I will concern myself with primarily the first point in this column.) These include: 1. Outsourcing low-complexity customer service tasks to a lower-cost human agent outside of the enterprise; 2. Migrating low-complexity and automatable interactions entirely to self-service over the Internet; and 3. Embedding intelligent device management capabilities in all electronic goods.
In his column in CNNmoney.com, “The Hidden Cost of Outsourcing”, Jeffrey Pfeffer wrote: “With consumers enjoying more choice than ever before, evidence is growing that great service is essential for long-term customer retention. To cite just one example, a recent survey of pension policyholders in the United Kingdom found that 75 percent would leave their current provider if they experienced bad customer service.”
Now just hark back to the NetReflector survey featured on TMC.net last week which threw up some startlingly dismal stats for those companies involved in sending their customer interfaces overseas. The prognosis was that a whopping 84 percent of respondents in the U.K. and 82 percent in the U.S. would likely or very likely switch to a competitor following a poor experience.
As mentioned earlier, my question is that with such research data on the side of the corporations, why is the contact center outsourcing boom refusing to die down? Why aren’t companies giving the due weightage to customer interaction and satisfaction before considering outsourcing of those operations? How can customer interface or service, the first point of contact with a customer or a potential one be treated as “non-core”?
If the statistics are any indication, companies would lose over 75 percent of their customers on an average owing to their having committed that cardinal sin in the first place. And as I mentioned in one of my previous columns, that would be sheer stupidity and akin to committing willful business suicide. That may not necessarily be true.
I personally believe that there is a lot more to this entire customer backlash fracas and that there are a whole lot of significant issues that have been swept away by the tidal wave of market surveys, studies and opinion polls. The growing number of dissenting voices through Internet blogs too has contributed to the growing disenchantment which is now fast becoming a deluge of disillusionment against outsourcing contact center ops.
Let me quickly add that this is not in any way a finger-pointing exercise or questioning the efficacy of any of these surveys, studies or opinions. They are legitimate in their own right and conducted by the most respected of agencies and analysts in the world.
But the fact is unlike bikinis, statistics do hide more than they reveal. They tend to create certain perceptions which over a period of time become generalizations. Let me explain.
Survey numbers of the likes presented above could prove to be a potential mine-field when read by those affected or laid-off by outsourcing. The negative reaction, although natural and unfortunate, would tend to get magnified a hundred times and could result at times in an outpouring of unwarranted criticism. The blogosphere then becomes the ultimate forum for expressing that anguish or anger. We all know that in today’s day and age, spreading any message can be done in a few hours over the Internet.
However, put the same data in the hands of the senior company executives that are outsourcing their customer care operations and it would evoke a different reaction – concern to start with, hopefully followed by a thorough analysis of the size and scope of the survey or study. The critical part is to have a complete and holistic understanding of the target industries covered (technical or non-technical), the number of respondents and the precise nature of the customer responses or ``complaints’’ if one should call it that. Of immediate concern to any corporation would be to scrutinize whether the industry that they belong to has been included in the scope of the research, whether they have been receiving similar feedback from customers of their off-shored centers, and if they need to take quick remedial action.
I would like to believe that it happens more often than not.
For example, going back to the NetReflector survey (and I’m not nitpicking here), “29 percent responded that bad accents were their top-of-the-mind complaint while 18 percent reported their number one complaint was dealing with rude or condescending agents”; 17 percent had long waiting times as their number one gripe. A simple calculation should logically show that the sum total of 64 percent respondents expressed dissatisfaction for specific reasons in their interactions with outsourced contact centers.
Although that is not how statistics work, it is an immediate perception that tends to flash in the mind’s eye.
But view it another way and the numbers could also suggest that 71 percent of the respondents in the first case did not cite bad accents as their top grievance, and that on the second parameter 82 percent of the respondents were okay about the ``accent’’ but unhappy with the “attitude” of the agents. Continuing in the same vein, since 17 percent respondents cited long wait-times as their primary complaint; it could mean that 83 percent were happy with the accents and overall attitude of the outsourced contact center agents.
None of this is really true, or untrue for that matter, but it puts a whole different spin on things doesn’t it? Like I said, it is about perception; the glass half-full or half-empty.
The outsourced contact center business is today a multi-billion dollar industry and has fanned and spread across the globe. Some of the best multinational corporations have reported excellent returns both in terms of costs and efficiencies by transferring their customer interactions overseas.
One needs only to look at the success that corporations such as IBM (
News -
Alert), Accenture, Convergys (
News -
Alert) or Genpact (GE) have achieved in India in the past years to prove that point. The key has been their underlying philosophy of recruiting the best-of-breed, offering excellent salary packages, creating environments that encourage quality of response, and investing in rigorous orientation and ongoing training programs. They sure can legitimately claim a large percentage of satisfied customers worldwide.
But yes, there is the other end of the spectrum – companies that try and emulate such success without focusing on the aforementioned critical aspects. These are the entities that need to be weeded out though stringent selection criteria and thorough background-, operations-, financial- and process-related scrutiny on the part not just corporations wanting to outsource their customer contact operations, but also by local industry bodies. This process is already underway in India and will be a subject to be discussed in a future column.
Before I sign off, the May 10, 2006 edition of Ascent, the employment supplement of the Times of India carried a half-page recruitment ad from none other than Dell (
News -
Alert). The personal computer industry major is looking to hire technical support executives in its new contact center in Gurgaon, in the northern state of Haryana, India, to provide high quality technical support to its customers worldwide. Dell on its part promises to provide in-depth training to enhance technical skills and the necessary tools and techniques “to deliver the best customer experience.”
Well, what is ironical is that almost every columnist worth his or her salt the world over has been the first to cite Dell as a prime example of a company that got bitten by the outsourced customer contact center backlash and moved its operations out. That world view might have been a trifle premature and myopic because Dell continues to run its customer contact centers out of Bangalore, Hyderabad and Mohali, while now investing in its new contact center in Gurgaon.
My view is that Dell’s earlier travails were more a case of exception rather than what was seen or rather perceived as the rule or norm. At $56 billion in revenue, the company is surely not stupid!
Is it time for a reality check?
------
Murli Menon was Editor of Computers & Communications (C&C), a leading Indian infotech and communications publication brought out by Media Transasia India Pvt. Ltd. from 1987 to 1994. He went on to set up the IT Publishing Division of Media Transasia in 1995 and as Publishing Director published PC World, IS Computerworld and Communications World in collaboration with IDG, U.S.A. until 2000. He now runs his own knowledge, content, and information management company –Virtual Digital Media.
VXi Launches UC ProSet for Contact Center Users
Gartner Says Adopting a Pace-Layered Application Strategy Can Accelerate Innovation; Special Report Shows Pace Layers Can be Used to Build a Business Application Strategy That Delivers a Faster Response and a Better
NEW Consolidating Infrastructures: IT's New Call to Business [white paper]
