Global Statistics Show Contact Center Outsourcing Will Continue to Grow

Outsourcing of contact center operations has often been shown to save the organization money, while also improving productivity and efficiency. When that outsourcing happens to be offshore outsourcing, even further savings have been known to be realized, despite the controversy that such a practice can cause.

According to Avaya (News - Alert) research, industry statistics show that organizations spent $113,6m globally on call center and business process outsourcing (BPO) services in 2005, and another $123,4m in 2006.

This number is expected to increase to $133,2m this year and $145,4m in 2008. Avaya points to customer relationship management and human resources as the most popular business processes to outsource. Following closely behind are financial services, such as retail banking, insurance claims and then billing and debt collections.

North America definitely has the largest share of the BPO market, followed closely by Europe, Asia Pacific and central and Latin America, Middle East and Africa, according to Avaya research. Interestingly, many of these markets that outsource services also are home to expanding outsourcing industries.

Business processes are mainly being outsourced by multinational organizations as there is a good business case for companies to outsource their call centers and business processes. Such strategies allow these companies and their IT departments to focus on corporate initiatives such as consolidating different IT systems on a single platform.

The benefits of outsourcing are well-known and include less reliance on technical skills, fewer staff retention issues and lower costs. Global statistics show that 40 percent of corporations already outsource some or all of their contact center or business process functions, and that 55 percent are considering doing so over the next two years.

Avaya itself benefits from the outsourcing practice as its majority-owned subsidiary, Global Connect, provides global call center and BPO services to local companies and multinationals, while also employing 6500 agents. In fact, 56 percent of Global Connect’s revenues come from call center outsourcing and 44 percent from BPO, including video conferencing.

The company also services 20 outsource operator clients in South Africa, including Sunguard with 1300 agent seats, Digital Communication Holdings with 1600 seats, Blakes with 1400 seats and Velocity with 200.

While Avaya’s share of the market is really just a glimpse into the total industry, it helps to paint the picture that even vendors that enable contact center operations have accepted the benefits that offshore outsourcing can provide and has capitalized on the opportunities that continue to grow.

And, while it is also true that many organizations have found that the offshoring model does not work for them and have started to bring agents back home, the same cannot be said for every company in every industry. For the foreseeable future, we should expect the outsourcing industry to continue to grow.

 

Susan J. Campbell is a contributing editor for TMC (News - Alert) and has also written for eastbiz.com. To see more of her articles, please visit Susan J. Campbell’s columnist page.