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Outsourcing

Contact centre outsourcing – Time to take a closer look

960 640 Stuart O'Brien

Matthew Sims, Director of 4T4 Consult, the first influencer to join Puzzel’s new partner programme, shares the top challenges when outsourcing and how to avoid ice-cream shops only selling vanilla…

The current Coronavirus crisis has shown the importance of contact centres at this difficult time. When many organisations are looking to outsourcers for additional resource, this is a good opportunity to reflect on the lessons learnt in the industry. By taking inspiration from the top challenges encountered when choosing a business process outsourcing partner there are advantages to be gained. 

8 Top challenges for contact centre outsourcing

  1. Over-promising and under-deliveringa tight and competitive market in the service sector is a haven for bullish promises from outsourcers desperate for growth.  However, suppliers should be responsible for building a solution that is both capable of passing customer board approval and is deliverable.
  2. Buy cheap, buy twicehistorically, the outsourcing industry has applauded itself on being able to deliver the same or better service for a lower cost, by using price as a differentiator.  The temptation to ‘buy cheap’ is immense but at what cost to strategic success?
  3. You can’t have your cake and eat it – third-party involvement may create ‘utopian’ agreements for customers, but when those agreements become impossible to deliver, they frequently end in the court room through severely damaged relationships and reputations.
  4. Poor alignment between long-term brand needs, solutions and cost – pressures from regulators have led many organisations to make major business adjustments to compensate for pricing and consumer-led pressures. But what is the impact on consumers, businesses and their shareholders?
  5. There are no tech silver bullets, only hard work, very careful due diligence and planningtech options have never been more exciting and have the ability to catapult the industry into a different sphere.  However, getting from legacy systems, processes and procedures to a new high-tech state is not easy to do well and can be extremely costly.  Done badly, the costs of change often outweigh the long-term benefits.
  6. Keeping in tune with cultural and brand alignment – when profit has been severely eroded through regulation, competition and skills deficiencies service often becomes a ‘nice-to-have’ rather than the ‘must-have’. Too much focus on rich tech investment and outsourcers risk becoming the equivalent of ice-cream shops only selling vanilla flavours!
  7. Data privacy, protection and crisis management – in fighting for business, brands have focussed on the power of marketing they can derive from using customer data.  This risky strategy can be expensive if data is compromised, as contravention of the General Data Protection Regulation (GDPR) could result in a fine of €20 million or 4% of revenue whichever is the greater.
  8. Practices that fail to keep pace with, and become misaligned with customer service strategies – often, when a customer service method changes, the people responsible for delivering it don’t change.  While the boardroom may applaud the reinvention, their customers could be fighting to get what they bought.  Meanwhile, agents are forced to adopt practices that come from teams who sit in the second row including the training, quality and management functions.  This is dangerous practice.

Successful companies learn how to turn these challenges into powerful opportunities to boost agent performance and the customer experience.  Organisations should first consider how they select and deploy the latest technology such as Robotic Process Automation (RPA) and Artificial Intelligence (AI).  Learn from brands that have already invested in them to identify any pitfalls and don’t rush in.  Adopt a measured approach that takes into account the customer journey and then use experts to deliver a carefully selected solution.

Next, always remember a partner is not just a supplier particularly when it comes to business process outsourcing and service delivery.  Organisations should choose their partner wisely, seeking to surround themselves with people and services they can rely on for quality, reliability and thought leadership.

Finally, offshoring is a great strategic opportunity, but not for short-term or tactical gain. Companies need to ensure that the partners, countries and solutions they select are fit for purpose for their customers tomorrow and not just for their profitability today.

To find out more, download the 4T4 and Puzzel white paper entitled “Contact Centre Outsourcing – Top 8 Challenges” at www.4t4consult.co.uk or www.puzzel.com.

UK outsourcing rebounds as government spending increases

960 640 Stuart O'Brien

A rise in government spending saw the UK outsourcing market rebound in Q2 after a quiet first quarter, according to the Arvato UK Outsourcing Index.

The research, compiled by business outsourcing partner Arvato CRM Solutions UK and industry analyst NelsonHall, showed that contracts worth a total of £938 million were signed by UK organisations between April and June, up more than a third (34 per cent) on the previous quarter.

Public sector spending reached £489 million over the three-month period compared with £51 million in Q1, as procurement teams focused on signing contracts to deliver back-office services.

Business process outsourcing (BPO) deals accounted for almost all (98 per cent) of the contracts signed over the period, with customer services, HR and revenues and benefits being the most popular service lines.

Central government departments procured the majority of public sector deals between April and June, according to the findings, signing agreements worth £470 million. Local government buyers were less active over the period, agreeing deals with a total value of £20 million.

The findings show private sector outsourcing spend was dominated by energy and utilities companies, as firms in the sector focused on securing tech contracts.

Contracts worth £284 million were signed for application and network management and end user computing. Manufacturing companies were the second highest spenders, with the total value of deals signed reaching £118 million.

Overall, the research highlights that despite the rise in public sector activity in Q2, the UK market experienced a slow start to the year. Contracts worth £1.64 billion were signed in the first six months of 2019, compared with £2.89 billion spent in the same period in 2018.

Debra Maxwell, CEO of Arvato CRM Solutions UK, said: “The government market rallied between April and June, with the vast majority (88 per cent) of deals being procured for services which haven’t been outsourced before. Central departments are using specialist partners to deliver a wider range of services and see them as key to delivering transformation across the back-office, whether that’s through introducing new ways of working or innovative technologies.

“But, the overall UK market was subdued, suggesting continued political uncertainty is impacting investment decisions. Spending among businesses softened to £1.08 billion in the first half of this year from £1.84 billion in the same period in 2018.”

Chris Sood-Nicholls, Managing Director of Services at Lloyds Bank Commercial Banking, said: “Although heightened economic uncertainty is affecting client demand and outsourcers’ appetite to invest, it is encouraging to see that there remain some areas where growth is continuing and new contracts are being signed. Labour markets remain tight and this could over time make it more costly for firms to hire; equally, changes to payment regulations are making it harder for some firms to manage working capital.

“Whilst still at an early stage of deployment the direction of travel of the Government’s new Outsourcing Playbook looks encouraging, and is clearly trying to put more of a focus on long term partnerships and value for stakeholders, rather than an absolute focus on cost alone.

“For now, the effect of that shift in focus is being subdued by the challenges affecting outsourcers’ ability to plan, but we would hope to see the sector begin to shake off its current cautious approach as those other pressures begin to lift, which they hopefully will in the next few quarters.”

Overall, BPO deals accounted for 58 per cent of the UK outsourcing market in Q2, with contracts signed across the public and private sectors worth £546 million. IT outsourcing (ITO) agreements made up the remaining 42 per cent, equating to a total value of £392 million.

The Arvato UK Outsourcing Index is compiled by leading BPO and IT outsourcing research and analysis firm NelsonHall, in partnership with Arvato CRM Solutions UK.

The research is based on an analysis of outsourcing contracts procured in the UK market between April and June 2019.

Image by PublicDomainPictures from Pixabay

Ventrica wins Gold at ECCCSAs

960 640 Stuart O'Brien

Southend-based customer management outsourcer Ventrica has won Gold in the ‘Best Outsourced Contact Centre’ category at the European Contact Centre & Customer Service Awards 2017 (ECCCSAs).

Founder and Managing Director of Ventrica, Dino Forte commented: “We are absolutely thrilled and honoured to win Gold in this category. I am so proud of all the team and their hard work and dedication which has led to this amazing moment. To be recognised as the best outsourced contact centre in Europe is truly phenomenal. Being judged by the industry’s most prestigious awards and coming top amongst a list of global players is just the icing on the cake at the end of what has been a fabulous year for us. It’s like an early Christmas present for the whole company.”

The ECCCSAs for 2017 were recently handed out at Battersea Park’s Evolution in London at an event attended by 1,100 leading figures from the contact centre and customer service industry. The award was presented to the Ventrica team by host Fiona Bruce and five times Olympic Gold medallist, Sir Steve Redgrave.

“Winning an ECCCSA this year was not easy. The robust face to face judging process was carried out by judges who are very experienced and recognised across our industry. And each entry was judged through a two-stage process which included both panel presentations and site judging visits,” Ann-Marie Stagg, Chair of the Judges, ECCCSA.

The award comes at the end of another successful year for the company, which in October opened its second 14,000sq ft. site in Southend, breaking new ground in contact centre design and creating capacity for up to 800 staff.

Earlier in June, the company won ‘Best Outsourcing Partnership’ for its work with McCarthy & Stone and ‘Advisor of the Year’ at the South East Contact Centre Awards. Also in June it was announced that Ventrica had been shortlisted for a record five categories in the European Contact Centre & Customer Service Awards including ‘Best Outsourced Contact Centre’, ‘Best Large Contact Centre’, ‘Employer of the Year’, ‘Best Multilingual Contact Centre’ and ‘Best Outsourcing Partnership.’

BA to ‘outsource more than 1,000 UK call centre jobs’…

800 450 Jack Wynn

A spokesman for British Airways (BA) has confirmed that the airline is considering outsourcing its UK contact centre operations in a bid to reduce costs at its Manchester and Newcastle sites.

Branded “a slap in the face” to its employees by the trade union, Unite, BA – owned by International Airlines Group – has reportedly already asked outsourcing firms to assess the two call centre sites and bid for the jobs. Third-party firms have also been approached to submit proposals for potential cost-effective solutions to implement. 

It is thought that a downturn in the aviation industry has prompted BA to make these cuts to compete with the popularity of low-cost airlines.

Consultation with union representatives and staff members will take place before a final decision is made, and the BA spokesman claims that outsourcing these jobs would enable the use of the latest technology to further improve customer service.

Oliver Richardson, Unite national officer, said in a statement published on the union’s website: “This review is nothing short of a slap in the face for hardworking staff who have constantly adapted to changing markets, while continuing to deliver the highest level of customer service.

“A cloud of uncertainty now hangs over the heads of workers who fear that their jobs will be outsourced or offshored as a result of this exercise. Such a scenario would lead to poorer customer service and a more fragmented experience for passengers. 

“We urge IAG to resist the temptation to engage in a crude cost cutting exercise and repay its loyal workforce by keeping the customer service operations of our national carrier in–house.”