RIGHTSHORE GROUP - FIVE KEYS TO CHOOSING YOUR CALL CENTER OUTSOURCING PARTNER – SEPTEMBER 2015 1

Five Keys To Choosing

Your Call Center

Outsourcing Partner

RIGHTSHORE GROUP - FIVE KEYS TO CHOOSING YOUR CALL CENTER OUTSOURCING PARTNER – SEPTEMBER 2015 2

Introduction

Much has been written on this topic but after 20 years of helping clients choose a partner they could trust I felt

compelled to offer my thoughts. Like most really important things in business the principles are simple but

devilishly hard to apply and execute.

As you read this paper one key thought to remember is that you’re not outsourcing your customer relationships.

You’re outsourcing the day to day execution of how they are managed but they remain your responsibility so

beyond the tips in this white paper my advice is stay engaged at the ground level. Whatever partner you choose

remember that their front line staff are the ones talking to your customers and, while they’re not your employees,

they’re the most important people in this conversation. Get to know them. Find ways to solicit their input

directly. When you schedule a QBR with your partner devote half the day listening to them so you can extend

your respect and admiration for their help in making your customers understand and accept those silly policies

and procedures you created that drive your customers crazy.

The Five Keys

I’ve listed the five criteria below in order of importance and my choices may surprise you but it’s important to

remember they build upon each other. In other words, if you can’t find the partner that meets all five criteria

you’ll be much better served selecting a partner who meets the top 3 versus one that satisfies 2-5.

1. Employee Engagement

2. Right sized pond for your fish

3. Domain and Industry Expertise

4. Geography / Cost

5. Partnership Flexibility

RIGHTSHORE GROUP - FIVE KEYS TO CHOOSING YOUR CALL CENTER OUTSOURCING PARTNER – SEPTEMBER 2015 3

Employee Engagement

Happy Engaged Team Members = Happy Customers

The development of best practices in the call center industry over the last two decades has been impressive and

pervasive. Most call centers have adopted industry best practices for recruitment, selection, training, WFM, QA,

et al. which are now table stakes for any reputable service provider. (Hence not in my top 5) The real key is that

even the best practices can be rendered meaningless if the front line employees don’t genuinely care about the

company they work for and the clients they represent – that’s you.

The front line team may do well on QA, AHT, and other metrics in order to secure their bonus but to deliver

a truly great customer experience they have to genuinely care and that begins with taking pride and ownership

in the organization they work for. We’ve all experienced it when it happens; you can hear it in their voice.

They’re genuinely concerned about solving your issue and take pride and ownership in making that happen.

Isn’t that what you want your customers to hear?

Much has been researched and written on the link between employee engagement and customer satisfaction

and nowhere is the impact more relevant than in call centers. Here’s just a few studies that support why this is

my number one criteria for selecting a partner.

The Gallup State of the American Workplace study found that companies in the top quartile of

employee engagement experience 10% higher customer ratings.

Bain & Company studies indicate that employee behavior and attitude is one of the most significant

drivers of customer satisfaction. Engaged employees not only spread their enthusiasm to customers,

but they also are more dedicated to providing the best product and service to customers.

Employee engagement is a simple concept but requires a huge investment and top down commitment to

make it happen, particularly when you’re dealing with an industry that employs a younger lower paid

demographic. I won’t go into all the strategies to drive employee engagement (perhaps that’s my next paper)

but there are clear signs to look for when talking to a prospective partner.

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What is the focus of the value proposition from the senior management team? The CEO of one provider I

recently met stated that his primary role was to serve his front line team members. Not his shareholders or even

his clients. He had proven that focusing on serving his front line team members was the best way to maximize

shareholder value and deliver the best results for his clients. Other signs include the scale and quality of

investments designed to enhance the workplace environment for a young demographic. (and I don’t mean a

nice cafeteria) I visited a near shore call center recently that had a rooftop soccer pitch where agents could let

off steam during their breaks and lunch. Corporate social responsibility (CSR) initiatives that provide staff

opportunities to give back to the community in a meaningful way also encourage employee engagement. And

finally you’ll see it on their faces. Happy engaged employees are hard to miss especially in a pressure cooker

environment like a call center.

Right Sized Pond for Your Fish

It’s a simple concept were all familiar with but all too often I see it ignored or overlooked by focusing too much

on elements like industry expertise or even past relationships when deciding on a partner. I’ve seen too many

unhappy clients that selected a large Tier I BPO provider for their 150 seat program based on the provider’s

reputation and domain expertise. All too often those industry experts that attended the initial sales pitch go

back to focusing on their fortune 50 clients while my client’s program is staffed with junior team managers

who’s primary goal is to graduate to those fortune 50 accounts.

The flip side can be true of course. You don’t want your program to represent more than 20% of your providers’

revenues or their survival becomes reliant on your business. Every situation is different and I’m reluctant to

offer clear cut rules but here’s some guidelines and considerations:

Choose a partner that will consider your program strategic to their business. (>5% of

revenues)

Choose a partner with a diversity of clients (No single client is >15% of total revenues)

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Avoid single site providers.

o The geography you choose today may not be the one you need tomorrow so select

a partner that has some diversity in their footprint covering the popular geographies

(more on this later)

The site management team can often be more important than the corporate leadership

team. Pay particular attention to the tenure and experience of the leadership team in the site

your program will be supported.

Industry & Domain Expertise

With this third criteria we’re starting to get into what some might consider table stakes and I wouldn’t disagree.

The important step is understanding how unique your particular domain is. For example if you’re a telco looking

for a partner I wouldn’t spend too much time worrying about this one. Virtually every BPO provider I’ve ever

interviewed boasts at least one telco client. The landscape can change of course as you go up the value chain

with increasing complexity such as Tier II technical support or back office provisioning.

Financial services and healthcare are two verticals where domain experience is a must, particularly given industry

specific certifications such as PCI or HIPPA that require significant financial investments that must be

amortized across multiple clients. Financial Services also has many sub categories like insurance that have very

specific regulatory requirements where certification and licensing are mandatory.

Ultimately you’re the best judge of how unique your business requirements are. If your requirements are unique

in any way picking a provider that has experience and understanding of your space can dramatically lower start-

up costs and speed the learning curve on your program making it a win-win for both partners.

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Geography and Cost

These two go together of course as the biggest variable driving cost is the service delivery location. The equation

is pretty straightforward; the further afield you’re prepared to go the lower the cost. Too much has already been

written on the pros and cons of the various geographies or the tradeoff between cost and proximity so I won’t

dwell on those.

What I will say is that it’s important to analyze and understand what these tradeoffs are for your specific

program as not every customer support operation is made equal. The biggest driver influencing this tradeoff is

complexity. As illustrated by the simple chart below greater complexity raises the risk of lower FCR and CSAT

when you put your program in the hands of less skilled agents.

For example, you’ll typically pay rates 30% lower for nearshore service delivery vs on-shore but if you’re FCR

drops by 15% what have you really saved? And the math doesn’t tell the whole picture. Not only are your

immediate savings cut in half but you may have inflicted serious damage to some important customer

relationships which represent a lifetime value that is difficult to immediately quantify but will eventually affect

you’re bottom line.

Finally it’s important to keep your options open. I recall many occasions where a senior executive swore he/she

would never take their customer support operations offshore only to find myself a year later touring them

through call centers in the Philippines and India. When you can, and only if they meet the previous three criteria,

pick a partner with at least some diversity in their footprint. That doesn’t mean you have to go with a Tier I

provider. There are many high quality small to medium providers with service delivery locations in the key,

popular geographies.

FCR / CSAT

Complexity

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Partnership Flexibility

I’ve noticed this one growing in importance over the last few years as both clients and providers appear more

willing to innovate but sadly most partnerships are still based on industry standard models that I believe are

flawed.

To illustrate let’s look at the traditional agreements that pay your partner an hourly rate with bonus / penalties

based on performance against traditional KPI’s. Have you ever noticed these KPI’s can be confusing and

conflicting? How often have you sat in a QBR where you complain that AHT is up but your partner responds

that their exceeding FCR and if we try to reduce AHT FCR will go down. Who’s right?

I believe these traditional partnership models fail to drive innovation. People will achieve the goal you set for

those things you choose to measure but that just means you’ll be stuck with the operational performance of the

past. As a provider who’s paid on an hourly basis what motivation do I have to truly drive innovation that

might cut AHT in half, or double FCR. Both things will negatively impact my bottom line.

I prefer relationships that are truly “Partnerships”. As my partner if you make investments that drive milestone

improvements in my business I want you to share in the rewards! A relationship that is truly a “Partnership”

must provide a means and a mechanism to reward the provider should they invest in technology or practices

that drive tangible improvements. This can come in the form of gain sharing or other mechanisms and there’s

no doubt that crafting these agreements can be challenging but I encourage you to try.

Ultimately any partnership needs two willing parties so when you raise the topic of partnership models embrace

the provider who is willing to explore innovative approaches that share risk and reward. These providers are

far more likely to drive innovation in your business.

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Summary

I’ll circle back to what I emphasized in my introduction. Even if you effectively use my five criteria to find and

choose a great partner your job is not done. Employee engagement is my number one criteria and is the secret

to unlocking a great support experience for your customers. The commitment to “serve” the front line team is

a shared responsibility that you must own with your partner. Embrace it, have fun with it; fund it. Make your

program the one that everyone in the center wants to work on! The dividends you’ll receive will be seen in their

smiling faces and the call you get from your CEO complimenting you on record breaking customer satisfaction.

About The Author

Robert Lyons is a Senior Partner at the RightShore Group. Robert has over twenty years’ experience providing

advisory services to fortune 500 clients on their customer experience strategies. He can be reached at

robert.lyons@rightshoregroup.com