The home agent model, for the past several years, was the call center equivalent of the “video phone.” It was always the next “up and coming thing,” not quite ready yet for its close-up, and many privately doubted that it ever would be, except for a few small niche companies and a couple of notable and oft-repeated case studies, most notably in the travel industry. As it turns out, as with many somewhat revolutionary ideas, all it needed was the right circumstances. Couple a need for better customer service in order to compete with perceptions of declining service quality supplied by offshore call centers. Throw in the continued need to cut costs. Mix in some depletion of popular regional call center worker pools. Sprinkle in the declining value of the U.S. dollar, making even nearshore destinations like Canada less attractive. Add the escalating cost of healthcare benefits, traffic congestion and the price of gasoline. Fold in the fact that technologies such as IP-delivered call center solutions are standard fare in enterprises today and no longer perceived as part science fiction. Shake it and bake it, and you’ve got an extremely fertile environment for the use of home agents.

Home agents, as we know, are hired, professional contact center representatives who can reside (and work from) anywhere there is a phone and Internet connection. The benefits are multi-pronged. Cost savings begin, but certainly do not end, with lower facilities-related overhead. In a 2006 “Telework Benchmarking Study” by The Telework Coalition, organizations reported cost savings associated with reduced real estate requirements of $3,000 to $10,000 per employee.The next major cost savings comes from the quality of the home agent pool. Home agents tend to be older, more mature, with more experience, and therefore less likely to churn and more likely to provide better customer service. Research firm, Yankee Group explains that “remote agents tend to be older, more educated and often have business and management experience…job turnover rate, or churn, among this group of workers is typically half that of in-house contact center employees which is known to be between 50 percent and 100 percent annually in traditional centers.” Anecdotally, we know it can be even higher than 100 percent annually.

Rising gas prices, too, are helping to convince employees to work from home, for at least part of the time. In addition, high housing costs in urban centers are forcing longer commute times from suburbs and exurbs, which provides further incentive to work from home, according to IDC analyst Stephen Loynd.

So how big is the push to use home agents? Right now, it is estimated that there are upwards of 200,000 remote agents working in the U.S. According to analyst group IDC, the number of home-based agents is expected to reach 300,000 by 2010.
The early adopters of the remote agent model were the travel industry (Jet Blue Airlines is an oft-mentioned example) and business process outsourcers. However, expect to see the model spreading outward across multiple verticals. In reality, any vertical can benefit from adopting an at-home agent model, especially those industries that require a flexible labor pool and round-the-clock call center coverage.

To gain a bigger perspective on the pros and cons of the home agent model, and some practical tips for succeeding, we spoke to several companies, both providers of home agent services and companies that offer technologies to better enable the model, and asked them to point out the benefits and drawbacks, and the factors to be aware of, when considering taking the route of the home agent call center.

Aspect Software (www.aspect.com)
Jim Mitchell, Vice President, Technology Office
Employees can also experience the benefits of an at-home work environment due to reduced commuting stress, flexible work schedules and even increased job satisfaction, which ultimately provides a better quality of life and typically leads to longer employment tenures — a factor that is very important in a very high turnover industry.

Office space savings may be somewhat offset by other costs in employing at-home agents, including providing the necessary equipment for the agent, such as phones, computers, modems, routers and applications. And the equipment may need some type of storage space during transition to/from employees — although this depends on the way the organization handles the deployment of technology.

Companies looking into deploying an at-home agent model also have other concerns to address before establishing a remote program. Even if a company is increasing its resource pool, it may not necessarily be cheaper from a wage point of view. In fact, depending on the required skill set and the business, there may be a small premium for those better resources. And, of course, that depends on prevailing wage rates where the contact center recruits and retains talent.

The drawback of a lack of physical space in which agents work can be offset by instant messaging and other collaboration tools that make it easier to have agents in remote locations, as with these media, employees are able to interact with co-workers and supervisors.

There certainly are some different challenges that organization needs to address with an at-home agent model. They need to consider how the IT department will support remote applications and train the agents on the applications. This may incur some costs that hadn’t originally been factored into the equation. Other concerns that contact centers need to consider when weighing the at-home agent option is legal considerations — ensuring that the company and employee are complying with local/state/government labor laws, safety issues (will the employee need liability insurance?) and protection of company property. In addition, depending on the types of customer contact activities the agent will be engaging in, companies need to consider security and protection of its customer data and information.

Additionally, because the agent is working remotely and the supervisor cannot occasionally walk around and listen in to calls, there needs to be a system in place to very effectively measure agent productivity, provide real-time metrics to ensure the agent is meeting KPIs and a process for monitoring call quality. Companies that deploy the remote agent environment effectively utilize a quality management tool to record calls and assist managers in training at-home agents, using recordings to pinpoint areas for improvement within calls.

They also certainly need to establish a process for building in opportunities for coaching and e-learning to ensure that even though the agent is not on site, he or she is still receiving ongoing training. It is imperative that companies first ensure the appropriate authentication, security and encryption before deploying a remote environment. In many ways, VoIP can be actually more secure than a typical PSTN call. Authentication mechanisms are actually built into SIP and other VoIP-based protocols. User agents, gateways, carriers, and other SIP components may be forced to identify themselves with encrypted passwords, or prompt users to enter password information. The SIP connection is then made, and the voice and data packets are encrypted to ensure that customer information is kept secure.

Calabrio, Inc. (www.calabrio.com)
Tim Kraskey, VP of Business Development
However attractive any remote model may be from a business standpoint, it requires precise planning and design.

Here are some risks:
• The network architecture must be manageable and reliable. It must be able to scale from home agent to branch or store front to contact center and voice/data centers.
• Planning is required around best practices and tools for managing virtual teams to ensure quality and adherence to key metrics.
• Applications must allow the network to be truly “virtualized” so the cost levels can be reduced while providing better service.
Successfully addressing these risks enables the technology and training resources to enhance the customer experience and provide consistent service and value.

VoIP-based systems. VoIP lifts geography as a barrier on effective communications, enabling workforces to be increasingly distributed.

Edge-architected solutions. An “edge” architecture uses the resources of the distributed contact center and leverages the processing power and storage capacity of end-user PCs. For example, quality monitoring that captures and temporarily stores recordings at the edge can be easier for contact centers to deploy and manage. The main benefits include a reduction in the required number of servers, network cost savings and more effective use of techniques such as real-time analytics.
Simplified suites. When contact centers implement a suite of configurable packaged products, it becomes easier to support a remote workforce because desktop integration is greatly simplified. Browser-based software eliminates the need to support software on each individual desktop. Changes are made centrally. Collaboration tools. E-learning and other Web-based collaboration tools support team management, coaching and training in a virtual environment.

Contact centers need to realize that simply implementing the technology does not create an operational remote contact center. As customer contact organizations migrate to a remote or virtual environment, companies need to adapt, adjust and manage their people, processes and technology in order to be successful. With regards to recruiting, with remote contact centers, managers have a much larger pool from which to select, making it easier to hire the right agents with the right expertise.

With training, monitoring performance and coaching, call center applications that are available today make these processes much easier. Training and coaching courses can all be automated and scheduled directly into the agents’ schedules to ensure remote agents have the same development opportunities as those that are located at the contact center.

There are also performance management applications and tools that help agents and managers understand how they are handling calls. Giving agents access to performance management tools helps them understand how they are doing and enables them to work with their supervisor to more efficiently address any performance issues.

We’re likely to see the number of virtual agents triple in the next three to four years. After slower-than-expected adoption, the IP contact-center market is now growing significantly. IP telephony solutions have matured and awareness of their benefits has increased. More and more contact centers are beginning to understand the benefits of remote agents.

Cisco (www.cisco.com)
Ross Daniels, Director of Solutions Marketing
We see customers in all vertical markets being able to take advantage of the benefits of remote agents. The typical resistance we hear from enterprises is that supervisors can’t be as effective in managing agents that do not work in their physical location. This has always seemed a weak excuse, as the variety of workforce management and monitoring tools available to supervisors today make remote supervision easily accomplished. We have also heard of remote/home-based agents creating a backlash from within the traditional agent ranks; agents working within the formal contact center may wonder why they aren’t able to work from a home office. Conversely remote agents may sometimes feel isolated from their peers. Another concern from employers is the security of confidential customer information, including credit card numbers and social security numbers. These are real concerns that must be anticipated and addressed to ensure success with remote agents.

The big leap forward for remote/home agents is the ubiquity of high quality/high bandwidth connections to the branch office or home-based office, and the proliferation of Internet Protocol (IP) for telephony transport in the contact center. These have made remote/home agents much more affordable from a telecom perspective. Web-based customer service (e.g., text chat or e-mail) also presents a strong case for the remote/home agent.

Data security is one of the valid concerns when it comes to the home agent model. The primary method that we have seen for ensuring data security is the use of thin clients (e.g., Citrix) for agent applications. In this model, all data are server-based, and no data reside or remain on the remote agent’s PC. In addition, training remote agents to understand the importance of safeguarding customer information becomes even more critical in this environment.

We definitely see this segment of the market growing over the next several years. The economic argument is compelling, and the “social benefits” of expanded labor pools, higher levels of experience for remote agents and reductions in automotive commuting will continue to drive growth in the market. Remote/home agents might make up 50 percent or more of the total contact center agent population in the next 20 years.

Interactive Intelligence (www.inin.com)
Tim Passios, Director of Product Marketing
An advantage of the remote agent model is the ability to address the issue of inadequate labor pools by being able to select from candidates beyond local markets. In addition, by offering more flexible scheduling and the convenience of working from home (including the advantage of gas and other commute-related cost savings), organizations can boost morale and loyalty, thus reducing agent turnover. This also has the side-benefit of reducing organizational costs associated with recruiting, hiring and retraining new agents. Another side benefit is that the reduction in commute-related environmental stressors addresses the increasing pressure from consumers for “eco-friendly” business practices.

Generally speaking, smaller, locally-focused businesses looking to address high-volume, low-value processes won’t derive as much benefit from a remote agent model. Two factors that qualify more as concerns than disadvantages, are additional security and supervisory/management measures that must be considered when employing remote agents. Though infrequent, some organizations report that remote agents can occasionally feel isolated or disconnected.

The two main challenges associated with implementing a remote agent model are adapting the business culture and processes, and selecting the right technology. For the latter, it’s critical that the technology be capable of real-time remote monitoring (including “status” or presence management) and reporting. Features such as “whisper coaching,” “listen” and screen recording should be built into the technology solution so that reporting can be done across corporate-based and remote agents, and across multiple communications channels.

More value can typically be obtained from a remote agent model when it’s applied to industries with complex, high-value/high-touch processes requiring specialized skill-sets. These might include verticals such as healthcare and retail. Note, however, that suitability of this model hinges on the process type, thus, it has broad horizontal appeal for a subset of an organization’s agents involved in high-value processes.

A secure VPN for remote network access is one safeguard. Thin-client remote access applications are another. It’s also critical that the solution supports TLS/SRTP standards, recording encryption, and encryption beyond user-to-user, such as inbound IVR and ACD, and outbound predictive dialing. Strict password generation requirements and the use of public and private key certificates provide additional security.

Lastly, to ensure remote employees follow appropriate procedures for information confidentiality, organizations should deploy technologies such as live call monitoring, call recording and screen recording.

IP telephony is the primary “enabling” technology for the proliferation of the remote agent model. Trying to support remote agents using separate voice and data connectivity was extremely complex and expensive. It also resulted in limited functionality. With the right IP telephony solution, organizations today can cost-effectively and easily support remote agents with high-quality, high-capacity transmission and access to the same features available to employees working from the corporate office.

Transera (www.transerainc.com)
Prem Uppaluru, Co-founder and CEO
In terms of technology, on-demand virtual call centers liberate the brick-and-mortar operations, allowing enterprises to locate their agents onshore, offshore, at home or in remote offices and source their agents as captive employees, outsourced workers or independent contractors at home. As the workforce is virtualized, managing this distributed agent community becomes more challenging. Web-based collaboration and communication tools can help in reuniting distributed agents into a cohesive workforce. Supervisors can use these tools to monitor and measure the quality of customer interactions and agent performance, assist in these interactions if needed and provide ongoing training to the agents. Agents can use these tools to contact other agents, escalate calls to supervisors or connect with knowledge workers. Agents can also use these tools to communicate more effectively with customers by adding voice, video and chat as necessary to meet customer preferences for service. The ability to combine voice and data over a single communications line has profound implications for the contact center industry. This technology foundation gave rise to the virtual contact center model.

Financial services, travel and hospitality and retail industries have been some of the first to adopt the remote agent model. We are also seeing adoption in the healthcare industry with nurses on call. Finally, the technology sector leverages virtual contact centers for technical support. In reality, any business can benefit from the remote agent model.

The biggest concern with any call center is customer privacy. This holds true for companies employing the remote agent model. Fortunately, there are technologies and systems to address this. For example, companies can provide their remote agents with PCs that are not equipped with hard-drives or business applications, including Word, Excel or PowerPoint. In addition, virtual contact center solutions can implement either Secure HTTP or IPSec VPN to access on-demand call center solutions. Finally, there are a variety of powerful Data Loss Prevention solutions to track where and how data is used so it isn’t compromised.

VIPDesk (www.vipdesk.com)
Mary Naylor, CEO and Founder
In terms of the size of the current home agent pool, recent figure of 400,000 could include all telecommuters working in the industry, and might also include managers, supervisors and other positions.

There’s a huge level of excitement and interest in the home-based model, even though it’s been around for 10 years. But today, you’re really starting to see the Fortune 500 and the high-end premium brands staring to put their toes in the water, and they’re embracing the model.

One of the key drivers is the quality of the customer experience. The other big challenge that a lot of these [outsourcing] companies are facing is that they’re all tapped out — with a traditional outsourced contact center, typically you’ve got a 50 or 60 miles radius to draw from for your recruiting. And this can be in an area where you have other premium brands and Fortune 1000 companies that are also operating call centers in the area, so you just end up maxing out on your labor pool. So now, with the home-based model, you have a national labor pool to draw on. Thus you have the ability to bring on the people with the skill sets you really need. For example, you could look for people who are enthusiasts in, for example jewelry or golfing, which would provide you with the skill sets you really need.

There’s some backlash from off-shoring — and there’s some challenges in the traditional bricks and mortar — so “homeshoring,” home-based or virtual, or whatever it’s called, is a really nice alternative that sits on the continuum of traditional bricks and mortar on one end and offshoring on the other. We sit right in the middle and we blend the best of both worlds. You great the great economics you get from offshoring, but at the same time you get superior quality. You also get high retention rates, which cuts down on the cost of recruiting and training. That in itself helps drive costs down. And then there’s the cost of real estate, and the infrastructure, of all the cubes and computers and parking spaces.

A big advantage is the retention rate. Every client benefits from this. Retention rates [among home agents] range from 85 to 90 percent, whereas at a traditional all center the turnover rates can be 25 or 30 percent, and as high as 100 percent. The demographics of the agents are far superior: Our average age is 40. We’ve got 75 percent with a college education, five percent with graduate degrees, 42 percent speak a second language, more than 30 percent have management experience. [In a traditional contact center,] you’re talking about an average age of about 22 for the average worker. So you’re starting with a more mature and stable worker whom you don’t have to teach how to work. Home agents tend to be more mature, higher caliber, more savvy, more worldly — and that translates into a superior customer experience. We’ve seen customer satisfaction scores and tone of service scores increase by as much as 40 percent, and here I’m going to give you some case study info: average order size has increased 30 percent and spending is up 50 percent, so it translates into metrics of increased order size, increased schedule adherence, increases in quality scores and an overall increase in customer satisfaction.

The other advantage lies in disaster recovery and business continuity. This is really critical. If you have a center that’s in Florida and it goes out, well, with this remote agent model, we have people all over the U.S. and Canada. So it’s very easy to move. Plus, you have cost savings through the infrastructure — it saves around $5,000 per year per seat, just to give you some sense.

Recruiting is done via a variety of methods. Predominantly, it’s referrals — it’s also public relations, a story that gets picked up that we’re hiring — and it’s traditional job postings, including Monster and CareerBuilder. But interestingly, depending on the client, we might go to any number of industry specific enthusiast type sites — whether its fashion, jewelry boards, message board — and believe it or not, there is an incredible community of stay-at-home workers who are on all kinds of message boards and forums, so it is very important that they’re able to communicate and talk about a company, and the word of mouth is quite something. We’ve been mentioned on a couple of TV shows, and we’ve seen thousands of applications come in within a two-hour time frame after being mentioned.

West Corp. (www.west.com)
There are many advantages to the remote agent model:
Higher quality agents. In general, companies are able to attract a more educated, more experienced agent in the remote agent model. In fact, over 80 percent of West at Home agents have some form of college education compared to only 34 percent in traditional brick and mortar call centers. These higher quality agents help increase sales conversions by 15 percent and provide a 10 percent increase in quality against key performance indicators (KPIs).

Greater staffing flexibility. The West at Home program allows us to schedule agents in half-hour increments – something that cannot be achieved in a brick-and-mortar environment. This scheduling flexibility allows us to flex up or down by more than 100 percent, based on fluctuating call volume needs.

Reduced costs and improved productivity. Through the use of remote agents, companies will see on average a 10 to 15 percent reduction in call center costs versus traditional call center agents. Because West at Home’s remote agents are better educated and highly motivated, they are generally more productive compared to traditional call center agents.