What do you do when you don’t want to run your own contact center anymore?

 

Simple: You sell it to an outsourcer.

 

That’s exactly what computer giant Dell (News - Alert) did when it recently sold one of its two contact centers in the Philippines to French outsourcing firm Teleperformance.

As per the deal, Teleperformance (News - Alert) will now manage Dell’s consumer technical support operations in the Philippines, including the main contact center in Pasay City.

 

Peter Ryan, head of offshoring and outsourcing analysis at Datamonitor, concludes that the acquisition is further validation that the contact center outsourcing market is here to stay.

 

“Dell's decision to maintain service from the Philippines is good news for offshoring as a business model, and foreshadows a number of possible trends in the contact center space,” Ryan said in a statement issued today.

Ryan said the deal “highlights the fact that many companies are looking to contact center outsourcers as a means of reducing costs through the recession.” Contact center outsourcers and vendors, as well as analysts, have been saying for months now that the recent recession ha been good for the sector. The fact that many companies are now putting a stronger emphasis on cutting costs while at the same time improving customer service certainly hasn’t hurt either.

 

Ryan speculates that this could be the beginning of a trend within the contact center sector, wherein in-house contact center operators eliminate fixed costs through the sale of assets to third-party vendors. The motivation for doing so is self-evident: By selling off their facilities these companies not only gain the operational efficiencies that are inherent with outsourcing, they also get rid of a depreciating asset (and with luck gain an immediate influx of revenue).

 

Ryan also suggests that the acquisition of Dell’s contact center in Pasay City by Teleperformance reaffirms the importance of offshore delivery.

“The fact that Dell has chosen to retain delivery from the Philippines for clients in the U.S., Australia and New Zealand is important for this business model, especially in the current political climate in which offshoring is often portrayed negatively,” he said. “By providing Teleperformance the opportunity to handle more technical support interactions, Dell is reaffirming that end-users can be serviced to a high standard by a third-party, at a cost effective level.”

The Pasay City Contact Center, which serves Dell customers in the U.S., opened in 2006 and employs about 1,000 agents.  It is reported that Michael Dell was there at the grand opening.

 

Ryan joined Datamonitor’s CRM analysis team in 2003, where he leads business process outsourcing (BPO) research. For more information, visit www.datamonitor.com.