Due Diligence Is Key When Considering Contact Center Outsourcing

BY MICHELLE CURLESS

Ten years ago most companies would have scoffed at the idea of entrusting a third party with anything but non-core competencies like cold-call telemarketing or customer inquiry overflow. Beyond these, most companies held on to their customer contact operations. Today, major pieces of a company's infrastructure are being outsourced to a third party: IT, HR, and yes, even customer contact. A growing number of companies are placing components of their direct customer contact -- their customers, their lifeblood -- in the hands of professional contact center outsourcers. The market for commissioned contact center services has transformed. Rather than simply providing a nameless group of voices that read basic scripts to phone-list prospects, outsourcers are increasingly a top choice for inbound and outbound customer acquisition, customer service and customer care, help desk, and contact center technology.

However, despite the current comfort in outsourcing (typically the financials of an outsource relationship are compelling) many companies remain uncertain about how to choose an outsourcer and in their ability to manage a successful relationship. Thus the split in the "outsource versus in-house" decision remains.

In order to gain confidence in not only outsourcing as a concept but in selecting an outsourcer, we will discuss the importance of several key tactical elements. First and foremost, ensure that you have conducted upfront due diligence. Once this is complete and before you begin soliciting requests for proposals, develop the business case. Finally, if you want this to be a mutually beneficial relationship you need to spend time differentiating between a partner and a supplier.

Understand The Need For Upfront Due Diligence
When evaluating the relative merits of outsourcing and the do-it-yourself contact center, it is crucial to look beyond simple cost estimates. Conducting upfront due diligence will help businesses successfully support their outsourced/in-house contact center operations' decision making and focus on satisfying both the needs of the business and the customer.

As part of upfront due diligence, it is crucial that before a company can determine how to outsource, they determine why they want or need to:

• What are the short- and long-term goals for your contact center?
• Do you anticipate a lot of growth or changes in your organization?
• What are your current or future key initiatives?
• What are the business risks associated with changing versus not changing?
• Do you consider customer interaction a core competency of the company? If not, would your resources be better utilized focusing on the business' core competencies?
• How much control do you need of your customers and customer interactions?
• Do you have the most current contact center technology and expertise? If not, are you willing to invest in contact center technology and the expertise to deploy and manage the infrastructure?
• Will a third party bring best-in-class solutions to your business?
• What are the key capabilities and characteristics of an effective outsource relationship?
• Do you have enough knowledge to manage an outsourcing relationship effectively?

With key stakeholders and team members in the room, answering these questions will help you begin the process of examining your organizational readiness and appetite for outsourcing, as well as garner buy-in from all parties involved.

Develop The Business Case
With insight from answering the "why," you can then turn your attention to reviewing and analyzing every facet of your current contact center operational model, in order to create your business case. Building a business case is applicable to both existing or greenfield contact centers.

As an added benefit, whether or not you decide to pursue the outsourcing path, the business case will become your initial blueprint for change. The business case details operational and financial elements such as:

• Existing and future strategic intent.
• Key success factors/risk factors.
• Operational features and functionality such as:
  • Legal and regulatory requirements;
  • Labor pool and profile;
  • Training;
  • Service level requirements; and
  • Key processes.
• Inventory of existing contact center technologies, including understanding how you want technology to work for your business.
• Analysis of current technology capabilities and limitations.
• Cost analysis of current operating costs for technology.
• Cost analysis of future state technology: outsource versus in-house.
• Gap and cost analysis between current and desired state.

Ultimately, a business case will answer two very important questions: What will it take to get to your desired state relative to operations and costs? Does your company have sufficient expertise and resources in-house to deploy and manage the future?

Differentiating Between A Partner And Supplier
Today there is no shortage of outsourcing vendors. In fact, today, outsourcers are accepting and undertaking longer, more involved contracts in which they become true partners with companies. Despite this, keep in mind there is still a difference between a partner and a supplier. A supplier rarely participates in the success of your business or customer satisfaction, whereas a partner has a mutual interest and is happy to be held accountable for managing and measuring your success.

In the end, most companies want to make certain that the vendor they select will in fact deliver the desired operational model and functionality at the desired cost. But once the dust has cleared and each operational and financial component has been scrutinized, you must also remember to assess the type of business relationship you desire and the character of the outsourcer.

As part of this process, seek out vendors that not only provide the services you need, but also share similar values. As we all know from experience, working with people and organizations with similar values provides a level of security and trust. You feel confident that business is being taken care of even if you are not present at every moment. Many outsourcers are developing risk-and-reward component contracts in order to ensure quality, cost, and satisfaction, as well as demonstrate that they are willing to put some skin in the game.

Learn to distinguish between problem vendors and problems. Some outsourcing relationships never seem to run smoothly, beginning with the implementation and continuing through the daily operational and service level requirements that never seem to be met. Talk with current clients and past references about the outsourcer's problem solving approach and response time. When problems occur, does the outsourcer tend to point fingers, make excuses, and promise to do better next time, or are actionable plans put into place and an outcome delivered? Answering this question can help you determine the root cause of the problem.

Finally, whether you require a partner or supplier relationship, remember to set realistic expectations, define roles and responsibilities, and maintain control of the process. Although you are outsourcing, you still own the business and are accountable for its success.

Conclusion
Outsourcing is a viable option for many contact center operations. Despite the fact that people are hesitant to pursue this option, outsourcing frequently results in a lucrative partnership. Before you make a decision to keep your contact center close to home or to embrace a supplier or partner, make certain to conduct the appropriate due diligence to make an educated decision.

Michelle Curless is director, The Customer Group, LLC. The Customer Group is a niche consulting firm, advising businesses in the delivery of Customer Interaction Excellence. The Customer Group’s world-class team of consultants average over 10 years of real world experience in developing business strategy, designing effective customer-facing operations and deploying enabling technology. Using the Company’s proven methodology, CustomerAcuity, consultants work with companies to enhance their customer experience. The Customer Group believes that customer relationships drive business results and relationships are built one interaction at a time.