August 1999

How One Teleservices Agency Successfully Manages Growth:  An Interview With Daniel Julien

While the merger and acquisition activity that has taken hold of the teleservices industry in the last few years has left a number of companies shattered in its wake, we are pleased to report on a teleservices agency that has prospered in this environment because of a well-thought-out business model. We recently spoke with Daniel Julien, president and CEO of Teleperformance International who founded Teleperformance 21 years ago and now manages it together with COO Christophe Allard. Teleperformance, based in Paris, started out with 21 lines, and has grown to more than 8,000 workstations within more than 100 call centers in 29 different countries, conducting programs in 25 different languages. In 1998, the SR.Teleperformance Group had revenues of U.S. $358 million (345 million Euros). This is expected to rise to more than U.S. $465 million (450 million Euros) in 1999. Its 1998 EBITDA was U.S. $37 million (36 million Euros).

Spend even five minutes with Mr. Julien and you will see why Teleperformance has succeeded where others have failed. His enthusiasm for the business cannot be contained: "We are people from the industry -  we are totally crazy about the business," he said recently over lunch. "We are obsessional about our management model, our numbers." Read on to find how this "obsession" has paid off in spades for Teleperformance.

CCS: Briefly explain your unique business model that has made Teleperformance so successful.

Julien: Our business model is totally dedicated to the ‘creation of added value’ for the different partners of the company.

First, we create value for our clients, not only in delivering a high level of teleservices, but also in being very proactive in helping them to design the most effective solutions in market research, telesales and customer management. We have created a database that contains key information on the top 10,000 telemarketing and teleservices campaigns we have managed over the last 20 years, and so we know very well what works and what doesn’t work, how to improve a program and how to minimize costs…and we share, all over the world, our experience with our clients.

Then we create value for our employees: for us, the true value of a teleservices bureau lies not so much in the computers and ACDs as in the people. We truly believe that, from the bottom to the top, the employees have to be very experienced in telemarketing and teleservices, very dedicated to the services they provide and very enthusiastic. This only happens if you make them successful. We, at Teleperformance, believe in education, internal promotion, real autonomy and empowerment within the business units …and all of this creates a very strong corporate culture.

And finally, we create value for our shareholders by working hard to achieve a level of growth above the average of our market and a level of profitability that is also above the average. This is done through internal growth, thanks to our wide range of services, innovation, a strong sales approach and our capacity to deliver the same quality of services in 29 countries and 5 continents. But this is also the result of successful external growth coming from choosing very good partners.

CCS: To what do you attribute your success in merger and acquisition activities while other companies are failing? What makes you so successful year after year?

Julien: What’s true is that over the past few years we have enjoyed an overall growth rate of 50 percent, while maintaining our profitability.

Frankly speaking, it comes first from working very hard to promote our competitive advantages, but it also comes from real success as a result of our policy on mergers and acquisitions.

Basically, we differ from the other consolidators in our industry in one way: ‘We never want to acquire a company, we always want to find partners.’ It means we never acquire 100 percent of a company, but only a majority stake, and we want the founder to remain in the company, to continue to manage the company and to develop our ‘common baby,’ taking advantage of the founder’s experience and our strengths. For us, it’s always a real ‘people story,’ involving individuals. It’s the creation of a ‘win-win partnership’ for the present and the future.

The result is that we have managers, all over the world, who are also shareholders, but we don’t have an ‘ethnocentric vision’ of the world. The world is a mosaic; we need to have common values, common strategies and common methodologies, but we have to respect the cultural differences — we are very proud to have more than 30 different nationalities involved in the management of our companies.

CCS: How do you manage your growth?

Julien: We believe in very operational business plans — over one-year and three-year periods.

These business plans are our road maps. They are prepared by all the individual members of a business unit, and then we consolidate them.

We always give, as input, the key developments in the market, in technology, the challenges, the goals…and then, every business unit’s role. So, the strategy is always the result of team work done all over the world.

2) We are absolutely obsessed with measurement. This is the only way to manage such a fast-moving business, so we constantly track key performance indicators:

• For our clients — benchmarking and customer satisfaction surveys,
• For ourselves — day-to-day measurement of all the key ratios.
• And, of course, we manage by focusing on ‘troubleshooting,’ using these benchmarks.

CCS: What type of management and incentive techniques make Teleperformance so successful? What do you do differently than other teleservices agencies?

Julien: Beyond the type of management, I would say that all over the Teleperformance Group, we share a common culture — that ‘We succeed through our clients’ success.’ We know that this is a people business and that we will be able to succeed only if we are a solid and enthusiastic team. This means that we do not believe so much in ‘rules.’ When there is a subject of debate to find the right solution, everybody is more than welcome to express their own opinion. For us, this is the most important thing. Of course, we have different techniques for incentives, which are different from one business to the other, and from one country to the other, but I can tell you that ‘trips for the team’ to another Teleperformance company in another country are very popular.

CCS: In your judgment, what are the differences in teleservices in Europe versus those in the United States?

Julien: On the one hand, telemarketing and teleservices in the U.S.A. are more mature. The clients know exactly what type of programs they want and very often they buy “X” amount of hours of telemarketing with specific quality requirements.
On the other hand, as Europe has a diversity of relatively small countries, the only way to build large telemarketing and teleservices businesses is to be very proactive.

So a service bureau can’t be just a good ‘call factory,’ it has to be creative, to initiate co-marketing, to propose new tests…in summary, I would say that the U.S. service bureaus are maybe more process and less marketing oriented — but this is a personal opinion.

CCS: How do you ensure quality is maintained in your global network of call centers that spans 29 countries on 5 continents?

Julien: We have a wide range of solutions ranging from training to processes including, of course, customer satisfaction measurement.

Just to give you a few examples:

• The Teleperformance Training Institute: with courses for our field management and top management,
• Teleperformance’s International Meetings: twice a year we gather together the top 100 managers of the Group for benchmarking and discussions, the monthly exchange of best practices, and, of course, the most important of all – the ISO 9002 Quality Assurance process.

The Teleperformance Group has been (and still is) the very first Group to be involved in ISO 9002 certification.

Teleperformance in France has been ISO 9002 certified since June 1996, and we already have a total of 12 countries certified — the last one being Japan in May 1999. We plan to have the whole Group certified by the end of 2000.

CCS: What type of network systems does Teleperformance have in place connecting its widely dispersed call centers? Do you standardize your systems or adjust them from country to country?

Julien: Today, we adjust our different systems on a country-by-country basis. This is basically due to the different origins of the companies of the Group as well as to the different level of assistance you can get from country to country.

At the corporate level, we ensure that we have the standard requirements of the markets everywhere in terms of ACD, predictive dialing, CTI….

Today, we work monthly with Lucent, Nortel, Aspect and Alcatel in terms of ACDs, and we use the call center solutions provided by Noble Systems in the U.S.A. and Europe, as well as some other solutions.

We have a strong investment plan to develop ‘Multimedia Integrated Call Centers’ in the next 18 months.

CCS: Do you conduct transnational campaigns? If so, what challenges do they pose?

Julien: Yes, we do! In case of international business, the key point is the quality of the preparation to get the right level of understanding and commitment from both local organizations (client and Teleperformance). It is very important to pay a lot of attention to the background information package, briefings and training.

At a corporate level, we have international client services people who are directly responsible for the management of an international account, so our client has only one point of contact, which is much more convenient. In the same way, we provide daily consolidated reporting via the Net.

CCS: How are you adjusting to the changes brought about by the explosion of e-commerce sites? Are you answering Web callbacks or Web chat, or implementing Internet telephony or voice over IP technologies?

Julien: For us, the Internet is an opportunity. Call centers are becoming multimedia contacts centers. Today, we already answer e-mail and Web callbacks for some of our clients. What’s more, many ISPs are our clients because we provide customer service and technical assistance for them. In Europe alone, we have nearly 1,000 workstations working to support ISPs or companies related to e-commerce, and this is growing very fast (1,000 new Internet subscribers generating one seat in customer service/technical assistance). Also, it’s obvious that in the very near future, our call centers will be multimedia integrated contact centers.

CCS: What benefits have CTI and the recent convergence of voice and data networks brought to your call centers?

Julien: The primary benefits of CTI are at two levels.

• Level One is ‘quality of service’: Thanks to the integration of database and ACD technologies, the call center workstation is now a ‘smart workstation,’ so more and more businesses can be handled by an outsourced service bureau.
• Level Two is ‘efficiency’: The call blending features dramatically improve the productivity of a call center. This reduces the cost of teleservices and encourages increased usage.

CCS: What benefits does Teleper-formance bring to its clients?

Julien: We offer a global, single point-of-service solution. We think globally, yet our clients deal with just one company. We act locally, and we respect the diversity of different cultures. We deliver the same quality of services thanks to our ISO processes.

CCS: What types of programs have been the most beneficial to your clients?

Julien: We have a wide range of programs and clients. Rather than looking at a program in isolation, we try to see how it fits into the overall client strategy. In this way, we can use our skills and experience to provide greater added value.

We provide market research, telesales, teleservices, customer management and we work across a range of sectors including: IT, telecommunications, financial services and insurance, mail order, publishing…so it’s very difficult to select one program or one industry over the others.

CCS: Where do you see future business opportunities for Teleperformance? Which regions and market segments offer future growth opportunities for Teleperformance?

Julien: We continue to expect very strong growth because we are part of the ‘Big Bang’ development in telecommunications, information technology and ‘e-industry.’

Our unique concept — ‘Marketing and Technology Integration’ — allows us to be a key partner in the development of one-to-one marketing strategies and customer relationship management.

Of course, we will continue to invest in technology solutions, and we hope to enjoy strong growth on both sides of the Atlantic for the next three years…and we cannot forget the development potential of ‘giants’ like Japan or Brazil.