The Real Case For The Home-Based-Agent Model
By Jim Ball, Alpine Access

In recent years, there has been a rapidly increasing level of interest in the use of agents working from home as an alternative to the traditional, facilities-based call center approach. It is particularly interesting to follow how many in the call center industry have characterized the value proposition underlying this business model. More often than not, discussions about the use of home-based-agents center around the cost-savings aspects, with a particular focus on the use of home-based-agents as an alternative to sending calls offshore. Terms such as “home-shoring” are creeping into the call center vernacular, implying that companies should look at the use of home-based-agents as a way of gaining the benefits of offshore centers (low per-unit cost) without having to deal with the operational and political concerns associated with sending calls out of the country. Not only is this inaccurate; it is also, in ways, a red herring. This article addresses the real value proposition offered by the use of home-based-agents.

Agent Quality
The most significant advantage of using agents who work from their homes is higher-quality agents. The reason the home-based-agent model truly can deliver on the promise of providing higher-quality agents is rather straightforward. For a given affordable wage rate, the larger the pool of candidates from which a company hires its agents, the more selective it can be in the quality of those agents. In a traditional, physical call center, there is a fairly limited radius from which a company can expect to hire agents. That radius probably is on the order of a 20-minute commute. But with a home-based-agent model that provides regional, national or even international access to agents, the candidate pool is essentially unlimited. Instead of desperately trying to keep seats filled, companies employing home-based-agents have the luxury of hiring only the very best of those applying for positions.

Having such a large reach does not automatically yield a high-quality workforce, however. It is important that the company has solid processes, specifically designed to identify those candidate characteristics that will lead to outstanding performance. Once on board, those agents expect a professional and efficient operation, with appropriate training, communications and support. The company that can meet all of those expectations will be rewarded with an agent workforce that is extremely difficult to replicate in an affordable manner at scale with a traditional call center model.

Redundancy
Next on the list of the benefits of a home-based-agent model is the unique opportunity to create a true, fully redundant service offering. Traditional call centers can implement a wide variety of sophisticated and redundant hardware and software infrastructures, providing for very high systems availability. But being able to route calls and data to an alternative location in an emergency is not very helpful if the agents trained to answer those calls all live near the primary (now non-operational) facility. Transporting trained agents to alternative locations may look good in a disaster recovery plan, but the logistics and realities of actually implementing such a plan often undermine the intended redundancy.

Building comparable multilocation redundancy in a home-based-agent model, with agents dispersed over wide geographic areas, provides the ultimate redundant infrastructure. Designed properly, the loss of an entire facility at one location can go unnoticed by the end user, as calls and data are routed to alternate facilities and agents receive those calls and data without interruption.

Flexibility
One of the very attractive characteristics of the home-based-agent model is that it is possible to quickly add staff in the event of an unexpected increase in call volume. By contracting agents who are trained on a given call type but not normally scheduled during that time, it is possible to significantly increase staffing in a matter of minutes. Not only would those agents be far less likely to drive to a call center in such an emergency, but the time required to mobilize and effect any significant increase in staffing would likely be measured in hours rather than minutes. This can be critical, as the longer it takes to react to an unforecasted increase in call volume, the more difficult it is to dig out of the inevitable resulting queue.

The home-based-agent model provides an additional flexibility benefit in that it can more easily expand its capacity to handle forecasted surges in call volume. Examples include these: seasonal increases, such as holiday peaks for many retailers; first-quarter peaks for tax-related activities; and summer peaks for companies offering warm-weather products and services. Similarly, many call centers find themselves needing to staff for short bursts of activity related to month-end billing cycles or periodic product releases. As well, most call centers experience heavy Monday volumes, the activity then subsiding throughout the week.
In any of these cases, the ability to add staff without needing to worry about availability of physical seats — with the related infrastructure, such as parking, food services, break rooms, etc. — to accommodate those forecasted surges can be a significant benefit. With agents working from home, the only fixed infrastructure needed is the technical system capacity to handle peak concurrent agent load. In having more of the part-time workforce deployed during those surges, it is much easier to provide consistently high service levels.

Control
There have been concerns regarding an inability to control or manage behavior with home-based-agents. Traditional thinking and business processes call for face-to-face management of large agent populations. Management by way of wandering about is the too-often-employed default in many traditional call centers, resulting in a lack of control over many of the key operational functions. In a distributed-agent model, those traditional processes are inadequate, so new processes and systems are needed in order to manage the workforce. Implemented properly, the result is a system-driven control infrastructure that actually provides a much higher degree of “visibility” as to what every agent is doing at every moment. The systems provide the support necessary to maintain absolute control; and with thousands of agents working from home, there is either absolute control or total chaos. Because there cannot be any middle ground (and assuming chaos is an unacceptable option), the home-based-agent model is required to operate with a very high level of control.
Many of the traditional control components, such as real-time or recorded call monitoring, should be standard components of a home-based-agent model. Likewise, regular quality assurance sessions similar to those typically used in traditional centers are easily accommodated.

Security
Building a secure technical infrastructure is fairly similar in both traditional and home-based-agent models. The implementation of appropriate business processes also should be similar in the two models, but actually is more easily (and, therefore, likely to be) accomplished in the home-based-agent model. The people aspect, however, is more advantageous by way of the home-based-agent model.

The first thought that comes to mind for most of us when we consider data security is the external hacker or malicious program that tries to access sensitive information. In fact, if you were to ask most security experts what they think is the most vulnerable point in a given data network, they probably would tell you it is by fault of the internal people who are authorized to access those data. Whether through intentionally accessing protected data for improper purposes or through inadvertently making system accessibility available to outsiders, authorized users usually are a company’s greatest security risk. The ability to be so much more selective in hiring people to whom system access will be granted allows a company using home-based-agents to significantly reduce the likelihood of a security breach.

Similar to the control factor, the unique business processes needed to support a large, distributed workforce provide the opportunity to implement a much higher level of security than typically is accomplished in a traditional center. Every action of every agent at all times must be monitored and recorded by the supporting systems in order to maintain control. So it follows that there is the opportunity to leverage that control to increase security. In fact, simply making agents aware of the level of activity monitoring that takes place can be a significant deterrent to inappropriate behavior. Combined with the use of algorithms designed to identify behavioral trends that could indicate potential security breaches, the level of data protection and breach detection can be extremely high with the home-based-agent model.

Of course, the threat of attacks from outside of the network remains important. Therefore, it is necessary to build an infrastructure that has all of the appropriate technical protections in place. Agents working from home can connect to data systems through secure SSL connections over the Web, or through VPN tunnels, or using a variety of middleware products designed to provide secure, remote access.

Cost
A developing presumption — that the use of home-based-agents is a viable “alternative” to sending calls offshore — seems to be predicated on an expectation that the cost savings which result from not needing a physical workplace is comparable to the savings that result from the much lower labor rates in offshore markets. Given the fact that, by far, the single largest expense in any call-handling model is agent labor, and that the labor rates in the most common offshore locations are a fraction of those in domestic labor markets, it would not be possible for a home-based-agent model to compete with offshore models if the measurement was simply on the basis of the cost per agent hour (or per minute, or per call). That does not mean the home-based-agent model is without significant cost benefits, however.

In a traditional model, it generally is necessary to schedule agents for a minimum of three to four hours at a time; that way, it is worthwhile for the agent to take the time to commute to the call center. With this scheduling limitation, it can be exceedingly difficult for a traditional call center to match its workforce with the incoming call volumes in a manner that yields high agent utilization without compromising acceptable service levels. In order to maintain acceptable service levels, it generally is necessary to operate at lower-than-desired agent utilizations during certain periods of the day.

In contrast, a home-based-agent model affords a company the ability to schedule its agents in much smaller time increments; often with multiple schedules in a given day. This ability to more closely match agent labor to forecasted incoming call volume can yield a significant cost savings. Although the unit cost per hour (or per minute) may be comparable to a traditional center, the number of units required to complete the job can be much lower.

One often-overlooked cost impact is the cost per dollar of revenue generated in an average transaction. Many businesses consider the call center function to be purely a cost component. In fact, depending on the nature of the calls, it may be possible to have this function not only pay for itself, but actually become a profit center for the company. Once again, the key to that success lies in agent quality. If the call’s nature is customer service, then an agent’s ability to perform at a higher level can translate to higher customer retention rates, higher return purchase levels and superior word-of-mouth support, not to mention the possibility of real-time upsell and cross-sell.

If the call’s nature is sales, the benefits are clear: agents who have been selected because they are friendlier, smarter and the best possible representatives for the product or service being sold will produce higher close ratios and higher average-order sizes. The higher levels of agent satisfaction resulting from the convenience of working from home also result in longer average tenures, which further translate to increased product knowledge and experience levels.

So Why Isn’t Everyone Doing It?
Given the compelling value proposition, people often ask why more companies haven’t made the move to home-based-agents. The first reason is it can be really difficult to do! Making the assumption that it is possible to extend traditional operational models out to the home is a big mistake. While it may work for a few agents, the chaos that would result from a more aggressive initiative — without a major shift in operational philosophy — would be disastrous.

On a more practical basis, many companies have been reluctant to move to a home-based-agent model because of the enormous amount of existing investment in traditional call center infrastructure. The brick-and-mortar aspects of that investment certainly are completely unusable in a home-based-agent model. Companies also find that much of their technology, business process and human resource investment are of little or no value in this model, as well.

To date, the combination of these factors has limited the model’s large-scale adoption in existing operations. Companies looking to launch new or expanded operations, as well as a growing number of those with existing traditional centers, however, are beginning to reconsider their options as they discover the real value proposition of the home-based-agent model. CIS

Jim Ball is founder and chief architect of Alpine Access (www.alpineaccess.com), an outsourcer of call center services using home-based customer service agents. Ball is responsible for guiding Alpine Access’ technology strategy and business process development to deliver a unique home-based-agent call center model. Prior to starting Alpine Access in 1998, Ball served as the primary developer of strategy and operational direction for Innovative Services of America, a customer care outsourcing provider. There, he ran call center operations, information systems, human resources and accounting operations, and was involved in orchestrating the successful sale of the company.

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