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Publisher's Outlook
December 2003

Nadji Tehrani Post FTC/FCC Rulings:

How To Buy

Call Center Technologies & Teleservices


Never before in the history of call centers has it been so extremely challenging to select and judiciously buy technologies and teleservices for the CRM, call center, contact center and customer interaction industries.

What Should Be Going On In Senior Management's Mind?

The challenge for CEOs is to keep their call centers and CRM centers up-to-date with new technology and make them globally competitive. As always, every year, new and different variables enter the decision-making process when making the right choices to purchase 'the right' technology or to select 'the right' outsourcing partner.

Over the last 23 years, this publication has exclusively helped the industry grow by providing authoritative articles on every aspect of the call center, teleservices, CRM and customer interaction industries. It is our paramount responsibility to continue to guide the industry to the best of our ability regarding the savvy buying of technology, outsourcing and all other products and services available to contact centers.

Compliance Is The Key
As we have covered the compliance topics, namely the FTC and FCC rulings, in every issue since February 2003, it is extremely important for every call center to become compliant to the extent that each violation would represent an $11,000 fine. That is, 91 violations = a $1,000,000 fine. As such, no company can ignore compliance with the latest FTC and FCC regulations. Having said all of that, it becomes extremely apparent that the most important topic to keep in mind when selecting technology or teleservices partners is that of compliance. As I travel around the industry, it is mind-boggling to realize that only about half of the companies visited are fully compliant or intend to be compliant. This is practically impossible to understand. Our best advice is, if you don't comply with the regulations, it is only a matter of time before your company will vanish.

Every year at this time, it is our paramount responsibility as the leading publication of this industry since 1982 to put ourselves in the shoes of the CEOs of Corporate America and inform them as to what important topics and functions they must keep in mind prior to making judicious selections of products and services.
From our vantage point, the following represents the topics that CEOs and other decision makers must consider. Before listing those items, I would like to make it abundantly clear that if you do not have the core-competency in call center management, and you do not fully and completely understand all federal, state and local regulations, the best advice for you is to outsource your call center and CRM functions to reliable and compliant teleservices agencies. After all, it simply does not make sense to take a chance and, God forbid, risk a huge fine. Having
said all of the above, we are now going to focus on some of the crucial matters and topics that the CEOs and senior management must keep in mind while preparing for a fully compliant call center/CRM/contact center within your company or such services outsourced to others:

  1. The CEO must ask the paramount and vitally important question ' are my services compliant with new FTC and FCC regulations?

  2. The CEO must adopt a judicious purchasing strategy.

  3. Teleservices acquisition strategies,

  4. Growth strategies,

  5. Offshore strategies,

  6. Productivity strategies,

  7. New technology acquisition strategies,

  8. Differentiation strategies, and

  9. Positioning strategies.

The prudent and progressive management of any CRM contact center should be asking the following questions:

  1. Should I buy or outsource in regard to contact center products and services?

  2. What do I need to buy or outsource ('rule of thumb, you must outsource what is not your core competency')?

  3. How do I select products and services?

  4. How do I compare products and services?

  5. What about compatibility?

  6. What do I need to protect my market share?

  7. What do I need to do to increase my market share?

  8. Finally, given the ever-increasing global competition, what should I do to remain competitive?

Fortunately, the economy is turning around and it is time for a progressive contact center manager to acquire the latest technology that will help to achieve the following:

  1. Improve overall productivity,

  2. Improve agent productivity,

  3. Improve CRM, customer care and customer retention capabilities,

  4. Better control of agent training and monitoring,

  5. Automatic compliance with all state, federal and local laws, and

  6. Improve ROI.

Compliance Issue
As you can see in every issue of Customer Inter@ction Solutions' since February 2003, this magazine has proudly and exclusively covered these vital and important issues ' FTC and FCC regulations in regard to do-not-call lists, predictive dialing, etc. We have clearly and decisively defended the industry's position and uniquely took on the FTC and FCC with powerful, hard-hitting editorials.

As we said in the April 2003 Publisher's Outlook, three to five million jobs are at risk of being lost because of the new Telemarketing Sales Rule. This is a reminder of what is at risk if you do not comply with new regulations. If you have not read it, we urge you to read 'A CALL FOR A UNITED FRONT AGAINST THE UNFAIR TSR REGULATIONS' now (http://www. tmcnet.com/cis/0403/0403po.htm).

We also warned in our October 2003 Publisher's Outlook ('91 Violations = $1 Million Fine') that given the astronomical fine of $11,000 to be levied by the FTC per violation, every call center must comply with the regulations or they will vanish. Indeed, the FTC has levied a $780,000 fine on AT&T for violating do-not-call rules. Having said that, the reality is you cannot have a purchase or acquisition take place without absolutely, positively knowing if you are in compliance. We have exclusively covered this matter in the past 10 months, and we urge you to read it religiously.

In addition to compliance, there is a paramount rule you should adhere to. If you feel you do not have a full grasp of the industry and the new regulations, you cannot possibly make a judicious purchasing decision. You should outsource whatever it is that you cannot do yourself.

New Technology Acquisitions
You must always answer two questions when you are purchasing new technology: Is it compliant with new FTC and FCC regulations, and can I justify the purchase with the corresponding gains in productivity and return on investment?

Keep in mind that given the current global competition and quality or lack thereof with some existing global competition, it is vitally important to differentiate your products and services so that customers and potential customers will have a clear reason to buy from you.

The First Law Of Positioning
Another important matter that will enhance your market leadership is the observance of the first law of positioning. The first law states that: 'It is better to be first than to be better.' As I stated in the September 2002 Publisher's Outlook ('Every Company Wants To Be A Peacock In The Land Of Penguins'), positioning must be adjusted to the rapidly changing market conditions. It is crucial for any product to be positioned advantageously.

Seeking Several Industry Leaders' Opinions
To get a realistic and balanced view for judicious selection of products and services in the post FTC/FCC rulings business world, I contacted several industry leaders and have asked for their input on these extremely important issues pertaining to the industry. Selected quotations from their comments follow.

On Teleservices Outsourcing
Steve Brubaker, senior vice president of Corporate Affairs at InfoCision Management Corporation (www.infocision.com), provided the following guidelines last year for selecting a teleservices outsourcing company:
' The rule for selecting a teleservices partner is to make them prove their experience, commitment and quality to you.
' Experience: Ask for examples of success within your industry. Get case studies and ask specific questions about how they've handled programs like yours.
' Commitment: What resources will be available to you for your project? Do they prove their commitment by investing in the right people, technology and processes? Is the operation scalable?
' Quality: Visit the operation. Meet the people who will manage your project; and, without exception, visit the call center. Determine whether or not the environment and people emulate your culture and values. Are they the people who will best represent your company to your customers?
' Keep these tips in mind, and always remember an operation's qual-
ity can't be found in a slick brochure or ad campaign, but in its people and its call center.

This year Brubaker added the following important advice: 'When your teleservices partner understands your regulatory concerns, you will certainly sleep better at night knowing you are protected.'

With the government fines, it is paramount that you make sure your outsourcing partner has the technology and a corporate policy of being fully compliant with all federal, state and local regulations.

To the best of my knowledge, most of the leading teleservices companies seem to be compliant. However, it is the buyer's responsibility to verify that the company they outsource to is indeed fully compliant.

Here is some other advice from industry leaders about operating call centers/CRM centers in a post-do-not-call business world.

'In 2004, enterprises will need to optimize customer interaction in a regulatory environment tightened through new do-not-call rules,' stated Jim Smith, vice president, CRM Strategic Planning and Product Management for Avaya Communications (www.avaya.com). 'Businesses will continue to embrace technologies that help them respect customer privacy and reach out to customers at the right time. Enterprises that can do this successfully will further enhance brand loyalty and satisfaction among customers, an ongoing focus in 2004.'

Carl E. Mergele, chief executive officer of SER Solutions Inc. (www.ser.com), believes that 'unlike 2003 when contact centers were consumed with an onslaught of regulatory compliance issues, 2004 will be a year when contact centers recommit to serving the needs of their customers.'

Erik Hille, vice president of marketing (USA) for Amacis (www.amacis.com), added that licensed solutions will be pushed back into the proverbial picture because the quick-fix solutions previously implemented were often short on functionality.

'As companies reevaluate these decisions moving forward, they will increasingly be looking for additional functionality,' he noted.

Added Matthew Self, vice president of call center development for Oracle Corp., effective CRM solutions in this new world must not only ensure regulatory compliance, but actively take advantage of contact opportunities that do exist.

'To do this, they must integrate customer information from multiple business applications and across all channels, as well as providing flexible tools to implement contact rules based on customer preferences and local, national and international regulations,' Self commented.

And William E. Meade, Jr., president and CEO, StarTek, Inc. (www.startek.com), thinks that the new legislation will only make competition stronger.

'Do-not-call legislation will intensify competition as excess capacity in facilities and people will lead outbound callers to accelerate their efforts to enter the inbound arena to cover overhead expenses,' Meade said. 'This will probably sharpen pricing, leading to further financial pressure and continued industry consolidation.'

'Research all of the technology available, compare not only the benefits provided by each to enhance operational efficiencies, but weigh the compliance additions to their technology,' advises CJ Johnson, senior vice president, CCC Interactive Corp. (www.cccinteractive.com). 'Once this is complete, two additional areas should be compared; how much do they spend annually on R&D-related specifically to compliance, and talk to their customers regarding their ease in utilizing their technology and maintaining compliance.'

'Contact center managers are faced with several very important considerations in order to be absolutely confident that the solutions and services chosen not only meet all of their traditional needs, but also are compliant with the new do-not-call regulations,' added Terry Ryan, president and CEO, HigherGround, Inc. (www.highergroundinc.com).

Ryan noted companies must be certain that the systems they choose provide four very important capabilities:

1. Upload do-not-call lists automatically,
2. Compare their call campaign lists automatically against the do-not-call lists, and flag the numbers that are included in the do-not-call lists to guarantee that they will not be called (proactive compliance assurance),
3. Conduct an automated search of their call campaign lists to verify the absence of 'do-not-call' numbers, thus proving that they were not called (reactive compliance verification),
4. Notify supervisors or managers immediately and automatically if a number on the do-not-call list was called (damage control).

Oscar Alban, principal, global market consultant, Witness Systems (www.witness.com), said that in today's do-not-call business world, there are many important factors to consider before making major purchase decisions.

'In the outbound world, you must ensure you have capabilities on your auto-dialer that suppress those telephone numbers that are protected under the Do-Not-Call Registry, as well as other requirements ' such as discounted rates and recordings,' Alban said. 'Further, if your organization is purchasing 'call lists' for outbound marketing, you should require proof from that vendor that the data have been cross-referenced and checked against the Do-Not- Call Registry.'

Another topic Alban says falls into this area focuses on the Telemarketing Sales Rule, which has become a forgotten piece of the puzzle.

'Very specific verbiage, as outlined by the FCC, must be used, and those interactions must be recorded and stored for a minimum of two years,' Alban noted. 'This is why it's even more important than ever before to invest in a system that offers both quality monitoring capabilities ' to ensure the correct verbiage was used and the outlined procedures were followed ' as well as the ability to perform compliance recording in order to meet the FCC's two-year storage requirement.'

Doug Berry, vice president and general manager for Epicor's Clientele Group, added that there shouldn't be apprehension about implementing CRM technologies.

'One thing to consider when evaluating CRM applications is to look at applications that control opt-in and opt-out requests from within the database, so that each outbound marketing campaign is executed with clean data.' Berry said.
As always, I welcome your comments ([email protected]).

New Year's Wishes
Best wishes for a healthy, happy, prosperous and peaceful new year to all!

Sincerely yours,

Nadji Tehrani
Executive Group Publisher

For information and subscriptions,
visit www.TMCnet.com or call 203-852-6800.

Nadji Tehrani
TMC Chairman, CEO and
Executive Group Publisher

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