Delegating customer services to a third party carries risks, but standards and performance in outsourced contact centres have improved markedly, as Dan Matthews discovers
For many companies in the UK, outsourcing to a third party the responsibility of communicating with customers via a contact centre is a way of saving money, building efficiencies, and providing more scope to concentrate on the central goals of creating new products and selling.
Whereas ten years ago outsourcing your call centre operations to India (to use the now classic example) was tantamount to admitting that you wanted to save money and didn’t care much for customer satisfaction rates, today businesses are much more careful about how their customer queries and complaints are managed.
India remains a global leader in contact centre facilities, and services have advanced and improved dramatically in the last decade. But, such is the growing interest among companies about who fields their customer calls and how they do it, new emerging economies have sprung up to offer increasingly sophisticated and beneficial services.
New emerging economies have sprung up to offer increasingly sophisticated and beneficial services
Four such emerging destinations for contact centre outsourcers are Britain itself, Northern Ireland, Sweden and Egypt. Each destination has its pros and cons regarding cost, efficiency, infrastructure, skilled workforces and language, but which countries are the real leaders in the outsourcing business?
Admittedly, it sounds a little contradictory to outsource in your own country, given that the cost savings will be less dramatic than if you delegate responsibility to a developing economy, but there are benefits nonetheless.
You share a common language (often with British accents), communication technologies are first-rate, and call centre operatives are likely to have an instinctive cultural understanding of the callers and their problems.
The UK is one of the most mature contact centre markets in the world, so there is a ready-made pool of talented employees and a big selection of technology providers close to home. The downside, as you might expect, is cost which can push up spending on both infrastructure and staffing.
Stephen Bentley, chief executive of Granby Marketing Services, says: “Some companies are turning their backs on foreign contact centres and instead investing in Britain-based ones. Companies may not see the initial financial rewards, but the gains made in quality control and ownership make for better results.
“Management are able to visit the centres themselves, without the long-haul flights and they can ensure that the people representing their brand are doing so as required. Of course, you have the added benefit of language and culture, and actually that is becoming a more important factor when it comes to running a successful operation.
“Call centres can never forget they are brand guardians and a less than happy experience can result in the loss of lifetime spend, which potentially should need to feature more in the offshore evaluation process.”
The fortunes of the contact centre industry in Northern Ireland have been up and down in recent years, with the global economic pinch hitting Ulster hard and several businesses in the call centre sector cutting jobs or even shutting up shop for good.
But there are still several potent reasons why it’s a good idea to locate your contact centre hub in Northern Ireland. There is no language barrier, travelling to your supplier is easy and operational costs are generally low compared to mainland UK.
Northern Ireland is a “near-shore” solution and offers a good option for firms seeking a low- risk area from which to run contact centre operations with a high-quality labour market at a competitive rate. Largely because of this, Northern Ireland has achieved considerable success in attracting contact centre business in recent years.
“With lower costs compared to many UK locations and in particular compared to Dublin in the Irish Republic, Northern Ireland has benefitted from good universities coupled with strong local government support,” says Declan Maguire, client services director at Conduit.
“It is seen as having a very high level of customer satisfaction and customer service experience, although relative size of the population coupled with the density of population centres is seen as a resource constraint.”
Luke Talbot, of Azzurri Communications, adds: “There is some great contact centre history in Northern Ireland, particularly in and around Belfast, and a shared culture make this a great destination for outsourcers. The downsides are broadly similar to those of the rest of the UK.”
Sweden shares the UK’s benefits of a highly developed and refined economy, a well educated population, and mature infrastructure and communications networks. Language is unlikely to be a problem either, with English widely spoken at a fluent level.
“Benefiting from the increase in regionalisation across Europe, Sweden is enhancing its reputation as being the preferred location for Nordic ICT [information and communications technology] and technical helpdesk facilities,” according to Declan Maguire at Conduit.
“Traditionally seen as an expensive country to do business in, it has benefited from government focus and support, creating a multi-lingual hub to service Scandinavia. There is a greater propensity for Nordic businesses, especially in the telecoms sector, to outsource their contact centre operations which has resulted in an increase in the number of outsourcing companies establishing themselves in the country.”
For two years in a row Sweden has come first in the World Economic Forum’s list of most developed countries and tops the list of ICT-savvy countries in INSEAD’s Global Information Technology Report, which takes into account technological infrastructure, political initiatives and consumer attitudes.
Good ICT education, investment in broadband during the 1990s, and one of the most connected and technologically advanced populations in the world add weight to Sweden as a destination for outsourced services.
But Luke Talbot, of Azzurri Communications, points out: “There’s no real problem with a language barrier, but question marks hang over the return on investment compared to running something closer to home which offers similar expertise and technology.”
Egypt has invested heavily in contact centre infrastructure over the last few years and several new businesses have emerged as a result, including Ameco Tech, Xceed and Raya, which employ thousands of people.
The companies have won an impressive group of clients, including some from Europe and the United States, thanks to an increasingly multi-lingual workforce. The boom in contact centre activity has led to the country being labelled the “new India”, although many observers suggest this title is still to be earned.
According to research by Datamonitor, in raw cost terms Egypt remains more expensive than India, with each hour of inbound customer service costing US$14.50 on average in the former case, compared to $13.30 in the latter. But the country consistently ranks highly in indexes for financial attractiveness, skilled employees and the general economic environment.
Sadly, all this could be dismantled, at least temporarily, by the side effects of the Arab uprising last year, which has left companies outside Egypt wondering whether investing in the country is a safe bet.
“Time difference parity to Europe, coupled with the previous Egyptian government’s investment in communications infrastructure, including educational programmes designed to attract blue-chip businesses, acted as the catalyst for development of the outsourcing industry,” says Declan Maguire at Conduit.
“But central to the attractiveness of Egypt, beyond the normal cost-reduction benefits to be had, was the stability of the government. The uncertainty of the political environment, as a new nation emerges, has given rise to many doubts around the short-term viability of the destination.”