Alpine Access: Vendor Profile Series for Home- Based Agent Services in Customer Care

Transcription

1 VENDOR PROFILE Alpine Access: Vendor Profile Series for Home- Based Agent Services in Customer Care Melissa Stevenson IDC OPINION Global Headquarters: 5 Speen Street Framingham, MA USA P F Over the past 13 years, Alpine Access has carved out a niche in customer care by building the company on its home-based agent business model with a strong focus on recruiting and training expertise. In the past three years, Alpine Access' growth has accelerated at a rapid rate. While Alpine Access remains relatively small in the big picture of customer care providers, its recent growth and unique value proposition make it a provider to pay attention to. IDC has made the following observations: The home-based agent model satisfies many issues of current client demand for customer care; lower cost, access to talent, and the ability to localize are some of the main drivers of the home-based agent model. By providing this delivery model exclusively, Alpine Access appeals to the needs of many companies seeking to outsource and take advantage of the benefits of the home-based model. Alpine Access, a comparatively small provider, competes with large ITO and BPO organizations as well as large customer care providers in the contact center space. Despite this, Alpine Access boasts an impressive lineup of clients including large brand names and Fortune 500 companies. According to IDC research, voice transactions are decreasing as a percentage of overall interactions, while technology-driven and automated channels like chat, text, and social media are increasing. As the contact center evolves, there will come a need to both "upgrade the agents" to better respond to more complicated queries and invest more heavily in technology, in particular as it relates to automated and self-service options. Alpine Access' value proposition of having a more stable and experienced workforce addresses the agent upgrade piece, but partnerships will need to be made to bolster the technology side of the contact center and investments in training social media experts will give Alpine Access a competitive advantage. IN THIS VENDOR PROFILE This IDC Vendor Profile highlights Alpine Access, a contact center and customer care provider that uses the home-based agent delivery model exclusively. The homebased agent delivery model is based on the use of home-based customer care agents to field customer care inquiries. These virtual agents facilitate calls and other customer interactions remotely from their homes. Primarily a virtual contact center Filing Information: December 2011, IDC #232037, Volume: 1 Contact Center Services: Vendor Profile

2 organization, Alpine Access also offers elearning and erecruiting solutions in a software-as-a-service (SaaS) model. These offerings are both proprietary solutions based on Alpine Access' internal recruiting and training procedures, which allow customers utilizing the home-based agent model in-house to take advantage of technology and guidance from Alpine Access. SITUATION OVERVIEW Company Overview Alpine Access is a pure-play home-based contact center services player in the United States; it was founded in 1998, and since its inception, it has experienced steady growth that has accelerated in the past couple of years. Table 1 provides an overview of the company. Details include: Alpine Access was founded in 1998 as a pure-play home-based agent contact center company. Set up completely on virtual platforms, Alpine Access does not own any brick-and-mortar assets; 100% of client engagements utilize homebased agents as the delivery model. Alpine Access states that its mission is "to transform where and how the world learns, works, and lives." Alpine Access is venture capital (VC) backed by Stolberg Equity Partners and 5280 Partners. Alpine Access has based its strategy and future outlook on three tenets: adoption, penetration, and reallocation. Alpine Access states that 75% of enterprises are in some phase of adoption of a home-based agent model, and that the demand is growing steadily for this method of delivery. While Alpine Access' services were originally tailored to the retail market, Alpine Access is now seeing demand across industries, in particular in the communications, financial services, healthcare, and technology verticals. The reallocation prong is Alpine Access' observation of customer demand to move work back onshore; Alpine Access has observed that its customers are seeking to move work from the Philippines and India to a home-based model to retain cost savings while improving the customer experience, and it sees this trend accelerating. Alpine Access has experienced 13 years of consecutive growth and significant growth over the past two years. Revenue increased about 45% from 2009 to During , Alpine Access revenue grew by over 75%. Alpine Access is projecting $150 million in revenue for the year 2012 and expects to be a $500 million 1 billion company over the next 5 10 years. Alpine Access has extensive capabilities in the financial services, wireless communications, technology, healthcare, and retail sectors, serving 20+ clients and 50+ programs. 2 # IDC

3 TABLE 1 Overview of Alpine Access, 2011 Category Details Year founded 1998 Year began offering home-based agent services 1998 CEO Headquarters Christopher M. Carrington Denver, Colorado Total number of employees 5,000 General location of home-based agents United States and Canada Most recent annual revenue $68 million in 2010 ($100+ million run rate is estimated for 2011) Company Strategy Performance Alpine Access' revenue has been steadily increasing, in particular over the past two to three years. Alpine Access states that revenue is at a $100+ million run rate for the year 2011 and anticipates similar growth over the coming years. Since Alpine Access only employs home-based agents, all customer care revenue is derived from this delivery model (see Table 2). TABLE 2 Alpine Access Revenue, ($M) Total revenue Note: 2011 data is estimated IDC #

4 Industry Expertise As Figure 1 highlights, Alpine Access boasts expertise across a wide range of verticals, with particular strength in financial services, technology, and telecommunications. It is also present in healthcare, education and government, retail, and transportation, as well as personal and other services. FIGURE 1 Alpine Access Revenue Distribution by Vertical Home- Based Agent Workforce Dynamics Alpine Access Agent Overview As Table 3 highlights, Alpine Access' home-based agent head count has also been increasing steadily along with revenue. Agent head count close to doubled in , and Alpine Access plans to come close to doubling its workforce yet again over the next year. 4 # IDC

5 TABLE 3 Alpine Access Home- Based Agent Head Count, Active home-based agents* 1,964 3,725 5,000 Home-based agent network** NA NA NA * Approximate number of agents active on assignment at a given time. ** Approximate number of agents within a network to call upon for assignment. As Alpine Access does not keep a "resource pool" of agents, all agents who are employed are trained and in production. Although it does not refer to applicants as a network of agents, Alpine Access receives approximately 400,000 applications for employment annually. In 2010, Alpine Access employed 4,535 employees, 3,725 of which were production agents. Alpine Access' agents are spread across 1,700 cities and 41 states, covering 2,802 zip codes in the United States. While agents are primarily based in the United States, about 15% of the workforce is based in Canada (see Figure 2), where agents are present in eight provinces. From 1Q11 to 3Q11, Alpine Access hired approximately 800 agents in Canada spanning across 250+ cities. Over the next two years, Alpine Access intends to hire an additional 3,000 4,000 agents, which if executed will nearly double its workforce. FIGURE 2 Alpine Access Agent Location 2011 IDC #

6 Alpine Access shared several top contracts with IDC; the names of the companies are confidential. The contracts span the spectrum of customer care services, including tech support, billing, customer service, and collections, and include several key verticals. One of the largest contracts utilizes approximately 1,000 agents for English and bilingual tech support and billing for a major software company. Another large contract utilizes about 600 agents for English wireless customer service and tech support, for a cable and broadband company, and yet another large contract uses approximately 500 agents for English and bilingual collections for a large telecommunications organization. Another notable financial services contract utilizes Alpine Access exclusively for its Mandarin and Cantonese customer support. Table 4 shows that Alpine Access' client engagements range from 50 to 1,000 agents per engagement. The average engagement utilizes about 350 agents. The majority of new client engagements are in the higher range of that spectrum, whereas primarily legacy clients still utilize Alpine Access for small engagements. TABLE 4 Alpine Access Home- Based Agents per Client Engagement Number of Agents Average number of home-based agents 350 Range of number of home-based agents 50 1,000 As Figure 3 shows, Alpine Access has about 43% of agents dedicated to customer service/account management and 38% dedicated to technical support. Approximately 12% of agents work in a collections function, and approximately 7% work on sales/other. Alpine Access maintains a workforce where each agent is focused on one task and/or account at a time. Figure 4 highlights the distribution of home-based agents by full- and part-time employment; half of Alpine Access' workforce is part time and half is full time. Employees must work a minimum of 20 hours to be considered part time and 35 hours to be considered full time. All of Alpine Access' home-based agents are assigned to one account at any given time. 6 # IDC

7 FIGURE 3 Alpine Access Agents by Horizontal Process FIGURE 4 Alpine Access Agents by Full- and Part- Time Status Value Proposition/Differentiators Alpine Access' business model contains several key elements, including the agent scheduling process and the agent profile, which Alpine Access contends are key differentiators in the contact center marketplace IDC #

8 Scheduling Alpine Access' value proposition lists the following differentiators as they pertain to the scheduling of agents' shifts: 15-minute scheduling increments. Alpine Access reports that it is the first virtual customer care company to offer agent shifts in 15-minute increments. The aim of 15-minute scheduling increments is to create flexibility and control for both the agents and the clients as the increments allow for scheduling up or down with clients' business needs and give the agents control over their schedule. Note that this doesn't mean that agents are necessarily working 15-minute shifts, bearing in mind the minimum hours required per week, but allows for flexibility; agents can grab extra shift time during peak times and create a schedule that works for their personal life. Alpine Access contends that this lends well to agent satisfaction along with client demand. Schedule forecasting. Along with scheduling flexibility, Alpine Access differentiates its scheduling process by utilizing proprietary workforce management tools that, it reports, result in the prediction of staffing requirements with 95% accuracy. According to Alpine Access, this kind of accuracy allows for maximum staffing coverage during peak periods as well as decreasing staff for slower periods, allowing for cost savings by maximizing efficiency and reducing excess staffing. Customer satisfaction can also be reportedly impacted by reduced wait times and potentially happier agents handling the calls. Intraday scheduling. In the event that the scheduling forecast is not accurate, Alpine Access is capable of accommodating scheduling changes within the same business day. Alpine Access customer care professionals set their own work schedule preferences within the shift availability using the proprietary workforce management system's staffing forecast. FTE model. Alpine Access argues that the home-based employee model (versus the 1099 or contractor model) allows for a more loyal and engaged workforce. Since its founding in 1998, Alpine Access has exclusively used an employeebased model. Employee Profile According to Alpine Access, the profile of its customer care agents is also different than the typical brick-and-mortar agent profile. The average age of Alpine Access' home-based agents is 39. More than 80% of the agents are college educated, and the average level of work experience is years. Alpine Access also places an emphasis on hiring disabled home workers, which it estimates currently account for just under 10% of its total workforce, as well as veterans and military spouses, which account for 35% of its total workforce. Alpine Access contends that the agent profile in part contributes to a lower overall attrition rate, which it estimates to be 50% or less than that of a traditional call center. Alpine Access also states that this more mature, educated workforce leads to better customer service outcomes including net promoter scores. 8 # IDC

9 Figure 5 highlights the various components of the home-based agent profiles that Alpine Access employs as part of its home-based agent workforce. FIGURE 5 Alpine Access Agent Skills Scalability/Ramp-Up Time As a result of the employee scheduling model and profile previously highlighted, Alpine Access claims to be able to provide faster and more capital-efficient scaling and ramping. Alpine Access states that its virtual operations can scale large and complex programs in less than 90 days. Investments in Recruiting, Training, and Retaining Talent Recruiting Talent Alpine Access' proprietary recruiting platform (also sold as a standalone offering on a SaaS basis) evaluates agents on a variety of skills, competencies, psychographic profiles, experiences, and abilities. Alpine Access finds that it is able to hire agents that are uniquely differentiated from the traditional brick-and-mortar agent profile. This includes some of the demographics and skills listed previously, including average age, work experience, education, and language skills. Alpine Access states that access to talent unrestricted by geography is a major advantage of recruiting for home-based agents. Alpine Access is able to hire candidates in most of the United States and Canada and therefore has a much 2011 IDC #

10 greater pool of talent to draw upon. The organization is very selective in its recruiting process and evaluates candidates based on an aptitude to successfully work from home; this aptitude is evaluated in a variety of screening questions and other assessments administered in the recruiting process. Alpine Access hires less than 2% of applicants. Alpine Access' approach to recruiting highlights what it considers to be the key advantages to working as a home-based agent: "We Bring the Work to You." Emphasizing the perk of being able to work out of one's own home, Alpine Access declares to recruits "We Bring the Work to You." According to Alpine Access, the clear advantage to being home and close to family life, the ability to adjust one's schedule to meet personal needs, the personalized environment (versus a "dreary cubicle"), and the time and money saved not having to commute to an office are all big draws for at-home recruits. Based on Alpine Access' assessment, some of the specific perks are: Savings on average of $5,000 each year by not needing money for gas and car maintenance, wardrobe and dry-cleaning expenses, and meals and snacks at the office Savings on average of 200 hours each year by avoiding the grind of a daily commute Paid training at home Opportunities for advancement A variety of corporate benefits, discount programs, and other incentives The pitch to recruits is not that of merely a job, but attempts to appeal to the career minded. It appears that Alpine Access is seeking to recruit serious, career-minded professionals who will have the responsibility, focus, and initiative to work successfully from home. Recruiting Platform Alpine Access' recruiting platform utilizes the virtual model used for operations. The initial recruiting engine is automated and evaluates applicants based on skills, competencies, experiences, and abilities. A proprietary methodology called the Science of Selection uses algorithms to match agents to client programs. With 400,000 applications received annually, this algorithm is able to do the initial filtering, stack ranking, and evaluation of potential agents. Training All of Alpine Access' training is delivered virtually via its proprietary elearning platform. Alpine Access' training program typically involves hours of content, depending on the client and program. The content is delivered using a multimedia approach including voice, video, chat, and social modules. Some of the training is self-paced study, while other components are led by a facilitator in a "virtual classroom." The progress of agent training, outcomes of learning, and knowledge 10 # IDC

11 retention are tracked throughout the agents' course of study. In many cases, client programs will require assessments and final evaluations before being put on the phones in production mode. Retention Alpine Access' retention rate varies by industry, call type, and client/program (some interactions are simpler and less stressful, thereby having higher retention rates than others). Alpine Access routinely benchmarks retention rates against its clients' traditional contact center agents, whether internal or outsourced, and finds for a majority of programs that Alpine Access' retention rate is twice as high. Alpine Access states that it invests heavily to ensure that agents have the training, knowledge, skill sets, and support to succeed as home-based workers. Alpine Access contends that the Science of Selection methodology allows its organization to select candidates with a higher propensity to stay longer and perform better than an average agent in a brick-and-mortar center. The elearning curriculum and training then allows agents to gain the skills and knowledge needed to be successful in their particular assignment. Alpine Access also invests in the development of support staff, including team leaders and coaches, to ensure they are able to effectively support the agents they serve. Also integral to retention is the investment in work platforms, communication technologies, and social tools to build cohesive virtual teams with a strong sense of camaraderie. Alpine Access' core philosophy is built upon creating career opportunities and promoting from within. Alpine Access' leadership believes that if agents are able to see a career path ahead, the chances are they will stay longer and grow their career with the company. Challenges Alpine Access believes that building a consistent company culture and sense of community is challenging to any organization with a large, distributed workforce; add in the element of home workers, and the challenge is even more complex. Alpine Access keenly states the challenge as: "knowing the agents are home alone but helping them to feel like they are not alone at home." Alpine Access has invested in communication tools and social interaction platforms that have helped to bring together and connect the virtual teams it manages with the goal of minimizing these challenges. Security and Delivery Infrastructure Alpine Access utilizes a comprehensive data protection security system that was specifically designed to address the needs of securing a home-based workforce. The following are Alpine Access' key highlights in providing security for provisioning homebased agent services: PCI Level 1 compliant. Alpine Access is a Level 1 compliant provider that secures its agents' home office locations, corporate network, and data infrastructure using practices and technology including: Remote access control Information classification and handling 2011 IDC #

12 Personnel security Incident response Change control Desktop security. Alpine Access' secure remote desktop allows access to the resources, applications, and tools required for client engagements while maintaining security through a variety of techniques. To ensure security, Alpine Access mandates that its agents use a five-step log-in process with a proprietary and confidential protocol dubbed the agents' "commute to work." The process, while confidential, involves five steps of authentication, password log-in, checking of firewall, and virus protection. Agent desktops are subject to the following security procedures: Automatically disables the agent's PC if unauthorized changes occur Controls access to all external devices Disables copy, paste, and save functionality Uses active password-protected screen savers Does not allow data to be stored on agent machines Requires secure SSL VPN tunnels Allows only the use of authorized applications Restricts Internet access to authorized Web sites Disables IR ports, wireless connectivity, COM and LPT ports, and LANMAN hashes People. Alpine Access also maintains that hiring the right people is paramount to its security. Hiring qualified and mature professionals who have undergone background and credit checks as well as drug tests when required allows the aforementioned security measures to be in the hands of capable and trustworthy individuals, according to Alpine Access. Technology Infrastructure Alpine Access' solution is contained within a secure private cloud, which is delivered with North America collocation facilities under the control of Alpine Access. The telephony cloud is supported by a geo-redundant Avaya solution. Alpine Access' VDI cloud is supported by a Citrix farm capable of delivering either a hosted VDI or a hosted application environment using XenDesktop and XenApp, respectively. Multiple components of Alpine Access' service delivery are cloud based, including the previously mentioned proprietary recruiting and training solutions, the SoftPhone/agent bridge, call recording and monitoring, and aspects of the security solution, among others. At a high level, Alpine Access solutions are delivered via a secure hybrid cloud model including both private and public/shared elements. This 12 # IDC

13 includes the secure hybrid cloud discussed previously and strategically selected thirdparty partners that are integrated into Alpine Access' private cloud using Alpine Access' owned, managed, and controlled third-party gateways. Go- to- Market Strategy and SaaS Offerings Marketing Strategy Alpine Access indicates that many of the recent client wins have been rendered from word-of-mouth and positive client referrals, particularly within the financial services, communications, technology, and healthcare sectors. Alpine Access also receives a large number of inbound sales inquiries, which has eliminated the need to invest aggressively in traditional sales and marketing. Alpine Access has stated that its strategy is to continue to invest in emerging capabilities and value-added technologies and solutions that are differentiators, including the cloud-based virtual recruitment process outsourcing (vrpo) and virtual learning process outsourcing (vlpo) platforms. Training and Recruiting SaaS Offerings Alpine Access uses its recruiting platform to evaluate and hire its internal employees but also offers this solution on a SaaS basis to multiple clients for recruiting of their inhouse home-based agent workforce. This customer base includes a Fortune 100 financial services organization. Although less than 5% of revenue is generated from this virtual talent management solution, Alpine Access reports growth in this area and a high level of interest from potential new customers in the SaaS recruiting solution. Alpine Access estimates that over the next two years, this aspect of the business will expand, with upward of 25% of revenue coming from the recruiting and training platforms as a SaaS solution. Likewise, Alpine Access is seeing demand to utilize its proprietary elearning platform offering as a service. Alpine Access now provides several customers, including a Fortune 200 financial services company and a Fortune 1000 media company, with customized content/curriculum development and a proprietary SaaS-based learning management system in a hosted environment. While the platform is customizable, the solution Alpine Access is delivering with this SaaS offering is a standard solution with similar functionality including Web collaboration tools, a platform for video sharing, and course assessments. FUTURE OUTLOOK The home-based agent delivery model for customer care is rapidly growing as a preferred method of delivery for companies in the United States and Canada. Alpine Access is one of the leading pure-play providers of home-based agent services and looks likely to continue strong growth. As the world of contact center services evolves, we see more and more customers seeking self-service and technology-enabled options for interacting with companies. In particular with new and emerging channels for customer care, such as social media, there are significant opportunities for customer loyalty and acquisition campaigns in this area IDC #

14 ESSENTIAL GUIDANCE Advice for Alpine Access Alpine Access should continue to invest in developing and advancing its elearning and erecruiting solutions. As a big differentiator for its business, Alpine Access should invest in marketing these solutions. Alpine Access should continue to make hiring and training the right employees paramount to its business strategy. The cornerstones of Alpine Access' value proposition are the talent and the loyal people it employs. With the growth that Alpine Access is experiencing and in light of current expansion plans and the goal of becoming a $500 million 1 billion company over the next 5 10 years, it will be crucial for Alpine Access to not let the quality of talent and strength of its training focus decline when faced with aggressive growth plans. Alpine Access should leverage its access to talent to develop a strong and unique social media representation capability. As social media grows as a share of customer care interactions and representation grows in demand, Alpine Access should get out in front to develop and promote capabilities in this area. As a home-based agent provider, it has access to a uniquely diverse labor pool and thereby the ability to hire people who do not match the typical call center agent profile. Alpine Access already highlights this in its value proposition of having a more experienced and mature workforce. Alpine Access has the capability to take this a step further to hire and train subject matter experts in the social media space and make a case for this as a differentiator. In addition to training and hiring agents specifically to handle social media campaigns, Alpine Access should look toward partnerships for technology solutions that address social media and other growing channels for contact center interactions such as chat and text. Having strong capabilities in these emerging channels will round out Alpine Access' customer care capabilities to more thoroughly address the needs of customers. LEARN MORE Related Research Finding Real Value in Facebook "Fans" for Customer Care (IDC #lcus , November 2011) Xerox-ACS BPO-ITO Services Update: Solving Business Problems While Facing Key Challenges (IDC #231158, November 2011) Sitel: Tuning and Optimizing for Future Growth (IDC #230741, October 2011) Social Media Services Trends in Customer Care Outsourcing (IDC #229996, September 2011) 14 # IDC

15 Copyright Notice This IDC research document was published as part of an IDC continuous intelligence service, providing written research, analyst interactions, telebriefings, and conferences. Visit to learn more about IDC subscription and consulting services. To view a list of IDC offices worldwide, visit Please contact the IDC Hotline at , ext (or ) or sales@idc.com for information on applying the price of this document toward the purchase of an IDC service or for information on additional copies or Web rights. Copyright 2011 IDC. Reproduction is forbidden unless authorized. All rights reserved IDC #