WHITEPAPER DELIVERING A SUPERIOR CUSTOMER EXPERIENCE THROUGH INTELLIGENT VENDOR MANAGEMENT

Transcription

1 WHITEPAPER DELIVERING A SUPERIOR CUSTOMER EXPERIENCE THROUGH INTELLIGENT VENDOR MANAGEMENT

2 DELIVERING A SUPERIOR CUSTOMER EXPERIENCE THROUGH INTELLIGENT VENDOR MANAGEMENT TRANSFORMING BPO MANAGEMENT FROM PRICE-CENTRIC TO PERFORMANCE CENTRIC Executive Summary The market for call center outsourcing has matured. Service Providers now have a multitude of Business Process Outsourcing (BPO) vendors from which to choose from in both domestic and off-shore markets. As a result of multi-vendor sourcing and a relatively low cost to change vendors, the call center outsourcing business has become largely commoditized. While Service Providers can leverage this commodity paradigm to extract attractive pricing from their suppliers, a price-sensitive commodity model provides little incentive for BPO vendors to deliver superior performance relative to their competitors. As a result, the commodity-outsourcing model creates fundamental barriers to service providers seeking to differentiate based on quality of customer service. This white paper will outline how automation of the call center intraday staffing process can create a win-win for both Service Providers and their BPO suppliers. With intraday automation, Service Providers can enjoy both attractive pricing and superior performance from their BPO suppliers, and BPO providers can benefit financially from delivering superior service. Table of Contents Call Center Outsourcing Pros & Cons of a Commodity Business... 3 Enterprise Routing Does the Benefit Outweigh the Downside?... 3 Real-Time Supply Chain Methodology for the Contact Center... 4 Intelligent Vendor Management... 4 Conclusion... 4 Page 2

3 call quality and first-call resolution (FCR), because most contracts do not include incentives for encouraging this kind of positive behavior. Call Center Outsourcing Pros & Cons of a Commodity Business Since its inception, the BPO market has been built upon a fundamental labor arbitrage value proposition. This value proposition began with non- union versus union labor rates in domestic markets, and eventually evolved to off-shoring into low-cost labor markets such as India, the Philippines, China and Honduras. Large service providers have historically optimized the return on outsourcing by contracting with multiple vendors. This approach has enabled them to leverage competition and keep the costs associated with changing vendors relatively low. As the market has matured, it has become increasingly commoditized, primarily because most BPO s offer comparable services. The result is that the Service Providers have gained the advantage and are able to extract the lowest possible prices from their vendors. BPO vendors have responded to this commodity paradigm by continually looking for ways to cut costs. Some common vendor strategies for reducing costs include expansion into lower labor cost markets, adoption of more efficient technologies and aggressively reducing management overhead. Although vendors can be punished for poor performance through Service Level Agreements (SLA s) resulting in loss of future business, there is very little incentive for these vendors to deliver superior performance relative to their competitors, in terms of The commodity BPO paradigm does not reward vendors for improving performance beyond defined minimal acceptable levels. As a result, there is little incentive for vendors to innovate. An example of this is Average Handle Time (AHT). Although vendors may be aware of technologies that can reduce AHT, if a vendor is being paid by the minute, what incentive do they have to introduce technologies that would ultimately serve to reduce their revenue? Another example is staffing. Most BPO vendors are asked to staff to a predetermined forecast and are generally paid for that level of staffing. But if the forecast requires 300 agents and the actual demand is 250 agents, there is little incentive for vendors to find ways to reduce staff. Conversely- if the forecast requires 300 and the actual demand is 350, it is difficult for vendors who set schedules weeks in advance to find ways to dynamically increase their staffing capacity on an intraday basis. Enterprise Routing Does the Benefit Outweigh the Downside? With Enterprise Routing, the distribution of calls to agents, whether they are in-house or outsourced, is based on agent availability. Although his methodology optimizes efficiency, it reinforces the commodity outsourcing model by rewarding all BPO vendors equally regardless of their performance. Service Providers seeking to differentiate on quality of service Page 3

4 should instead look for mechanisms that direct traffic to their best performing vendors. Real-Time Supply Chain Methodology for the Contact Center Imagine if contact center staffing operated like a manufacturing environment. In manufacturing, unexpected changes to demand (e.g. canceled orders, new orders) are automatically managed through real-time supply chain methodologies. For example, if an unexpected rush order is received, parts suppliers are automatically notified and can be paid expediting fees for getting additional parts to the manufacturers loading dock early. Real-time supply chain methodologies rely on process automation to ensure that the right parts in the right quantities are delivered at the right time resulting in an optimum balance between orders, output and inventory. If Service Providers implement real-time supply chain methodologies to intelligently automate intraday staffing, they can more easily flex-up or flex-down their intraday staffing levels to better align capacity with actual demand. This approach removes the pressure placed on Service Providers to develop highly accurate staffing forecasts, something that is virtually impossible to do weeks in advance. by incorporating aggregate vendor performance metrics such as Average Handle Time (AHT), First Call Resolution (FCR), and Intraday staffing responsiveness (ISR) into its rules engine. This technology enables Service Providers to transform from a commodity-based BPO management paradigm to one based on merit whereby incremental volume is offered to the best performing vendors first. BPO s can similarly leverage Intelligent Intraday Automation technology to deliver superior interval-level performance and quickly respond to staffing change requests from their clients. Examples of this include extending the duration of agent schedules, offering additional shifts, dynamically moving multi-skilled agents from one queue to another, or rescheduling meetings, training and coaching sessions. Conclusion The win-win with Intelligent Vendor Management is that high performing BPO s get rewarded with more volume and Service Providers benefit from superior intraday performance. BPO vendors who are slow to adopt real-time supply chain methodologies stand to lose client market share, and therefore, should be highly motivated to get on board with service providers interested in implementing Intelligent Intraday Staffing across their enterprise. Intelligent Vendor Management An Intelligent Intraday Automation decision system can determine BPO staffing allocations Learn more about Intelligent Intraday Automation at Page 4

5 About WorkFlex Solutions wor k fle x s o l u t i o n s WorkFlex Solutions LLC is the Industry Leader in Intelligent Intraday Automation solutions for contact centers. Our award-winning technology maximizes agent scheduling flexibility, optimizes intraday performance and reduces workforce administration overhead. Designed to easily integrate with existing Workforce Management (WFM) and Automated Call Distribution (ACD) systems, WorkFlex enables clients to leverage their existing enterprise software investments, and quickly generate a positive ROI. WorkFlex deployments span multiple industry sectors including financial services, communications, healthcare, automotive, cable/sat and government. For more information or to schedule a demo, please visit us at WorkFlex Solutions, LLC 7872 Cooper Road Cincinnati, Ohio P: (513) E: info@workflexsolutions.com