Outsourcing. A Global Speech Networks Whitepaper

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1 Everything you need to know about Outsourcing A Global Speech Networks Whitepaper Global Speech Networks Pty Ltd 2012 Level 12, 114 Albert Road South Melbourne, Victoria 3205 (+613)

2 The content of this document is proprietary information, and is the intellectual property of Global Speech Networks Pty Ltd (GSN), and must not be used in any manner without the prior approval of GSN. The GSN name and Trademark logo must not be removed from this document without the prior written permission of GSN. Should permission be granted, then it is mandatory that GSN must still be acknowledged as the author. Global Speech Networks 2012 Global Speech Networks i

3 Legal Notice... i Table of Contents... ii 1. The Challenges of Outsourcing Models of Outsourcing Necessities for Success The Hosted Option Contact Details... 6 Global Speech Networks ii

4 Outsourcing in one form or another has been with us since the beginning of the industrial era. The arrival of services such as the rail networks eliminated many internal horse and carriage logistics departments. As businesses grew, outsourcing support tasks such as cleaning and printing became necessary. The benefits that the pioneers of highly specialised outsourcing enjoyed all those year ago are still the drivers behind outsourcing today. That is, the ability to purchase intellectual capital, to focus on core competencies, to budget better and to lower overall costs. The question to be answered by business leaders is: can these same benefits be achieved by building capability in-house? While this question is a no brainer for activities that are clearly noncore, such as printing or cleaning, in most cases the answer to this question is not so cut and dry. This is primarily due to the fact that even the most basic activities and processes are often intertwined with more complex processes, which are core to the business and mission-critical. Global Speech Networks 1

5 In the case of customer service few would argue that this is not a core function. It is difficult to argue against this view given the customer is the number one component to making a business tick, no matter what industry. So does this mean that outsourcing the customer service function is off limits? Well many businesses have led the way, and while there are stories of dreadful failure the outsourcing experience has been positive for the majority. The key to successful outsourcing is in identifying and separating the non-core, less complex activities from the larger overarching processes that they are entangled with. This of course needs to be achieved while still maintaining an appropriate level of integration between sub process and master process. This is a challenge that faces the service provider as much as it does the organizations that wish to outsource and in recent years there has been a gradual evolution in the type of outsourced contact centre products available. Outsourcers have matured in people, technology and process to allow a high level of granularity and service flexibility through hybrid models such as: Taking on your people and managing them at the outsourcer s premises using the outsourcer s infrastructure. Taking on your premises and infrastructure, with the outsourcer providing the people and management. Taking on your people, premises and infrastructure and migrating totally to the outsourcer s operation over time. Global Speech Networks 2

6 While these options provide increased flexibility and assist in the untangling of commodity process from critical functions, these paths are not without their challenges. A key ingredient to any successful outsourcing partnership is performance measurement and monitoring. Unless there is a transparent framework for performance monitoring and communication it is easy to lose visibility and control. A performance measurement framework is critical to eliminating the disconnect between the processes under management and the customer s broader business function. In the contact centre space, performance management and monitoring is in the form of call centre analytics which encompass macro contact centre-wide and micro agent specific measures. While there are some well accepted and standard metrics commonly used by contact centres, there are subtle differences in how these metrics are calculated and reported upon and this can drastically change the meaning and value of these measures. For example, the measurement of agent occupancy is generally calculated as the percentage of time the agent is engaged in customer interactions. Sounds simple enough, but until you define customer interaction this metric doesn t mean much. In the case where after call work or agent wrap-up times are not included as part of the customer interaction, there will be an unrealistic impression of agent utilisation, when compared with a metric that includes agent wrap up time and after call work. This type of misinformation can be further exaggerated when you consider the same statistic over different sample periods. For instance, a report with daily averages might show under utilised agents for the day, but will neglect to highlight that in peak times there is a severe shortage of agents. Obviously, there are a number of other metrics that can assist in understanding and measuring performance, but this highlights the importance of immediate and transparent information interchange between outsourcer and customer. Global Speech Networks 3

7 This fox guarding the chickens problem is nothing new and has been managed in a multitude of different ways. In fact there are many academic frameworks and methodologies that have been developed to specifically address this issue. In general, the answer to this problem is in a deployment were there are independent measures and controls for management. In some cases this involves the client requiring the outsourcer to use the client s internal information systems which provide the required integration and insight into the outsourced operation to the client. Another approach to achieving independence and control is to split the outsourced process into its technology and people components and outsource these separately. This split can ensure the resulting technology elements provide the reporting and performance measurement framework independent of the people management outsourcer. In practical terms, this dissection is being achieved though hosted technology services, which is a technology only form of outsourcing. Hosting services have been available as an outsourcing option for quite some time in areas such as web hosting, mail server hosting and more recently hosted CRM systems with products such as Salesforce.com. Organisations can now also access hosted contact centre technology solutions that encompass advanced PBX, ACD and WFM functions as well as IVR and Speech Recognition services. The Managed (or Hosted) Service Provider offers contact centres an option that avoids the high capital costs and investment risks which typically accompany premise based deployments for communications technologies. Managed Service Providers do more than simply make the capital investment on behalf of contact centres; they also provide customers with access to their intellectual property, a future proof technology path, ability to rapidly scale in size or function, access to specialised and expert skills, capital expenditure relief and high availability for mission critical applications. This ability to split the technology away from the people in an outsourcing context provides enormous flexibility to organisations as they simplify the deployment of sub processes to people outsourcers by providing them with not only the back end information systems, but also the telephony and contact centre platform. Using this approach, organisations can cherry pick the commodity processes and outsource part or all of the people elements. Using the hosted contact centre infrastructure as the base, the organisation maintains control and independence over performance monitoring and measurement. In fact, under this scenario the customer can control the flow of calls and resource allocation on a dynamic basis allowing the business owner to compare human resource pools from inhouse and outsourced resources, using the same reporting framework in real-time. This approach delivers a true virtualized contact centre environment where there is uniformity in management, control, visibility and with the added flexibility to dynamically pick and choose the appropriate human resource pool to process each interaction. As call centres expand and begin to grow over several sites or even several countries, the importance of a cohesive, functional operating and reporting platform increases. Virtualised Contact Centre solutions provide that link between sites, allowing customer bases to be segmented and categorised, and deliver specialised levels of customer service. Virtual Contact Centres can also be implemented when a short-term campaign is required. Given the rapid scalability of the products, a virtual contact centre can be setup and running in a matter of hours, fitting seamlessly into existing systems; a solution exclusive to the Hosted option Global Speech Networks 4

8 While there are many challenges facing those looking to benefit from the economics of outsourcing, there are also many learnings and proven approaches that can overcome these. Among the key components for success is the ability to effectively identify and separate the commodity processes and sub processes from the entangled up and down stream processes, while maintaining the level of integration required to ensure cohesive operation. The ability to independently measure and monitor outsourced contracts is invaluable to ensure service levels and business requirements are met over time and not just after the initial deployment. In the contact centre space this can be accomplished by splitting technology and people outsourcing using hosted contact centre services that provide added control and transparency to the organisation. Additionally, it can provide companies with increased flexibility when accessing services in the outsourcer market, through the benefits of a true virtual contact centre environment. It then becomes practical to utilise more than one people outsourcer in servicing a single process, thus providing organizations with the ability to benchmark service performance between multiple outsourcers and inhouse operations. Conclusion Whilst the theory of performance management is easily understood many organisations struggle to implement it, and almost all struggle to maintain it. The initial enthusiasm for pursuing best practice is quickly replaced by the realisation that in order to sustain the benefits a significant investment in manpower is required. Using the Global Speech Networks Performance Management suite organisations will greatly improve the efficiency and accuracy of performance management reporting, thus enabling them to react faster and achieve performance targets sooner. Performance management is the key to employee productivity, maintaining quality, customer retention, and ultimately corporate profitability. Without the tools to measure, analyse and reward call centre performance, managers may be more than simply ineffectual, they may be making the wrong decisions. Global Speech Networks 5

9 Address: Level 12, 114 Albert Rd South Melbourne 3205 Victoria Australia Telephone: (61 3) Fax: (61 3) Web: All Rights Reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form by any means, electronic, mechanical, photocopying, recording or otherwise, without the prior permission of Global Speech Networks. Global Speech Networks 6