By Michael Blankman

In my recent article, we concluded that the most important aspect of managing remotely is building a strong and trusting relationship. Creating a partnership that doesn’t rely solely on the contract for the outsourcer to get performance security. The partnership is critical because once operations are outsourced, real influence over daily management will and should be limited, or why outsource at all? The partnership needs to be based on respecting each other’s expertise, ensuring roles and responsibilities are clearly defined and that the underlying business model justifying the decision to outsource is protected.

Managing the ongoing performance (real time, daily, weekly, etc.) is the second most important area on which to focus. Performance management is conceptually aligned with the concept of trust, but verify.

Customer service expectations that are critical to the outsourcer can seem at odds with the operational efficiencies targeted by the vendor.

Recapping what we have covered to date:

• The toughest decision, which is to outsource has been made.
• A general observation is that businesses aren’t unique and that it is important to let go and to fit into their operating model.
• The outsourcer has created a small but influential and agile group of subject matter experts to be the primary interface with the vendor; the vendor has assigned dedicated account management.
• Depending on the size of the business, it is important to accept that the overall number of support and management staff dedicated to a program may be small.

Customer Satisfaction / Quality Management

The vendor and the outsourcer may have service and quality goals, which seem contradictory. Putting a process in place is the moment of truth between the supplier and the vendor. That is why it is critical during due diligence process that the vendor’s commitment to quality is understood that they are not providing lip service or view quality as a necessary evil. A vendor’s true commitment is easy to recognize by understanding what local processes they have in place and if they are followed consistently.

A good way to see if customer service and quality are truly integrated into the management process is to ask the staff their opinion and to find out from them what reward and recognition programs are in place. Everybody in every function, whether or not they are writing code or answering calls, wants an opportunity to be recognized. Integration and consistency, although seemingly obvious, are critical. It is interesting to see how many initiatives are the “flavor of the day” and dwindle in importance, replaced by new programs that also dwindle in importance. For example, consider when the last employee of the month was awarded.

Additionally, during contract negotiations change of control protection is critical. It is very easy for a change in ownership and management philosophy to alter customer service dynamics. This is as important as protecting the financial model contractually.

Qualitative versus Quantitative

Many of the relevant statistics will be relatively easy to track and done systematically.

In call centers, vendors will focus more on agent performance and outsourcers more on qualitative data that will enable them to understand the underlying reasons for a call and to apply that data to specific customers, where appropriate. In the call monitoring process, vendors will target a statistical sample by agent to quantify performance versus call type and client specific metrics favored by the outsourcer. Important also is the ability to disposition calls correctly. Vendors often bristle at free form wrap and want to rely on system driven algorithms to deliver MIS. Attention needs to be paid to the integrity of this process or the data derived will not be useful.

Call Monitoring: Call monitoring is the best process for both parties to really understand quality and make improvements. It is also labor intensive but can be done efficiently.

The Program

• Call monitoring has to be a dedicated function on both sides: don’t engage with a vendor unless it is already a part of their quality process.
• There needs to be agreement on what metrics are tracked during monitoring and the vendor should try to accommodate the outsourcer’s needs, especially where regulatory attention must be paid. Some expansion to the vendor’s current process will most likely have to take place.
• Whatever the final process looks like the outsourcer will always have to monitor additional calls. There are nuances to the businesses and clients that the vendor will never understand completely. To avoid undue bias and potential line of business conflicts, call monitoring at the vendor should reside as part of an independent quality group. This is not an attempt to create layers – the assumption is that the vendor already has this group in place for their own monitoring and other quality initiatives.

A multi-tiered process should be established. For example:

• Both quality teams should monitor calls together according to a formalized schedule for calibration purposes. Ultimately the vendor will monitor the majority of the calls therefore both sides need to be in synch.
• Calls need to be monitored separately as well with the results distributed and reviewed by all parties.
• Underlying clients, where possible, should be included in some of the monitoring sessions (relationship management should also be involved so the vendor hears the voice of the client).
• Utilization of third party remote monitoring organizations as an independent counterbalance should also be considered.
• An underutilized and sometimes poorly managed tool is mystery shopping. Mystery shopping is a tool to gage your own service and an opportunity to compare the metrics and best practices of your competitors. The outsourcer can accomplish mystery shopping internally by calling both competitors and the vendor or by hiring an independent firm.

Anytime multiple sites or vendors can be utilized, the ability to competitively benchmark and drive improvements is enhanced. To emphasize, quality and reward programs need to be consistent and tightly managed with tangible goals.

Michael Blankman, a global outsourcing senior advisor, can be reached at: michaelblankman@aol.com

By Robert L. Scheier

Service level agreements (SLAs) are the heart and soul of many outsourcing contracts. They define what the provider must deliver and their penalties for failure, in anything from application uptime to the time required to solve a customer’s problem on a help line.

But at least as currently defined, SLAs often fall short of detecting (and, more importantly, correcting) problems quickly. That was the message at the recent SIG Spring Summit from Senior Corporate Counsel Richard English of Ingram Micro and Shaalu Mehra of Sheppard Mullin Richter & Hampton, who helps the electronic distributor negotiate outsourcing deals.

SLAs fall down, said Mehra, because they don’t change with the customer’s requirements, aren’t defined precisely enough, and often aren’t structured to do a root-cause analysis of the root problem behind multiple failures.

“I love SLAs,” Mehra said in a session on “Best Practices for Ensuring Quality of Service in Multinational Outsourcing Engagements.” However, he continued, they are limited because they are just one “data point” measuring a provider’s performance.

While SLAs are the subject of intense negotiations at the start of engagement, he says, they may not be based on the right metrics to measure the effectiveness of the outsourced service for the customer. In addition, he said, SLAs “can be undermined by even minor changes” to the processes or systems they measure, and are often not updated often enough.

Another factor that limits their usefulness is “single incident limitation, (which makes) root cause analysis subject to an agreement of the parties,” said Mehra. Understanding and correcting the reasons for past failures can also be hindered by what English called a “statute of limitations” requested by vendors on how long a customer can ask for a service credit after a failure.

Both strongly suggested using a common approach to SLAs and other terms with all outsourcing providers, regardless of their location. “While that company may be India-based, and might be doing work for us in Asia, or might be doing work for us in Latin America…we don’t care,” said English. “We’re going to build in one global SLA.”

Two areas where the pair said specialized SLAs might make sense were to measure English language fluency and attrition. While Mehra agreed that “fluency” is subjective, he said it could be measured through a sampling of calls or surveys of whichever end users were being served.

Mehra said such SLAs often measure attrition on a rolling 12-month basis, and is an area where definitions (such as whether promotions, reductions in force or departures for personal reasons count as attrition) are often the cause of hard bargaining. “However reasonable the vendor’s concerns may sound, at some point, we have to draw a line” about where and how the customer will be protected from excessive turnover, he said.

In addition to SLAs, Mehra recommended regular payments based on the achievement of milestones, as well as periodic payments with provisions for holdbacks as a penalty to the provider for failures in delivery.

By Rosanne D’Ausilio PhD

Average turnover, reported at 40% to 50%, has always been, and continues to be, a chronically costly problem for call centers, a problem that seems to be tolerated rather than solved. Respondents to a FurstPerson survey reported an average monthly attrition rate of 7.18%. Annualized, a 40% annual turnover estimate becomes an actual turnover rate of 87%. As you read further, you’ll see what that costs!

Although 90% of corporate executives say that employees are the most important variable in their company’s success, a Towers Perrin survey reported that in practice they rank people-related issues far below other business priorities. Executives agreed improving employee performance would improve business results; 73% even said their most important investment was people. However, people-related issues, such as training and compensation, consistently ranked at the bottom of the list. It seems the mouth and the feet don’t always go in the same direction.

Training is Crucial

A profitable workforce requires well-trained, knowledgeable, conscientious, service-oriented employees who enjoy their responsibilities. Training is crucial. Recent studies in service industries link increased training to decreased employee turnover.

For example:

• Ryder Truck Rental discovered that among employees who participated in training programs, the turnover rate was 19%. For employees who did not participate, the rate soared to 41%.
• Guest Quarters Suite Hotels report their low turnover rate is one indication of employee satisfaction. Additionally, but not surprising, there is a positive correlation between training, employee satisfaction, and guest satisfaction.

Turnover is a Priority

At this time when nearly all businesses, are looking for ways to cut costs and save money, turnover should be a priority. Disruption of workforce stability should also be of concern to those who manage the customer care process.

FurstPerson reports the average cost of attrition at $5,466 per person. Interestingly, the cost of attrition in an internally managed contact center was reported at $7,994 per person, more than twice the cost of attrition at an outsourced center which was reported as $3,420 per person.

The disparity in cost is most likely related to the amount of time and money that is dedicated to training individuals in an internally managed contact center. And we’ve seen turnover in other reports as high as $8,500 per person +++

Following is a typical scenario with 100 people and a 30% turnover rate:

100 people

x30% turnover

30 (people are leaving annually)

x$7,500 average (conservative) cost of new hire

$225,000+ + + = Turnover cost

Note: The +++ represents the additional cost of the learning curve. For instance, when senior representatives, supervisors, and/or managers need to sit with or give time to new hires this obviously takes away from their productivity.

Also, you need to factor in consideration of the people having to take on the additional workload because of the short staffing, or because new hires are too ‘green’ to be on their own. Then there is the subsequent declining morale that goes along with these examples. All of this impacts productivity negatively, customer (internal and external) satisfaction, and employee satisfaction.

Can you see the easy justification for investing in a training initiative of say $60,000 that could reduce turnover for almost a 4:1 return on your investment? Sounds like a slam dunk to me.

Rosanne D’Auslio, Ph.D., President of Human Technologies Global, Inc. known as ‘the practical champion of the human,’ is an industrial psychologist, consultant, master trainer, bestselling author, executive coach and customer service expert.

By Dan Berthiaume

Everyone seems to have at least one story about a nightmare experience dealing with telephone customer service. The fact that many call center providers are located in countries where language and customs are significantly different from US norms only exacerbates the problem. Some experts recommend that companies outsourcing call center functions attack the problem of poor customer service by focusing more attention on serving the needs of customers. But is that always the best strategy?

Michael D. Brown, a corporate consultant and trainer who specializes in developing professional brands, has a slightly different recommendation. “Step back and take care of the employee first,” Brown says. “They will then take care of the customer. Make the employee number one and the customer number two.”

Brown realizes that his advice to place the frontline employee before the customer amounts to heresy in the eyes of many customer service gurus, but he hastens to explain that this is actually the best way to ensure a top-quality customer experience. “When you look at unfavorable dealings with the end user, there is a rush to judgment to put a band-aid on the situation,” says Brown.

Instead of approaching each individual customer complaint as a separate issue necessitating an on-the-spot fix, Brown says companies should make more effort to understand how the frontline call center employees actually spend their day. “Take a side-by-side walk with your frontline employees,” says Brown. “See what a typical day is like; see what types of calls they’re getting and where the roadblocks are. Then ask, ‘Do I have the right processes in place?’”

Brown says real-time communication technologies such as Skype and FaceTime allow US companies to virtually perform side-by-side walking with call center employees who may be working from distant offshore locations.

After performing side-by-side walking (either in-person or virtual), Brown says companies should then go about “smart tasking” outsourced call center employees. “What do the employees do besides just answering calls?” asks Brown. “To deliver a world-class call center customer experience, look at the sequence of tasks employees perform and see if you can make any changes to enable them to deliver a better customer experience.”

Let Frontline Employees Make it Right

Following smart tasking, Brown says companies should provide outsourced call center employees with what he calls “Make it Right” power, or the ability to solve certain problems on their own. “Often the person answering the call can do nothing other than pass on the call to someone else when there is a problem,” says Brown. The customer becomes even more infuriated when they are passed to person after person.”

Instead, Brown says the employee manual should provide frontline employees specific instructions on how to resolve common issues and that the second person they speak to should have the authority to handle all problems.

“Most customer problems are not rocket science,” comments Brown. “The frontline employees hear the same issues day in, day out. Ask them what they are doing day to day and look for organically developed solutions.” Brown says companies should then compile these solutions into a continually growing “What-If Arsenal” of resolutions to common problems that is built from the bottom-up, guaranteeing employee buy-in.

Brown says is it also important for companies engaged in call center BPO to encourage “bubble up innovation,” or innovative ideas that come from frontline employee brainstorming sessions. “Often we don’t have the answers, but need innovation bubbling up from the bottom,” Brown says. “It gives the frontline employees ownership in the workplace.”

Clued In

Brown says all the steps he recommends to achieve world-class customer service in an outsourced call center will not succeed if everyone involved is not relentlessly focused on the same goal. “Does everyone understand the vision, or are people in different silos?” he asks.

Of course, companies also need to simply follow through and make world-class customer service happen at their outsourced call centers. This includes remaining open to making changes in response to changing needs of customers. “Keep it fresh,” says Brown. “Things will change. Look at what happened to Borders. To take call center customer service to the next level, you need to say enough call centers are giving the industry a bad name, it’s time for us to rise to the top.”

An essential part of making it happen is ensuring frontline employees fully understand what customers expect from products and services. “Too often the call center employees haven’t a clue,” he states. “They must understand how things are made, not necessarily from a technical standpoint but in terms of the promised experience. Often the call center employees don’t know what has been promised to the customer.”

By Rosanne D’Ausilio PhD

There is what we call a moment of truth when a customer makes a decision about you, your company, maybe even all companies in your industry, based on their interaction with anyone from the front lines up to and including your CEO. In those first three sentences, a customer determines whether their interaction will be a good experience, a bad experience, or a waste of their time.

When talking about customer service, customer satisfaction, and customer retention, you often hear that the best way to determine how you’re doing is to ask your customer. And that’s absolutely true. However, if you really want to know how your company is doing, ask your internal customer.

Not many companies do this. Their focus seems to be on the external customer only. But knowing what’s going on with internal customers is key to improving the satisfaction of external ones.

Who is your internal customer? Your employees, your peers, your direct reports, any and every one who has an impact on the customer experience. And how do you assess them? What do we look for when we take the pulse of a company?

• What are the strengths of your people?

• What are their weaknesses?

• What are the commonalities among applications?

• What are the changes currently going on in your organization?

• Hardware
• Software
• Teams
• Rules/Regulations

• What is today’s stress level?

• What doesn’t get communicated powerfully?

• What feels like you’re working with one hand tied behind your back?

• What are the mixed messages that may be rampant at your company?

• Why are your customers calling – do they have a question, a request, a complaint or a problem?

• What is a Typical Call?

• What is a Call from Hell?

• What’s the biggest gripe on the side of the customer?

• What’s the biggest gripe on the side of the employee?

• What gets accelerated and why?

• What empowerment exists, if any?

• What works really well?

• In a perfect world what would you do differently?

When you can answer these questions, you’re really getting to know your company and its people.

How do you accomplish this? We do it by:

1) Interviewing people

2) Monitoring calls

3) Studying the flow

4) Navigation of screens

5) After-call process

However, we don’t want to talk only to the best people or the highest level, but to all of them, whenever possible, and at all productivity levels.

Armed with this information, you can then identify the gaps and with that knowledge in hand, you are best able to present options. These options can fall into one of three categories:

(1) People

(2) Process

(3) Technology

If it is determined that it’s a people issue (which often it is), design customized training sessions to address the gaps and kick it up a notch in the area of customer service. We suggest these classes be delivered over time so that retention is improved and delivery is in real time addressing whatever current challenges exist.

If it is a technology issue, usually it’s caused by silos, the left hand not knowing what the right hand is doing. Many companies because of heavy investment in technology keep trying to make it work. Reminds me of the definition of insanity: Doing the same thing over and over again expecting different results.

If the results show a process issue, ‘be a customer’ and go through the process to see where the gaps are. Stand at the end, what is the result you want and how did you get there? What got in the way? What would make it smoother? Again, what are the gaps and how do you either eliminate them, fill them, or replace what isn’t working?

Rosanne D’Auslio, Ph.D., President of Human Technologies Global, Inc., and known as “the practical champion of the human,” is an industrial psychologist, consultant, master trainer, bestselling author, executive coach, and customer service expert. She also writes the complimentary tips newsletter How To Kick Your Customer Service Up A Notch!

By Patrick Haller

With 2012 in full-swing, a critical look at what lies ahead for Nearshoring  is in order. With a shaky global economy, and some forecasts calling for a sluggish year in IT and BPO sourcing, this is no time to be complacent.  Whether it’s building solid skill sets, creating sufficient scale, matching client’s expectations, managing expansion, or doing business amidst social change and myopic political theater, providers have a lot to confront. We tapped some of the leading experts in the Nearshoring space for their answer to the burning question: What is the single biggest challenge you think the Nearshore outsourcing industry faces in 2012?

David Rutchik

Partner, Pace Harmon, LLC

For outsourcing buyers, Nearshore vendors are often a better buy because of the typically touted travel, time zone, and language benefits, not necessarily the capabilities provided. As Nearshore economies become stronger and currency arbitrage becomes a challenge, Nearshore outsourcing vendors must build out their skill sets so they can stand on their own. For ITO they need to develop a greater breadth of capabilities, and for BPO they need to improve on both the depth and breadth of capabilities.

Anupam Govil

President/Partner, Avasense Inc./Avasant LLC

Globally, 2012 will be an interesting year for outsourcing as technological (cloud) and economic disruptions will shape the future of the industry. Gauging by recession-affected market sentiments, most companies are unlikely to tinker with their current outsourcing strategy (new contracts, change service locations, etc). This would in turn limit new expansion opportunities at a global level.

From a Nearshore point of view it will be a crucial year. While many providers have established significant presence in Latin America, the second stage of scaling-up looks challenging. The key reason for this is the lack of depth in service delivery maturity. Many companies in the region are finding it challenging to replicate quality, and lack maturity models as well as training programs that have been one of the successes in other offshore destinations.

It is imperative for the region to develop a strong mechanism to ensure constant flow of trained professionals and educate middle management on business aspects of remote service delivery (IT management, maturity models, IT security, client relationships, etc.). Some of the smarter providers have achieved this by cross-pollinating resources between their Nearshore and offshore locations.

Atul Vashistha

Chairman/CEO, Neo Group

I think the biggest challenge is the ability to show a value proposition beyond cost at scale. While one can show resources in many locations lower in cost than the USA, one needs to show capability at scale that can show better outcomes: quality and/or speed and/or greater ability to collaborate.

In the end, it’s about credibility.

Peter Ryan

Lead Analyst, Ovum

In my view, the single largest disruptor in the coming 12 months will be political/economic instability in the region. The year has not gotten off to a good start with Daniel Ortega hosting political pariahs Hugo Chavez and Iran’s Ahmadinejad in Managua for Ortega’s inauguration . The optics of this are beyond terrible in the US. Couple that with a Mexican election that no one knows how it will turn out in a country that is facing monumental problems around violence and uncertainty around Argentina’s economic direction, it is possible that American firms may look to other regions, or even domestically. for service delivery alternatives.

Dawn Tiura Evans

CEO, Sourcing Interests Group

The biggest challenge with Nearshore as a “destination,” in my opinion, is that it is truly “many destinations” with few overlapping commonalities, laws, and capabilities. My hope is that 2012 is the year of increased awareness of the issues facing Nearshore, resulting in the initiation of more government support for infrastructure, education, and legal reform. Until Nearshore can start converging as a single destination, it is going to struggle to gain the traction that India or China is capable of creating.

Eric Simonson

Managing Partner of Research, Everest Group

Nearshore outsourcing will face continued concerns about its security risk profile, which may be compounded by rhetoric from the US election cycle. The political spin will potentially heighten the criticism of Nearshore/offshore jobs. More fundamentally, we may see the US questioning its objectives and commitment to projecting itself beyond its own borders. Growth in Nearshoring is likely to face headwinds as uncertainty awaits around most corners.

Jeffrey Sheehan

Senior Vice President, Site Selection Group

To be fair when discussing Nearshoring, it should always be a two-part question:

1.Challenges/Concerns

2. Benefits/Opportunities

This may seem like a broken record regarding the challenges/concerns for Nearshoring, but this is what I believe:

To begin, many companies have gone beyond having concerns for Nearshoring and thus removing the challenge for the growth in Nearshoring. With that being said, we clearly are still seeing companies, when we discuss the opportunities of Nearshoring, having concerns in making a decision to be the pioneer as “they” see it, in making a jump to Nearshore. For many companies, countries such as the Dominican Republic, Costa Rica, and Guatemala are seen as making progress in building their base with a skilled workforce and such but still are a ways away from being ideal to some groups. Countries such as Bolivia and Venezuela are very touchy due to the political environment. With that being said, we are currently looking at sites for various clients in several Central American countries. For manufacturing groups, the economic numbers are too compelling, especially in Mexico; supply chain relief, speed to market, NAFTA, cultural affinity. The challenge for Mexico is simply safety. This has been compounded for the worse with the ongoing perception/reality of the violence….this is a HUGE challenge. The business benefits are great but the perception/reality of doing business there is one that needs to be changed; many companies will not take that risk.

Juan Manuel Gonzalez

Research Manager, Argentina Office & Enterprise Communications Industry Manager,

Frost & Sullivan

I think during 2012 the big challenge that Nearshore providers will face is the pressure from clients for consistent achievement of key performance indicators while keeping costs down, along with the ability to measure customer satisfaction and first-call resolution.

By Rosanne D’Ausilio, Ph.D.

The interaction anyone has at any level with your employees, including you, gives a customer an opportunity to make a judgment about you, your company, and all companies like yours. I’m not just talking about call centers here. All technical support or help desk personnel are included as well. As a matter of fact, anyone who is in the customer service business – period.

The preamble to the United States Constitution begins, ‘We, the people…” I feel strongly that we, the people, are what make the difference in life, both personally and professionally. But how does that relate to customer service?

With continued focus on customer satisfaction, customer retention, and lifetime value of the customer, it is no surprise that contact center operations continue to increase in importance as the primary hub of a customer’s experience. For the customer, the person on the other end of the phone is the company. The contact center is still the most common way that customers get in touch with businesses. In fact, Gartner reports 92% of all contact is through the center. And it’s been reported that 70% to 90% of what happens with customers is driven by human nature, having nothing to do with technology. State-of-the-art technology is a necessity today, but it is meant to enable human endeavors, not to disable them.

I often talk about taking customer service and “kicking it up a notch.” In the food industry, the word “lagniappe” is often used. Its definition is “a small present given to a customer with a purchase.” For example, when you go to the bakery and buy a dozen donuts or bagels, you oftentimes get a free one or a baker’s dozen. That’s what customer service should be about: giving the customer more than they expected! Let’s bring lagniappe into the contact center industry.

Customer service is those activities provided by a company’s employees that enhance the ability of a customer to realize the full potential value of a product or service before and after the sale is made, thereby leading to satisfaction and repurchase.

The First W: Why? 

The state of customer service today is not good, be it over the phone or self-service. Because 92% of people feel their call experience is important in shaping the image of a company, this reinforces the importance of centers in branding the image of their companies.

According to a Mobius Management Systems Survey, here’s what happened because of poor customer service:

• 60% cancelled accounts with banks

• 36% changed insurance providers

• 40% changed telephone companies

• 35% changed credit card providers

• 37% changed Internet service providers

Are you one of these statistics? I certainly am.

In a study done by Purdue University and BenchmarkPortal.com, in answer to (1) how did agents satisfy your needs and handle the call?, and (2) based on any negative experience, would you stop using this company in the future?, the findings reveal a strong correlation between the participant’s age and the tendency to stop using the company after a bad experience.

What does this mean? Younger participants were less tolerant and more likely to move to the competition. People over 65 were found to be more demanding than those in middle age.

What can you do? Give younger callers a “wow” experience – maintain their loyalty. People over 36 probably have more of an “emotional bank account” with the company they are dealing with – maybe had some good experience and therefore are more willing to forgive.

70% of Americans are willing to spend an average of 13% more with companies they believe provide excellent customer service – up from 9% last year. But most feel businesses aren’t measuring up. In countries around the world, a majority of consumers are willing to spend more with companies they believe provide excellent service, with the average amount they are willing to spend ranging from 7% to 22% more.

Average Percentage More Than Consumers Are Willing to Spend

Source: 2011 American Express Global Customer Service Barometer Survey

In a recent study (CRM Magazine/PeopleSoft Webinar on How Usability Helps to Drive a Profitable Contact Center), the number of applications required for agents to access customer inquiries were:

3.7% just 1

81.5% 2 – 5

7.4% 5 – 10

7.4% more than 10

As you can see, the majority of applications are two to five. The goal, of course, is to link every point of contact to one central location for a customer-centric, synchronized approach satisfying customer experiences with every interaction.

Strategies for success for world class service should include:

• Respond promptly

• Handle requests through the customers’ choice of medium

• Be brief and clear

• Reduce back and forth communications (especially in writing, i.e., e-mail; kick it up to a phone call if it goes beyond two messages)

• Personalize the service

• Delight the customer

What does it mean to delight the customer? It means inform and educate them, offer options, and diffuse any anger, if necessary. It also means establishing your expertise and professionalism, and taking ownership of the call.

Remember we’re still on the first W – the Why. Today’s pressures on agents are different than in the past. They are asked to handle more customers, more volume, more complex and/or complicated calls. After all, if we could handle our issues with self-service, we probably would not call. But if we tried self-service and it didn’t work, now we’re upset and it’s an escalated call from the get-go.

Agents are expected to provide more information, do it faster, and be available and accessible. But they are also expected to lower costs, generate revenue, incorporate new technologies, ensure closure and commitment, and deliver great service – yesterday, of course.

The U.S. Centers for Disease Control has concluded that the causes of death for people under 65 are:

21% – environment – war, accidents, crimes

9% – health care system – doctors, hospitals, medications

17% – human biology – not because of lifestyle

53% – because of the way people choose to live their lives!!!

The good news here is that for more than half of us, it’s about choice. There’s something we can do about it.

Who?

Who needs to be involved in the effort to improve customer service? Front-line agents/representatives, supervisors, team leads, managers, assistant managers, internal customers, and other departments – anyone who is a touch point so that he or she can learn to speak the same language, and more importantly, not be in an adversarial position, but rather feels that together they are serving the external customer or end user.

Where?

Certainly it is most cost effective to have training on site. However, distractions are rampant and the participant remains available to other personnel and to solve problems.

Offsite is more costly. However, there are no distractions, and the participants are unavailable to other departments, their managers, or any issues. I believe there is psychic value in taking people away from their workstations and off-site to acknowledge the tough jobs they have.

What?

The following modules provide a robust, powerful, and succinct training curriculum:

I also suggest university certification to up the ante. The more professionally you treat your employees, the more professionally they will treat your customers.

When?

For new hires, training should occur monthly, continually, consistently, whenever change occurs, when stressors increase, and as needed. Each employee should get a minimum of 24 hours per year of ongoing training, spread out over time for the most absorption. We divide our trainings into two four-hour sessions per day and deliver six days per employee. Therefore, 30 people can participate in the training per day. If there has been no ongoing training, we do four days once a month for four months and then a session three months later, and then another three months later. In this manner, training is customized, in real time, and can address whatever challenges are presented when they occur.

Remember, as it reminds us in the preamble of` the US Constitution, “We, the people,” make the difference.

Rosanne D’Auslio, Ph.D., is President of Human Technologies Global, Inc. Known as “the practical champion of the human,” she is an industrial psychologist, consultant, master trainer, bestselling author, executive coach, and customer service expert.

By Clay Browne

Once a sleepy backwater of Central America, and known more for its beautiful beaches than the strength of its economy, English-speaking Belize is beginning to spring to life as a 21st century outsourcing destination.

Belize’s economy has long been dependent on agriculture, but tourism has grown significantly over the last couple of decades to become the largest foreign exchange earner in the country. The BPO industry in Belize is still quite young.  Yet there are clear signs that private industry and public agencies are seriously examining how to create the right ecosystem to foster long term growth.

The call center industry is, not surprisingly, where the action is for Belize. The country employs an estimated 1,500 agents, mostly around Belize City and Belmopan (about 90 minutes from Belize City). Maturity of operations spans from the basic, commodity-driven service provider like Ready Call (among its clients is the notoriously hard driving TracFone) to the more feature rich and high-touch operator like Transparent (described below).

One of the biggest hurdles the country faces is its tumultuous ICT environment where the local telecom player – Belize Telemedia – has been reclaimed by the government after a bruising battle with the former chief investor, and behind the scenes financier,  Lord Micheal Ashcroft . (Much has been written about Ashcroft’s complicated relationship and financial influence in Belize, including this piece in The Guardian.) Critics argue that Belize Telemedia (BTL) has behaved like a predatory monopoly player, shutting out competitors and offering little in the way of ICT innovation.

Upon arriving in office two years ago, Prime Minister Dean Barrow decided enough was enough and took action against BTL, which has resulted in the carrier being nationalized. Despite this change, true telecom service liberalization has yet to occur. Recently an agreement was reached to enable ‘rationalized Bandwidth pricing ‘ to be provided to BPO operators in Belize – substantially reducing service fees.

Belize is one of the most sparsely populated countries in Latin America, with a population of around 350,000. Around one-fifth of the population, upwards of 60,000 people, live in the capital Belize City.

Belize has a reasonably good public school system, with functional literacy estimated to be around 75 percent for the country and above 80 percent in the urban areas. Belize has never had much of an industrial base, so the work force has traditionally been focused on service industries. Belize City has developed an above-average infrastructure over the last decade or two, including reliable Internet and cell phone service throughout the area.

The IT outsourcing industry is just in its infancy in Belize, but BPO companies report that there is already a good supply of entry-level software developers available.

“We are pleased that several local investors have expressed interest in developing Data Parks…our Government is willing to offer attractive incentives to those willing to invest in these facilities” – Prime Minister Dean Barrow

Call Centered

Call centers are by far the largest sector of Belize’s BPO industry, with five operations of varying sizes underway and several more in the exploratory or planning stages. Ready Call opened the first call center in Belize in 2005, and there will be at least ten call centers operations in Belize by the end of 2012. The large pool of native English speaking potential employees is obviously a big plus, and the relative stability and increasingly business-friendly climate of Belize are also attracting attention.

The Belize Trade and Investment Development Service (Beltraide) is a governmental organization founded in 2000 to foster business development and encourage investment in Belize. Malcolm Sobers, a BPO/ITES & Financial Services Industry Specialist for Beltraide, is an eloquent spokesman for the organization who points out how a wide range of recent changes in Belize have made it much easier for call center operations to do business in the country.

“We have undergone a restructuring of Beltraide and have developed a specific division that is focusing on ITES (Information Technology Enabled Services). The BPO industry, along with other services, falls under that umbrella,” Prime Minister Barrow told Nearshore Americas’ Kirk Laughlin, during a recent visit to Belize.

Mr. Barrow went on to say that one of his biggest concerns is the lack of available facilities. “We have been working with many building owners that have empty space, but only some are adequate for housing large numbers of workers,” he said. “We are pleased that several local investors have expressed interest in developing Data Parks…our Government is willing to offer attractive incentives to those willing to invest in these facilities. ”

Also on the plus side, the country has recently liberalized its labor laws. Beltraide, has also launched a BPO Certification Program with support from the Ministry of Education. This program teaches Belizeans the basic technical and customer service skills they need to work in call centers. The initial 80-hour pilot training program was very well received and graduated 160 ready to work employees in just a couple of months, and the full-scale program is expected to produce a minimum of 1500 trainees in 2012. Beltraide works directly with the individual call center companies to provide them with a trained labor pool for their current and future needs.

Sobers also emphasized the financial and tax benefits to doing business in Belize. “Belize does not tax corporate profits on the national or local level, and our laws allow 100 percent repatriation of profits as well as allowing businesses to establish local bank accounts in US dollars.”

Transparent BPO

Scott Newman, CEO of Transparent BPO, is unabashedly enthusiastic about Belize as a place to do business. Transparent BPO is headquartered in Baltimore, Maryland, but has all of its call center operations in Belize. Transparent BPO began with a small 30-seat call center in Belize City in 2009, moved up to a 110-seat operation in 2010 and is now doubling capacity again, with construction of a 220-seat call center underway.

Newman acknowledged that there were some significant issues to be ironed out when they first set up their operation, including a generally negative attitude about the call center industry.

“But the business climate for call centers has improved dramatically since we began,” he continues, “and Belize is a great place to do business today.” Newman credits the establishment of Beltraide as the watershed moment when both the bureaucratic barriers and the negative attitude toward the BPO industry started to break down.

By Luke Bujarski

Given its close proximity to the mainland and ample bilingual workforce, Puerto Rico should stand out as an ideal Nearshore platform for call centers and BPO operators – right? 

Not so fast: Cost arbitrage aside – a lack of coordinated planning around a knowledge economy may have also set Puerto Rico back a long way behind similar Caribbean and Central American (CCA) markets, particularly for knowledge-intensive services. Here, lessons can be drawn from the successes Costa Rica has had in attracting technology-enabled captive operations. And, given the right global market environment, Puerto Rico could see expansion beyond the current 5,000 or so contact center seats. However, with a premium on wages and a solid base of human capital, planning and promotional authorities might be better off looking higher up on the global services value chain.

BPO Market Overview

As a commonwealth of the US, Puerto Ricans are US citizens, which means that this island nation must abide by the same federal minimum wage laws that apply on the mainland. From a pure cost-play perspective, this immediately puts Puerto Rico at a disadvantage to other CCA (and much of the developing world) markets such as the Dominican Republic, Jamaica, and Belize. However, this has not stopped companies like Atento, American Airlines, AT&T and the US federal government (the IRS and the Social Security Administration) from servicing Puerto Rico’s relatively large domestic market, in addition to utilizing its bilingual and bicultural workforce as a platform to service the Americas.

Research and advisory firm Zagada Markets put the 2011 contact center market in Puerto Rico at approximately 5,500 seats and $110 million in revenues. Where Puerto Rico loses out on wage rates, it gains some ground on telecommunications costs. According to Philip Peters from Zagada, “Puerto Rico has one of the most efficient and lowest-cost communications systems in the Caribbean.”

The country has other strengths which have attracted interest in the contact center industry. Estimates from standardized test scores suggest that nearly a quarter of the total population (approximately four million) is completely fluent in both English and Spanish. Likewise, Puerto Rico has a solid education infrastructure relative to other CCA markets. Universities graduate 30,000 students per year, and literacy rates are comparable to US standards.

A focus on manufacturing and failure to position itself in line with knowledge-enabled services such as network management, applications development, IT consulting and software R&D has, for the most part, left Puerto Rico out of the global services equation

Quick Stats on Puerto Rico’s Economy

- Total Population: 3.99 million

- Major Population Center: San Juan – Population: 2.73 million

- GDP per capita: $19,600

- Currency: US Dollar

- GDP real growth: 2010: -5.8 %; 2009: -3.7 %; 2008: -2.8 %

- Literacy Rate: 94.6 %

- Unemployment: 16.5 %

Competitive as a US Location, but Not Ideally Suited for Global Services

The country transitioned from agriculture into manufacturing during the 1950s in an effort to create jobs for this densely populated island. Known as Operation Bootstrap, the US government invested millions to promote the sector, which eventually moved the manufacturing base to more capital-intensive production in pharmaceuticals, chemicals, machinery and electronics. However, growing global competition continues to strain Puerto Rico’s manufacturing base leaving the latest unemployment rate at 16.5 percent. Additional public sector layoffs are expected as Puerto Rico’s economy struggles to regain its footing from the global financial crisis (see GDP growth above). Construction, retail, and the financial sector have also seen significant job cuts over the last two years.

Likewise, a focus on manufacturing and failure to position itself in line with knowledge-enabled services such as network management, applications development, IT consulting and software R&D has, for the most part, left Puerto Rico out of the global services equation. Furthermore, emerging BPO players in the CCA region including Jamaica, Belize, Nicaragua, Guatemala, and Honduras offer cheaper alternatives for contact center operators like Convergys, which recently announced plans to open a 1,000-seat center in Montego Bay, Jamaica.

Puerto Rico Could Learn A Lot From Costa Rica

A heavy focus on manufacturing and a lack of strategic planning around IT and knowledge-driven sectors may have permanently set Puerto Rico behind places like Costa Rica. Costa Rica has a similar-sized market in terms of population and education, but continues to attract technology services operations from companies like IBM and Dell, as well as niche design and digital marketing firms like Possible Worldwide, which currently staffs over two hundred programmers and application developers in their offices in San Juan. Costa Rica has remained competitive in this space despite a relatively small labor pool and rising wages. And when asked whether there is a shortage of IT talent, Possible Worldwide Country Director Yvette Pascua explained quite the contrary. “Many of our most talented designers had previously worked for the big technology companies and come to us trained with a solid knowledge base in IT.”

Costa Rica has managed to create this ecosystem and institutional base around IT services, despite high wages compared to other CCA countries. But developing a culture and infrastructure for IT services takes time, and with a historic commitment to education by the government and investment promotion agencies like CINDE, Costa Rica has steadily built a reputation as a center of excellence in IT-enabled services.

Dating back to 1948 and Operation Bootstrap, Puerto Rico continues to focus its efforts on attracting manufacturing firms, particularly in the pharmaceuticals space – although one would not know it from looking at the country’s premier economic development agency website. Furniture, textiles, and needlework are among the handful of sectors targeted for growth by the Puerto Rico Industrial Development Company (PRIDCO). Ultimately, a stronger long-term vision and coordination at the national level will be needed to pitch global service providers on Puerto Rico and this country’s relatively strong base of human capital. “While the numbers [graduation rates] may be strong, the outcomes have not produced many local firms or have attracted the kind of attention Costa Rica has,” explained Peters from Zagada.

External Factors Will Likely Decide Puerto Rico’s Fate

The future of Puerto Rico’s place in the global services sector will depend heavily on what happens outside its borders. The upcoming 2012 election in the United States has some worried about legislative action set to discourage offshore outsourcing outright, via tax reforms pitted against firms that choose to offshore. While unlikely, this scenario could be a boon for Puerto Rico in the outsourcing space, given its commonwealth status and marginal cost competitiveness over markets on the mainland.

And while Puerto Rico continues to be at a cost disadvantage to other CCA markets, the wage gap could close faster than expected. Unscrupulous contact center operators in countries like Guatemala and Jamaica have been notorious for artificially inflating wage rates in their attempts to maximize short-term profits. If wages continue to go up in these markets, it could make Puerto Rico’s generous tax breaks and duty-free access to the US market much more attractive to multinationals.

Source: Computer World UK

Call centre offshoring comes under bipartisan attack in Congress – Law would penalise companies that move call centres overseas

Four US lawmakers (three Democrats and one Republican) have teamed up to attack call centre outsourcing by introducing a bill that would penalise any company that moves a call centre overseas.

The bill would make any company that moves a call centre offshore ineligible for any federal grants or loans. It would require the US Labour Department to maintain a list of employers who relocate a call centre overseas and force companies to provide at least 120 days’ notice before doing so.

It would also require a call centre worker to disclose his or hers location at the beginning of the call, if the caller request it.

The US Call Centre and Consumer Protection Act (HR 3596), was introduced by US Representative Timothy Bishop and announced at news conference that included representatives of the Communication Workers of America. The measure’s co-sponsors include David McKinley, Gene Green, and Michael Michaud.

“Outsourcing, in my view, is one of the scourges of our economy, and one of the reasons we are struggling so to knock down the unemployment rate,” said Bishop. He said there are 4.7 million call center employees today, while in 2006 there were 5.3 million.

Broadband Helps Local Call Centres

In August, FCC Chairman Julius Genachowski said that broadband deployments are boosting call centre industry employment. He claimed that an average of 4,000 call centre jobs are being created each month.

Alpine Access, a Denver-based call centre provider with a work-from-home business model, has 5,000 agents working in 41 states and said it has added 1,000 since August. It also has agents in Canada, who serve that market.

Christopher Carrington, president and CEO of Alpine, said that 70 percent of his company’s growth over the past three years is the result of companies moving call center work back to the US. “There is definitely a trend of jobs returning [from] offshore back to onshore,” said Carrington. “In reality, without legislation the momentum of the market is already leaning that way.”

Carrington said the move of call center jobs back to the US is largely being driven by consumers.

“The American consumer has become increasingly frustrated with their confidential information being handled outside the United States, and with the difficulty of some phone calls that are handled internationally,” said Carrington, who believes consumers are taking their business to companies that are able to serve them domestically. “You can legislate things, but at end of the day the consumer is the real decision maker as to how companies I think will create their own policies.”

Could Cloud Centres in the Cloud Help?

Carrington expects his company to be near £70.4 million ($110 million) in revenue this year and anticipates 50 percent growth next year.

Bills to discourage call centre outsourcing have been tried before with little success. For instance, last year US Senator Chuck Schumer, pitched the idea of charging a 25-cent excise tax on any customer call that originates domestically but is transferred to an agent in a foreign location.

Frederik Cote, the president of Kunnect, a company that uses Amazon Web services to provide a cloud-based hosted call centre, supports Bishop’s legislation. Cote said that about 90 percent of his clients are in the US.

“A lot of people wrote off the call centre industry many years ago,” said Cote, adding, “I’m happy to see the call centre business is a thriving business, it is still truly an American business.

“I’m happy to see that we’re contemplating laws to protect that,” said Cote.