Becoming One with the Team: Managing Your Outsourcers
1 Jul, 2007
By: Cliff JusticeIn an environment of outsourced contact center operations, the most important success factor is how effectively your relationships with your service providers are managed, both collectively and individually. This is true regardless of how many relationships exist or how complex their interworkings.
Of course, multiple relationships – especially those that span the globe – compound and complicate the management challenge. The changing nature of contact centers, as more companies move to leverage their centers as tools for customer satisfaction, adds to the complexity. Effective management of such a broad operation is nearly impossible without at least some level of face-to-face familiarity with the individuals and facilities involved.
The key members involved in managing, or governing, the service provider relationships should be visiting each of the sites where work is performed at least twice each year and more often if there is significant turnover among the key individuals at those facilities. While there is a cost associated with these visits, when done properly, the ability to impact productivity and quality can be invaluable.
But first, let’s look at the foundations of successful governance, which are best laid at the earliest point possible in the outsourcing process, the point of determining strategy. The goal of governance in outsourcing is to preserve and enable the “intent” and objectives of the strategy, the reasons an organization chooses to outsource the selected processes. The reasons typically involve reducing costs and improving or transforming the process and, as a result, the intent of the deal impacts everything from the structure of the contract to the type of client-service provider relationship to the design of the governance model.
How important is governance? Research has found that without a strong governance model and team, organizations risk losing up to 20 percent of the anticipated value from their outsourcing initiatives. In many ways, good governance – the artful combination of people, processes, and technology – can make or break the success of the initiative.
Historically, contact center outsourcing has tended to be cost-driven, with a company choosing a service provider based on easily measured factors such as talk time or speed to answer. The winning providers were those that performed well and at the lowest prices. However, with more companies realizing the potential for their contact centers to help build relationships and sales, the emphasis has moved to work being done by well-trained agents who can represent the company in the most positive way.
Achieving the difficult-to-quantify goal of customer satisfaction requires not only a different mindset, but more careful management of the service provider’s – or multiple providers’ – ongoing performance.
Establishing Good Governance
When it comes to the “infrastructure” of governance, many companies use outside expertise, such as outsourcing advisors, to build or refine this foundation and to work with the service providers to establish the necessary communication and monitoring processes.
No matter how many contact center outsourcing service providers a company may work with, the most efficient management is achieved via a single governance organization with standardized processes. This governance group, which also consists of representatives from the service provider organization, should be large enough to encompass all the relationships, but small enough to work together with maximum effectiveness. Ultimately, there should be one individual in a position of responsibility for all the relationships.
For its governance team, a company should look for individuals with contact center experience who understand its importance to the larger strategic objectives of the organization. For instance, one important team member would be the person who knows how to bridge the contact center operation to the marketing and product quality departments to leverage the information obtained by those on the frontlines.
The governance team should also consist of people with outsourcing management skills. They add a different dimension to management because even with the best governance procedures in place, if the team lacks the right experience and leadership, governance will suffer.
Communication with internal company stakeholders is also a key function of the governance organization. From top executives down to the frontline employees affected most by outsourcing providers, the governance team must continually seek feedback about the qualitative aspects of the outsourced relationships and the internal perceptions about them.
In terms of the cost of governance, numerous surveys of outsourcing companies’ levels of satisfaction find a direct correlation between the investment organizations make in outsourcing management and their satisfaction. “Investment" encompasses personnel, processes, software and tools, and external services. Typically, the optimum investment levels range from four to seven percent of the total annual contact value.
Importance of a Site Visit
Three factors are the most important in a site visit – overall service delivery capabilities, operations management and workplace culture.
To evaluate service delivery, there is no better way than shadowing the work teams and watching them handle the processes. For example: “Y” jack into a random call and listen to ensure the agent deals with the customer appropriately, not only listening to his voice, but also watching facial expressions and body language. Does he pick up on the customer’s intonations and escalate the call to the next level in a satisfactory way? Different cultures, a significant issue if you outsource offshore, interpret the nuances of a caller’s attitude in different ways.
Observe the infrastructure of the facility. Is it being kept clean, safe and secure? If your needs are expanding, can it accommodate additional personnel from both a facility standpoint and the ability to train them properly? Is all data being kept secure, with safeguards in place to prevent employees from downloading data or otherwise compromising it? Is the facility comfortable, making it easier to recruit quality employees on an ongoing basis?
The site visit also enables your company to renew and refresh its relationships with the service delivery teams and to assess how well the management (particularly if there have been changes) understands and caters to your needs.
You can also evaluate how any language issues and cultural differences are being managed, making sure that offshore service delivery teams understand the culture of the target audience they are serving, with the right levels of empathy and judgment.
Employee turnover is always an issue in call centers, but in the large dynamic offshore locations, attrition can be crippling if not managed well. The site visit allows you to determine how well the management of the individual facility deals with that. If your contact center is primarily handling transactions, higher turnover rates are less of an issue than if you are outsourcing more complicated contacts. But if your primary goal is a high level of customer satisfaction, recruitment is more challenging, with a smaller pool of employees capable of delivering caring customer service.
More about Management
How is frontline management of a service provider different when the goal is customer satisfaction? Service levels that call for abandonment rates and time-to-answer, for instance, will definitely remain important but must be balanced against the customer satisfaction objective. That will require a high degree of flexibility in the customer-provider relationship. Average talk times may be much more difficult to standardize.
A strong relationship with the provider will be one that is flexible and that addresses the needs of both sides. It must incorporate the change management tools that can allow the agreement between parties to evolve as conditions change.
While measuring the service provider’s performance is important to ongoing governance, so is the “big picture.” To assess how well the relationship is serving the company as a whole, the team needs to stay in close contact with executives and other stakeholders. This is a two-way communication that conveys the state of the relationship to those stakeholders and also assimilates their feedback.
Governance Tools
The trend toward a complex blend of outsourcing, offshoring and internal shared services creates a clear need for end-to-end global performance monitoring. Most organizations either develop their own tools or rely on those of their service providers. However, there are third-party technology tools available that help drive and reflect the operational and management discipline, provide greater accuracy and independence from outsourcing service providers and serve as catalysts for change.
These tools are particularly useful in mapping processes, and in some cases, measuring and gauging the quantitative measures of service provider performance.
It is important to think through what tools your governance organization needs to effectively and efficiently manage relationships. For some organizations, the third-party tools are in place, but there is difficulty in effectively leveraging them and gaining visibility into their global situation. That has driven the development of new, wider-ranging tools. These tools are designed to handle not only all aspects of a single outsourcing relationship, but can be particularly effective in managing multi-provider environments and all the aspects of all the outsourcing relationships in which an organization is involved, regardless of the business process.
With the appropriate effort to assure that the company and the service provider are operating from shared principles, a basis for a true partnership-oriented relationship that delivers on its potential is created.
