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What about outsourcing to a call center in India?
"I manage a medium-sized support center, and we already offload about
half our call volume to a U.S. outsourcer. I've heard that I could
probably cut my costs by 50% or more with an Indian outsourcing firm.
That kind of savings would be a big help, but I'm concerned about
managing a vendor who's literally on the other side of the world.
And I'm uncomfortable about exporting jobs, too. Can anyone offer
some guidance?"
—Sally from San Diego
Dear Sally,
Several people offered advice on this question:
"A major success factor to outsourcing is the ability to manage the
vendor. Many outsourcers offer remote monitoring tools that you can
view online to track their performance on a real-time basis. This
would be a critical requirement for outsourcing to a vendor on the
"other side of the world".
"Finally, f you are seriously considering this outsourcing alternative,
there are a number of resources available to you. For example, I just
read an article in Call Center Magazine, on this very topic. You can
view it online at: www.callcentermagazine.com.
When you arrive at their site type "Thinking Through Outsourcing" in
the search box, and it will bring up the article for you."
—Craig Bailey craigbailey@adelphia.net
Customer Centricity www.customercentricity.biz
603/491-7948
"My employer has strong India connections and a subsidiary in India
that has three thousand software developers. In the last year we
opened another subsidiary for call center technical support. We have
been using the India call center for e-mail and chat-based support
with good results. I would recommend going slow and working with
someone that has a lot of experience with India.
"The challenges are many. Recently a trans-Atlantic cable was cut and
caused us many problems. The telecom connections are via England, not
across the Pacific as you might expect.
However the benefits are great as well. You can get access to a
highly educated workforce, all college graduates with technical
degrees, for a fraction of U.S. labor costs.
"The bottom line is that India will almost certainly take a segment
of the business, but due to the constraints it will never be more than
a segment of the large market."
—Bruce Grubb bgrubb@hns.com
Hughes Network Systems www.hns.com
301/548-1155
"We outsourced our Level 1 U.S. call center operations to a global
organization about 8 months ago. While the outsource company has
done a credible job, I feel that this solution is only practical
in certain circumstances.
"We closed one of our main offices in the U.S, which was also the
home of our support center. Our staff was small, about 8 people,
so outsourcing made sense for us. We still maintain Backline or
Senior Level Technical Support Engineers in-house to handle
escalations and to work with engineering. We are engaging this same
company to provide Level 1 support in Europe, which will go live in
about 8 weeks. From there we will look at engaging this company in
Asia/India. By implementing a phased approach for each geographical
region and retaining subject matter experts in-house to handle
escalations, outsourcing has worked for us."
—Gina A. Hayes gina_hayes@phoenix.com
Phoenix Technologies Ltd. www.phoenix.com
408/570-1679
"I have placed well over 1,000 seats in India and understand the pros
and cons of doing so. It is humorous at times when you consider some
of the issues that befall every vendor in India, and what some have
done to alleviate the problems. These issues can have a devastating
effect if not managed up front. When service is good, it is typically
very good and when it is bad there is little chance of recovery. I
strongly believe that tech support will always have a home in India
as the expertise there is remarkable and the savings quite substantial.
The savings is currently over 50%, but that number will change in the
near future. Customer service and such things as inbound sales will
come back to the U.S. and stay, at best, near shore or on the mainland.
"My experience in dealing with and observing service providers is that
you must be certain of your partner. In the earlier days this was
difficult, but today there are some clear choices. One of the key
indicators of a successful arrangement is a partner who has a great
deal of middle and all of upper management either from England, the
United States or both. This has proven true for the Philippines as
well."
—Roger Gloddy rgloddy@starband.net
Alpine Access www.alpineaccess.com
720/559-4746
"True—outsourcing can save money. We looked at this and then decided
to go a different route—we opened call centres in "strange" locations
(Moscow, Budapest, Kuala Lumpur) as well as in more traditional
countries (USA, Sweden) to give our customers a 24 hour support
operation, but with regional knowledge and staff. But, we didn't
outsource—I put a western manager in charge of each of the operating
units and let them deal with local hiring/firing etc., while still
keeping our company's vision/goal in sight, as well as the budget!
"It's worked really well, our customer satisfaction survey shows a
4.5% year on year increase in customer satisfaction. The early days
were difficult, and I spent a lot of time flying around the world,
but now they are all 3+ years old and everything runs smoothly.
"I'm sure outsourcing works--but I wanted hands-on control and authority
over what the support teams were providing, and I was a bit scared of
using a 3rd party in a strange country with strange language (let alone
the fact that they are probably 10 hours+ ahead of your time zone).
"This setup allows me to run a 64 person support operation for around
$4.5m USD per annum, all costs included (office space, telecoms,
travel+accom, training etc)."
—Tim Newton tim.newton@scala.hu
Scala Business Solutions NV www.scala.com
+36 1 452 7500
"We have not outsourced our support to India. However we did
outsource a part of a software package we are developing. My job
was to implement/test the work done. The work was OK. The main
problem I had was communication. In spite of good English, the
accent and the unusual grammar made communication (both written
and oral) tough. I would be concerned about the language skills
of the support people.
"I've had some experience in asking for support and getting someone
who is not fluent or whose accent is thick to my ears. It was
generally not a good experience. If the problem was resolved it
seemed to take more time that I wanted to spend and more effort on
my part (and the techs) to communicate effectively."
—John Franzen john@versaform.com
VersaForm Systems Corp. www.versaform.com
408/370-2662
"While the prospect of reducing the cost of your call center
operations by 50% is certainly attractive, much thought must go into
the decision as well as study of the true costs associated with this
type of move. We have all heard that outsourcing call center
operations to India provides dramatic savings; there are a few
things to consider. First is how large is your operation and will it
be possible to get the scale that will result in these savings?
Second, have you considered the "hidden" costs associated with this
move? Who will be paying the charges on the calls that are routed
overseas? How will you handle quality control issues? Etc. Other
issues have begun to surface due to the current economic realities
in this country. The economy is poor, unemployment is at its highest
level in 30 years, and Congress and the media have now begun to focus
their attention on the number of jobs being exported to India. There
is a distinct possibility of a congressional and media backlash
against outsourcing to India. The Wall Street Journal recently
published an article regarding outsourcing to India, and if the
Journal is aware of these issues, other media outlets are soon to
follow.
"It is likely that the outsourcing company can provide skilled
workers to handle the calls, and they are certainly capable of
handling the volumes, but you must answer this question: What would
be the reaction by your customers if they should find out that you've
exported jobs overseas? If you are certain they don't care, then go
right ahead if the economics support it. If, however, your business
model is such that you would have to share sensitive information on
your customers, and they would be leery of continuing the
relationship with your organization due to security and privacy
concerns. Think twice.
"Also, as someone with years of experience with National Security
concerns, I would caution those who would outsource mission-critical
functions to an unstable region. The geo-political realities of that
region are that India and Pakistan continue to wrangle over the
Kashmiri region, both are nuclear powers, and both have fought over
that area three times in the last 50 years. Pakistan is a hotbed of
Islamic fundamentalism, and the government, until recently, supported
terrorist organizations. Military campaigns by the United States in
the region could undermine the current spirit of cooperation between
the two countries, and recent activities in the Kashmiri region
suggest that further terrorist campaigns are likely. This does not
bode well for those who are considering business investment."
—John W. Fasano fasanoj@earthlink.net
210/456-1941
"Since you already outsource at least some of your business, you
have already made one of the tough business decisions—"Should I
outsource?" I assume you are comfortable with outsourcing and feel
it is right for you.
"On the surface, it may seem you can save money exporting jobs to
other regions of the world. However, there are items that could
drive your total costs up to the levels you pay now to your US
outsource provider. Travel, telecomm, and cross training are just a
few of the costs that come to mind.
"India has a large pool of technical, hard-working people and it is
a popular choice for those seeking an offshore staffing solution.
However, picking a specific outsourcing partner is so complex that
you should probably complete a feasibility study to determine what's
best for you. From that study, you might find that developing a
center in economically challenged regions of the US is
better for your company."
—Frank Rich frank@fjrich.com
Frank J. Rich & Associates www.fjrich.com
858/513-9474
[Other comments and suggestions about this topic? Send an email to
membership director Jane Farber at jfarber@asponline.com,
and we'll post your feedback.]
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