Outsourcing: Which shore is
right for you?
Outsourcing customer care and technical support is a best practice for brands looking to improve the experience and build efficiencies with the help of customer management experts. The most common reason brands choose to outsource customer operations is to reduce costs, gain access to CX tools and technologies, free up internal resources to focus on core business needs, and improve business or customer focus.
There are many ways to outsource. Different options work best for different environments, scenarios, and customers. Here are descriptions, benefits, and limitations of different outsourcing options to help you decide what’s right for your business and your customers.
Offshore outsourcing staffs contact centres overseas in countries who can produce similar quality of interaction while saving tremendous costs.
Pros: Moving customer operations completely offshore to a low-cost region like the Philippines is a great way to reduce costs and tap into the already established customer management engine that exists there. Operations here are leaner, meaner, and the labor pool is much more robust.
Cons: Quality is still a concern compared to more expensive options. But as stated above, quality is on the rise and consumers are more aware and understanding of offshore operations if it keeps prices low.
Simple or transactional interactions are the easiest to move offshore, where the quality of customer experience is based on performance of the task. Look at your business to identify the types of services that should be moved offshore. Consider the value of the transactions, the impact on the customer relationship, and the sensitivity of consumers to offshoring when deciding what and where to move.
Onshore outsourcing staffs contact centres in the brand’s home country, using third-party employees.
PROS: Associates can relate to consumers, as they will be neighbours, relatives, and people who have similar experiences living in the country. Economically, onshoring also keeps jobs local. And privacy, security, and sensitivity of information also make the case to keep operations contained within the firm’s home country.
CONS: It’s about three times more expensive to operate from a brand’s home country (U.S., Australia) than it is to manage operations offshore. In addition, the local labor force can’t always meet the need that companies have for skill or volume.
One tactic we recommend is to “rebadge” a firm’s customer operations. A company’s contact centre and group of employees still do the same job in the same location, but the outsource partner takes over the everyday management of the operations and employees. It’s an easy way to reduce the costs and burden of running your own customer operations with minimal disruption to consumers or the business.
We also recommend that when possible, outsourced sales operations should remain onshore, due to their strategic nature and immediate bottom-line impact.
Nearshoring offers the next best thing to onshore, staffing contact centres in neighboring countries to the brand. It combines the cultural similarities of the home brand with the cost efficiencies of a different country.
PROS: It’s a similar experience at a lower cost. New Zealand, for example, has a very similar culture to Australia, but its dollar goes further than the Australian dollar. The same can be said for Canada and the U.S. in terms of its proximity, cultural alignment, and costs of doing business.
CONS: There is a perception that international outsourced operations aren’t as high quality as those in country. Also, some industries or operations involving sensitive information must stay onshore. Scale and resources can also be a challenge. New Zealand’s population of 4 million make it a very small labor pool from which to hire, for example.
Nearshoring is a great way to dip your toe in the offshore waters. Use a phased approach that moves some operations to a nearshore facility. This provides the best of both worlds, without having to completely commit to an offshore operation. Monitor operational efficiency and customer satisfaction to gauge success.
In addition to different “shore” options, there are opportunities to go beyond the shore with at-home associate strategy, automation, and managed services. Find out more about these options, plus case studies, data points and customer stories in the TeleTech e-book, “Outsourcing: Which Shore Is Right for You?”