I’ve spent a fair amount of time writing about costs and people lately and a quotation attributed to Alan Shepard (the astronaut) came to mind that sums up the pivot point perfectly. Alan Shepard, was reported to say of his time in space:

“It’s a very sobering feeling to be up in space and realize that one’s safety factor was determined by the lowest bidder on a government contract.”

Many companies, when finding ways to decrease customer service costs turn to outsourcing as a popular panacea.  Adherents promise lower costs and more time to focus on core competencies.  I’m not against outsourcing per se.  But I am against blindly following the outsourcing crowd.  Simply put, outsourcing doesn’t always work.  Here are a few questions to ask before making the leap with your customer service.

  1. How big are the cultural differences between the people? For example are the new employees likely to be more argumentative because that is an accepted part of the culture?  If you’ve ever traveled to the Middle East you know that bargaining and negotiating is as much a part of a business transaction as the product is.  I once negotiated with a cab driver who was so intent on giving the best bargain (compared to his peers) that he offered to pay me.  True to his word – he did!
  2. How will your customers react to the outsourcing? One reason customer call centers are placed in the Midwest US is because their speech has a neutral accent.  Not so in India, or New York City for that matter.
  3. What types of problems will new employees handle? If they are very similar then outsourcing may be a good solution because flow charts can provide adequate service.  But delivering the service online (without much human interaction) may be a better solution.  If the problems are highly specialized your customer service team has a chance to make a difference in the total experience.  You won’t want to cut corners on delivering great service in this case.

For us, the pivot point is that the hidden differences in outsourcing are also hidden costs.  When your customers contact you, do you want them to realize that you valued them so poorly that you found the lowest bidder you could find?  If more executives applied Shepard’s comment to customer service, the world would have more satisfied customers (of all products and services).

Outsourcing to Lower Costs Can Be Very Costly
Tagged on:             

Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.