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In today’s fast-paced and ever-changing business environment, contact centers are pressured to deliver exceptional customer service while managing costs and keeping up with rapidly evolving technology.
Recent research from Boston Consulting Group shows just how acute this challenge is for IT leaders. While core customer experience and digital transformation initiatives remain essential in 2023, companies are also focused on controlling IT costs. 30% of survey respondents listed cost containment as one of their top three priorities for 2023.
The COVID-19 pandemic and recent economic uncertainties have also impacted contact center operations, including a shortage of skilled personnel and unpredictable demand patterns. Deloitte’s Global Outsourcing Survey 2022 found that 50% of executives “identify talent acquisition as a top internal challenge in meeting their organization’s strategic priorities.”
As a result, many contact centers are increasingly turning to Business Process Outsourcing (BPO) providers to outsource personnel.
The Key Benefits of BPO: Flexibility and Cost Savings
With contact center BPO, customer service and support are outsourced to a third-party service specializing in managing customer interactions.
While BPO is a proven way to provide top-notch CX while reducing costs, it sometimes gets a bad rap.
Outsourcing isn’t a decision to be taken lightly and requires a deep understanding of the strategy and sourcing needed to be successful. With a robust strategy and the right partners, BPO delivers extraordinary flexibility and significant cost savings.
With traditional in-house staffing models, contact centers often need help managing and scaling their workforce effectively during peak periods or unexpected spikes in demand. BPO providers offer the flexibility required to quickly scale up (or down) your workforce based on demand without recruitment or training.
Research from Deloitte indicates that 53% of surveyed companies expect their “total contact volume to increase over the next five years.” With this in mind, workforce flexibility should be a key priority as contact center operations increase in scale and sophistication.
BPO providers can offer flexibility regarding service hours, allowing contact centers to operate 24/7, which can be crucial for businesses operating in multiple time zones or offering round-the-clock customer support.
Plus, outsourcing personnel through BPO providers enables you to access specialized skills and expertise you may not have in-house. These skills, such as multilingual support, technical support, or social media management, can be added to your contact center without needing to recruit, train or manage those personnel.
Ultimately, this flexibility, from the number of staff you have to service hours to the skills, helps improve service quality and enhance overall customer experience.
The other key benefit of outsourcing personnel through BPO providers is cost reduction. BPO providers typically operate in low-cost locations, allowing contact centers to take advantage of lower labor costs without compromising quality.
Keep in mind that this doesn’t automatically mean you’re outsourcing offshore. Your BPO strategy should analyze the implications of outsourcing onshore, nearshore, or entirely offshore.
Cost reduction comes from BPO providers offering economies of scale — your contact center benefits from shared resources such as office space, equipment, and IT infrastructure. Reducing overhead costs frees your in-house CX team to focus on core operations.
Outsourced CX Challenges Lead to Hesitation
Despite the clear benefits, companies often hesitate to outsource contact center operations.
One of the most significant concerns is quality, particularly when outsourcing to low-cost countries where language barriers and cultural differences may exist.
Multiple studies have found that customer satisfaction levels for offshore contact centers are often lower than those for onshore centers. As a result, before outsourcing contact centers through BPO providers, language capabilities and cultural understanding should be assessed to ensure that they can meet quality standards and deliver the desired customer experience.
Vendor management is another critical challenge when it comes to contact center BPO. Effective CX requires clear expectations and ongoing performance. Many contact centers need more resources and expertise to manage vendor relationships.
A study conducted by Deloitte found that vendor management can drive tangible results, with 43% of respondents reporting “significant savings.” The study suggests that contact centers should dedicate more resources to managing vendor relationships effectively, as this function has a strong business case.
Finally, compliance with data protection is a significant concern for any organization considering contact center BPO due to the nature of the personal customer data they handle.
Sensitive personal information is subject to data regulation protections such as California Consumer Privacy Act (CCPA) and Health Insurance Portability and Accountability Act (HIPAA) in the US, General Data Protection Regulation (GDPR) in the EU and Personal Information Protection and Electronic Documents Act (PIPEDA) in Canada.
The need for data protection compliance creates additional complexity when outsourcing personnel, particularly to locations with different data protection laws. Any BPO outsourcing plan must ensure appropriate data protection policies and procedures to avoid potential cybersecurity, legal or reputational risks. Any data transfer to and from the BPO provider must be secure and comply with data protection regulations and corporate security policies to ensure the integrity of customers’ sensitive data.
Ensure Success with Outsourcing Strategy for CX
The promise of outsourcing contact center operations is evident, especially as customer expectations rapidly evolve. As a CX leader, you’re balancing the need to drive digital transformation while containing costs and ensuring high customer satisfaction.
Contact center BPO is an appealing option, yet the stakes are high. By working with consultants focused on outsourcing strategy for CX, you can maximize the benefits and mitigate the risks. With deep experience in evaluating outsourcing options, identifying potential risks, and developing outsourcing strategies to support your business goals, they can help you choose the right BPO partner.
As part of the selection process, they can conduct due diligence on potential BPO providers and develop performance metrics to monitor service quality. Also, they can assist with contract negotiations to ensure that the agreement reflects your contact center’s needs, ongoing vendor management, and recommendations for compliance with data protection regulations.
For example, with vendor management, your outsourcing strategy team may review the BPO providers’ services for quality assurance and identify areas for improvement.
Contact Center BPO: A Proven Way to Reduce Costs and Increase Customer Satisfaction
In the current economic climate, contact center BPO, when done strategically and methodically, offers a tangible and proven way to reduce costs and improve customer satisfaction.
However, to reap the full benefit of contact center outsourcing, the focus needs to be on proactively mitigating the risks related to quality and compliance.
Bridgepointe’s CX team are experts in BPO outsourcing, including operations management, workforce management, training, quality assurance, and more. We’ve worked closely with hundreds of clients on their BPO initiatives, and our clients typically experience a 15-20% reduction in operating costs and a 50% savings in new employee training expenses by outsourcing.
Learn more about how we can help you with your CX outsourcing starting now.