The British insurance companies are undermining relationships with their customers and fail to save outsourcing call center activities : This is the conclusion of a study conducted by Compass Management Consulting .
The analysis conducted by Compass on onshore and offshore environments shows that increases in personnel costs of up to 15% per year in countries such as India are reducing the benefits of offshore call centers.
All financial services companies should ask themselves some simple questions before deciding to offshore, " What are the drivers for an efficient call center and what the market cost of a call center which will help to maintain or even increase the competitiveness of a company? , "said Simon Scarrott , head of business development and marketing at Compass.
" To resolve operational problems and inefficiency of the processes do not simply transfer to other countries in the hope of improving. The key point is to what extent savings are real, sustainable and contribute to improving the customer experience. In too many cases, service quality is compromised by their offshoring decision that fails to deliver the expected level of savings , "said Scarrott.
Besides the poor quality of service customers report that in the case of offshore call centers, the language difficulties reduce productivity and significantly increase the calls that last up to twice those premises. According to the study conducted by Compass, the problems of understanding occur on average only 4% of calls to call centers onshore.
for offshore call centers this figure rises to 18% and each of these obstacles can prolong the call from 39% to 105% above average. The duration of calls affects productivity when you compare the onshore and offshore in terms of sales.
Reduced wages are not sufficient to ensure the long-term savings
According to Compass, the savings associated with lower wages are disappearing with the rising cost offshore, process improvements do not occur and the operations are not very productive. Compass In a study in which measure the performance of call center operators in terms of average number of sales, the figure was 4 offshore sales a month against 10 dell'onshore.
" The range of areas is promoted as a location for outsourcing is impressive. China, India, Ireland, Malta and South Africa are currently marketing campaigns in progress. But for financial services companies the quality of customer service is a key indicator of the brand, as well as an opportunity to increase revenues and profits through customer retention and cross-selling activities. Neglecting these elements to adopt a strategy of operating in distant countries makes no sense, "says Scarrott.
Instead of asking "What country is suitable for our call center?" Compass advises businesses to ask
· What works in our call center and what we should fix?
• How we position compared with the best company in the industry in terms of call center?
· What can we learn on the efficiency of call centers in other sectors?
Only then the location becomes important.
Equipped with the answers to these questions and with a plan to improve the processes in place, you can assess which parts of the operation can be outsourced effectively. The analysis shows that it will very rarely customer-facing processes for financial services companies.
Analysis Compass over 50 call centers show that the benefits in terms of costs associated with offshoring decreased significantly over a period of 3 years compared to a onshore environment where an improvement initiative is implemented.
Repatriation due to customer dissatisfaction and higher costs of long-term
Accelerating an offshoring decision on the basis of short-term costs may in fact create a twofold problem: customer dissatisfaction and long-term costs higher. As the companies are faced with this reality, there is a return of call center activities by many internationally renowned companies that have understood and measured the productivity of call centers, as well as damage to brand products dall'offshore.
Compass agrees that an approach ' Lift and Shift' in which a call center in the United Kingdom is closed and activities transferred offshore can provide a small savings - typically up to 15% in the short term. However strategy advocates a 'Fix and Mix' based on analysis of transactions in the country and implementing a performance improvement plan. This approach can ensure process efficiency savings more than double those offered by the method 'Lift and Shift', in addition to optimizing the customer experience.
" The improvement of existing processes can be associated with the use of offshore features such as call routing based on the value, to take advantage of areas where the facility can provide a competitive advantage. For example, routine questions on the balance can be sent offshore, while the demand for opening new accounts to be managed by a more experienced onshore and mother tongue, "says Scarrott.
The chief executive of Swinton criticizes offshoring
Compass points the finger at Swinton, Manchester insurance, where profits are growing by 26% and 31% of bills each year, as an example of company that considers its call center and its staff a competitive advantage. Swinton measure success based on business growth rather than on cost reduction and Patrick Smith, CEO, comments:
" Offshoring is the result of a company run by accountants and is an easy way to cut costs without taking into account the quality of service. Our clients are opposed and we have also seen companies such as Norwich Union to change outsourcing idea. "
Smith confirmed that the activities in the UK are a strong point for Swinton: "It 'one of the winners, we are in the sixth year of consecutive growth and the policies we have doubled in the last 5 years .
Source: www.i-dome.com - 09/13/2007
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