Contact centre navigation in 2014
Johann Kunz, WNS Global Services South Africa.
The contact centre has made significant strides as an outsourced function. What was initially considered as a cost centre, today occupies a central position in building and nurturing customer relationships. More importantly, it is evolving as a revenue generating channel.
The new contact centre
The contact centre presents a prime opportunity for businesses to build strong customer relationships and generate revenues. However, with customer loyalties becoming fickle in a multi-channel world and technology seeping in to all aspects of business, complexities have only multiplied in contact centre operations.
The business process outsourcing (BPO) industry has led the way in keeping up with these changes and at the same time creating value for clients. Contact centre navigation in 2014 is more than responding to customer calls; it is about value delivery, convergence of technologies, and people.
Cost centre vs value delivery
The call centre has today evolved into a hub that not only provides customer service but also has the capability to bring in revenue. Introducing the 'Sales-through-Service' model to the contact centre really works in favour of the business. A recent McKinsey report reveals that a sales-through-service customer contact centre can generate up to 25% of total new revenues for credit card companies and up to 60% for telecom operators. The underlying factor that makes this model successful is the pairing of sales and service to generate revenue. For instance, when a contact centre agent fulfils the service need of customers and then probes sincerely about their broader needs, customers become receptive to buying new products. The transition from service to sales-and-service is not as easy as it may sound. At a tactical level, key performance indicators (KPIs) in the contact centre need to be adjusted to revolve around customer experience and sales effectiveness rather than the traditional service oriented KPIs such as average handling time (AHT). For example, while a low AHT indicates lower operating overheads, it can have an impact on the customer experience when calls are kept short. The transition from service to sales-through-service requires the contact centre to include "conversions" and "number of bookings" - KPIs that indicate sales effectiveness - over and above service focused KPIs.
For businesses considering an outsourced contact centre, this transformation can have an impact on pricing models, which are beneficial to both the buyer and the service provider.
Pricing can be effectively tied to the outcomes from such a contact centre according to Johann Kunz, Managing Director at WNS Global Services, South Africa: "The move to a revenue-generating contact centre coincides with the emerging strategy of clients using service providers who are able to integrate effectively with their own business. This arrangement is formalised with an outcome-based pricing model that ties the revenue of the service provider with the commercial success of the client's campaign."
Cloud-enablement and analytical insights
On the technical front, contact centre systems architects have to cater for multiple channels (phone, e-mails, fax, Web site, chat) that are unified in a multi-channel portal - enabling a single view of the customer. Systems architects need to build system automation in a manner that enables the end-user to independently handle lower complexity transactions.
Another major technological development that is changing the way contact centres function is the cloud. Cloud applications have made offering business services more agile, enabling easy lift-and-shift of operations to new locations without re-deploying technical architecture, which is now housed in a distant and often third-party server farm. The cloud also enables and supports plug-and-play deployments as well as alternative placement options such as home-based agents.
Technology developments lead us to one of the most promising value-add advancements in call centre operations, but one which is often least understood - analytics. BPO providers have the capabilities to provide high-end research as well as integrated analytics services to their clients.
The analytics journey starts with collecting and cleaning of data. Data explosion is a reality that businesses deal with today. While most companies may sit on heaps and heaps of data, few have the right combination of human capital and analytical tools to make sense of the data.
The contact centre is a touch-point where a lot of data is generated. This data is valuable for businesses as it provides immediate visibility into customer behaviour, their choices and preferences. Offshore BPO providers with advanced analytical capabilities can become an active support component for companies by creating informed strategic campaigns based on an understanding of customer behaviour from contact centre data.
Multi-channel customer service
Societal changes coupled with the convergence of technologies (social media, mobility and the cloud) have had an effect on contact centres. Customers are present on social media - on Web sites and smartphones - and they expect their product or service complaints and queries to be resolved immediately and effectively. Delays and ineffective efforts to resolve complaints on the part of companies often turn into negative consumer sentiments that impact overall brand equity.
Social metrics have become an integral part of brand equity mapping. For instance, a million likes on Facebook is a big deal for companies, as it demonstrates the popularity of the brand. Likewise complaints on the public forum HelloPeter are something companies would like to steer away from.
In such a 'social' setup, a multi-channel contact centre becomes a central hub that can bring a brand or business close to its consumers from multiple channels. Furthermore, it provides the company with a unified view of the customer and an opportunity to forge stronger relationships.
In the middle of this whirlwind of developments are the frontline call centre agents. No longer are they expected to simply read their script, get a response, and move onto the next call. As service complexity increases, agents have to engage with customer issues often at the point where the customer is already irritated, understand the often technical products and services, and be able to cross-sell and up-sell products and services. Advanced workforce management techniques, automation, social media tactics and analytical modelling are some of the changes that BPO providers are infusing into the contact centre strategy for enhanced business impact.
Resistance to change
When one talks about call centres, many people think of jobs lost to off-shoring, of incomprehensible foreign language helpdesk operators, and of unsolicited sales calls. In South Africa the perception is slightly different because very few jobs are off shored thanks to the country's globally competitive delivery capabilities. A recent report from the London School of Economics' Outsourcing Unit (South Africa's Maturing BPO Service Advantage: Case Studies of Success 2013) highlights the role of BPO in industry development and job creation: "The competitive advantage of nations is created, not inherited. Government and industry need to focus on keeping aligned factor conditions, firm strategy, structure and rivalry, demand conditions and related and supporting industries. BPO is a related and supporting industry, and vitally important to building industrial clusters and competitive advantage, as well as producing jobs and harnessing talent." - Leslie Willcocks.
In this context, the South African government must be lauded for directly addressing job creation and economy growth. In his 2014 State of the Nation Address, South African President Zuma said: "The National Development Plan outlines interventions that can put the economy on a better footing. The target for job creation is set at 11 million by 2030 and the economy needs to grow threefold to create the desired jobs. In my last meeting with the business community, the sector indicated that for the economy to grow three-fold, we must remove certain obstacles. We will engage business, labour and other social partners in pursuit of solutions. No single force acting individually can achieve the objectives we have set for ourselves."
The South Africa value proposition
In this climate, delivery locations such as South Africa have emerged as they offer significant cost savings over European and North American sites. South African delivery centres are also cheaper than certain South East Asia locations such as the Philippines. South Africa's Big Mac index of $2.16 against a GPD per person of $8 078 indicates, according to The Economist, the South African Rand's under-valuation against the US dollar by more than 50%. South Africa also brings the added value proposition of good English language skills and a neutral accent.
"As a destination, South Africa prides itself on its ability to offer a high quality, cost effective customer service solution. This is driven by the quality of our people who possess a natural cultural affinity with Western markets. The cultural affinity is the base which allows our people to perform at a very high level that often exceeds the performance levels of their onshore counterparts,", said Gareth Pritchard, CEO of BPeSA, the BPO industry association in the Western Cape. He continues: "These factors combined with world-class infrastructure, ideal time zone positioning for European markets, a large English speaking
talent pool, supportive government incentives and the presence of leading international brands such as Amazon, IBM and Shell have made South Africa one of the most sought after customer service locations in the world."
The Road Ahead
With the rest of the world galloping towards SMAC - social media, analytics and Cloud technologies, a simple voice-based customer contact centre may not be the best fit to tackle complex customer and business demands. An outsourcing provider with experience in multi-channel contact centre delivery is best placed to deliver value to companies. However, an understanding of some of the issues related to outsourcing and evaluation of a BPO service provider makes the decision more objective. Some of the factors to be remembered are:
1. Outsourcing is not the death of a company - it implies growth and strategic flexibility.
2. Choosing a delivery location is not just about maximising cost savings. It is important to consider the global deliverychain and additionally look at the talent pool that your service delivery partner will provide. The talent pool should ideally have optimum industry and technical knowledge, cultural affinity, language proficiency, and customer service skills. Such skills are necessary for managing the increased complexities in customer service.
3. Don't ignore social media as a playground for advertising professionals and social butterflies. Your customers use it so your agents must be skilled in its use and be able to represent your brand across all channels. This is where cultural familiarity plays a large role.
4. Insist on revenue generation at your contact centres to improve your ROI while also enhancing the customer experience.
5. Look for a service provider who has demonstrated the technical and analytics capabilities that you require.
6. There is a link between the attrition rate and the effectiveness of contact centres, so ask your providers what their attrition rates and strategies are.
7. Insist on a pricing model that suits your business and the prospective processes. A hybrid model should be used with the aim of deploying an outcomes-based model after the outsourcing relationship matures and the processes undergo outcomes focused re-engineering. This directly aligns your service provider's performance, and fortunes, with your own particular strategic goals.
Such significant shifts and increasing complexity in the market have led to large corporate deals as companies opt out to refocus their attention on their core business. Here for example we've seen Convergys acquire Stream and IBM sell off its customer care operations. Service providers are now specialists who offer more than low cost off-shoring - they re-engineer processes and employ subject matter expertise that a non-outsourced organisation may not have access to or inclination to deploy. The customer service business is becoming more specialised and BPO delivery giants are beginning to emerge.
For more information, contact WNS Global Services South Africa at mindsSA@wns.com or (+27) 021 526 6789