Through outsourcing the control of a process or a product is transferred to a third party service provider. These providers may provide the services at a remote location or at the same place - whichever is more convenient, and more importantly, more cost-effective for the company. If utilized correctly, your company can benefit from the advantages of outsourcing.

Advantages

There are plenty of advantages of outsourcing. These valuable services should have both tangible as well as intangible benefits, which may include the following.

• Outsourcing allows the company to work on an ongoing basis. They do not need to focus on a single project. By outsourcing some of the processes, they get more time and freedom to concentrate on other projects.
• Another great thing about outsourcing is that it can look after the ancillary functions, and thus, allow the organization to concentrate on the core business function. This eventually optimizes the growth of the company.
• One of the greatest benefits of outsourcing is that it reduces the operating costs of the organization by taking care of the various secondary processes. When a third-party service provider handles the supporting portions of the business operations, the company always has its capital funds available for the major core business area.
• Outsourcing of the various processes to a third party service provider also helps the company to improve their productivity as well as service. They get an easy way to standardize all the processes and operations. The outsourcing vendor takes care of the global portfolio as well and while doing so actually increases its lifespan too.
• One of the most important benefits of outsourcing is that the company gets an easy access to world-class capabilities, which you can use to support your business.
• Any organization can save up to 25% of the cost by outsourcing some of its major processes.
• It does not only increase the productivity, but it also reduces the amount of risks involved.
• In this modern competitive world, it is very important for any organization to be fast and active in order to adapt the changing circumstances while making the best use of the same. And, this is where outsourcing plays the most important role because the benefits of outsourcing also include fast work processing and sharing of innovations for best practices.
• Even if the company goes through some uncertain phase, outsourcing can help it make the best use of all the resources available. Outsourcing provides ultimate flexibility with beneficial facilities, and this gives a competitive edge to the organization.

There are plenty of additional benefits of outsourcing as well, such as improved customer satisfaction, effective cost management, project enhancement, and much more. If you believe that your company can benefit from the advantages of outsourcing then what are you waiting for?

The topic of outsourcing has become a hot election debate in the US with the race for presidential election picking up. Never before was Outsourcing so widely debated as is being done today. And interestingly enough everybody has his own perspective, his own judgment. But for the management of corporations and owners of small businesses for whom Outsourcing today is not a mere option but a regular business strategy to achieve organizational goal of growth and efficiency, the million dollar question is whether to outsource or not?

To put it plainly, although there are multiple advantages associated with outsourcing any
process, the benefits accruing to different clients will always differ. Companies are getting up to the fact that its not simply outsourcing a process and get relieved kind of thing but competencies to develop a relationship with an outsourcing firm, and trust on their methodology that matters the most.

So what are the principles that should propel a decision on outsourcing?

1) Why to outsource: This should be the most important criteria in assessing whether to outsource or not. Outsourcing decisions prompted by short term benefits or as a stop gap arrangement will definitely not reap much benefit. Worse, such decisions created in pressured environment like general crisis of the company, transfer the desperation element to the third party vendor and often the entire process collapses even before it has started. Proper analysis with relation to cost, benefits, flexibility and risks involved should be done before starting the actual process. Like every strategic decision which takes time to reward the business, a well thought of outsourcing strategy gelled with the company's strategic plan is sure to be successful and rewarding.

2) What to Outsource: Before embarking on outsourcing decision it is advisable for the organization to know which functions are most important to the organization and whether or not the company needs to retain administrative control over those functions to ensure quality results. One thing that needs to be understood here is that outsourcing the duties does not necessarily mean, the outsourcing of responsibilities. An organization needs to do a clear SWOT analysis before deciding what to outsource. This means it should always retain its core strengths for the in house staff and outsource non key functions like accounting.The following points should be taken into consideration before deciding what to outsource:

Core competence: Core competence and processes which give clear advantage over its rivals, should never be considered for outsourcing.

Process which is heavily dependent on physical infrastructure: Such processes should be the first to be considered for outsourcing as it will save precious resources for the business.

  Process that are non value adding and demand specialized skills like accounting should be considered for outsourcing.

3) Selecting your outsource partner: Again due care should be taken to select your outsource partner. You need to evaluate him on his expertise, experience and capability before making a final decision. It is highly recommended that several outsource service providers be screened before arriving at your prospective partner. Once a decision relating to this has been taken, all referrals provided by the vendors should be verified to establish their authenticity.

4) How to Outsource: The most important thing to realize in outsourcing process is that often staff of the outsource service provider do not have the familiarity of how individual business work for their clients. It is therefore needed that clients establish a mentoring relationship with their vendors and be patient with initial mistakes. Communication and reporting by the vendors staff on a regular basis can do wonders for a healthy relationship at this stage.

Benefits of outsourcing are many. However a careful and patient approach all the way from the conceptual stage till the transitional and maintenance phase ensures that it is really fruitful for the organization and delivers on its real promise of reduced cost and better resource allocation.

Increase revenues and develop your agents with proven "best practices"

With a 10-year history of implementing technology solutions in hundreds of call centers, we have identified four (4) best practice initiatives that leverage technology to maximize revenue, agent performance and contact center efficiency. We anticipate you will find a suggestion in this article that will help you drive your contact center to new levels of success!

Best Practice #1 - Move to a blended agent environment for maximum efficiency

The most efficient call centers train their agents to handle both inbound and outbound calls. This allows supervisors to better balance staffing levels based on call volume. For example, your agents can conduct outbound campaigns to generate sales as their primary responsibility, while also receiving incoming customer service calls. This allows the agent to convert routine, inbound customer service calls to revenue-generating interactions ("As you requested, I have updated your mailing address. By the way, have you heard about our new product?"). From a technology perspective, managing a blended agent environment is easier facilitated if your system 1) allows for the same agent desktop for both inbound/outbound activity 2) monitors call volume and automatically switches agents between outbound and inbound campaigns (based on business rules that you define). Automatic call blending increases contact center efficiency and removes the supervisor from the time-consuming task of monitoring call activity and manually moving agents between campaigns.

Best Practice #2 - Maximize agent productivity with a unified desktop

A unified desktop provides a single, integrated interface to all enterprise and external applications that agents typically make use of during a call. The unified desktop manages key supporting systems such as scripted sales and service workflows, an objections/rebuttals knowledgebase, payment processing, and a customer interaction history that shows prior interactions, activities and additional profiling and context. The results are dramatic productivity gains for both the agent and the company:

· Dramatically Reduce Training Time - By deploying the same interface to handle every type of interaction, agents don't have to be trained on different systems. Imagine the savings from streamlining agent activity - rather than making a call, then entering a different system to process a credit card or transaction, and then returning to the voice-based system to handle phone calls-a unified desktop incorporates all these functions. Whichever application the agent needs is always available right on their desktop. This improves efficiency by reducing training ramp-up and average handle time. Embedding external applications in the agent desktop allows agents to remain within the flow of the call, reducing distractions and eliminating manual processes.

· Reinforce your desired culture and sales behavior - A well-designed unified desktop allows you to reinforce the desired sales behavior in the contact center by showing individual and team performance against sales or service Key Performance Indicators (KPIs). Reinforcing the expected behavior via the desktop and measuring results for each individual will help create a culture of accountability. When you combine desktop "real-time statistics" with a solid quality monitoring/coaching and recording solution, you have set the proper expectations for your agents to be measured and developed.

· "De-Pulp" your Contact Center by making all relevant documents, policies, procedures, and "paper-based" knowledge available within the agent desktop. Anything that an agent might track manually via "sticky notes"- product information, callback commitments, company policies and procedures - should be available electronically. Training time and onboarding of new agents can be reduced from weeks to just a few hours!

· Position your agents to maximize each customer interaction - Another feature offered by more advanced agent desktop platforms is context-sensitive up-sell and cross-sell scripts that can be set to automatically prompt the agent when a cross-sell or up-sell opportunity arises. For example, the system may prompt an agent if the customer's current product coincides with the availability of a relevant upgrade, and can be sold as an add-on.

Deploying a unified agent desktop is one of the most critical initiatives you can implement to align your sales workflow with your company's business goals.

Best Practice #3 - Implement "closed-loop coaching" to reinforce a results-driven culture

Motivating and training agents on a consistent day-to-day basis is one of the biggest challenges most contact center managers face. Implementing a closed-loop performance measurement solution is one of the most effective ways to promote a culture of success. When every agent knows they are measured by the same criteria as their peers, and those measurements are updated and communicated in real time, you are on your way to building a winning culture. By defining performance standards, measuring agent's adherence to these standards, providing honest objective feedback to the agents, and then continually reinforcing the measurement/coaching process, you create a "closed-loop" coaching system that allows you to maximize agent performance.

Some tools you can use to communicate and reinforce agent performance include:

Agent Evaluations and Scorecarding - Rating agents based on defined performance standards allows you to laser-target areas for improvement. Several companies provide tools that automate the evaluation and coaching process, allowing supervisors to evaluate agent call and screen recordings compared to established KPI's and provide immediate feedback to the agent.

These tools also incorporate external data points (ACD, payroll, schedules, sales results) to help create a comprehensive view of agent performance. Agent scorecards, presented in a constructive coaching session, are a critical tool in the closed-loop coaching process.

Post-call surveys - Many companies survey customers via various media-outbound phone, email, direct mail, web. Each of these methods has limitations. For example, direct mail is inexpensive but not too useful as the feedback occurs too long after the interaction that you are trying to measure. Email surveys are easy for a customer to ignore, reducing response rates. For the most timely and accurate measurements, automated post-call surveys are ideal for obtaining immediate feedback tied to the specific incident and agent. The customer is invited to participate in the survey sometime during the call and if they agree, at the end of the agent interaction they are prompted by a series of questions and can respond via IVR. Results are available immediately, and can be continually measured to track changes over time. The data collected can be used as a component of agent performance measurement, but can also reveal root-cause issues and help determine customer satisfaction levels.

Real-Time performance statistics - Some call center technology platforms offer a real-time statistics feature that shows the agent their daily performance statistics between every call so they know exactly where they stand for that day.

Best Practice #4 - Deploy strategic call recording and analytics to identify the most effective sales strategies

Gaining a competitive advantage in your contact center involves more than just analyzing basic metrics. Most contact centers record customer/agent conversations for compliance and training purposes. These recorded customer interactions are valuable sources of information about your customers' needs, competition, how your company is perceived, and how your agents close (or don't close) sales. However, it's not practical to play back thousands of hours of recordings, so analyzing this data with any degree of accuracy or efficiency is difficult. Speech Analytics, one of the most exciting recent developments in call center technology, helps you extract meaningful knowledge from these recordings.

Speech Analytics technology first became available a few years ago and customer adoption of these tools has accelerated rapidly. Speech analytics monitors customer-agent conversations to spot key words or phrases, evaluating factors such as inflection, phonetics, emotion, and periods of silence. This allows supervisors to determine which strategies result in the best closing rates, to quantify what objections occur most often (and what works best to overcome those objections). Identifying those "moments of truth" that can make or break a sale is one of the most valuable benefits of implementing analytics technology. Another key benefit of speech analytics is the ability to more efficiently pinpoint specific areas where agents need more training, without supervisors having to sift through volumes of calls to identify problem areas.

An emerging development in this area is analyzing Web, Email and chat interactions in addition to voice to produce cluster maps and trend graphs to identify customer trends. As these products are introduced and the technology perfected, managers will be able to obtain an all-inclusive view of customer interactions with your organization.

Effectively implementing each of our suggested best practices provides an organization a winning "recipe" of sales and service process optimization, while developing your contact center workforce. If you have chosen the right technology platform to "engine" these initiatives you will have the data and feedback mechanisms in place to dramatically improve your results!

When two parties decide to cancel their agreement, both will be affected by this decision. In an outsourcing project, it is under most circumstances the sponsor who will decide to break the contract. This is always a difficult decision. Breaking the contract too early could mean a lack of commitment, but waiting too long may cause even more harm, for either parties.

The start of such an outsourcing transition is a phase where the contract has been signed and where the sourcing partner starts to configure their systems according to the requirements that have been outlined. The project / transition has really started…

During such a phase there will always pop up issues that haven't been addressed in the contract. When such an issue-list becomes too large, the project becomes unmanageable and it is better to call it off. Under what circumstances this should be done is hard to say and specific for every situation.

Examples of problems during such a transition are:

• lack of functionality offered by the sourcing partner. The sponsoring party will feel that it will loose too much functionality. This issue must have been addressed somehow in the contract, but a project on paper is different from a project in real life: people will feel what the lack of functionality will mean for their business. Standardizing is one of the issues here. A sourcing partner must offer standardized functionality so it can reuse similar components on a larger scale and to other companies. Otherwise, it is not in the interest to start the in-sourcing. The outsourcing partner must be aware of this
• Time-to-market. During a transition delays are an indication of the time-to-market of the partnership business. This comes from both sides, but is one of the indicators that shows the success of the partnership.

Somewhere along the line someone has to take the decision to call it all off.

The sponsor, who started the outsourcing, should manage the incident and should report the problem to the rest of the organization. There is always a cause that gets communicated, but one should check whether it is the real cause. Outsourcing affects the organization which causes stress. Was the change well managed? Were people not informed about the changes? It is possible that the resistance to continue the outsourcing grew over time during the project?

Take your loss means also that this problem must get addressed. Blowing the whole thing off doesn't solve the problem the organization was dealing with. The decision to outsource requires a cultural change from "Do It Yourself" to "Manage A third party." The new dilemma now is whether this was a management problem - the transition could not be managed - or really the problem of the sourcing partner (not able to offer the right functionality, time-to-market and on budget).
This is one of the main issues and if this doesn't get cleared out, the organization will drag the same management problem with it.

Take you loss solves the investment problem. It doesn't solve the management problem. How do you know whether you will not make the same mistake again? If it was the first time than it is all part of a learning process. If more outsourcing projects have been canceled, it might be a symptom of a more profound problem.

In either case it affects the image of both parties. The sourcing partner will have a negative publicity towards new projects and clients, unless it is able to communicate the problem and learn from it. It is very likely that the sourcing partner is able to solve the problem and use the knowledge of the "failure" in next projects, so this gives the organization more experience.

The Sponsor will have to deal with a new problem. What now and how does this affect our strategy?

The economic situation (outlook) could also have influenced the failure. Many companies decide to outsource as part of a growth strategy, not only on refocusing their business. When the forecasts change this could impact the strategy and negatively influence the sourcing decision.

H.J.B.

There has been a lot of talk about the pros and cons of Offshoring and Outsourcing. This is because of the fact that you can actually get bigger profits while saving a lot of money in the process. Offshore call centers have already proven that. Such strategy enabled companies in the US to save millions and give jobs to economically challenged countries therefore reducing dependency to US financial aid. It is a win-win situation for both parties and here we're going to break down the good things about offshoring and outsourcing into 3 points:

1. Lower priced goods and services - cheaper cost of production means lower priced goods and services. If the client company is able to save $20,000 on production cost, the product can be readily made available at a lower price. Lower price for a commodity means the people have greater purchasing power thus the number of products that gets into the hands of consumers tends to get bigger. Profit is earned at a lower cost. That is what's important in any business venture. Offshoring and outsourcing makes that seemingly simple business logic (but so hard to fulfill sometimes) definitely possible.

Let us take for example customer service or tech support: In the US, you can save up to 50% cost by hiring a Filipino college graduate as compared to an American tech support employee who probably has lower education qualifications than his Filipino counterpart. Saving cost and giving out jobs to places where it matters is one of the plus sides of offshoring services. In short, it's getting higher quality workers and at the same time, cutting back on cost. These two ideas seem far from each other especially when talking about basic marketing principles but this is entirely made possible by offshoring and outsourcing.

2. More sophisticated jobs - Outsourcing jobs will move less important jobs out of the client company therefore creating new sophisticated ones. This will require higher qualifications thus pushing the country to educate its citizens more and focus on improving the quality of their own employees.

Doing call center jobs for example, requires patience and the ability to get your point and message across without resulting to an irate customer, now if these jobs are offshored and outsourced, then future employees will have more challenging and fulfilling jobs waiting for them. The focus now would be on improving more skills and creating higher quality employees. The effect will reach farther than the scope of the company and would prove to be beneficial on a wider scale.

3. Focus on core functions - In business functions, depending on the nature of the business, what's usually the unnecessary added worry is the Customer Service part of the business function. If we outsource this, we reduce added risk and worry and can focus on more important aspects such as Research and Development, Production/Operations, Finance and Administration/IT. Most client companies employ customer support employees from other countries to reduce the cost and then give more funds to Research or Marketing. This is a wise and logical move that delivers better results at a lower cost.

In offshoring and outsourcing, good things just keep coming. What's amazing about this is that you not only get to cut your costs but you are also able to provide jobs for developing countries while raising work standards in your own company. Results are seen through lower priced goods and services, refined job opportunities and development of your company's core functions.