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  • Writer's pictureZag Global

Identifying and Mitigating Risks in Call Center Outsourcing

A proactive approach to addressing various call center risks is crucial for businesses to meet customer expectations and increase revenue. These risks can be classified into different categories such as operational, security, financial, reputational, and compliance-related risks. It is important for businesses to have a strong strategy in place to identify and tackle these challenges early on. Additionally, decision-makers must keep in mind that call center risks, like call center trends, are subject to change over time.

The choice of outsourcing some or all of your call center operations carries significant implications for your company, making it one of the most consequential decisions that a leader can make. If the appropriate collaboration is established, the business can benefit from improved productivity, reduced expenses, and top-notch customer service. This will allow your company to concentrate on essential skills and creativity, giving it an advantage in the market. However, making an ill-informed or rushed decision could harm your brand and jeopardize your most valuable resource, which is your customers.

It is of utmost importance to be aware of all risks beforehand so they can be found solutions for, in time. To ensure long-term relevance, profitability, and competitiveness, businesses should establish a comprehensive strategy that addresses the top risks associated with call centers. Additionally, it is essential to regularly review and update the strategy to include emerging risks. Implementing ongoing call center risk management processes is crucial for achieving these goals.

Risks Involved in Outsourcing

1. Losing Control over Your Call Center

In the world where customers are given priority, providing excellent customer service is closely linked to the brand's reputation. It's not unexpected that business executives hesitate to delegate the management of their call center, which is often the only human interaction point, to an outside provider. This is because they question whether outsourced agents could have the same level of dedication to customers as in-house staff who are part of the same work culture, share a common mission and objectives. Leaders in charge of customer service, who are not directly involved in frontline operations, may feel that they lack the capacity to connect with agents and effectively convey information about products, services, promotions, and policy changes.

2. Compromised Quality of Service

When a vendor is chosen solely based on price, it can result in a reduction in the quality of service provided. Outsourcing companies that prioritize offering the lowest price may resort to shortcuts, such as hiring less experienced staff, reducing training time, or employing fewer supervisors for supervision and guidance.

3. Risk of Data Breaching

Nowadays, data breaches frequently make headlines, which is why safeguarding customer data and cybersecurity are at the forefront of every executive's concerns. If a company shares sensitive information with external contractors who do not have reliable security systems and protocols in place, the risk of compromising customer data is significant. This could result in severe consequences for the company, including damage to its reputation and financial losses.

4. Increased Agent Turnover

The call center industry experiences a significantly greater employee turnover rate compared to other industries. Without retaining competent and trained agents, call centers cannot proactively provide excellent customer service. Moreover, the high employee attrition rate results in expensive recruitment and training costs. Call centers must identify the reasons behind the agent attrition to retain their employees. Implementing a robust strategy to keep agents motivated and content is also crucial in controlling the attrition rate.

5. Communication Gap

If call centers across the world don't have agents with good communication skills, there can be issues such as heavy accents and cultural differences. Similarly, in outsourced call centers within the United States, communication barriers can exist if agents aren't trained and screened appropriately. When trying to resolve customer service problems with the help of agents who have language barriers or inadequate training, it can lead to longer waiting times and lower performance on key customer-centric metrics like FCR, CSAT, CES, and NPS.

6. Prevailing Absenteeism

Several studies indicate that contact centers experience absenteeism rates ranging from 5 to 10 percent, where call center agents frequently miss work without a valid explanation. Some agents tend to consume their sick leave for reasons other than illness.

To provide exceptional customer service and achieve established service level agreements, call centers need to reduce absenteeism rates. Nonetheless, absenteeism rates in call centers tend to fluctuate, and managers must monitor the trends closely and develop a comprehensive absence management strategy to curb absenteeism.

7. Dearth of Interdepartmental Coordination

Resolving complex customer service issues usually requires the collaboration of multiple departments. Agents need to communicate and work with other department employees or agents to resolve the issue efficiently and effectively.

However, some call centers fail to prioritize seamless interdepartmental communication and collaboration. Consequently, agents struggle to deliver satisfactory customer experience and improve service quality. Call centers must ensure that agents can access pertinent information and receive relevant assistance without any inconvenience or delay.

Measures to be Taken for Mitigating Outsourcing Risks

Like any other business partnership, outsourcing your call center carries certain risks. Nevertheless, most negative experiences with vendors can be attributed to inadequate planning, ambiguous expectations, and insufficient research. Here are a few factors to keep in mind that will assist in reducing risks and steering your company and prospective partners in the right direction.

Create a List of Your Objectives

To initiate your search for an outsourcing provider, it is important to establish the framework for the forthcoming partnership by precisely outlining your goals, prerequisites, and anticipated outcomes.

Would your primary objective be to reduce expenses, increase channels, or expand operational hours? Consider what kind of partnership would best align with your business objectives. For instance, do you require a vendor who can manage the core call center function or one who can assist in driving innovation and business growth? Form an evaluation team that includes key stakeholders from various departments within your organization. It may be advantageous to include an individual, either internal or external, with expertise in call center outsourcing to guide the process.

Ensure Comprehensive Due Diligence

Due to the sensitive nature of the information that the call center will handle, it is necessary to incorporate compliance and data security evaluations into your due diligence process.

Ask potential partners about their customer data protection measures, including data storage, access, and system maintenance. Conduct a risk assessment to verify that the vendor has adequate security controls and practices and adheres to industry standards and certifications. It is crucial to have frontline training and monitoring procedures in place and ensure compliance with procedures consistently.

To evaluate potential disruptions to business operations due to geopolitical, weather, and labor market concerns, conduct what-if scenario planning. Assess the potential impact of such events on your customer base. Additionally, determine how the vendor will manage and monitor your risk exposure, as well as their procedures for ensuring business continuity.

Fostering Transparent Communication Between Partners

Effective communication that is both open and transparent is crucial for ensuring that prospective partners fully comprehend the objectives, policies, procedures, required skill sets, and agent training needs, as well as any events that may affect call volume. During the selection process and after the contract is signed, it is essential to maintain an open channel of communication in both directions. Taking the initiative to share information about modifications to products, services, and operational procedures will ensure uniformity in service delivery and guarantee a successful partnership.

Overcome Cultural and Linguistic Barriers

To mitigate any potential negative impact on your customer base due to accents and cultural differences in international locations, consider restricting your vendor selection process to onshore and nearshore providers who exhibit top-notch training and development in English language communication and proficiency.

Fostering True and Authentic Partnerships

To increase the likelihood of finding an outsourcing provider that aligns with your vision and objectives, it's important to invest adequate time and resources in the vendor selection process. Rather than simply establishing a contractual agreement, it's important to focus on building a genuine partnership with the vendor. While a contractual agreement ensures that the vendor meets performance standards, a true partnership involves the vendor taking on a vested interest in mitigating risks to your business. In a genuine partnership, the vendor collaborates with you to streamline processes, improve quality, identify opportunities to enhance products and services, and goes above and beyond to elevate your operation into a best-in-class service provider.

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