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Outsourced Call Centers Losing Feasibility?
Daniel Pronych writes "BusinessWeek is running an article about how outsourcing call centers in India are no longer an 'inexpensive option' for American companies. These shops are now striving for better outsourced work from the U.S. and Europe multinational companies; many are fed up with U.S. clients trying to continually lower prices. New Delhi-based EXL Services, for example, terminated a contract with Dell Inc. because EXL was losing money in the deal."
It used to be like that in many European countries. Americans called that socialistic or communistic.
When a large company had problems, the government would take action like buying products from them, subsidizing research or construction, etc.
It worked for a while, but then the first examples of fraudulous management who put the government money in their own pockets or their own adventurous projects appeared.
It seems like greed will always win from responsibility.
Now, we have the EU. Instead of moving jobs outside the EU, new low-wage low-welfare countries are added to the EU faster than you can imagine, and companies are encouraged to move their jobs there. This results in some fictitious good economic results, but of course when you are losing your job because of this, you'll look at it in a bit different way.
Imagine that the USA would expand to include Mexico and middle-american states "because there are so many people there that want to work and expand our economy". That would be like what the EU does.
Small wonder that those countries where the people were asked their opinion voiced a strong NO. However, it will take something stronger to really wake up the EU politicians.
Odd... Jobs leave the US for India, causing Americans to get hungry. Then Indian outsourcers start rejecting those jobs because they pay so low the Indians go hungry. Sounds like there's a worldwide hunger crisis in the works, so to speak.
So if India can demand better wages and reject outsource work, can America have those jobs back? We already know the language. Or will we have to wait until Business is done exploiting China and the third- and fourth-world countries? Some companies have come to their senses, but not all and not fast enough.
Which brings to mind a Dilbert strip about how the outsourced work had been so undercut while being bounced to foreign markets that eventually it went to the lowest bidder -- the original company.
Laughter is the Spackle of the Soul.
I work at a Canadian office of an outsourcing company that opened offices in India.
I've actually had a conversations start with "Finally, someone in North America.", "Great, a Canadian. Better you than India." and many other anti-offshore statements.
And that's not even getting into some of the rather rude comments that people make towards our Indian coworkers. I especially feel sorry for immigrants from India/Pakistan/etc. who are IN Canada, but get treated just as badly as if they were IN India.
And of course, I've dealt with India call centers as a caller. While I'm patient towards them because I know exactly what they have to go through, I'm less than satisfied with the level of service I get sometimes. I'm not surprised in the slightest that India firms are ramping up their rates.
Oh, and something interesting I've found out recently, is that there are also some firms opening up in Latin America. Why? Because they can support English and Spanish.
I work in one of the six main utility companies in the UK. We've just taken the decision to return all our work in house, from India. The reason we've done this is mainly that outsourcing doesnt work, but is also because we're moving away from a command and control environment where the work is broken down into small amounts and processed ad infinitum by the worker, which made outsourcing so attractive. We're moving to a system thinking/lean model like Toyota's production line being the main example. The, i've got 200 workers that can do 2000 units of work at $x amount means that there are targets in the system. Once you get targets you're defining that once they've done 2000units of work they are effective and its even better when we can get the work done cheaper. Problem is that those 2000units of work havent been done effectively. They've been fudged, the ticket has been resolved for instance but the actual customers problem hasnt so they'll raise 4,5,6,7 tickets all 'resolved' each time as a unit of work for the outsource, making the management happy by meeting the target but the customer is still pissed off and has taken there custom else where as they've never resolved the problem. The trick is to look at how the work works and improve the system. not break it down into a series of units and whore it to the cheapest bidder. Once you improve the system you can view what work is waste and value. IE one office receives a number of bits of paper staples whacks them in an envelope and sends them to another office where they employ someone to take the staples out. Why staple it? turn off that bit of work and free that employee to actually look at that work and work it. Yes, i've been sold on it, but then again it actually works. In 12months we've gone from 90% above average for customer complaints to 60% below average and have overtaken most of our rivals and our catching the rest up. Not only that moral in the company has really improved too. Personally my little rant doesnt do justice to how well its working and will continue to work for us.
There's a good section in the book "Lean Solutions" by Womack and Jones, that looked at Fujitsu Services UK applying lessons from the Toyota Production System on their call centre business. Instead of measuring # calls handled, # rings, # tickets closed, they ended up persuading clients to compensate them on the number of people who *could* potentially call them... and then set about doing rigourous "root cause" analysis and corrections to stop customers having to call in the first place. The end result being that more customers were satisfied, call volumes dropped dramatically, level of service went way up while the costs plummeted.
Most call centres are still back in "rote stock answers territory", so the life of the end consumer never gets to improve. In the final analysis, it's the fault of the company who decides to outsource in the first place. If they got a statistician or someone who could map out customer value streams, they'd save more costs than outsourcing to the cheapest battery farm - wherever it is located..
Ian W.
"wake up the EU politicians"
:-)
You are forgetting that EU isn't only about economy, but about culture and security as well. The east-west division is unsupported by Europe's history.
Not to jab at you, but it's funny how economists have hijacked all decision-making and ways of thinking. We might be better off with people from the other "angles" in gov't and media leadership. Now it's like a buncha mathematicians running all Science...
Hope you get what I mean