Why Onshoring Your Call Center Make Sense

By Jeff Wissink

For many consumers, a service call evokes frustration. Thecustomer has a problem, can?t find the solution online and grudgingly picks upthe phone, anticipating a language barrier and cultural disconnect with anoverseas call center agent.

That customer service experience is the product of many cost-reductioninitiatives throughout corporate America over the past 15 years. What startedas a way to cut costs has, for many companies, ended with a customersatisfaction issue.

Internal company cost pressures made offshoring the callcenter a fairly common business practice. Management (and, frankly, the consultantswho advised them) found the lure of potential cost savings, deep resource poolsand ?follow the sun? support cycles appealing enough to risk communication,cultural and information security problems.

It was a simple decision. Any process that was consideredlow-value or not a core part of the business needed to be simplified andautomated where possible, or simply shipped offshore. India, the Philippines,Eastern Europe and other nations became business process outsourcing (BPO) hubsfor many basic company functions, ranging from finance and human resources tofront-office functions such as customer call centers.

Call centers in particular became an ideal opportunity foroffshoring. Executives saw them as necessary yet costly, and despite the factthat they are customer-facing, not terribly strategic. In recent years,however, these decisions have been reconsidered, and there have been manyhighly publicized cases where companies have decided to bring call centeroperations back home. However, the offshore cost savings remain, and companieshave been forced to balance the desire for a quality customer interaction withbottom-line pressures.

While it?s easy to measure the difference between per-minutetalk time charges for onshore versus offshore call center agents, it?s a lotmore difficult to measure the benefit of onshore call center agents. How do youmeasure the financial benefit of a happy customer?

There have been many attempts to quantify the customersatisfaction benefits, including the development of survey tool and myriadmethodologies proffered by consulting firms and research organizations, such asthe American Customer Satisfaction Index (ACSI). But ?hard-benefit? numbers aretough to come by, making the ROI of moving a call center back on shore adifficult (and therefore politically treacherous) path for many organizationsto take until the problem becomes so severe that there is little choice.

The fact is that call centers are anything but low-valuebecause they provide an unbelievable opportunity to interact with customers.Companies spend millions of dollars every year marketing to existing andprospective customers, but when those customers directly contact an organization,it?s OK to provide a merely satisfactory (or, often, dissatisfactory) level ofservice that detracts from the overall customer experience?

Today, U.S.-based call centers?both internal within firmsand U.S.-based outsourcing companies?are getting smarter about their owninternal cost structures, blurring the once-obvious financial advantage ofoffshored customer care centers. ?Homeshoring,? for example, is a maturingbusiness model in which skilled onshore agents take customer service calls and Webchats during specified times in their homes.

This has several obvious advantages. First, sourcing highly skilledcall center talent that is not tied to geography expands the pool of qualifiedagents. Also, companies are not forced to incur the significant overhead costsassociated with a traditional brick-and-mortar call center. Finally, since peoplechoose to work on their own schedules and receive incentives for their work, thecompany benefits from highly motivated workers. 

Although it?s still difficult to quantify the exact benefitof an onshored call center, the cost differential is diminishing. And with allof the advantages of using U.S.-based personnel, the decision becomes easier.

For companies that are on the fence, start small. Divert 5to 10 percent of your call volume back to the United States?leveraging one ofseveral U.S.-based homeshoring companies?and compare the results. If yourcustomers are happier, it may be worth the incremental expense. 

Jeff Wissink, a seniorpartner at business transformation firm Navint,  has more than 19years of management consulting experience in the areas of enterprise transformation,IT assessments andstrategy, enterprise systems implementations, custom application developmentand project turnaround services.