April 2007 - Long Distance Connection

Electronic Retailer sits down with Oceans Connect, a leading provider of call center services, to discuss a variety of issues relating to offshore outsourcing.

By Tom Dellner

Oceans Connect is a London-headquartered call center and outsourcing services provider with facilities based in Pune, India. Founded in 2001, Oceans Connect now employs more than 600 agents and expects to reach 1,000 by the end of 2007. The company’s services range from inbound orders and customer service, to outbound telesales, market research, order entry and claims processing.

Adarsh Sethia is the founder and CEO of Oceans Connect, while Khawar Ali heads the company’s U.K. business development team.

Electronic Retailer: Why should a retailer consider outsourcing its call center operations offshore? Is it primarily a matter of cost savings and increased capacity?

Khawar Ali: To be very simplistic, companies outsource-or should outsource-to allow themselves to focus on their core business.

Adarsh Sethia: In the sphere of electronic retailing, one could argue that the retailer’s core competency really is to source the right product, develop the ad-or perhaps infomercial-and put it out in the right media and at the right times to generate the maximum response. As for the job of actually collecting those orders and handling the fulfillment thereon, many companies would consider this to be outside their core competency.

What you’re really doing when you’re outsourcing is taking your non-core activities and giving it to a third party. And that third party shouldn’t just merely be able to perform those tasks, this should be their core competency and they should continually refine their processes. Because it is their core business, the business process outsourcer (BPO) can invest in related technologies, which would not make sense for the retailers, because the return would be too small. We don’t focus on merely answering phone calls and processing orders, but rather on constantly refining what we do, improving the customer experience and making it more efficient and ultimately reducing the cost per order.

Ali: We’ve come a long way from where we were five years ago, when it was simply about providing a low-cost alternative to in-house operations. The market has now moved on to an analysis of what value the BPO player brings to the table in terms of productivity, efficiencies and improved customer experience.

ER: How has the BPO space evolved over the past few years in terms of the variety and scope of services that are being outsourced?

Ali: Historically, under the banner of BPO were primarily voice services, inbound orders, outbound calling, service campaigns-typical contact center operations. But where the BPO industry is today in terms of competency, skills, expertise and value, now we’re seeing the outsourcing of back-office work, HR, customer service, technical support, revenue generation, CRM-quite a few areas can and are being outsourced today.

Sethia: We’re starting to see very large companies outsourcing entire chunks of their business activities to large technology service providers. Companies like P&G might sign multibillion-dollar, seven- to 10-year contracts to manage their entire back office from HR through to finance through to customer interaction. The content of what can be outsourced has dramatically changed in recent years.

ER: When deciding whether or not to outsource-especially offshore-a company’s primary concern is usually losing touch with the customer. What does your company do to allay those concerns?

Ali: It goes back to value of what the BPO partner brings to the table and how the business is transferred to the BPO. We utilize six sigma process re-engineering and advanced risk-mitigation processes. Ideally, we imbed ourselves in the client’s organization to understand it-its aims, goals and ambitions. We look at the business activities and design and plan a transition into an outsourced environment.

Nine times out of 10, things aren’t working properly. (If they were, the company wouldn’t be looking into outsourcing in the first place.) They have poor customer satisfaction and low service levels. They are looking to a BPO to understand their industry and their business, what’s working and what isn’t. We re-engineer the operation if required and transition it to our environment in a manner that the client is comfortable and secure with.

ER: How should a retailer best manage its relationship with the BPO?

Ali: The retailer needs to realize that the BPO player is going to manage a very important facet of their business and is essentially an extension of the brand or company, speaking to the most important people in the business-the customers.

I think it’s key that they [the BPO] be treated as a partner and not merely as a supplier. And the partners must sit down and discuss what the retailer’s objectives are, what the BPO is expected to deliver, and how it all can be aligned with the BPO’s own business objectives. If these goals and objectives aren’t discussed or are misaligned in any way, the person who will ultimately suffer is the customer.

ER: How might a retailer and BPO find themselves at cross-purposes?

Sethia: Although everyone talks about the customer experience, frankly, some companies are interested more in the bottom line-how many calls can be answered at the cheapest cost possible. If this is really the retailer’s driver, it’s important that this is communicated and understood. If the communication between the partners has been all about great customer service, now the BPO is off and running in a different direction.

The two goals-in extremes-may not be compatible. Take the case where the retailer is looking for the order to be taken in the course of a 228-second phone call. But what if the customer base is of an older age group that likes to talk on the telephone and not be rushed? Now we have a contradiction: the customer wants to talk, but the BPO needs to get them off the phone. This is an extreme example to illustrate a point, but it is something that we’ve experienced.

ER: Can you provide an example that illustrates a retailer-BPO partnership functioning properly?

Sethia: Here’s a very simple example. Recently, we worked with a retailer who was really looking to improve the customer experience. The client clearly communicated this goal to us.

We analyzed customer service calls and learned that customers tended to call if they hadn’t received a product in five days. So we implemented a process that detected when the shipment would arrive in six days or longer, and then called those customers on the fifth day, explaining to them that their order had been delayed, apologizing and telling them when they should expect the product to arrive. We pre-empted their call-we knew from our studies that the call was going to come in-and provided a great customer experience.

At the same time, the company gained information about what categories of products were arriving late and after what time period customers became dissatisfied-taking advantage of our position on the frontline, handling thousands of phone calls every month.

ER: What about concerns related to data security?

Sethia: Technology advancements have opened up potential for abuse, I suppose, but these same advancements can be used to enhance security, as well. For example, instead of transferring data from client to BPO, now data can be accessed from an offshore site, with the client maintaining control over the data. All the outsourcer can see on the screen, from 5,000 miles away, is the data required to handle that specific query.

About six months ago, the FSA (the U.K.’s Financial Services Authority) toured a dozen or so Indian BPOs that were doing business for large British financial services companies. And what they found was that the data security measures were actually of a higher standard than those in place in the U.K. (or the U.S., for that matter). Because the concerns about sharing data offshore have been so great, Indian companies have been forced to adopt exceptionally strict data security measures. Our agents don’t have e-mail or Internet access outside the site, just internally. Our operations floor is entirely paperless. Agents can’t bring possessions onto the floor. These are things that just can’t be done in the U.S.

ER: What’s your response to potential clients who worry about the customer experience suffering due to differences in language and/or culture-or about purchasing behavior being influenced negatively when customers sense the call has been routed offshore, triggering feelings-ill-founded or not-of nationalism, loss of domestic jobs, etc.?

Ali: Several years ago, we were seeing a lot of backlash about outsourcing to India and the Philippines, with concerns over loss of jobs, etc. Compounding the problem was the fact that early on, quite frankly, the customer experience frequently was not great. But over time, as processes have been refined and experience gained, the reputation, capability and commercial acumen of the Indian companies has greatly improved. It’s no longer about the voice or the accent; it’s about the agents’ ability to handle queries.

Sethia: If the call is answered within three rings and the customer is not forced to go through five layers of IVR, he or she is going to be happier. And if the agent actually understands the client’s business and resolves the matter quickly and efficiently, the customer will have a great experience-and that’s what the customer remembers.

There’s an interesting example of a U.S.-based mortgage provider who, about two years ago, provided callers with the option of having an application processed offshore, in which case they would receive a response within 24 hours. The callers also had the option of choosing to have it processed within the U.S., but they were told that this option would require 72 hours for a response. Approximately 98 percent chose the offshore option.

Khawar Ali will speak in greater detail on offshore outsourcing at ERA’s 2007 Asia Conference, April 25-26 in Hong Kong.


No Comments

No comments yet.

RSS feed for comments on this post. TrackBack URI

Leave a comment