Ventura

Delivering Service Excellence through Contact-Centre Outsourcing

What is behind the unprecedented growth in contact-centre outsourcing? What are the key drivers leading to this growth? And how does this strategic solution add value and improve performance? Why are outsourced contact centres increasingly used to deliver service excellence to both private- and public-sector customers? These key questions, and more, are addressed below.

In the UK, contact-centre outsourcing is at a crucial stage in its market development. It has expanded rapidly, fuelled by an ever-increasing number of companies looking for contact-centre services. According to HI Europe, the contact-centre outsourcing market grew by 20.7 per cent in 2002 and is predicted to break the £2bn barrier in 2003.

Evolving outsourcing market
The concept of outsourcing is not a new one, to the extent that companies have always contracted out certain parts of their non-core commercial functions to outside contractors either to reduce costs, or simply to manage seasonal peaks in their business. The nature of outsourcing is, however, changing. More businesses are considering the UK, as well as offshore outsourcing, as a means of reducing costs, gaining access to expertise and new technology, achieving greater flexibility, plus differentiating through better-quality service. From the first generation of prescriptive contracts, companies are now moving towards risk-sharing contracts, partnerships and joint ventures.

Companies no longer want an outsourcer simply to fulfil a contract, but wish to work with an outsourcer that will grow and change with them, work towards a common purpose and fulfil their core objective of maximising the value of each customer relationship. Today, there is more emphasis placed on the outsourcer’s ability to add value to a company’s service delivery. Market challenges have led to leading outsourcers offering services that go beyond the key benefit of reducing costs, by offering services that help companies adapt to the changing business environment: in other words, moving towards transformational outsourcing.

Outsourcing in the public and private sectors
The private sector has used outsourcing organisations to deliver a better quality service for many years, with over half of FTSE 100 companies now outsourcing a portion of their IT and business processes. It is only since the mid-1990s that public-sector departments have made increasing use of contact centres to deliver services to the public. Outsourcing has developed rapidly within this sector in recent years, more recently in light of the high-profile e-government initiative that stipulates a 2005 deadline for getting 100 per cent of public services online. This initiative aims to give the public access to services over the Internet, through contact centres, mobile phones and digital TV, leading to greater interaction and improved service relationships. Several other factors are driving government departments to consider outsourcing. These include keeping apace with new technologies and the advancement towards multi-channel contact centres, the difficulty in attracting and retaining skilled staff, and the constant pressure to improve financial performance.

This paper turns the spotlight on to outsourcing and the public-sector contact centre, since contact centres have been identified by the government as essential bodies for delivering the key requirements of better service, greater effectiveness and cost savings. It further examines why outsourcing is so high on the agenda and considered to be one of the core strategies for delivering service excellence.

According to a 2002 report by the National Audit Office, government departments spent just over £350mn answering 95 million calls in 2001–02 through approximately 133 call centres ranging from Floodline, the Environment Agency, the Child Benefit Enquiry Line and the UK Passport Advice Line. Since 1999, when there were only 13 departmental call centres, there has been a significant increase with 133 call centres now employing over 15,000 staff — 45 centres of which are outsourced to the private sector.

Some public-sector bodies are already working closely with private-sector outsourcers to transform their services. Access to best practice, new technology and expertise for standardising operations is the key strategic reason for outsourcing.

A well-managed, efficient contact centre can transform the whole experience that the public has in interacting with the government. It can eliminate or reduce form-filling and lengthy call-waiting times, have empowered agents ready to deal with queries more quickly, and even manage callers’ queries outside of regular working hours, at the convenience of the caller. Agents have all the required tools at their disposal to manage as many queries as possible through a single interaction.

The customer’s view
So what is the customer view on using contact centres? The private sector is well aware that, as a nation, customers have become more demanding. They expect to be able to conduct their business in a 24-hour society and will only engage with those companies that are available at their convenience. The companies that have become wise to this are those that will gain competitive advantage. Sometimes this is only possible by engaging an outsourcing partner that has the resource, the planning expertise, the technology and the capabilities of running services cost-effectively.

The same is becoming true in the public sector. ‘Citizens’ expect a tailored service and will be more responsive to a government that anticipates and satisfies their needs. Accessibility, convenience and choice of channel are all demands made in today’s fast-pace lifestyle. Adopting a wider range of contact media for managing customers is therefore essential to providing a better service.

A 2002 research report by the National Audit Office revealed that 60 per cent of people responding to a survey said that they were content to receive government advice and services over the telephone through a contact centre. Almost everyone in the UK has access to a telephone and should therefore be able to access public services in this way. When dealing with the public, the phone is therefore likely to remain the primary communication channel for the foreseeable future. Internet technology is likely to become more important, but human interaction will remain paramount in the public sector.

In-house or outsource?
Whether or not it is possible to manage the contact centre more cost-effectively and efficiently in-house is a key question that needs to be addressed within government departments. It makes sense first to consider whether there is the available expertise, the technology, and trained and skilled staff resources in-house against whether it is better to seek best-practice expertise and resource from a reputable outsourcer. The latter is more likely to lead to cost-efficiencies and a speedier set-up, as outsourcers tend to have the ability to innovate and invest in order to support service improvements.

The decision to outsource is not a simple one. Government contact centres face challenging environments. They deal with a wide range of calls and, by their nature, a significant proportion may not be predictable. An outsourcing partner with experience of managing large, complex customer-service operations can offer economies of scale and experience in managing peaks and troughs. This is just one of the key considerations to be taken into account.

It may be a good idea to involve the outsourcing partner from the outset, as they can contribute towards building the business case, which needs to be a thorough and well-considered process. This is one of the most important steps in outsourcing, with a key element being a full assessment of the risks against the opportunities and benefits in retaining a contact centre in-house compared to outsourcing. Objectives need to be established and costed, and benefits outlined for the project, so that challenges can be addressed.

Successful outsourcing partnerships
Some of the most successful outsourcing partnerships in both public and private sectors ensure that the outsourcer is fully integrated within the government department or client organisation, living their brand values, understanding and aligning objectives and having the right cultural fit.

The process of evaluating which organisation to partner should be detailed. A positive relationship requires mutual respect, ongoing management and accurate reporting, monitoring and benchmarking. Throughout the evaluation of outsourcers, the tendering process and the contract negotiations, it is important to keep sight of the objectives.

Implementation
Once the contract is signed, this is only the beginning. A number of factors will influence how well the outsourcing relationship progresses and these include the outsourcer’s style of management, location, visibility and degree of openness.

Roles and responsibilities need determining within the implementation teams. The outsourcer can support this process using previous experience of both complex and simple implementations. It is important that appropriate senior management from both sides of the partnership ‘buy in’ to the project and are updated regularly on performance against the project plan.

Ongoing measurement
Once the contact centre is fully implemented and goes live, performance measurement and regular monitoring are key to success. Ongoing quantitative and qualitative performance reviews against targets are essential for efficient operational management of the contact centre. General measures may include customer-contact quality, customer satisfaction, call outcomes and volumes, and employee satisfaction. Service quality and service levels are two standard measures that can be expected as part of a contractual agreement.

Looking to the future
A reputable outsourcer will be focused on identifying and driving change, to take advantage of ongoing opportunities that add value, rather than assuming that the environment remains static during the course of the partnership. Management of the relationship, as opposed to the contract, is a critical ingredient in the success of an outsourcing project. Ongoing accountability alongside open and frequent communication and regular reviews are essential, leading to a mutually rewarding, trust-based relationship.

Ventura
Ventura is one of the leading providers of outsourced customer management in the UK. With over 30 years’ experience of managing customers for organisations, Ventura has a wide range of clients across business sectors, including the public sector, telecommunications, financial services, insurance, retail and utilities. Part of the Next Group Plc and winner of the ‘Best Outsource Contact Centre’ in the 2002 European Call Centre Awards, the company has a workforce of over 3500 employees and runs three award-winning contact centres, and a print and fulfilment operation.

Supplied by courtesy of Vicky Jenkins, Operations Director, Ventura