Hidden Costs of Foreign Outsourcing

A few weeks ago I decided to take a quick trip to Virginia Beach, so I called a well known travel company that happens to outsource to India. I was greeted by an agent that stated his name was John, although I had suspicion that he gave an alias name. Being so involved in the call center industry, I know it’s a common practice for agents based in India to use American names when servicing American calls.

I told John that I wanted a beach front hotel room in Viginia Beach, and he asked if I needed airfare as well. I told him that I would be driving from Philadelphia, PA to Virginia, so I would not need air travel accommodations. After several minutes of uncomfortable silence, I asked if availability was an issue for the dates given. To my surprise, John told me that he was definitely having trouble making my reservation because he was not finding any beach front hotels in Philadelphia.

I chuckled for a second and corrected him, indicating that I needed a room in Virginia Beach, and also told him that Philadelphia does not have a beach. This made me wonder, how often does location interfere with the quality of service provided? Would an agent located in the Unites States have wasted time searching for a beach front hotel in Philadelphia? I would like to say that this is an unlikely issue to encounter when dealing with an agent familiar with American geography. However, when knowledge fails to prevail, should active listening skills not accelerate?

This experience made me think about questions I would ask companies that outsource call center services to foreign countries. Here are a few of the questions I’d ask:

  • Did you visit the location servicing your calls before making your decision to use this vendor?
  • Did you conduct random call monitoring or calibration style monitoring before making your decision to use this vendor?
  • Did you personally experience a call handled by at least 5% of this company’s workforce before making your decision to use this vendor?
  • Did you speak with current American customers and inquire about their customer satisfaction scores and attrition levels (churn) for this specific vendor?

While we all recognize the money saved by using foreign agents, how much effort is put into measuring the hidden costs of foreign outsourcing? For example, how much money is lost in the form of repeat calls due to language barrier issues? How much impact does the foreign company have on your customer satisfaction scores, or do you not even know because you fail to measure it? This can be a scary thought, right? How much churn has this vendor generated?

One thing we know about American consumers is that we have options, and when dissatisfaction is experienced, the potential is high for churn. Knowing this, it becomes critical for companies to measure their customer retention. For this, I have a simple solution: Inspect what you expect.

While doing this inspection, be on the lookout for these common outsourcing turn offs:

  • American consumers are pretty sensitive to sweatshop call centers - where you can hear the agent next to the agent that is servicing your call because all the agents are crammed into ridiculously close quarters. When a consumer calls a company, they should never have to deal with sound quality issues generated by agents seated too closely. Close proximity means potential risk to customer satisfaction levels and increased average handle time (AHT).
  • American consumers for the most part are tolerant of accents (as America is a melting pot where we all look and sound different), but Americans also have a basic expectation to be able to understand and be understood when calling an American company. Having to repeat information to an agent, and not understanding an agent is quite frustrating, especially when experienced repetitively.
  • Canned Customer Service- Many people are turned off when they reach a foreign agent who has been trained to stick to specific scripts based on key words used by the caller. This type of interaction feels too scripted and no longer feels natural, or custom - similar to the feeling people get when bouncing around in an ineffective automated menu. This often leaves the caller feeling that the agent can’t relate to the reason for their call, thus having a negative impact.

On a final note, the thing to point out about all of these turn offs is that they can all be easily measured by monitoring quality assurance, AHT, CSAT, and churn / customer retention trends. After making the decision to use foreign outsourcing, it’s the company’s responsibility to measure the hidden costs of the outsourcing; if these hidden costs are equal to or more than the savings yielded by outsourcing, it’s not worth the business impact. Be a part of your business and inspect what you expect.

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