What You Need to Know About BPO

Here are three decisive questions all contact center directors should consider when choosing and maintaining relationships with their BPO partners.

Many individuals find it difficult to admit when they need help. But for companies that stand to lose loyal customers over poor service experiences, embracing business process outsourcing (BPO) demonstrates strength, not weakness. 

For modern contact center directors, today's landscape may appear daunting, as new channels emerge to challenge the traditional status quo. While conventional leaders leveraged BPO to support rapid growth and reduced cost, current consumer behaviors and expectations have companies scrambling to evolve alongside the customer.

"Today, BPOs are being leveraged for much more increasingly complex customer engagements," explains Mayur Anadkat, vice president, product marketing at Five9. "Companies are keeping a keen eye on the customer journey, which includes providing newer channels such as social and mobile. Whether that's improving sales or customer service, the focus is always on improving the overall effectiveness of a contact center. Benefits include expanding a company's business reach geographically, achieving flexibility with staffing, agents, and technology; and powering increased productivity and growth." 

But, as companies look to establish BPO partnerships or advance current outsourcing relationships, they must not only look outwardly at what providers have to offer, but also internally to determine what they seek from these dealings. Here are three questions every leader must ask when developing and maintaining BPO partnerships:

For many contact centers, outsourcing represents the ideal way to cut costs and reduce repetitive tasks that distract from deeper customer engagement initiatives. Leaders are also driven by these providers' technological appeal, as they don't have to bear the expensive burden of periodic system upgrades to remain in sync with the overall market.

"These sorts of tasks drag down an organization not just because of the costs, but also because employees in these functions usually have no upward mobility in the company, which drags down morale and diminishes drive to innovate," says Michael Gravier, associate professor of marketing and supply chain management at Bryant University. "The prime benefit of a BPO partnership handling the contact center should be to have the best expertise at a much lower cost. The BPO organization has created an entire professional career path for its employees to focus on improving processes that other companies need on a much smaller scale. It also helps that assets and obligations required to own world-class capability largely sit on someone else's books, bolstering efficiency measures."

However, to achieve the level of innovation that comes along with these technology investments, companies cannot depend upon procurement to lead the provider selection process. As Katrina Menzigian, vice president, research relations at Everest Group, emphasizes, cost may be one of the deciding factors, but it can't be the only deciding factor. Partnerships must also be evaluated based on their inevitable business and process impact. Cost may present strong short-term benefits, but operational synergy will aid the desired long-term trajectory of such relationships.

"When selecting a BPO partner, it's important to remember that the level of the service you receive is only as good as their people and service ability," says Michael Mills, senior vice president, call center solutions for CGS. "Your outsourcing provider's staff skill set needs to meet your requirements from industry experience to technical and soft skills. Whether outsourcing onshore, offshore, or near shore, providers should offer seamless team integration and awareness of cultural norms and sensitivities. A strategic partner should also be able to align its solutions to your technical and business objectives, while being flexible in meeting your needs."

Alex Levi, vice president of sales for AI Foundry, advises leaders to consider the following when outsourcing service: 

  1. How will this partnership impact overall brand reputation?
  2. How will these new forms of service influence the customer base?
  3. How will this financial investment advance revenue gains?

Ultimately, companies turn to BPO providers because operating contact centers isn't their core business. According to Fred Weiner, founder and president of The Connection Contact Center, clients will gain greater value—of both the financial and experiential variety—by outsourcing versus managing customer service internally. BPOs specialize in branding for their clients. They know how to recruit, hire, train, and manage agents to ensure the client's brand is replicated and represented exactly the way the client would expect. Partnerships should be driven by their mutual desire to improve customer service satisfaction.

Are we in the right frame of mind?

Companies must approach BPO partnerships with an open mind in order to grow and improve. BPO providers offer expertise, which allows them to uncover unknown issues and unmet needs that may be hindering the customer experience. Praveen Puri, president of Puri Consulting LLC, emphasizes that leaders need to treat BPOs as a partner or advisor and listen to their suggestions instead of treating them like vendors who merely follow instructions. Of course, there will be instances when the client might not want to hear what the BPO provider has to say, especially in cases where budget must be expanded to meet business objectives. However, this expert guidance promotes clear and honest communication, which remains paramount to long-term success.

"There are always three factors to consider in every relationship: time, quality, and price," says Kathy Aman, senior vice president of sales and customer relationship management at Firstsource Solutions. "Getting the customer experience right takes time and it's an investment to get quality service. Long-lasting BPO relationships need open communication, honesty, and flexibility. To support the longevity of the relationship, communication also needs to be two-way. BPO partners need to understand the outcomes companies are looking for in order for them to deliver the desired result."

To synchronize with the client mindset, providers must engage in dialogue with leaders to understand their customer base, says Stephanie Eslinger, director of TeleTech@Home Sales & Support. Once both parties have defined expectations and assessed needs, providers can the build out an effective solution that caters to the client's comfort level, while keeping cost and goals in check. "By getting to know the customers they'll be serving, providers can creat a contact center solution that reflects the way the client already operates. Customer experience excellence translates to improved satisfaction, strengthening partnerships for the long-term."

Gravier notes that contract development holds the key to setting realistic expectations because it forces both parties to assess needs, examine risks, and determine the tone of the relationship. "As in archery, a small difference in trajectory at the beginning has a huge impact on whether you hit the target," he says. "Take time to think through and express in clear terms what's desired out of the relationship, how each party will benefit over the long term, and the specific process for resolving issues.

Weiner adds that, when setting proper and appropriate expectations, everything boils down to experience and transparency. Effective BPOs will take the time to truly understand what the company's budget, program goals, and key performance indicators (KPIs) are, as well as what the desired customer experience looks like. BPOs will also proactively be able to identify areas for opportunity and improvement. Often times, expectations fall short when the budget and program goals collide with the customer experience. Sometimes providing the desired customer experience may take a little longer than the projected average handle time. It takes partnering with a provider that has experience in the industry—that understands this balance—to help set appropriate expectations. They must also be willing to push back when objectives and expectations don't align. When expectations are clear and appropriate, then the likelihood of meeting those expectations and maintaining a positive partnership climbs.

Do our company cultures align?

While client and provider relationships must clearly align with regard to goals and objectives, these teams must also align when it comes to internal culture. Michael DeSalles, principal analyst at Frost & Sullivan, emphasizes that, in order to come together and provide the seamless customer service experience the client company hopes to achieve, both parties must share a similar mission and vision to ensure everyone's working toward one common purpose.

"The nature of the relationship between customer and provider is vital to the long-term success of any outsourcing arrangement," DeSalles explains. "It becomes even more important in the current market scenario because consumer expectations for excellent service delivery are extremely high, regardless of the vertical segment. Premium brands, in particular, want to be able to shape the customer experience. This requires a shared vision and a good cultural fit between an outsourcing vendor and client. It engenders a high level of trust, a synergistic relationship, and a great deal of transparency."

Ideally, the BPO provider will take on the mindset of the company, enabling the agents who serve that given client to adopt their culture and experience, making them feel as if they're part of the particular organization. However, not all partnerships succeed. "Poorly defined requirements and a lack of understanding between business cultures can produce service delivery gaps that are irreparable," DeSalles adds. "Some providers have had contracts terminated for lack of ownership of the client programs and failing to treat them as their own. Clients are constantly reassessing contact center priorities to stay in tune with the market and remain competitive."

Anadkat echoes this sentiment, emphasizing that, in order to ensure a long-lasting relationship between the contact center and BPO, the outsourcer must be aligned with the company's mission. "Solely focusing on cost and resource allocation has become passé in the contact center industry, as contact centers look for more and more customer experience metrics to drive their decisions," Anadkat says. "It's no longer just a discussion of reducing cost. It's also about which BPOs really understand the business and can improve the company's overall customer experience. It's also important that the BPO doesn't feel like an outsourcer and doesn't feel disconnected. Operations are more seamless when they speak the same business language."

Company leaders must sit down with potential BPO providers to determine if both parties share the same beliefs and perspective. Aman notes that it's increasingly hard for BPOs to differentiate their offering as their services are very similar. Companies that are passionate about customer experience, however, are the ones that can usually provide most benefits, rather than the simple transactional players. Providers that focus on meeting and exceeding the client's business objectives will always blaze the trail for new and innovative solutions. 

Ultimately, as Vikram Mago, director of operations for Capgemini Business Services, mature and experienced providers should be continuously innovating and transforming capabilities. Doing so positions them to bring contact center directors new and fresh ideas on how to improve their business processes, which is precisely what they seek. By asking (and answering) these critical questions, leaders can lay the foundation on which to build these long-term partnerships and enhance customer service capabilities.


Written by Anna Papachristos, Staff Writer at 1to1Media

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