The ever-expanding call center industry remains a vital piece of the global customer service industry. Contributing to its growth is a greater emphasis on customer satisfaction, new developments in information technology, and overall cost reductions in operating modern facilities.
Of course, the real reason they are so popular is that decades of experience have proven call centers are the hallmark of successful organizations seeking to give customers the highest quality of assistance when needed. Even better news: Whether it’s for inbound or outbound calls, these days retaining the services of a call center can be affordable for small businesses as well as the larger multinationals.
However, while the merits of call centers are many, debates are now flaring about whether a firm should outsource part of their customer service jobs overseas or use a domestic provider right here in America.
Pros and Cons of Outsourced Overseas Call Centers
In 2014, according to Everest Group Research, 26 percent of full-time contact center jobs were found in the Philippines, 24 percent in India, 21 percent in North America, 12 percent in Western Europe, 10 percent in Latin America, and 7 percent in Eastern Europe/the Middle East. Specifically, American firms fancy the Philippines due to its low labor and telecom costs, and abundance of over 1.2 million industry workers. An added bonus is that the English accent spoken here is said to be more “familiar” to Americans than the one spoken in India.
Myriad valid reasons exist for selecting “business process outsourcing” (BPO) in an overseas environment. But sometimes the pros and cons can be markedly miles apart when viewed on a spreadsheet.
First, savings can be considerable when the labor, overhead, infrastructure and operational costs are handled by a third party customer care center. This responsibility encompasses the hiring, training and management of call center teams, too, some of whom receive/make calls for multiple clients during the same shift.
Talking wages alone, consider that the same call center job in India paying anywhere from $2,400 to $5,000 a year may start off between $20,000 and $40,000 a year in the United States. (The average U.S. call center rep earns about $12/hour: Payscale.com.) With that said, since labor costs in some nations have begun to increase recently by up to 20 percent annually, the operational cost gap between onshore and overseas call centers is narrowing each year. That, say pundits, is reason one to rethink bringing the jobs home.
A big plus for offshore outsourcing is the ability to give round-the-clock support at affordable rates for both overflow and normal call volume. However, unlike overseas agents, conventional wisdom holds that U.S. agents who reside in the same or similar time zone as their customers will more likely be available for peak call volume work schedules or on-call situations.
David Antony, CEO of Flatworld Solutions (headquartered in Bangalore, India) says one big reason why some American firms chose overseas centers is due to the challenge in the U.S. to find “a significant volume of trained manpower to do certain technical tasks.” However, for other tasks, U.S. workers are just as or more educated and trained.
Another plus for using offshore agents is that most Americans “see call centers as temporary, not long-term, employment,” points out Antony, but in countries such as India and the Philippines, “these jobs are careers for people. It’s not uncommon to have people work up to ten years at an operation.”
As part of client-centric training, offshore call centers routinely give cultural education training to agents with Americanized first names to help them connect better with diverse English-speaking populations worldwide.
While that works well in some overseas centers, in others there still exist agents who lack the communication skills, English fluency, right accent and cultural skills demanded by customers on the other end of the phone line. Does that matter? The answer is a resounding “yes” according to recent studies. A CFI Group study found that when customers thought an agent was difficult to understand, calls were resolved just 45 percent of the time.
A security concern is that overseas call centers may possibly put American personal and/or financial info at risk as many foreign countries do not maintain central criminal databases, and so may not be able to do background checks as rigorous as those conducted in the U.S. Sometimes the worst-case scenario happens. For example, in April 2015, AT&T agreed to pay a $25 million fine after it was discovered that call center employees at facilities in Mexico, Colombia and the Philippines sold AT&T customer data.
Growth of American Call Center Jobs Continues
In the 1980s and 1990s, an estimated 600,000-plus U.S. call center jobs were outsourced overseas. Today, the sector is undergoing a positive transformation on American soil.
“The best guess” is that about 70,100 call centers operate in our country, says Paul Stockford, director of research for the National Association of Call Centers. No one really knows the exact number “as the only organization that has the manpower to [count them] is the U.S. Bureau of Labor Statistics,” he continues. The problem is, this agency “only counts stand-alone/third-party centers” and ignores all the private/in-house facilities.
“I’m not sure if we’re re-shoring these jobs in the U.S., but we’re definitely seeing growth,” says Josh Wright, director of marketing and communications for Economic Modeling Specialists International (EMSI), a Moscow, Idaho-based market data analytics firm specializes in labor market and economic data.
“From 2001 to 2003 almost 40,000 [call center sector] jobs were lost, then the numbers started climbing every year since 2003,” he notes. The nine years from 2001 to 2010 garnered just eight percent growth, but then “from 2010 to 2015 the sector experienced 22 percent growth by adding 93,213 jobs; that’s huge.” (The exact number of industry employees is anyone’s guess. Some articles report anywhere between 3.5 and five million people are employed as U.S. call center agents.)
In March 2016, EMSI generated a report with data gleaned from state agencies for this article. Among other things, it shows where the workforce density is the highest for call center workers (based on 2010 and 2015 industry figures). In the Top Ten grouping, Utah came in first as having the most per capita sector jobs, followed by Idaho, Arizona, Maine, Florida, Colorado, Nevada, West Virginia, New Mexico, Oklahoma and Oregon. The five states with the lowest concentration of call center jobs in the workforce mix were Massachusetts, Hawaii, Wyoming, D.C., and Alaska.
Viewing job numbers alone, Florida’s 65,610 jobs led the eight states with the most sector jobs in 2015, followed by Texas (56,724), Arizona (28,941), Ohio (21,176), California (20,186), Utah (18,401), North Carolina (16,534), New York (16,437). Of course, these statistics don’t include the multiple new U.S. industry projects created in 2016 by private and outsourcing centers, or announced for the near-term future.
Those seeking call center employment will find plenty of openings. This reporter’s online search for “call center” positions nationwide using Indeed.com found 50,000 full-time and 7,700 part-time jobs, plus over 7,000 contract, commission and temporary gigs. On this day, metro areas with the most openings this day were New York City, Chicago, Phoenix, Austin and Dallas. Top recruiting companies included staffing and marketing companies, a major big-box retailer, and a plethora of well-known public healthcare companies.
Top Trends Expected to Transform the Industry
It can be challenging to track the latest industry innovations in the market. Call center technology using Big Data is constantly evolving, so it can be difficult to keep track of the latest innovations in the market.
In the last five years cloud-based technology usage has been embraced by diverse industries, and is a perfect partner for the call center sector. For example, California-based Five9 is recognized as a leader in the cloud revolution for contact centers. This firm has helped thousands of clients facilitate about three billion customer interactions annually.
Outside of the brick-and-mortar center, “cloud power” also allows an agent with a computer and Internet connection to easily work from home. Benefits for employers are game-changing as well. The large footprint and real estate costs of a facility can be dramatically decreased; reps can serve customers from any geographic area; and a workforce can be scaled up or down quickly, without worry about office space considerations. Virtual call center software significantly improves operations other ways, too. Systemwide updates are automatic, and supervisors can improve customer service by easily tracking individual agent performance using real-time and historical analytics.
But not all projects are right for home agents. Antony of Flatworld Solutions says this option won’t work for many of his clients who want physical centers to safeguard sensitive and/or confidential information, and reliable, redundant power supply systems to overcome any emergency. “You can’t guarantee that will happen in a home environment,” says Antony, adding that even an hour without service can immensely impact some clients’ businesses.
Customer trust and loyalty are not just built by phone work these days. Some centers now employ agents to reach the younger, tech-savvy population with proactive (often personalized) non-phone communications typically supervised by the marketing department. But how best to harness these interactions? Kodak Alarms has one headline-grabbing solution. In November 2015, the company launched its AI Foundry unit, which employs self-learning, artificial intelligence (AI) technology to organize unstructured data and give a unified view of customers across multiple channels (e.g., email, web chat, social media, smartphone texts) without human interaction. For call centers, this exciting, adaptive technology can increase resolution satisfaction and agent performance while lowering operational costs.
Another powerful technology tool, from software firm Zendesk, operates like a real-life crystal ball. Instead of measuring customer satisfaction by looking backward at past events, it forsees outcomes; e.g., how likely an interaction will receive a good or bad rating from a customer. Specifically, Zendesk’s “Satisfaction Prediction” engine uses machine learning and predictive analytics to figure out if customers are at risk of churn, prioritize routing based on customer risk, and guide agents to take the right action to ensure positive outcomes.
According to the International Customer Management Institute (ICMI), adding more self-service options to a contact center is a wise move as they have been shown to positively affect customer satisfaction by 38 percent, first contact resolution by 22 percent, and quality of experience by 20 percent. Moreover ICMI reports 67 percent of customers prefer self-service apps over talking with a company rep, and 81 percent of them think self-service options are a competitive differentiator. A whopping 93 percent of people say they’d be even more satisfied with customer service if they could select their self-service channel(s) to use.
On the training side, some call centers are changing tactics in hopes of speeding up response time and decreasing complaints. This is achieved by providing the troops with more intense knowledge-based training, and empowering agents to adapt rules and policies on their own (without manager approval) to find resolutions.
Each year an estimated 45 billion phone calls are made at call centers, so clearly they are not going away. For many people needing answers to help them live in a complex world, it’s somewhat comforting to know that such support is just a few clicks or button pushes away.
About the Author:
Veteran business communicator Lisa A. Bastian is an award-winning journalist and editor who has authored well over 500 articles for national magazines focused on economic development, global trade and related industries. Since 1986 she has served clients nationwide with her editorial and copy writing skills (see BastianPR.com). Lisa lives in San Antonio, TX, with her family, and is a former president/board member of the local chapter of the International Association of Business Communicators.