Call center outsourcing

The NASSCOM-McKinsey study projects the call-center
market as one of the biggest growth areas for India in the near future. It gives
the size of the global customer interaction services as the call centers are a
part of it-as over $ 6.5 billion. Most market researchers however give a figure
three times higher than this. It is estimated that the call center outsourcing
service revenue alone to be about $ 17 billion.

The blended skill sets of English speaking people with
computer literacy, cost and quality advantages, technological progress,
government incentives are all the basic factors making India rejoice a strong
brand in the world. For the same, the business giants like GE, British Telecom
and Bechtel have pioneered in outsourcing call centers to India.

There are countless reasons that underscore the benefits
of outsourcing, such as maintaining or establishing a competitive advantage;
lowering operating costs; delivering expertise not usually available in-house
and providing the latest technology with no additional capital investment or
employee overhead.

The call centers may vary as per their functionality-
inbound call centers; outbound call centers; blended call centers,
medical/healthcare etc. One may decide even within these broad categories, that
what kind of service should be really provided. The wide range starts from basic
ones, created solely to handle customers in a controlled and efficient way. On
the other side, there are sophisticated telemarketing systems, inbound and
outbound, that capture response, analyze demographics, prompt follow-up calls,
and help one manage marketing campaigns and track and measure sales.

The call center hardware and software market in Asia
Pacific is expected to surge 20 percent year-on-year to $ 946.9 million in 2006
from $ 272.1 million in 1999, according to a survey. On average, companies are
realizing a nine percent cost savings and a 15 percent increase in capacity and
quality through outsourcing. (The Outsourcing Institute, 1998). On average,
companies who have completely outsource their call center functions have
realized a greater 10 year average return to investors, a higher average 10 year
annual growth rate, and a larger percentage change in earnings per share. (DGY
Associates, 1997).

Currently, the largest market in the region is
Australia, which contributed $ 130.2 million (or 48 percent) to the total
regional revenues last year. The second largest market is China with $ 46
million (or 17 percent) contribution. In third position is Hong Kong with $ 25.4
million (or nine percent) contribution followed by New Zealand, which
contributed $ 22.8 million. Singapore contributed $ 20.5 million to the total
regional revenues last year.

India and the Philippines are expected to grow in
importance as locations for establishing international outsourcing call centers.
This is because India and the Philippines have a large pool of English speaking
people who can be trained as call center agents easily.

The major benefits to the outsourcer are:

  • Greater
    flexibility to maximize manpower, money and time resources.

  • The
    opportunity to conserve and target resources at what you do best, and

  • Realizing
    significant savings by converting fixed employee costs to flexible, variable
    costs and avoiding large capital expenditures required to implement and
    maintain call center technologies.

Reports state that in terms of wages alone, India shows
a clear-cut advantage. An agent whose average cost in $ 1900 per month $ 11 per
hour costs only $ 175 when outsource to India. The time zone of 10-12 hours is
another advantage.

The bottom line to all this however remains is to attain
the projected figures and sustain the market share. The key to all this is
quality indeed.

VNSV Prasad Call Center Consultant
Sapphire Callnet

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