Customer Service Outsourcing

Many companies recognize the importance of customer service to their businesses but cannot implement customer service within the resources of their company. In such cases, companies do customer service outsourcing to a 3rd party company and allow them to take over the implementation of the customer service function.

What reasons force companies to do customer service outsourcing?

Most of the companies do customer service outsourcing for many reasons: The reasons are as follows

  • Lack of expertise - Some companies are focused on a niche area in the market and typically do not have the expertise in-house to focus on customer service. They do understand the importance of customer service and wish that it could become one of the key integrated functions of their business. This reason forces them to outsource their customer service activities to a 3rd party company allowing their resources to focus on more critical tasks of the company.

  • Cost-effectiveness - For a company to start with their customer service efforts would mean a lot of investment. It will mean that the company will have to employ resources for this function and train them on customer service skills. A CRM software would also need to be acquired that contributes to the overall cost. Companies outsource these functions to 3rd party companies already having these logistics in place to make it more cost effective.

  • Cheap Labor overseas - One of the growing practices is to outsource the customer service work overseas to countries like India, Philippines etc. Companies do this because these countries have a big workforce and also provide cheap labor. Outsourcing customer service to companies in these countries has brought down the cost to the companies in United States of America by at least 50%.

What factors should companies consider before they do Customer Service Outsourcing?

It sounds simple. Just locate a company overseas and push all your customer service work to them. In reality, there are lot of factors that should behind a company choosing a 3rd party partner for their customer service function. Amongst others is the infrastructure provided by the partner company, the quality assurance model and the business model.

Remember, customer service drives customer satisfaction and the company doing customer service outsourcing would need to be sure of the partner company's ability to accomplish this at all times.

Customer Service Outsourcing to countries like India, Philippines has resulted in cutting down the unemployment rate in these countries and also resulted in cost advantages for the companies in the USA. The result is a win-win deal for both parties. If due diligence is exercised at each level of decision making by both the parties, customer service outsourcing takes care of a big percentage of a problem called customer service.