Agent repatriation social myth or boardroom reality


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Agent repatriation social myth or boardroom reality

  1. 1. Industry ReportAgent Repatriation: Social Myth orBoardroom Reality?
  2. 2. IntroductionCustomers want their calls answered quickly; they want aclear connection; they want their concerns addressed in atimely, accurate, professional manner and they want it24/7/365. Social Media The last few years have seenIf the First Call Resolution rate is high and companies such as Delta Airlines,Customer Satisfaction is acceptable, should it United Airlines, AT&T, Dell,make a difference where the call is handled,, Expedia and HPfor the caller or the company? repatriating offshore Call Centers, cutting across all product lines.Aren’t customers merely data on a switch and These companies believe they will becompanies just a bottom line? Apparently, delivering a higher degree of overallthings aren’t so simple and we took some customer satisfaction by opting totime to find out why. come home with their call center employees.We asked business leaders inhabiting callcenter discussion boards about their position ~David Filwood Principal Consultanton off-shoring customer service and then we TeleSoft Systemsasked about repatriation in polls and formalsurveys.This report encapsulates what we heard fromaround the globe.For those of you considering repatriation, we Does repatriation makehave included an ROI and Cost Comparison sense for companiesModel for the Offshore and Home Agent wanting to enhanceModel so you know the bottom line. service levels and brand reputation? When is the right time for your company to repatriate domestic agents?
  3. 3. S oc ial MediaTo start conversations around the offshore phenomenon, we first turned to socialmedia and delved into the subject matter on industry discussion boards. Weasked: “Do you think it matters if an agent is located offshore? If the quality of service is the same, does it matter if the CSR is in the same country as you are?”These questions sparked interest and comments fromhundreds of companies and individuals around theworld and engendered a variety of responses farwider than we expected.It doesn’t seem to matter if you approach the Even though ourquestion as a customer or provider, there are question does notstrong opinions about off-shore call centers that mention repatriation,serve to raise temperatures and immediately the conversationinvoke lively debates on the pros and cons of quickly went there.repatriating jobs.Even though our question does not mentionrepatriation, the conversation quickly went there. We were ourWe were told that variances in geography, sector and company better socialsize made a great deal of difference in defining the parameters of and politicalour question. We were told that “Quality”, to Quality Assurance selves onteams, equals scoring on First Call Resolution, Average Speed of social media.Answer, data and empathy and it means ticking boxes on ascorecard and to the Call Center Manager, “Quality” means theaggregate of those tick marks, which is something altogether different.One commenter rightly asked, “Where does the quality of ‘intensity’ reside?” andanother, “How does one measure the dynamism of passion for a product and itscentrality to the relationship shared by the agent and the customer?”Some customers it seems, possess a passion that is arguably an important partof the relationship they have with a product or company and on the support end,a matched intensity provides a sense of security within the transaction.Many of the comments asked, “What of company values and marketing as itinvokes locality, neighborliness, family, patriotism and loyalty? Is it OK, to sayyou are a “family company” then suggest your family includes an overseas callcenter of contract agents?Differences between a service call and sales or up sell call mattered a great dealto customer-types on the boards when appreciating where the call originatedfrom and executive-types thought the same held true for commercial or
  4. 4. consumer goods and for Tier 1 and Tier 2 technical support. Gold customersexpect and receive preferential treatment is what we were told.Contributors told us that dialect, inflection, pacing and tone varied widely withinthe boundaries of their own national boundaries and that lead to problems ofmisunderstanding as great as any experienced from an overseas agent. Ouroverseas friends came to the defense of offshore practices with examples ofexcellent training, accent education, First Call Resolution and technicallyadvanced agents. Others, clearly looking at a high-level executive view,suggested that six zones were too many for a director to travel and for them thatmade all the difference.The fact is that the difference between our better social and political selves, asexpressed on social media versus the impact of business realities came into highrelief when we compared social media comments with formal survey results.People spoke through the discussion boards, business spoke through the survey.The clear conclusion is that while there are compelling arguments both for andagainst off-shoring and repatriating; personal, social and political ideals need tobe set aside for a rationalized decision making process that gives primacy to thebottom line..The data suggests that out that inward looking, in-house and North American callcenters are less likely to be motivated by social forces and need bottom-linereasons to have any discussion about repatriating.That is not to say repatriation is a non-starter, not by a long shot. But to get theinterest of these corporate leaders, a costbenefit analysis will get the conversationstarted before any talk of corporatecitizenship will take hold.Third Party Service providersand companies outside NorthAmerica, experiencing amore fragmented reality ofcross national clients andcultures, are moresensitive to the socialaspects of off-shoringand repatriation. Thatisn’t to say thearguments will sway anyof them, but personaland social and politicalviewpoints are morelikely to be reflected inthe official corporatemodels and policies ofthose groups.
  5. 5. F ormal S urvey: P artic ipant P rofileQuestions of fair trade, legislating change and corporate responsibility wereinitially considered for our survey based on comments made on industrydiscussion boards as outlined above. Survey responses along with all thequestions touched on are detailed in the following Industry Report along withinput from the social media discussion boardsS urvey P ool S izeWe contacted 2029 individuals in 1860 companies in order to obtain atrustworthy sample pool. Our focus for the survey report is the call center industry5 key business verticals: • Financial Services • Retail • Technology • Telecommunications • Consumer Goods and ServicesWe had a response rate of +10% with 197 unique company representativesparticipating in the survey.J ob T itlesSurvey respondents consisted of management as well as executive teammembers, the bulk of which (89%) were from the operations side and theremaining from Sales (7%), and IT (4%).Directors and above made up 59% of those polled followed by Managers at 41%.K nown vs . AnonymousOur method of reaching out to anonymous individuals for polling was by way ofsocial media (LinkedIn et al), word of mouth, website notices and email forwards.Additionally, we reached out by personal invitations to the subscribers of ourquarterly newsletter. In all, 71% of respondents came from our subscriber list and29% were anonymous.G eographic L oc ationResponses came from every Continent (save Antarctica) with North Americamost represented at 68% followed by Asia at 13%, Europe 10% and Australia6%.
  6. 6. Overview of S urvey F indingsOur survey data places Australia at the top of the list with an over 80%willingness to go offshore and North America follows behind that at about 50%.When compared with how much propensity each geographical area has towardrepatriating those agents, all locations report in at around 25%. If we comparethe two, about half of the North American pool looks favorably on repatriatingagents compared to about a third of Australians.The European pool, which had the least interest in off-shoring at 28%, had thegreatest desire to bring those jobs back at 71%.We surveyed according to call center size and found that departments that hadbetween 200 to 500 agents were the least interested in shipping those jobsoffshore and nearly all of them would repatriate jobs if they were able to.Somewhat expectedly, the call centers with over 1000 agents were the mostinclined to offshore.Retailers and financiers were most amicable toward off-shoring at 80% and 75%respectively, with the technology, telecom andconsumer goods sectors all reporting aboutthe same at between 50% and 60%.It is the technology group thatwould repatriate most willinglywith over 50% reporting thatthey have or will bring jobsback to home soil. Retailersand financiers were lesslikely to change offshoredecisions at about 25%each willing to do soand telecom andconsumer goods, whendecisions were made,were least likely tochange at about 15%each.For in-house callcenters 62% say thatthe differences betweenFinancial Services,Human Resources andInformation Technologyshould not make any impactupon decisions regarding off-shoring and repatriation ofagent. That figure is turned on itshead when we ask the same
  7. 7. question to 3rd party service providers where 59% disagree. In North America, itmatters less where 42% told us it makes a difference, but outside North AmericaCall Centers are more likely to take those differences in to account with 63%reporting that the question of off-shoring/repatriation depends on the differencesin Financial Services, Human Resources or Information Technology.Capacity seems evenly split for 3rd party service providers when compared within-house call centers. For each about 60% say that they would have the facilitiesavailable to simply turn off the tap and bring any jobs back should it be decidedupon. There are marked differences however between North America and theother regions where North America has the capacity reporting almost 70% ableto do so compared with 40% elsewhere.Considering that off-shored call center work usually means transactional levelcalls, the answers across the board were surprising when we asked if mostcustomer interaction demanded regional agents because you simply can not trainfor the consistency of delivery at a distance. In-house call centers said no byabout 60% and 3rd party centers said yes by about the same amount. NorthAmericans reported by a margin of 55% that yes, regional call centers areimportant compared with 45% elsewhere.
  8. 8. Indus try R eport Offs hore P henomenon: T he R epatriation of Domes tic Agents S ample C os t B enefit Analys is ROI and Cost Comparisons Model: Offshore vs. North America Home Agents At Home C os t P erformanc e Off S hore Off S hore At Home T ime Off-Shore vs. Work@Home: Cost Savings Summary Business Case Off-Shore Work@HomeAnnual Base Cost $2,184,000.00 $3,696,000.00Effective/Adjusted Direct Program Cost $2,184,000.00 $2,585,744.00 Base cost adjusted for direct cost -18% savings onlyEffective/Adjusted Total Program Cost $2,184,000.00 $1,502,774.00 Base cost adjusted for direct cost +31% savings and sales uplift *This Cost-Benefit analysis is included as a guide. It contains data derived from external consulting sources, internal Transcom results and recent survey results from 20 organizations in several key sectors.
  9. 9. Analysis Assumptions Business Case Off-Shore Work@HomeHourly Productive Bill Rate $13.00 $22.00Standard bill rates per productive hourAnnual Base Cost $2,184,000.00 $3,696,000.00100 FTE; 140 hours per month; 12 monthsAverage Handle TimeIn-language efficiency, domestic (experienced) 240 230agent interaction**Calls Handled per Hour per Agent75% agent utilization ; 92% agent efficiency 10.35 10.80Calls Handled per Year100 FTE; 140 hours per month; 12 months 1,738,800.00 1,814,400.00Retention Percentage (Saves)Domestic US agents familiar with US products as 9% 14%well as market and cultural imperatives** Cost Savings Return on Investment Business Case Off-Shore Work@HomeAverage Handle Time Reduction CostSavings $0.00 $154,000.00Incremental calls handled X At-Home rateFirst Call Resolution Uplift - 11%11% reduction in overall escalations and repeat $0.00 $406,560.00call volumeProgram Support Cost Reduction - 3%Decreased internal vendor support costs (travel, $0.00 $110,880.00inefficiency etc) valued at 3% of contractRevenue Preservation from Retention$25 recurring income opportunity; 8% saved $0.00 $254,016.00(disconnect/cancellation calls etc.)Customer Satisfaction/Retention CostSavings - 5% $0.00 $184,800.00Reduced customer churn and increasedsatisfaction valued at 5% of contractAt-Home Direct Cost Savings $1,110,256.00
  10. 10. Sales Return on Investment Business Case Off-Shore Work@HomeSales ConversionsBased on standard inbound sales up-sells/cross 23% 30%sellsRevenue per Hour based on $30 saleCalls per hour x 25% sales calls x sales $17.85 $24.30conversion % x $30 saleRevenue per Year based on $30 sale $2,999,430.00 $4,082,400.00100 FTE; 140 hours per month; 12 monthsAt-Home Sales Uplift $1,082,970.00
  11. 11. Survey ResultsOffshore Phenomenon:Repatriation of Domestic Agents
  12. 12. Social Media G eographic L oc ation Most of the consumer requirements will not be very complex. Commercial users are a different matter. You 2% 1% have constraints that are beyond the context of simply solving a problem. You add complexity 13% of the problem into the mix, which will affect the 6% number of people available overseas. 10% 68% ~ Aun Mohammad Deputy Director, Supply Chain Management NJVC, LLC B us ines s C ategory Afric a 19% 17% As ia 7% 16% Aus tralia 41% E urope North Americ a S outh Americ a F inanc ial R etail FAST FACTS: T ec hnology Our largest representation comes from North America with 68%. South American T elec om and African numbers are omitted due to sample size. G oods and S ervic esSocial Media FAST FACTS:My philosophy is “one company, one sound”. Businesses with an interest in TechnologyThere are many corporations that have were well represented with 41% of ourcustomer service/experience down to a science. survey pool. See our survey, “AgentWhether you are experiencing their Adoption in the North American Call Center”product/service here in US or overseas… it’s to see how these 5 categories view the usethe same. of at-home agents. ~Brandon Schofield Manager, Tuxedo Support Center The Mens Wearhouse Corporate
  13. 13. Social MediaAgent L oc ale for all C all C enters Consumers want lower prices and the way to achieve that is out source manufacturing and packaging of consumer goods. 15% Why are businesses any different? 14% 49% The cost of healthcare, insurance premiums 22% and generally the cost of business sky rockets year after year. For some small companies it could be the choice between staying in business and outsourcing. Ideally we would be self sufficient, but people Domes tic and business are not willing to pay the price. ~ Raymond Heiland Director of Sales Off-S hore Ambit Software Pvt. Ltd. Near S hore Home S hore In-Hous e C all C enters vs . T hird P arty P rovidersFAST FACTS:49% of call centers reported that agents were 36%located in fixed facilities, 22% were offshore. 64% For our survey it was important to understandopinions as they differed between In-house callcenters and Third party service providers. 36% ofrespondents were BPO providers and 64% werecompany held call centers. In-hous e C all C enter T hird P arty S ervic e P roviderSocial MediaCustomer service is not about where, but abouthow.Clear, courteous, prompt service, is the key. FAST FACTS:Two out of three wont do. Number of Individuals Polled: 2029 ~ Mike Ross President at 4PSA - Cloud Calling Number of Companies Polled: 1860 Number of Participating Companies: 197
  14. 14. Social Media P ropens ity to Offs hore by L oc ation Our customers work in a fast-paced environment. The offshore agents we had did a great job learning the technical aspects of the100% project, had great command of the English language, but could not match the intensity of 80% our customers. 60% ~ Matthew Wallis 40% Director, Information Services 20% Dominos Pizza P ropens ity to R epatriate by L oc ation As ia 100% Aus tralia 80% 60% E urope 40% North Americ a 20%FAST FACTS: As iaWillingness to offshore, in our survey, includesthird party service providers, company run call Aus traliacenters, those that have off-shored and thosethat will off-shore in the future. E urope North Americ aSocial MediaIn house call centers often implement things in FAST FACTS:a rush, influenced by internal management andwithout a change control process. So I dont At-home agents are a real alternative to off-think its about overseas at all, its about how you shoring. A recent Transcom survey showeddefine and execute your training, standards, that organizations are embracing at-Homeprocesses and deliver expectations, whether agents and are realizing benefits far beyondyour contact centre is downstairs or 4000 miles what they had originally planned for. Of theaway. . companies that had adopted, 90% found the program successful. ~ Simon Priestley Independent Contact Centre Consultant (Survey available on request) Interim Manager
  15. 15. P ropens ity to Offs hore by Social Media Department S ize If an HR call center takes, say, 200 calls per day, handled by 4 to 5 reps, whats the value100% proposition of off shoring those activities,80% especially since some of that work will not be suitable for off shoring at all?60%40% ~ Jim Scully President Shared Services Institute, LLC20% P ropens ity to R epatriate by Under 50 Department S ize 51 - 100 100% 101 - 200 80% 60% 201 - 500 40% 501 - 1000 20% Over 1000 Under 50 FAST FACTS: 51 - 100 The significant drop in the 200 – 500 range is reflective of optimum call center sizing in many 101 - 200 call center markets. 201 - 500 501 - 1000 Social Media Over 1000 [Philippe (and others)] are coming at this question from the perspective of an outsourced solution where presumably tens if not hundreds of clients activities are aggregated. The fixed overhead and effort of setting up, maintaining and managing an off-shore presence is more feasible in this business model than a single-instance in-house model. ~ Jim Scully President Shared Services Institute, LLC
  16. 16. Social Media P ropens ity to Offs hore by C ategory I find that, along with technology enablers, processes get more defined and repeatable by100% simply going through the act of off-shoring.80% Of the 23 different processes I off-shored, we brought one back and outsourced it within the60% US for good reason. It was the process with the40% most customer interaction and we simply could not train for the consistency of delivery we20% wanted within that particular offshore/outsourced provider. ~ Stephen Hosley Principal F inanc ial Finance Transformation Practice The Hackett Group R etail P ropens ity to R epatriate by C ategory T ec hnology 100% T elec om 80% 60% G oods and S ervic es 40% 20% F inanc ial R etail T ec hnology Social Media T elec om Contracted agencies and staff are already at a disadvantage compared to company-hired employees. G oods and S ervic es A passion for the product rather than contact metrics is paramount to a satisfying customer experience, and is more difficult to instill in non- employee agents. ~ Griff Williams Sr. Manager Technical Services Guidance Software
  17. 17. In-hous e vs . 3 rd P arty P rovider I s c o r p o r a te s o c i a l100% r e s p o n s i b i l i ty c o n s i d e r e d80% a n i m p o r ta n t f a c to r i n60% r e p a tr i a ti o n ?40%20% 0% Company Call Third Party North Americ a vs . E ls ewhere Center Service Provider 100% Y es 80% No 60% 40% 20% 0% Outside North America Social Media North America Considerations need to be made with respect to audience, agent function, and company marketing/culture/message. Y es If their statement is "your neighbor" or No "completely local", its going to be tough to explain going offshore, even to Canada, given the current environment. ~John Bertoni FAST FACTS: Managing Director Mava Consulting Companies that have concrete plans to repatriate jobs in the future are notably more likely to consider corporate social responsibility an important factor in repatriating domestic agents.
  18. 18. In-hous e vs . 3 rd P arty P rovider D o e s m o s t c u s to m e r100% i n te r a c ti o n d e m a n d 80% r e g i o n a l a g e n ts b e c a u s e y o u s i m p l y c a n n o t tr a i n f o r 60% th e c o n s i s te n c y o f d e l i v e r y 40% a t a d i s ta n c e ? 20% 0% Company Third Party North Americ a vs . E ls ewhere Call Center Service Provider 100% No 80% Y es 60% 40% 20% 0%Social Media Outside North AmericaIn a sales environment, on or near shore almost North Americaalways seems to outperform.And, when you think about what really matters,isnt conversion of a sales prospect into a Nopaying customer what it is really all aboutversus a lower cost per minute? Y es ~ Errol Davis Senior Associate; Contact Center Outsourcing & Consulting Errol Davis & Associates Social MediaSocial Media For agents who provide solutions with a heavy accent (regardless of the language) customerIf your decision to offshore is purely financial, satisfaction surveys rate them the same asthen it makes sense if the service is the same… those without an accent.… but if empowering the offshore agent isnt When a solution is not provided, those with anfeasible, your overall operating costs may accent receive lower customer satisfactionnegate any labor savings. scores, often with a reference to language skills. ~ Tom Buiel Enterprise Sales Manager Cicero Inc ~ Ronnie Jones Senior Manager Customer Service GSI Commerce
  19. 19. In-hous e vs . 3 rd P arty P rovider Do es y o u r c o mpa n y h a v e100% e n o u g h f a c i l i ti e s to j u s t80% tu r n o f f th e ta p a n d b r i n g60% th e n e e d e d n u m b e r o f j o b s40% ba c k ?20% 0% Company Call Third Party North Americ a vs . E ls ewhere Center Service Provider No 100% 80% Y es 60% 40% 20% 0%Social Media Outside North AmericaAccording to ComputerWorld: North AmericaGovernor of the US State of Ohio, TedStrickland has recently issued an order Noprohibiting state agencies from hiring anycompany that sends Call Center work overseas. Y esThe order to the state agencies says that thepurchase of offshore services "hasunacceptable business consequences." Theorder further added: "There are pervasive Social Mediaservice delivery problems with offshore From an operational perspective, I do notproviders, including caller dissatisfaction with believe you can have support centers coveringthe quality of their services and with the fact widely different time zones (i.e. with more thanthat the services are being provided offshore to 6 hours difference).begin with." It obviously works right now but on the long ~ David Filwood Principal Consultant, term and in certain industries I don’t think it is TeleSoft Systems sustainable and many companies are now trying to rethink their global sourcing strategy taking this into account. ~ David Perrault Senior Technical Support Manager EMC
  20. 20. In-hous e vs . 3 rd P arty P rovider D o e s th e q u e s ti o n o f o f f -100% s h o r i n g /r e p a tr i a ti o n80% d e p e n d o n th e d i f f e r e n c e s60% in F ina nc ia l S er vic es ,40% H uma n R es ou rc es or20% I n f o r m a ti o n T e c h n o l o g y ? 0% Company Call Third Party North Americ a vs . E ls ewhere Center Service Provider No 100% 80% Y es 60% 40% 20% 0% Social Media Outside North America Here at HR Access, we have domestic Services North America Centers for Payroll but all the back office is off shored. No I think that for business areas that are "National" sensitive, the quality will suffer of Y es Offshore services center. The fact is if the agent is not sensitive to the culture of the country, it is harder to have a good answer. ~ Philippe Guinaud Global Product Manager HR Access Solutions
  21. 21. In-hous e vs . 3 rd P arty P rovider I s l e g i s l a ti o n i n c e n ti v i z i n g100% r e p a tr i a ti o n o f C a l l C e n te r80% j o b s b y ta x i n g a l l o f f s h o r e60% C a l l C e n te r c a l l s a t $ 0 . 2 540% per c a ll r equ ir ed?20% 0% North Americ a vs . E ls ewhere Company Third Party Call Center Service Provider No 100% 80% Y es 60% 40% 20% 0% Social Media Outside North America The trend to legislate the repatriation of Call North America Center jobs is growing in the UK/Euro Zone/Australia/New Zealand as well. No In the past two years a few of the companies Y es that have moved offshore Call Centers OnShore/NearShore cut across all product lines and include Delta Airlines, United Airlines, AT&T, Dell,, Expedia and HP. Opting to ‘come home’ for their Call Center employees is making sense for more companies seeking to enhance their Service Levels & Brand Reputation while delivering a higher degree of overall Customer Satisfaction. ~ David Filwood Principal Consultant, TeleSoft Systems
  22. 22. In-hous e vs . 3 rd P arty P rovider I s i t p a s t ti m e to b r i n g th e100% pr in c iples o f " F a ir T r a de"80% i n to a d i s c u s s i o n a b o u t60% C a l l C e n te r r e p a tr i a ti o n s ?40% North Americ a vs . E ls ewhere20% 0% 100% Company Call Third Party 80% Center Service Provider 60% No 7% 40% Y es 20% 0% Outside North America North America Social Media No We cannot overlook the centers who, getting business from organizations who have Y es outsourced their operations (to India), adapt their accent, work style, work timings, holidays according to the country whom they are providing service to. Social Media Associates/ team leads/ managers don’t get Its past time to bring the principles of “Fair even on biggest festivals off in India; however Trade” into a discussion about Call Centers they get US/UK festivals like thanks giving, Independence and labors day. “Fair Trade” is based on ideas of human rights & economic justice. “Fair Trade” is about Centers have adapted themselves to a great improving the social & ethical well-being of extent in order to provide services to another people in both developing & developed nations. country. It is about the Pursuit of Happiness rather than ~Vivek Sahni Director at Jacaranda Call just the pursuit of wealth. And the Pursuit of Center Private Ltd Happiness has always been about improving social relationships among people ~ David Filwood Principal Consultant, TeleSoft Systems
  23. 23. About the Author:Daniel G Willis is Business Development Manager - Marketing for Transcom WorldWide (North America)Inc., where he publishes industry documents, webinars and newsletters for over 20,000 readers.About Transom:Transcom is a global outsourced service provider entirely focused on customers, the service theyexperience and the revenue they generate.Our customer and credit management services are designed to strengthen our clients’ customerrelationships and secure their revenue streams.Our broad service portfolio supports every stage of the customer lifecycle, from acquisition, through service,retention, cross and up sell, then on through early and contingent collections to legal recovery. Expert atmanaging both customers and debt, we make a positive contribution to our clients’ profitability by helpingthem win customers, grow business and secure their payments.And, while our services are designed to maximize revenue, our delivery operations are built to driveefficiency. Through our global network we can provide service in any country where our clients havecustomers, accessing the most appropriate skills and deploying the best communication channels in themost cost-effective locations.Every day we handle over 600,000 customer contacts in 33 languages for more than 350 clients, includingbrand leaders in some of today’s most challenging and competitive industry sectors. The experience wegain is used to constantly refine our service portfolio and processes and delivery, allowing us to respondquickly to changing market conditions and client requirements.Thanks:Informing our survey and polls werecomments made by some of thehundreds of experts we reached outto in advance. Their insights andcomments added a depth of inquirythat would not have been possibleotherwise and for that I thank them.Special thanks to David FilwoodPrincipal Consultant, TeleSoftSystems in Vancouver, Canada.David’s contributions in the manypublic discussions around theOffshore Phenomenon helped sparkthe lively debate reflected in thesepages. TeleSoft Systems is thePublisher of the SPAS Call CenterAgent Pre-Employment