2013 Peruvian Customer Value Enhancement Award

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2013 Peruvian Customer Value Enhancement Award

  1. 1. Customer Value Enhancement Award Assessment: Peruvian Contact Center Outsourcing Market Martin Ramirez
  2. 2. 2 Customer Value Enhancement Award Assessment TABLE OF CONTENTS SIGNIFICANCE OF THE CUSTOMER VALUE ENHANCEMENT AWARD ....................................3 Key Industry Challenges Addressed by Enhancing Customer Value..............................3 Contact Center Outsourcing Services Revenue Forecast ..............................................4 Percent Sales Breakdown Contact Center Service Outsourcing Market…………………… 4 KEY PERFORMANCE DRIVERS FOR HDC................................................................................5 CONCLUSION .......................................................................................................................9
  3. 3. 3 SIGNIFICANCE OF THE CUSTOMER VALUE ENHANCEMENT AWARD Key Industry Challenges Addressed by Enhancing Customer Value The Peruvian contact center outsourcing market has developed greatly over the last two years. Internal and external factors have facilitated this growth. A neutral Spanish accent, one of the most cost-competitive resources in South America and a continuous economic evolution of the country over the last five years, with low inflation, which increased consumer incomes, have been the key attributes behind this development. Nevertheless, 2012 has proved to set the bar higher than ever. The Peruvian outsourcing market has been historically divided into multinational and local companies, each with their own market presence. Multinationals were mostly focused in external revenues, in which Peru have one of the highest portion of the region. A vast portion of this offshore revenue originates in Hispanic businesses, mostly in Spain and Latin America near shore. Spain is experiencing an unprecedented financial crisis and as a consequence business demand from this major country is shrinking. As a result, now multinational outsourcing companies have started to service the domestic market to compensate for this fall, which is currently impacting the pricing and competitiveness of the entire outsourcing industry. For this type of companies cost is amortized as large centers can potentially afford lower margins in return from occupied locations. Lack of human capital proficiency is another challenge of this market. Peruvian contact center companies have experienced difficulties in recruiting professional resources, as well as a fluent English-speaking workforce. The market tendency has been to consider this country as a service commodity provider, with low revenue margins. Outsourcing visionaries are working on shifting this mentality and being able to provide high-quality complex services such as financial and technology support. Lastly, it has been noted that although the level of coordination between the government and private sectors intensified over the last years, when compared to other countries in the region such as Colombia it is still necessary to implement stronger incentives to expand current investments. Measures could include enlarging the tax-free zone (there is only one at the moment, and distant from any urban locations), avoiding sales taxes, and offering education oriented to the service sector, especially considering that the business process outsourcing (BPO) industry drives employment for a large portion of the young population. “2012 has proved to set the bar higher than ever... Now multinational outsourcing companies have started to service the domestic market to compensate for this fall, which is currently impacting the pricing and competitiveness of the entire outsourcing industry.”
  4. 4. 4 Customer Value Enhancement Award Assessment 0.0 5.0 10.0 15.0 20.0 25.0 280.0 290.0 300.0 310.0 320.0 330.0 340.0 350.0 360.0 370.0 2011 2012 Revenue 310.6 364.5 Growth Rate 21.9 17.4 GrowthRate% Revenue($Million) Contact Center Outsourcing Services Market Revenue Forecast Peru, 2011–2012
  5. 5. 5 KEY PERFORMANCE DRIVERS FOR HDC Pursuing Excellence in Recruiting and Training its Human Capital HDC has positioned itself as a company that does not provide basic services. In order for it to be considered excellent by the customers it needs to rely on an intelligent, diligent, and highly skilled staff. HDC achieves this knowledge and expertise through singular recruiting and training programs. When hiring new members, the company requires that they have at least a secondary-level education at a minimum. However, it is the training program that exceeds the average level, as it displays two different processes. One is an internal training, conducted by qualified coaches who have experienced real-life situations and share their knowledge with trainees. The other process is delivered by a third-party provider, powered by a regional training consulting company, Teleaccion, which brings to HDC almost 15 years of experience of training more than 23,500 people. When Teleaccion courses are completed, all trainees are certified in this methodology for which they are required to undergo an evaluation test. One of the main concepts in the Teleaccion training is the “brain dominance assessment” in which employees are trained to categorize all customer personalities under one of the four brain quadrants and assign a color for it: red for emotional personalities, blue for rational personalities, yellow for innovative personalities, and white for insecure personalities. Employees are instructed to handle their contacts differently and take different actions based on this classification. Focus on Constant Innovation In HDC innovation is not just a word, but a living principle. The company believes that in order to provide enhanced value to its customers and make a significant difference it needs to create solutions that address the unmet needs. “One of the main concepts in the Teleaccion training is the “brain dominance assessment” in which employees are trained to categorize all customer personalities under one of the four brain quadrants and assign a color for it.”
  6. 6. 6 Customer Value Enhancement Award Assessment In that path, its post-sale service is extremely valuable. For telecommunications its state- of-the-art order-tracking system is designed to monitor the sale at all levels; service representatives assist the customer during the sale itself and in guiding customers about how to use a new device and understand its basic functions, the support usually ends up in a face-to-face interaction. Finally, the sale is considered as closed only when the customers confirm that they have received the device, used it, and are satisfied with it. Another innovative idea that HDC implemented is the creation of the business intelligence team (BI). The company believes that information is a vital element to improve relationship with its collection contacts. The BI team is accountable for analyzing data from customers and educates the supervisors and operators with unnoticed insights about location, best contact frequency, and best contact channel for callers. In this way, it assures an effective and positive rapport with clients. Moreover, this team works together with the planning team in accurate and effective forecasting and staffing of the operation. Personnel motivation and Retention Activities As part of its human proficiency requirements to fulfill its promise to deliver excellence, HDC is a pioneer in developing activities that increase employee morale and retain talent. Two main programs have launched recently in this direction: “Crecer” and “Exprésate.” “Crecer” is a career development plan hosted by an internal tool resembling social media that contains all job offers, CVs, and opportunities, while “Exprésate” is a counseling direct line to receive feedback from employees at all levels. An additional initiative to keep the staff motivated and avoid attrition is that all supervisors, managers, and directors have a bonus associated with the retention levels of their team; therefore individual goals of supervisors are aligned with company goals. Under these plans, HDC performance on key operational indicators such as the retention level has been outstanding, showing 96 percent, while the Peruvian market average is close to 91 percent. “HDC is a pioneer in developing activities that increase employee morale and retain talent. Two main programs have launched recently in this direction: “Crecer” and “Exprésate”.”
  7. 7. 7 “Teletrabajo”: Leveraging Work from Home Platform Effective October 2012, HDC has started “Teletrabajo” operations, which enables some operators to work from their home, not based on temporary circumstances but permanently. The advantage of it is that there is no location cost or transportation requirement under this platform. This is a new opportunity for the entire domestic Peruvian market as it occurs in other regional countries such as Argentina, Colombia, or Brazil. The fact that HDC is the only local service outsourcer with representatives working from their homes shows how this company is willing to be the vanguard of the industry. CONCLUSION HDC is a company that makes significant and measurable progress at a considerable pace in the Peruvian contact center outsourcing market. This progress is the result of a premeditated, well-calculated strategy that resides in an ambitious and creative mentality. Being always one step ahead of local competitors in finding solutions as a customized business intelligence team, a third-party training certification program and face-to-face post-sale services are value-added actions that clients know how to reward. More opportunities will come if this client-oriented approach continues. In a country considered to be a commodities provider, HDC distinguishes itself and shows the rest the way to earn more profits out of the same interactions. “This progress is the result of a premeditated, well- calculated strategy that resides in an ambitious and creative mentality.”
  8. 8. 8 Customer Value Enhancement Award Assessment The CEO 360-Degree PerspectiveTM - Visionary Platform for Growth Strategies The CEO 360-Degree Perspective™ model provides a clear illustration of the complex business universe in which CEOs and their management teams live today. It represents the foundation of Frost & Sullivan's global research organization and provides the basis on which companies can gain a visionary and strategic understanding of the market. The CEO 360-Degree Perspective™ is also a “must-have” requirement for the identification and analysis of best-practice performance by industry leaders. The CEO 360-Degree Perspective™ model enables our clients to gain a comprehensive, action-oriented understanding of market evolution and its implications for their companies’ growth strategies. As illustrated in Chart 5 below, the following six-step process outlines how our researchers and consultants embed the CEO 360-Degree Perspective™ into their analyses and recommendations. Chart 2: How the CEO's 360-Degree Perspective™ Model Directs Our Research “The CEO 360-Degree Perspective™ model provides a clear illustration of the complex business universe in which CEOs and their management teams live today.”
  9. 9. 9 Critical Importance of TEAM Research Frost & Sullivan’s TEAM Research methodology represents the analytical rigor of our research process. It offers a 360-degree view of industry challenges, trends, and issues by integrating all seven of Frost & Sullivan's research methodologies. Our experience has shown over the years that companies too often make important growth decisions based on a narrow understanding of their environment, leading to errors of both omission and commission. Frost & Sullivan contends that successful growth strategies are founded on a thorough understanding of market, technical, economic, financial, customer, best practices, and demographic analyses. In that vein, the letters T, E, A and M reflect our core technical, economic, applied (financial and best practices) and market analyses. The integration of these research disciplines into the TEAM Research methodology provides an evaluation platform for benchmarking industry players and for creating high-potential growth strategies for our clients. Chart 3: Benchmarking Performance with TEAM Research About Frost & Sullivan Frost & Sullivan, the Growth Partnership Company, enables clients to accelerate growth and achieve best-in-class positions in growth, innovation and leadership. The company's Growth Partnership Service provides the CEO and the CEO's Growth Team with disciplined research and best-practice models to drive the generation, evaluation and implementation of powerful growth strategies. Frost & Sullivan leverages 50 years of experience in partnering with Global 1000 companies, emerging businesses and the investment community from more than 40 offices on six continents. To join our Growth Partnership, please visit http://www.frost.com. “Frost & Sullivan’s TEAM Research methodology represents the analytical rigor of our research process.”
  10. 10. 10 Customer Value Enhancement Award Assessment Juan Manuel González Research Manager Frost & Sullivan Argentina Source: Interview El Comercio / Sección Economía Date April 4, 2013 Carla Segura Suarez General Director HDC BPO Services Source: www.americasistemas.com.pe “At the moment the majority of companies in the sector in Peru is focused on contact center services and not so much on value added services. There are exceptions to this , some companies have started to increase their solution portfolio. For example HDC has been recognized with and international award for innovating in the collection service.” “We have had a very significant growth, supported on advanced technology. Additionally we have created a team of business intelligence, because we know information is vital to run an operation efficiently. Our business intelligence team is not only responsible for obtaining internal KPOs for a proper operation, but also for delivering our clients valuable information that allows them to make decisions in multiple fields and this is also part of the value added services we offer.” HDC AWARD IN THE NEWS

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