The document discusses how outsourcing technical support is often viewed as a commodity based on cost, but there are opportunities for outsourcers to differentiate and add value through optimization of processes, performance, and delivery. Focusing on outputs, processes, and inputs can help outsourcers engineer solutions that reduce total cost of ownership and enhance customer experience beyond basic people, process, and technology.

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Valuation & Optimization: Your
Customer’s Technical Support
Experience
Summary
Providing a positive customer experience inside
of efficient technical issue resolution is critical to
retaining customers and expanding market share.
Businesses that provide an exceptional product
set for their customers must endeavor to provide
a high level of technical support and customer
service to complete the customer experience.
November, 2012
Kurt Leiblich VP
Technical Services & Solutions, Aegis Communications
Group

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Introduction
Technical support is an integral piece of the customer experience mix.
Companies can leverage their customer experience as a differentiator,
and choose to outsource this specialized role. Outsourcing service
providers have for years continued to center value propositions on
people, process, and technology – but doing so is no longer enough.
There is a tendency for players in this market to consider technical support,
and specifically outsourced technical support, to be a commodity. Demand is
present but the services are perceived to be supplied without real qualitative
differentiation, so buyers are driven to a selection process primarily based on
hourly cost comparisons.
Why does this happen? Market operators initiate procurement or buying
cycles that typically start with RFP or RFI solicitations. Responses come back
from a multitude of potential vendors, those responses are reviewed,
questions are answered, facilities are toured, and each supplier always talks
about the same things. Each outsourcing partner has HR and recruiting teams
and mechanisms; all talk about training, knowledge transfer and
development, about operations, workforce management, reporting, program
management, IT and all of the other core delivery functions. After a while
everything can start to sound the same or very similar (even to experienced
market players) which ultimately contributes to a decision process focused on
hourly rates. Costs become king when everything else seems to be equal.
Everyone touts their people, process, and technology, which have become
table stakes, but each one of these components along with each
departmental function possesses a broad scale of variables. The combination
of these parameters is no longer enough. It is the architecture and solution
engineering alongside the respective delivery amplitude that produce the
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differentiators and value creators. Even if the structural or operating
components are the same or similar across outsourcers, there is an enormous
amount of qualitative differentiation within each function and what is done
with the reins of operational execution, delivery, and opportunity. A good
analogy comes from the investment world; like shorting a stock (betting on
and making money from a stock price falling), although gains are possible the
opportunity costs (losses) in the aggregate calculation of variable impact
across operating and delivery functions are essentially limitless. As a result,
the rate focused view and buying perspective can create a significant degree
of cost from both a monetary and a customer relationship / lifetime value or
revenue realization perspective. To add the highest value, outsourced
technical support solutions need to be specifically engineered with
consideration for and focus on three key elements:
• Output requirements that are centered on business level objectives,
KPI’s, metrics, and specific functional requirements
• Process components that make up the measurement and management
of program execution and delivery to include performance measurement
strategies, reporting, data availability and analytics and risk mitigation
strategies - considering risk to customers, the client, and total cost of
ownership
• Input requirements that directly correlate to the defined and variable
output parameters for the program, including: tactical skill sets and
qualifications, knowledge development and evaluation structures,
infrastructure and shoring, recruiting and compensation, etc.
Even outside of ownership and operating costs with respect to CSAT,
customer loyalty, or customer retention, let’s look at an example strictly from
a performance and operating cost perspective. If you are operating support
services domestically, have 5 million customers, a 10 minute AHT, and a 20%
contact rate, each 1% increase in first call resolution equates to a savings of
$50,000 per month. Then put that number into a respective technical support
delivery context based on recent information from the Aberdeen Group1 on
average there is up to a 22% FCR variance between Industry Laggards at the
bottom of the scale, the industry average, and best in class delivery with the
best in class FCR average at 87% - that means that if you are paying the same
hourly rate for each respective provider, a best in class supplier’s correlating
TCO (total cost of ownership) is going to be $1M less / month versus an
industry average performing vendor and $2.1M less / month versus an
industry laggard resulting in a $12-$25M spend variance within a $56M annual
budget, strictly from a direct cost perspective, and not including correlated
impacts, cost, and implicit fall out tied to customer relationship management
and revenue retention or augmentation. Commodities do not produce those
levels of variation, risk, and cost implications so it is important to look at
technical support and respective strategies in a way that appropriately takes
total cost and impact, both positive and negative, into consideration and
ultimately into buying decisions.
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Using the previously mentioned context, we can start to look at how Aegis
provides value to our clients and their customers: we don’t manufacture
consumer products or build out broadband or cellular networks; what we do,
and what we have done for the last three decades, is specialize in managing
and enhancing customer relationships across the customer lifecycle,
partnering to help our clients reduce cost, and achieve their business level
objectives. OEMs, and MSO clients looking for value add and innovation may
get stuck in systemic performance gaps when their outsourcing partners do
not have those capabilities built into their corporate or program level
operating structures.
As mentioned, people and companies in our industry, have for years
continued to center value propositions on people, process, and technology
– but doing so is no longer enough. What we look at is the larger scale
and range of an outsourced operation and the correlating quantification
and valuation of an existing or potential business partnership – there is of
course value in the labor and geographical arbitrage components that exist
within an outsourced operation. Reducing the cost of your labor, reducing
the requirement for CapEx, overhead, and infrastructure costs, and right
shoring those labor efforts all create value; these are baseline expectations
and should be used as a foundation for a larger contribution. Performance
will always be a key factor. There may still be some disbelievers in the
marketplace, but properly built and executed outsourcing solutions can and
often do produce metric and KPI performance results that are stronger than
their in-house, higher paid, counterparts. Furthermore, there are many other
pillars within a TCO and quantified value analysis that deliver and create
opportunities for added value. Some of the things we look to are:
1. The capability and expertise to deliver closer to core services i.e. those
processes downstream and adjacent to Tier 1 and 2 technical support
or others within the client support lifecycle, that open opportunities to
outsource and optimize other respective customer lifecycle touch-points.
2. Leveraging our understanding of business processes, which is of course
a core function of what we do, and leveraging that expertise to help
our clients streamline operations, reduce redundancy and re-work, and
remove inaccuracy from adjacent and parallel business processes and
departmental functions.
3. Providing skilled resources across program operations and support
functions that enable our clients to right size their operational efforts in
respective departments – not only within professional services functions
such as IT, but in core customer servicing responsibilities such as
training, project management, reporting and analytics, forecasting, and
staffing.
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4. Leveraging industry best practices, best-in-class management process,
cutting edge technology along with a multi-vertical global experience
set creates a unique perspective for us to work from within our client
partnerships and helps us find new ways to increase efficiency, enhance
performance output, increase effectiveness, reduce cost, leverage
technology, and infuse innovation.
5. The leverage of a COPC® based quality process that moves far beyond
a checklist of call attributes and identifies and measures respective
impact to our client’s business, each customer interaction, and
process accuracy or adherence. This collectively enables us to elevate
performance and metric attainment while providing relevant and useful
business intelligence back to our clients. We are using the call center as
a listening post to provide insight to the client as to what their customers
are saying and experiencing.
Technology Integration, Channel
Optimization, & Automation
Enhance
Capability
Process, Performance, &
Delivery Optimization
Improve Optimize Contact & Resolution Rates,
Performance Remove re-work, duplication, inaccuracy
Right Size Support Organization /
Enterprise (Resources,
Functions, Facilities)
Remove
Cost
Outsource Non-Core Functions
This perspective along with our experience, expertise, and entrepreneurial
approach to client engagement is how we look to identify and enhance
value in each one of our client partnerships.
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Conclusion
Improved process performance, delivery optimization, and best practices are
keys to extracting value from outsourced technical support operations and
enhancing relationships with your customers. Selecting an outsourcing
partner with skill and expertise to do so is core to the critical nature of
mitigating against execution and delivery risk and impact variables, while
migrating your tech support operations from a cost arbitrage play to one
centered on long-term value creation and positive impact to the top and
bottom line performance of your organization.
About the Author
Kurt Leiblich
Kurt Leiblich, VP Technical Services & Solutions: Kurt is responsible for the
structuring and engineering of Technical Support solutions for technology and
telecom sector based Clients. He brings more than 12 years of experience
across multiple leadership and management functions within the BPO
industry. Prior to joining Aegis, Kurt was the Executive Director of Solutions at
Aditya Birla Minacs where he lead global solution development with a
specialized focus on the technology and telecommunication sectors and
served as the Head of product development for high-tech, telecom, and
manufacturing service products. Previously Kurt ran site Operations for
Minacs across 2 multi-national contact centers supporting technical CLM
services, and over the prior 7 years Kurt served in several senior Operations
and Account Management functions at Convergys supporting large scale
technical programs within Fortune 100 Client accounts. Kurt is a seasoned
BPO professional with an extensive range of experience and expertise within
a track record of achievement and demonstrated success managing large
scale contact center operations, driving exceptional P&L performance,
leading multi-national account management operations for Fortune 100
Clients, and delivering significant proficiency within the construction and
management of strategic business solutions across multiple verticals.
1. (The Contact Center in a Profit Centric Service Organization – Shoring Up
the Foundation of Service Delivery, May 2011)
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About Aegis
Aegis is a global consulting, technology, outsourcing and training & education
company committed to impacting clients’ business outcomes by focusing on
enhancing customer experience across all touch points and channels. Aegis
was founded 30 years ago in the US and now has operations in 56 locations
across 13 countries with more than 55,000 employees. Aegis services over
300 clients from verticals such as Banking, Financial Services & Insurance,
Technology, Telecom, Healthcare, Travel & Hospitality, Consumer Goods,
Retail and Energy & Utilities. The company is wholly owned by the Essar
Group, a USD 27 billion conglomerate.
For more information, write to us at info@aegisglobal.com or visit
www.aegisglobal.com
Global Footprint
UK:
> Manchester
US:
> Irving, TX (2)
> Killeen, TX
> Port St. Lucie, FL
> Fairmont, WV
Philippines:
> Joplin, MO
> Baguio
> Sierra Vista, AZ Costa Rica: UAE: > Cebu (2)
> New York, NY > San Jose > Dubai > Manila (3)
> Los Angeles, CA
Saudi Arabia:
Sri Lanka:
> Riyadh
> Colombo
Peru: > Jeddah
> Lima India:
> Noida
> Gurgaon
> Lucknow (2)
> Hyderabad
> Bengaluru (2)
South Africa: > Hazira
> Johannesburg (2) > Ahmedabad
Argentina:
> Durban > Pune
> Tucuman Australia:
> Cordoba > Mumbai > Melbourne (3) New Zealand:
> Bahia Blanca > Kolkata (2) > Sydney > Auckland
> Mar del Plata > Jamshedpur
Global Headquarters > Buenos Aires City (2) > Bhopal
> Gandhinagar
> Srinagar
> Chennai
> Vijaywada
> Chhindwara
Version 1 / Nov ’12
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