By Stephen Pickett
Twenty years ago there was a huge rise in companies offshoring operations to countries including India and the Philippines. Between 1994 and 2004 offshoring increased by 35 per cent in the manufacturing industry and almost 48 per cent in the professional services. It was a popular choice for companies looking to increase profitability and improve efficiency in a cost effective way.
However, offshoring services have been the subject of much debate in recent years and polarised opinion amongst businesses, service users and the public. Computer Weekly recently reported on IBM staff reductions as a sign of a shift in the outsourcing sector and the ‘diminishing importance of low-cost operatives’.
The provision of customer service support through offshoring partners has contributed significantly to negative opinion of the practice, as customers have experienced frustration when trying to speak to ‘local’ support only to be faced with disconnected operatives and challenging language barriers.
Companies including BT, Santander, RBS and Lloyds have responded to this dissatisfaction by overhauling their existing set ups to improve their customer service. In 2014, Britain’s largest mobile phone company, EE, announced it was moving 1,000 call centre jobs back to the UK after receiving concerning reports that some users were forced to call staff in India and the Philippines seven or eight times to get problems solved.
But offshoring is not necessarily a dirty word if it’s the right sort of service that’s relocated. As EE has learnt, telephone customer contact should in the majority of cases be local so that the people on the end of a telephone line are engaged, aware and able to assist with complex enquiries. But teams of developers and coders for example can prove invaluable for efficiency and cost saving if sourced from areas and countries where skill levels and availability are high. And there is evidence to prove it – a recent University of Nottingham (UoN) report shows offshoring is associated with productivity improvements and increased exports.
What this can also mean for UK businesses front-ending the customer contact experience is that there is greater budget and focus on up-skilling staff when it comes to building and managing customer relations. For instance, figures show that between 1994 and 2004 offshoring created 100,000 extra jobs in Britain, giving companies more UK based resource to meet customer demand.
Put simply, offshoring for many more businesses is becoming an area for exploration and collaborative partnerships. The 21st century business has to be continually aware of ways in which to be innovative and efficient, to ensure competitive advantage and retain existing customers.