Besides being an economic proposition, outsourcing should add value to the customer through quality performance and enhanced brand experience. Does this happen?
Since call centre operations have become synonymous with outsourcing, discussions centre on this narrow interpretation. Stereotyped responses, rigid approaches and deficient skills are more glaring at call centres and hence we start believing that flawed process design and lack of empowerment at the grass roots level bring about customer ire. However, to draw the right conclusions, we must understand outsourcing more comprehensively.
At the premium end of outsourcing, the slightest transgression can impair the image of the principal substantially or even embroil them in criminal negligence. Franchises for top end hotels and contract manufacturing of drugs and pharmaceuticals fall in this category. Here, typically auditors from principals land unannounced, observe discreetly and submit the tally of violations to franchisees. Variations beyond permissible limits can result in termination of agreements. Throw in the risk of being arraigned by drug controllers and health officials and it surprises none that instances of quality dilution tend to be lesser.
At the next level, customer expectation is met through penalty-controlled outsourcing. Time limits for pizza deliveries, uptime guarantees by IT service providers, error rates at high-end BPO operations and parts per million in contract manufacture fall in this category. Here again, due to the pain of penalties, there is an attempt to adhere to basic quality levels. Still further, at a third level, as in the case of automobile outlets, franchisees can deliver quality service through a package of financial incentives, training and mandatory customer feedback.
Proactive actions by the outsourced partner, such as investment in high quality personnel, infrastructure and good corporate governance can engender positive relationships. Cash-rich entities such as those in the software outsourcing space can and do adopt this route.
It is at low-end outsourced operations such as telecom billing, white goods maintenance and logistics that we start encountering customer dissatisfaction in myriad ways. Infirmities such as lack of time discipline, fuzzy communications, shoddy workmanship, mixed up deliveries, wayward billing and abrasive behaviour show up significantly.
The author is a corporate executive. Views are personal