Insurance carriers are not shy about proclaiming their talents. They know what they do well and they don't mind telling you about it. On the opposite end are the areas in which the carriers have, shall we say, slightly less confidence-the ones they are eagerly trying to get out from under. And if there's one area that insurers rarely brag about, it's their call centers.
Some companies may have a good call center crew, but the success of such an operation is often tenuous. Turnover can turn a good crew upside down at a moment's notice. It's hard to ask for loyalty in today's business climate when a function like customer service seems a hair's breadth away from being outsourced.
There, we've said it: outsourced. It can be an answer to your company's biggest problems or it can be a nightmare. What determines which side it falls on is the work that goes into selecting the right outsourcer and the ability to communicate with that segment of your operation. Too many businesses have seen their outsourcing efforts fail because of the Cool Hand Luke Syndrome-a failure to communicate.
Plenty of Expectations
Many companies don't worry about the IT department connecting with the call center because nowadays the IT department itself is outsourced as often. With insurers wisely believing their core competencies are in the traditional insurance fields (underwriting, policy administration, claims, etc.), it's easy to believe that less insurance-traditional departments are being shopped around.
Donna St. John, technology business development manager for Deloitte and Touche, tells companies interested in outsourcing to take a close look in the mirror before taking any steps. When a company knows what it does best (and what it doesn't do well) it can then make the critical decisions needed to achieve success in the market.
Often that means outsourcing. “Actually, for many companies IT is one of the first things they want to get rid of,” St. John said. “It is the most expensive part of the company and the hardest to keep people.” Call centers are not as expensive to operate as an IT department, but they share a similar problem: turnover.
Companies have different expectations when outsourcing their call centers. Some want to be able to tap into every facet of what the center is doing. Others are less concerned, wanting only monthly activity reports. The use of call centers has become so common that trust is not really an issue.
“When customers are talking to your call center they don't know if the employee works for you or someone else,” St. John said.
When researching the outsourcing option, a mistake that companies often make is not being honest with their employees. Many companies are fearful that once word gets out that it wants to outsource a department, the employees will flee like rats. St. John said that call center reps are often vagabonds, not worrying about a long-term relationship. There is always another telephone to dial or e-mail to send.
St. John reminds companies that there may be a few call center employees they wants to retain. “You may have people leaving that you don't want to lose,” she said. “You should at least inform them before the word gets out.”
Plenty of Opportunities
The advantage that often comes with outsourcing is an upgrade of the technology. Companies choosing to outsource often base the decision on how much the new technology will cost them to retain the center. “Ninety percent of the time you are upgrading your current software package,” St. John said. “During this time you are still getting calls at your old center, but you are slowly phasing it out. It can go anywhere from two weeks to a year.”
The bigger problem involves connecting the call center's software to the carrier. The Internet is obviously not secure enough, and not everyone has access to a T1 line. “If you can afford a little downtime, you can afford to use the Internet,” St. John said. “It's less expensive and the call center probably has a connection.”
Installing a T1 or DS-1 line-a dedicated high-speed digital connection-is more costly (although prices are steadily falling, according to St. John), but it offers a direct link that keeps communication open 24/7.
Desktop support is a major issue as well. St. John said that those operating off a local area network “don't usually work as well” because switches and hubs are harder to support in a remote location. A wide area network, based on routers, is easier to support and expand as necessary.
Karen Leland, a co-founder of Sterling Consulting Group and co-author of Online Customer Service for Dummies, said care is an important factor in selecting the right outsourcer. “They are representing your business,” she said. “The customer doesn't know or care that the person they are talking to works for an outsourcer. You have to make sure the vendor has the same kinds of values and standards of service as your company has.”
Plenty of Questions
The service provided to the call center by the IT department will have a great impact on the success of an outsourcing arrangement. “The worst thing that can happen is having IT in a vacuum and the outsourcer is one step removed,” Leland said. “You have to have a company that will allow you to work with their call center people. This should all be explained in the screening of companies. Are they easy to work with on this issue?”
She believes it is imperative that working relationships between the outsourcer and other clients be investigated. “You have to determine the level of partnership,” she said. “How willing will they be to customize the needs of their clients?”
Companies have to evaluate their own business practices as well. “What are the policies and procedures that have to be followed?” she asked. “Are you committed at the top to the outsourcer? What hardware will be employed?”
The IT department's job is to ask many of those questions. Leland said the two sides have to establish training and education levels for the call reps. “There have to be standards in place,” she said. “You have to be able to track results.” Tracking those results when the system is kept in-house means more time, effort, and management. “Companies find that it is easier to sub it out when they don't have that management capability,” Leland said.
But she is not sure what direction the outsourcing field will go in the coming months. What she offers is a series of questions that need to be answered if the call center and the IT department are going to be able to live together:
- Is the company outsourcing to avoid an expense or because the job can be done better by the outsourcer?
- What is the purpose of the decision? Will it be to answer all calls? Overruns? Technical calls?
- What are the levels of service needed between the outsourcer and the IT department?
- Is the carrier willing to review reports to see what it can learn from the outsourcer?
- Is the outsourcer conveniently located?
- Is the vendor experienced in your field?
The answers to these questions will determine the correct steps for your company. Sending any business function to an outside vendor can be traumatic. It can be even more difficult for a CEO when the realization hits that the call center rep, working for some outside vendor, is the person charged with the important job of keeping his customers happy.
But the trauma can be reduced if you know that the right equipment is in place to provide these strangers with the data needed to make the call center reps sound like they wrote the company's annual report. That job belongs to IT.
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