CRM outsourcers need to follow Branson’s advice on telecommuting

Peter Ryan, Lead Analyst, IT Services

Regardless of the sector in question, home-based working has always aroused emotions among executives. The recent comments made by Yahoo CEO Marissa Mayer and New York Mayor Michael Bloomberg against home working have further inflamed this debate, but Ovum feels that contact center services players would be wise to heed the remarks of Virgin founder Sir Richard Branson, which were well thought out and very much in favour of working from home.

To date, this business model has been classified as “niche” in the CRM space, but all evidence suggests that it remains on an upward trajectory, and those players that have not availed themselves of credible home-agent offerings may miss the proverbial boat.

Branson’s assessment reflects the home-agent experience to date

We are very much in agreement with Branson’s recent blog comments, in which he stated that allowing workers the flexibility to choose their workplace and hours promotes a content workforce.

From the standpoint of contact center services, having a happy and motivated workforce is essential, given the ever-increasing levels of support that are being demanded by end users across vertical markets.

More than ever, optimizing customer service is seen as a prerequisite to stopping end-user churn, which has been a major sore point for enterprises seeking to hold as much market share as possible since the outset of the global financial crisis. According to our research among vendors providing home-agent outsourcing (and their enterprise clients), the virtualized model has been able to deliver these results (see Ovum’s latest study on this market, Profiting from Home Agents in CRM Outsourcing).

The benefits are also clear from a financial position, as the home-based model provides cost savings for vendors and their clients due to reduced expenses relating to managing a contact center facility and much lower levels of attrition (because of a motivated, happy workforce).

Vendors need to balance telecommuting interest with compliance

While Branson’s comments ring true from our perspective on the home-agent market, outsourcers need to realize that it is not as simple as letting contact center agents have complete control over when and where they work.

There are significant compliance demands from enterprises across industries (some more stringent than others, especially in the case of healthcare and financial services), making it essential that vendors balance the benefits of working flexible hours from a remote location with scheduling mechanisms and an isolated home-based office that is equipped to minimize distractions and the opportunity for fraudulent behaviour.

Not having these prerequisites in place will severely limit any outsourcer’s long-term prospects in this space.

CRM outsourcers without home agents are limiting their horizons

The home-based agent outsourcing market took a competitive turn last summer when global vendor Sykes completed the purchase of leading pure-play home-agent provider Alpine Access. This was the first consolidating move in the virtualized CRM outsourcing space, and one that has arguably put pressure on other facilities-based operators that want to make more of a dent in this market (which we forecast will double in size between 2011 and 2015).

While most of these traditionally operated outsourcers claim to provide a home-based service, they will need to make acquisitions in order to truly make their presence felt, and acquiring one of the remaining pure-play operations is the least painful way to gain scale, mindshare, and a book of established business.

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