Q. Which areas of outsourcing do you focus on and why?
A. Convergys is focused on providing relationship management services, so we help clients maximise the relationship with their customers as well as employees. If you break that down, our customer care business is focused on CRM and HR or employee outsourcing and our information management business focuses on providing telecoms billing solutions.
As the market evolves and as competition becomes more intense and product cycles shorter, companies are challenged with maintaining superior customer experience and need to balance that with costs. In order to provide a superior customer experience you need certain capabilities that companies sometimes find hard to either develop or practice efficiently.
Q. Most of your customers come from the US, but are you looking to expand further into other geographies, particularly in light of the current US (and UK) economic situation?
A. Our view is that the customer care market is globally worth about $300bn and only $60bn of that has been outsourced and the outsourced segment seems to grow 12-15 % annually and it will continue that way over next five years. So we feel like we’re in a space that has enough greenfield opportunity. We also believe that an average in-house call centre only has about 150 seats, which means it doesn’t have the scale, capabilities or investment to start leveraging some of the benefits we can bring to the market.
So we believe that there’s plenty of bottled-up demand in the industry. The economy goes through these cycles, initially there may be a pause, but I think there’s going to be a resurgence of outsourcing.
We have 55,000 agents worldwide of which 20,000 are not in the US, so we do have a significant footprint in the US. About 500 are here in the UK. Being a global player means we can mix and match components of our solution in a way that meets customer preferences.
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About 85 % of revenue comes from the US and the rest is international: EMEA, Australia and Asia/Pacific. We’ve already established strong relationships with Global Fortune 500 companies and we’re looking to exploit those relationships and expand our portfolio in EMEA and elsewhere. We don’t actively measure it by country, but we have several important clients that we service in the UK in banking, telecoms and technology.
We want to go after global relationships. There’s only a handful of companies who can provide global focus, so the smaller players or the India-only players will struggle to provide those kinds of solutions to customers. We want to capitalise on that and that gives us a book of customers we are already doing business with in US and can provide those services to other parts of the world.
Q. Call centres still have a fairly rocky reputation among consumers. What tends to go wrong?
A. Companies get it wrong when they just lift and throw something over the fence and don’t create enough connection between the buyer of the service and the provider. The call or contact centre really has to experience the brand of the product it’s trying to service. They have to buy into the brand, so that when a customer calls, they are transmitting the same sentiment and positioning as people within the company. That is definitely a very common gap – call centres can come across as very aloof from rest of the company and the product they are trying to sell.
I also believe when customers move a service offshore it’s like taking a Buick and putting a Bentley engine inside the car. If you just drop it in it’s not going to work automatically, because it doesn’t work with the rest of the car. There are numerous examples where companies try to run operations offshore exactly the same way as they would run them here, but the workforce is different, the time zone is different, technology and processes are different. Customers and suppliers need to invest in proper transition process.
Q. Where are most of your call centre and other work based?
A. We’re very strong in the Philippines and India right now and we’re seeing strong demand for both offshore destinations. India has at least two million graduates entering market each year and a quarter of those graduates have acceptable English speaking skills. So if you look at skills and combine them with the heavy mathematical and process orientation that India brings to table, and I still think India is a very attractive proposition. We have also an established footprint in China, but I see for foreseeable future India and Philippines will be the mainstay of our English speaking services, while we see China for more technical support work and back-office work.
Q. How is the market, and customer demands, changing?
A. Customers are becoming increasingly demanding and want more innovation and value add. Five years ago just performing the service as given to you was deemed good service and now it doesn’t even get you to the dance. That’s a good thing, because customers are forcing suppliers to deliver more value and products and they are looking for providers to be more nimble. Rather than have monolithic long-term contracts, they are looking for more dynamism and put that in the contract, as well as more transparency.
On the supply side, companies will have to take the lead in bringing more value to the table. The era when just picking up the phone and answering the call used to be called service are gone; the question now is why was the call made or what are the drivers for initiating that query or complaint? How can I proactively avoid that call next time and while that customer was on the phone, how many other latent needs did I fulfil? Did we sell something back to the customer in order to strengthen the relationship with customer during the call? There are a host of techniques as well as technologies that are coming into play that to change the game completely in this space.
Q. What kind of techniques and technologies?
A. To provide a proactive, seamless customer experience, you need to know your customers and their pattern of behaviour over time. So it’s important to have analytics of customer behaviour and intimate knowledge of call types and customer segments.
How that information is deployed to agents at point of service is also very important. On the technology front, productivity technology, in other words, how do I make my agents more productive is critical. There are innovation techniques such as Six Sigma and process optimisation that can also make a difference. We ask our agents for ideas on how things could be done better or how we could deliver a better service to our clients, so that we’re not just doing the work clients ask us to do, but over time we start improving the process and making a better process and that’s a value-add for our customers.
