Outsourcing Myths
By Charise StevensMarketing Director, Shieff Services Inc.
August 19, 2011
Outsourcing has gained a bad reputation over the past decade due to misconceptions. Perceptions of outsourcing often embrace that only large companies outsource decreasing flexibility, control, quality. Many people consider outsourcing as a resource utilized only during financial distress. However small businesses to corporations use outsourcing as a competitive advantage and growth.
1) Only big companies outsource
Outsourcing is not limited by an organization's size but is often determined by the business model. For instance, a complex business model consists of many strategic and tactical levels. This system often delays decision making and reduces flexibility. The complex business model can utilize outsourcing for a specific task or purpose. A simple business model integrates multiple strategic and tactical functions allowing quick decisions and responses. The simple business model commonly uses outsourcing for multiple purposes such as administrative tasks, customer service and fulfillment. Depending on your business model, outsourcing can expand a single or multiple functions and purposes.
2) Lacks flexibility and control
Outsourcing increases flexibility by allowing scalability to meet fluctuating demand. Thus when your company promotes or launches, additional agents are quickly added to serve your customers at same service level. Control is especially critical to business leaders. Outsourcing center's daily summaries allow business leaders to monitor and control activities.
3) Loses quality
Quality is an important factor which must be improved and maintained to build customer relationships. Without quality service, customer loyalty decreases which causes your company financial losses. Measuring quality is implemented through monitoring chats, emails, live and recorded calls. The quality of an agent’s social and technical skill are observed and developed through training. Continuous agent performance feedback helps build quality and customer service.
4) Use only when facing financial problems
Outsourcing should not only be used when economically strained but when you desire to expand. Building a business provides many great opportunities but the costs and risks are high. Employee salary, benefits, taxes and equipment costs are expenses every company must understand. In March 2010, the Bureau of Labor Statistics revealed employee compensation averaged $29.71 per hour. Wages and salaries averaged $20.67 per hour which consisted for 69.6% of compensation costs. Benefits averaged $9.04 and accounted for the remaining 30.4%. (" Employer Costs for Employee Compensation news release text") Equipment costs will quickly reach to many thousands of dollars for computers, software, wireless connection, headset and voicemail services. Business leaders must also consider the cost for employee space and furnishing. Outsourcing relieves the stress of employee operational costs and offers the opportunity to increase at a lower cost.
No matter the size of your business, outsourcing can be the right decision allowing you to achieve new success. It can supply flexibility and scalability to adjust to customer demands. Quality service can make or break a company, but by monitoring and controlling this factor agents will build customer relationships. Remember outsourcing is not only used during financial decline but for growth.
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