Posted On June 25th, 2013
Having worked as a consultant for a number of offshore outsourcing companies over the years, I've been able to witness a number of trends. One which seems apparent amongst a number of the larger vendors at the moment is the 'anything but voice phenomenon'.
'Anything but voice' is a phrase that I've made up to represent the way in which many companies increasingly believe that the grass is greener in the non-voice BPO sector. I've seen a number of companies with a relatively large offshore presence decide that they should only offer other forms of outsourcing and only yesterday, I heard that a huge offshore call centre company has decided not to take on any additional contact centre work. The phenomenon isn't unique to companies. We've even seen a push by The Philippines to increase the percentage of its outsourcing work which comes from sectors other than call centres.
Why Is it So Hard?
Acceptance Rates: Acceptance rates among offshore call centres are low. I've yet to find a reputable call centre whose acceptance rate of applicants is above 10% and most are closer to 3%.
High Attrition: Attrition rates in call centres globally are high and offshore they are even higher. A statistic which is not helped by working night-shifts. The pressure of the role of a call centre agent certainly makes things even worse. Attrition is nowhere near such a big issue in f&a outsourcing.
Over-saturated market: it seems that every man and his dog have set up a call centre in places like India & The Philippines. Any decent opportunity has huge numbers of call centres trying to win the business and with many of them having little to differentiate themselves, many are simply not winning enough business.
Shrinking margins: The over-saturated market has forced margins down. 10 years ago, margins offshore were double that of domestic call centres but they are now comparable. Clients of offshore call centres realise that they need to push prices down even further to compensate for increased average handle times and lower conversion rates offshore. There are now many offshore companies working to simply cover their operating costs.
Is The Grass Really Greener in 'Non-Voice'
There is some evidence to suggest that some service offerings do not operate in such an over-saturated marketplace but the markets are still competitive. Clients in areas such as HRO and F&A will always almost always choose vendors with application experience and so having large number of call centre agents does not necessarily translate into a viable offering for non-voice. Vendors also need to be able to differentiate themselves whichever type of outsourcing they are operating in. Margins are slightly higher in some types of BPO but it's still a very competitive market. Of course, you don't have to contend with the negative public perception of offshoring but there are still many challenges in delivery all types of outsourcing services.