Outsourcing / offshoring? Same same. Don’t get caught up with wording. There is probably a subtle difference. But you are simply looking at paying another company to take care of the support function for you. A BPO is a Business Process of Outsourcing. It’s a company specialized in externalising a whole function. Adopting offshore for your support means you will trust an external entity to deliver to your client on your behalf. That raises a lot of questions!
Why adopting offshore for your support is a good option
Many companies would need the benefits of an offshore partner, but just don’t realise it.
I know because I was one these leaders. I was very focused on execution and couldn’t comprehend that offshore partners can provide a ton of value. I was even very defensive. I used to think offshore was evil. I couldn’t be more wrong. Feels familiar?
After looking into it properly, it became impossible to avoid the benefits of offshore:
That’s the one everyone thinks about. Often coming from a top down decision. You are being asked to reduce the cost of your team. Or you are being asked to grow your team with a smaller budget. These two scenarios will play out differently but they will both lead to adopting a BPO.
When you start going into these considerations, you need to calculate your current costs.
Here are some questions to get your started.
What’s your cost per ticket?
What’s your “margin per ticket”?
Revenue – (Cost per ticket x number of tickets)Yes, this is hardly mathematical, but you get the idea.
This is going to lead to interesting question. The revenue is not the same for a small or big customer. And the load in support is not the same either. So does it make sense to reduce your cost for high paying customers? Maybe you should just stop supporting very small customers altogether?
Get closer to your analytics guys to get the answers to these questions. You need financial data, forecasting, people cost. Maybe even factor in all costs of employment if you are trying to build a case for offshore.
With a global organisation, I was able to show that an offshore employee was about 4 to 5 times cheaper than an internal employee. No premises, hardware, pension, healthcare, etc. to pay. Everything is included in the invoice. Just because you hire people from Guatemala, doesn’t mean they are less educated. It doesn’t mean they lack drive or are not able to learn. There are some true gems out there and it would be foolish not to take advantage of these opportunities.
Seasonality and Flexibility
There are very few businesses without seasonality.
Some businesses will create the seasonality themselves. Think Amazon Prime Days… And then many e-commerce companies will have the mad rush of November. In South East Asia, it’s 10/10, 11/11 and 12/12
Travel is often very strong in January. There is a tax season. Back to school. Halloween, etc.
One important aspect to consider: seasonality is largely predictable. It’s something you’ve experienced already. Something you know will happen. There is a seasonality throughout the year, but also throughout the day, or the week.
At Smartly.io, we had 60% of support load on EMEA, 30% on Americas and 10% on APAC. It was highly predictable and somewhat (with some multipliers) connected to the business activity.
What’s not predictable are surges. These are a lot more micro than macro. They could last a few hours. Or a few days. They can happen because of a bug or because of external events.
There is a fascinating podcast about change.org on this topic. Highly recommended.
Being able to increase and decrease your capacity at will is a really appealing concept. You have 10 employees who are doing a great job. You wish you had 20 next months, and back to 10 the following months. This is what offshore can do for you.
When it comes to flexibility and answering sudden surges, you need to listen to the podcast above. Offshore can help, but it’s probably not the silver bullet you are looking for.
If you are in a variety of locations in B2C, you need to speak the language of your customers. It’s less true in B2B where you can get away with English or other major languages.
When it’s time to find some efficiency at scale, you are probably also looking to serve a very wide array of culture and languages.
Some languages are available everywhere
When adopting offshore for your support, some BPOs will try to sell fluent speakers of the rarest languages in places you wouldn’t expect.
It’s not always a scam! Most BPOs have a very comprehensive test setup to make sure their candidates meet the expectations of their clients.
If the client (you) expect that the BPO will supply people speaking Japanese in the Philippines, it’s very possible. Obviously this comes at a higher price. You can expect to pay at least two or three times more than for a regular English speaker.
And keep in mind that it will take more time to find the right people. If you are looking for people with a specific skill set on top of the regular customer support job. eg. Online Marketing + Japanese, or Graphic Design + Customer Support + Japanese.
Some languages are really hard to find though
And it’s OK. You probably want to be a bit realistic. Are you asking to find the same Japanese speaker in Latin America? With Online Marketing or Graphic Design skills for a Customer Support job, it’s going to be hard. Be realistic.
You can also decide that you will not serve Japanese customers in Japanese outside of certain working hours.
What you should really do: Ask if that BPO in the Philippines could find someone willing to work the “graveyard shift”
The graveyard shift has a very negative connotation. These are the shifts that force you to work either very early in the morning (like 2AM-8AM) or very late at night (6PM-2AM). Not sure why they are called like that, but you can imagine that you can easily turn into a zombie when you are forced to work at these hours.
That said, the gig economy has changed everything. Many people are more than happy working at odd hours. Just ask and you could get surprised.
Adopting offshore for your support also means formalizing your approach to quality. Before speaking with a BPO, I was looking at the overall quality of the customer support. I was not going into the details of what made the quality.
I was taking it for granted that our people were of best quality. I was convinced they could only have a very high quality output. And to some degrees I was right because the results were speaking for themselves.
But when a BPO comes in the picture, some aspects of the recruitment will not be in your hands anymore. They will try to replace your hiring process as much as possible. This will make them as dependable as possible. They have spent quite some time trying to refine that process and made it very lean and cost effective. That’s what they are selling you. Cost effectiveness.
You are completely entitled to question the quality of the work.
What makes up the quality of the customer support? You can find a few interesting criterions. These in turns may increase your paranoia and at least raise more questions.
- Product Knowledge
- Tone and Empathy
- Followed internal process
- Language and Grammar
Each of these items can become a KPI that you are following. And some of these may become areas of development.
Product Knowledge: You cannot expect that the agents you hire are specialists of your product. The quality of their product knowledge will depend highly on your input.
Tone and Empathy: You are totally entitled to expect a very empathetic crowd of agents. But it’s up to you to set the tone. You can follow the guidance of your BPO, or craft something special (think Zapier: keep customer support weird)
Following internal process: Guess what? Your processes have to make sense and be well documented if you want your external support agents to follow them
Solution: That’s the smart you are buying. Once the agent has all the information in their ends. Once they know the product, they know the bandwidth they have for fixing a problem. Once they know how much they can spend to make a customer happy. You are entitled to measure that and understand if you are getting your money worth.
Language and Grammar: This one is probably the most straightforward to assess. Except when you get into rarer languages. How do you assess that someone speaks good Japanese, very good Japanese, or near native Japanese? I have no idea. This is what you pay for and you need to trust that your partner is doing it the right way. But nothing prevents you from double-checking. Trust but Verify.
Weekend and Holiday
This one if fairly self-explanatory. It’s a clear benefit. But it’s important to be upfront with your BPO of your expectations. It’s important to communicate the load you will likely experience on a given weekend. It’s also really important to keep track of all the special days around the world. They could impact you and your business.
“Hello Sir, today is national holiday in India. I’m sorry we didn’t talk about that earlier. It means we are going to have to pay everyone a bit extra to make sure we have the appropriate coverage. Also I’ve checked and it looks like all the people who are usually the safety net of the team in Germany are on holiday today. So this could complicate things. Do you have an alternative?”
This is a conversation you don’t want to have when you’ve decide of adopting offshore for your support. It’s going to be stressful for everyone. And your clients will probably suffer from that situation.
Practical advise. Google Calendar and Outlook have native calendars to overlay the holidays of other countries. It can be interesting, but it’s fairly static and requires you to keep an eye out for these.
A better option is to setup a shared special days calendar for you and your team. Good idea to also share it with your BPO. You can set up notifications long in advance. Like 2 weeks.
That will give you enough time to find a solution when holidays are clashing.
Spend a few hours going through a whole bunch of calendars. Add recurring events and set the right notifications to make sure everyone is up to date on these events.
BTW guess what, a BPO could probably easily supply someone to do that kind of task. You don’t have to spend a whole day doing that with your expensive salary 😉
That’s the benefit of adopting offshore for your support.
As said earlier, you may have spent quite a bit of time refining and improving your recruitment process. But the whole job of a BPO is to be extremely efficient with hiring. That’s what they do. They hire people by the bucket and they make sure the hires are calibrated to the needs of their customers. There has got to be some really good ways of doing things in that process.
It’s hard to let go, you may even be emotionally attached to your hiring process. But it’s best to trust the BPO. You don’t want to go into the details of how they do it. You want to spend all your energy conveying the expected result.
Again, it’s hard to let go. Look at it this way. You are adopting offshore for your support because you are growing as a company. Growing comes with growing pains and it often means changing your ways of doing. If you need to change the way you hire people, maybe you could learn from your BPO. Don’t be shy to ask. You want to know all the details and that’s fair enough because you are the paying customer.
BPOs are in the business of making your life easier. Not only taking over a whole function, or supplementing an existing in-house function.
Many BPOs will have multiple services they offer. They usually have a specialty though. But they are often able to help you on some topics that are loosely connected to your function.
Do you need a project manager? Someone to run operations? A graphic designer? A video producer? There is a good chance that you BPO can help. If not directly, many of them are part of a bigger group and they have agreements with other BPOs with different specialties.
Offshore is not evil. They may be sitting on the other side of the planet or not very far. You will change your perspective once you realise that you can hire at a very interesting price and great quality.
I won’t lie. It took me some time, and the change management with the rest of the team was difficult. But it also produced unexpected benefits. For instance, we went much further in the career pathing of the team. That provided even more clarity for everyone.
This article only shows the beginning. There are multiple ways of approaching outsourcing and offshoring. Some companies like freelancers as they are very scared of diluting their company culture. Some others hire a huge part of their operations offshore and put a ton of effort into documenting and managing the offshore functions.
Feel free to reach out if you are looking for some help to evaluate a BPO or if you want to understand better how this world work. Hit me up on Linkedin