Earlier this week I had an infuriating experience.
An offshore customer service rep, working for a global Fortune 500 financial services firm, contacted my vendors to verify some financial information. In call after call, he mispronounced the name of my company during his inquiries. To make a long story short, his broken English created a tangled mess that could have damaged my business irreparably. Luckily, one of my vendors recognized the error and brought it to my attention. It took me hours to unravel the confusion and un-do the damage that had been done.
This less-than-stellar customer service experience is just one of several frustrating situations I have had when dealing with third world customer service reps. The amount of time I waste communicating and being understood by foreign customer service reps is my problem. But what about the companies that resort to this low-cost customer support?
Does spending less on customer service ultimately cost them more?
A few years ago, research was done on just this assumption. According to researchers at the University of Richmond, “the average decline in ACSI (the American Consumer Satisfaction Index) scores due to offshoring customer service results in a 1 percent to 5 percent reduction in a company’s market cap.” That means a company with a $50 Billion market capitalization could experience up to a $2.5 Billion reduction in value. All because of a decision to embark on offshore customer service…
Now more than ever, HR and executive management need to work together to find solutions to controlling customer service costs while keeping customer satisfied. Sure, running a call center offshore for 1/3 of the price sounds like a great business decision. But in this day and age of social networking, one unhappy customer can instantaneously share their unpleasant experience with 100 or more friends. Over time, this negative word of mouth could slowly but surely chip away at the brand value and bottom line.
In my opinion, customers and their satisfaction should always be priority-one. By keeping control of this function, companies not only improve customer satisfaction, they hold the reins when it comes to training, and brand management. Best of all, inter-departmental communication—and productivity — can be optimized.
Perhaps other, less client-facing functions (such as IT and manufacturing) could be offshored instead. Savings might also be realized by simply relocating customer service to a more affordable domestic location.
What’s stopping you and your company from keeping customer service in-house/close-by? Have you found a solution to this dilemma? Please comment.