Winning with Team USA

1. Winning with Team USA By Steve BrubakerSr. Vice President InfoCision

2. Call Center “Outsourcing” Offshore or Domestic (USA)

3. Business Week, June 21, 2004

4. Datamonitor: by 2007 16.1% of agent positions will be outsourced offshore….

5. Most Popular Offshore Locations • India • Philippines • Latin America • Caribbean • South Africa

6. Choosing an Outsource Partner • Reasons are the same Offshore or USA • ROI • Experience & Depth of Management Team • Quality & Innovation • Client References – Satisfied Customers • Regulatory Compliance Expertise

7. The Cost Factor - R.O.I. • Quality Communication • Regulatory Compliance • Consumer Privacy • Cultural Connection • Technology • Service Levels - Productivity • Travel and Relocation

8. Cost Savings in Focus • Significantly lower than anticipated despite wages at 10-20% of agents in USA • Meta Group: Lower Productivity can add up to 20% in additional costs offshore • Jim Poole, CIO of W.C. Bradley, told NewsFactor. "In terms of cost alone, outsourcing is a high-risk solution."

9. Cost Savings in Focus • Dane Anderson, program director for Meta Group , told NewsFactor. "You have to weigh the costs throughout the entire agreement - not just in labor rates." • There is no such thing as a free lunch or cheap outsourcing, says Gartner. The firm predicts that 80 % of organizations that outsource customer service will fail to reduce costs. • Business Wire predicted savings of 30%-50%, realistically come in closer to 15%-20%.

10. Losing Money by Spending Less Web.com • “Outsourcing the customer support process may have resulted in a 3:1 savings in gross costs, but this was quickly negated when customers began leaving in droves due to the lower quality of service that resulted.”

11. Quality “Insurance” • Call Center Industry Created in the U.S. • Partner with Experience • Convenient Access: Personal Client Involvement

12. Compliance • No Shortcuts • U.S. Client is Liable • Significant Ongoing Investment • Risk Management

13. More Legislation Inevitable Offshore Bills: • State Tax $ • Economic Development Incentives • Truthful & Immediate Disclosure of Agent Location • Redirect Call to US agent if asked

14. Privacy of Consumer Data • Consumer privacy laws vary by country. • Offshore employees cannot be punished for violating U.S. privacy laws. • When you work with a domestic call center, you can be sure that your consumer data stays in the United States and is protected by American laws and law enforcement. • Learn from other companies’ mistakes (Capital One, Conseco).

15. ID Theft ChoicePoint and LexisNexis • US Laws do not apply to information sent overseas to foreign-owned companies. DMA Ethics Dialogue in Los Angeles • ID Theft was #1 concern

16. Communication and Culture • 92% of U.S. consumers form their image of a company based on their experience with the contact center.(Purdue University, Center for Customer-Driven Quality) • 65% of American consumers would alter their buying behavior toward a company if they knew it was using an offshore call center regardless of the level of satisfaction.(Purdue University, Center for Customer-Driven Quality and Benchmark Portal, Inc.)

17. Comprehension Obstacle • EDS UK - Warns companies transferring call centers to India risk alienating consumers. • Rudy Oetting, “Heavy accents and improper English can be a major problem with offshore countries.”

18. Language usage and other cultural differences Information Week What does “Yes” mean? • US – Person agrees • India – Understood what was said, not necessarily agreement

19. High Turnover • Spectramind, division of Wipro, reported a 90 % annualized attrition rate • PeopleOne Consulting reported that the pool of good candidates for call centers is limited.

20. The Management Gap • “The major gap with most offshore providers is the lack of strong middle management. Because the industry is so young in these offshore locations, the depth of knowledgeable and experienced middle management is severely lacking.” Jon Kaplan, TeleDevelopment

21. Security • Since 9/11, concern for travel to countries in close proximity to instability, terrorism, or high crime. • David Sims, according to XDNet India: Bangalore on radar of militant groups. • Could American offshore enterprises become terrorist targets?

22. Customers Tell us What They “Really” Think • Mike Budde, president and CEO of Advanced Data-Com, Inc. why his customers were unhappy with offshore outsourcers: • Extremely slow customer service response • Poor handling of data • Poor handling of file transfers • Lack of technical savvy, including inadequate understanding of telephony and systems issues • Lack of Strong Management

23. Technology • Technology is enabling companies to compete better on U.S. soil against foreign competition. • IP Contact Center • Home and Virtual Agents • Better WFM, Routing and Self-Service Technology • Modern, flexible CRM and database products enable 360-degree knowledge of customers across all media points, leading to shorter call resolution and improved efficiency in agents.

24. The Greater Offshoring Issue • What is Long-Term Effect on American Standard of Living • U of CA • Santa Cruz study • Toyota • American Made • Nobel Prize winner, Paul Samuelson

25. The Reason Foundation Stop “Outforcing” • High Federal Corporate Tax Rates • A Faltering Education System • Innovation Stifling Government Policies

27. Taylor Institute for Direct Marketing By Dr. Dale LewisonChair – Dept. of Marketing The University of Akron, Ohio