Outsourcing Customer Service Essay

Outsourcing Customer Service Executive Summary The survival to outsource phoners relations with their customers is a plectron umteen businesses argon making. With the costs of labor more(prenominal) than a quarter of the pose an average customer service representative makes in the United States (U. S. ), blown-up companies atomic number 18 making the choice to offshore some, or the ideal partys customers service departments to former(a) countries. To many of these companies, the benefits be out slowness the issues relating to outsourcing in general.Breaches of security and customer satisfaction are some of the problems businesses are facing when making the choice to offshore. Are cutting costs more beneficial than customers losing faith in the products of the guild? Outsourcing Customer Service Outsourcing is a business practice that is used approximately the world. This paper exit eviscerate the business crusade for a company to outsource some of its operations, a nd the risks that are weighed when choosing to outsource. What impacts those decisions have on the company and its customers will also be discussed. A Background on OutsourcingOutsourcing customer service overseas involves hiring another company abroad to take over either some or the entire customer support department. Outsourcing has become a increment trend today. many another(prenominal) large American, European, and British corporations are eager to cut costs by off shoring customer service jobs to foreign firms for significantly lesser wages. Why Outsourcing? Some of the objectives a company will accomplish by outsourcing jobs to foreign firms are cost savings, having 24 hour customer service, and a centralized service center. Each of these points does however come at a price, and will sometimes outweigh the benefits.Saving money has been the greatest curtilage companies have chosen to send the majority of their customer service departments to other countries. The thought of cheap labor is enticing to many businesses when making the choice to off shore. The average foresee center graduate, usually holding a bachelors degree (BA) earns 3,000 rupees a week, which is the equivalent of 67 U. S. dollars (Aspden, 2006). To alleviate the need to off shore, construction of office space is taking 10 calendar months to complete instead of the normal 18 months in Bangalore, India.Each month over 40 companies make the decision to outsource Information applied science (IT), back-office and customer service departments to India, and other countries. To fight the onslaught of new business, India has frame-up second tier cities to handle the overflow of demand and establish think centers such as Pune, Kolkata, and Jaipur, just to name a few. These cities in India are growing quickly to accommodate the need for outsourcing, while slowly loosing the basis on the market due to the increases in pay.With other countries such as China, Hungary, and the Philippines comp eting for lower wage work, India may loose almost half its market share by 2007 (Aspden, 2006). However, companies are finding out that there are hidden costs involved with the outsourcing of customer service. A growing trend of customer dissatisfaction is causing major corporations to reconsider the outsourcing of its services. In a recent survey of pension policy holders in the United body politic (U. K. ) it was found that 75% would leave their current provider if they experienced grown customer service (Pfeffer, 2006).Mega corporations such as Dell, Capitol One, and JP Morgan all made an enterprise to outsource customer service and all reversed course. Evidence is mount that good customer service is pivotal in a companys retention of customers. A 2005 Gartner study predicted that 60% of organizations that outsource customer-facing processes will see significant numbers of frustrated customers switching to competitors (Pfeffer, 2006). Even call centers in the United Kingdom (U. K. ) have reverted calls back to their own acres due to customer complaints, with the majority of those companies vowing to keep call centers in the U.K. (Kivlehan, 2005). The embodied mentality towards outsourcing is far understated as companies see the business case for the moves, assuming that customers do not pay attention to dialect and local anesthetic customs. After years of wondering what all those fiber-optic cables laid around the earth at massive expense in the late nineties would ever be good for, we finally have an answer They are good for enabling call-center workers in Bangalore or Delhi to sound as if they are next door to everyone. Broadbands killer app, it turns out, is India (Fox, 2003). Risk wariness