Outsourcing non-core customer communication operations—from customer care to collection services—is a strategic practice for brands aiming to enhance the customer experience and build efficiencies through expert customer experience management. Common reasons for outsourcing include reducing operational costs, gaining access to the latest CX tools and technologies, freeing internal resources to focus on core business operations, and augmenting business or customer focus.

There are several ways to outsource your customer communications. Various options work best for different environments, scenarios, and customers. This guide will help you understand the benefits and limitations of varying outsourcing options, enabling you to decide what type or combination of outsourcing is right for your business and your customers.

Types of Call Center Outsourcing

Offshore Outsourcing

Offshore outsourcing involves contracting a call center with delivery centers in overseas locations. These centers allow agents to deliver similar interaction quality at significantly lower costs.

Pros:

• Cost Reduction: Moving customer operations offshore to countries like the Philippines significantly reduces costs due to lower labor expenses.
• Established Expertise: These locations often have well-established customer experience management infrastructures.

Cons:

• Quality Concerns: There might be concerns about the quality of operations compared to more expensive options. However, this is improving as consumers become more understanding of offshore operations if it keeps prices lower.
• Suitable Operations: Simple or transactional interactions can be efficiently moved offshore. However, consider the value of the transactions, their impact on customer relationships, and the sensitivity of the information being handled.

Onshore Outsourcing

Onshore outsourcing means contracting customer communication to contact centers within the brand’s home country through a third-party service provider.

Pros:

• Cultural Proximity: Agents relate better to consumers, leading to personalized customer-brand communication and improved CX.
• Local Economic Benefits: Keeps jobs local, enhancing the national economy.
• Security: Ensures information privacy, sensitivity, and security by keeping operations within the company’s home country.

Cons:

• Higher Costs: Onshore outsourcing can be up to three times more expensive than offshore options.
• Labor Force Limitations: The local labor force may not always meet the required skill or volume needs.

Strategic operations with a significant bottom-line impact, such as sales operations, can be effectively outsourced onshore. This allows for reduced costs while maintaining high customer satisfaction.

Nearshore Outsourcing

Nearshore outsourcing involves contracting call centers in neighboring countries, offering cultural proximity and cost efficiencies.

Pros:

• Cost Efficiency: Provides a similar customer experience at a lower cost. For instance, Jamaica has a culture similar to the US’s but offers more cost-effective operations.
• Proximity and Cultural Alignment: Countries like Canada offer proximity, cultural alignment, and cost benefits.

Cons:

• Perceived Quality: There may be a perception that international customer service is lower quality than onshore vendors.
• Regulatory Constraints: Industries handling sensitive information might need to remain onshore.
• Scalability Challenges: Scaling operations and resources can sometimes be complex.

Nearshoring allows for a phased approach to offshoring, providing a balanced mix of operational efficiency and customer satisfaction without fully committing to offshore outsourcing.

Right Shoring: The Optimal Approach

In addition to offshore, onshore, and nearshore options, right shoring involves outsourcing parts of your operation to different offshore, onshore, or nearshore delivery locations of a global call center that offers the right shoring solution. This strategy ensures that each aspect of your customer communication is handled efficiently and effectively, optimizing costs and customer satisfaction.

By carefully selecting the right outsourcing strategy, businesses can significantly improve their customer service operations, reduce costs, and enhance overall customer satisfaction. Choosing the right location for call center outsourcing is crucial for building a successful and efficient customer experience management strategy.