The pros and cons of contact center outsourcing


Tring, Tring… it’s time for customer-centric businesses to take one tough call.

Should contact center operations be in-sourced or outsourced? Opinions could vary depending on the nature of business, in-house capabilities and expansion plans. Usually, the need for outsourcing crops up due to dearth of internal skill sets or intermittent business demands. Also, if this business-critical function is outsourced, there’s a fear that the customers might be given a raw deal. But then, this is the era of outsourcing. So, what matters is how it is done and how it is managed. Let’s take a look at some of the most common pros and cons of contact center outsourcing.


Cost efficiency

People, process and technology – these are the most expensive components of a new-age contact center. But what if the function is outsourced to a third party within or outside the country? It would certainly result in substantial savings since specialist contact centers are good at what they do – sales, support or back office work. The best part about them is that they take care of everything, so the business stakeholders need not worry about investments; especially CAPEX.


Not every customer-centric business is good at running its own contact center. It is either an alacrity issue or a competency issue. That’s usually because an in-house contact center has the onus of recruiting, training, and optimizing agent performance while maximizing the productivity of their core business functions. When contact center operations are outsourced, they can rest assured that they have the best possible resources at their disposal.


What if a business is not able to predict a spike in the number of customers? What if it’s not geared up to scale their in-house contact center whenever the situation arises? An outsourced contact center can be an answer to both these questions. Since customer service is the mainstay of business process outsourcing (BPO) companies, they can beef up their resources at short notice. They also know that their success is ascribed to their ability to meet the demands of their clients, and their customers.


Language barrier

A contact center can’t be effective if its agents are not able to strike a chord with the customers they interact with. Though the concept of outsourcing/offshoring is not new, customers don’t expect cultural barriers to interrupt their interactions. A demerit of the outsourced model is that the contact centers are based in different countries, with agents who speak with different accents. The challenge lies in recruiting and bringing them up to speed. Although English is the most common language, there are 7,000+1 languages in the world. So it’s not surprising that more and more contact centers are becoming multilingual.   

Product knowledge

An extended contact center works with a multitude of clients across verticals with diverse offerings. This results in agents being moved from one process (product) to another depending on business requirements. Oftentimes, this results in wavering loyalty and dwindling product knowledge, though they do go through the relevant process training. Also, motivation levels could drop if they are compelled to learn about new products/services time and again. Furthermore, the new generation of omnichannel contact centers is also expecting more from traditional agents.

Privacy concerns

The increase in the number of data breaches and online frauds has made business stakeholders become circumspect in their outsourcing initiatives. Protection of customers’ personal/sensitive data is a common challenge that’s becoming tough to tackle. But yes, today’s contact centers are evolving with the times and are bracing up to address issues ‒ both predictable and unpredictable. In a contact center agent survey, 30%2 of the respondents reported that they have access to customers’ payment card information or SSNs, even when they’re not engaged in a conversation with them.

Management challenge

A business that outsources customer service operations is dependent on agents who are not on their own payroll. Usually, even recruitment and training happens in an offshore location. Albeit stringent quality monitoring and call verification happen periodically, supervision is left to the managers who handle the teams at the respective contact centers. This could pose new challenges to a business that’s new to the outsourcing model. What’s more, emerging technologies like AI, machine learning and IoT can add a new layer of complexity if not implemented well.



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