Call Centers: Is Working from Home Too Good to Be True?

The practice of offshoring often presents myriad complex challenges such as high attrition coupled with costly hiring and training. In addition, moving call center operations to other countries adds language and cultural barriers, and sometimes, makes businesses the targets of political backlash. Companies opting to expand with new operating models are utilizing telework agents, who take calls while working from home. Generally speaking, this virtual model provides higher quality agents, which, in turn, leads to a higher level of effectiveness. Over the past few years, major U.S. companies such as Discover, jetBlue Airlines, and even the U.S. Internal Revenue Service, have switched to teleworking for at least a portion of their call center needs -- and the results are impressive. Recent research indicates the teleworking trend will continue to increase at a rapid pace into the next decade. This is good news because teleworking addresses the cultural and political issues many businesses experience by sending calls overseas. Offshoring, although economical, has often led to a decline in customer satisfaction, usually due to language barriers that further exacerbate cultural disconnects. Both factors result in a disappointing customer experience. By moving agents into a telework environment, organizations can not only reduce costs from a facilities standpoint, but reap other benefits as well. In fact, rather than being a "cost play," teleworking is really a "quality initiative" that strategically reduces overall costs as a secondary benefit. People: The Key to Teleworking In a typical call center, the people answering the calls generate at least 70 percent of the costs. Attrition rates, which are traditionally high, create the need for a steady flow of new hires and training sessions, add to handling time, and detract from the productivity of experienced agents, who are expected to perform on-the-job coaching. This vicious, never-ending cycle drives much of the high costs found in traditional call centers. By contrast, the telework model is not tied to a specific location and appeals to a new class of workers -- a larger and more broadly experienced pool of applicants compared to traditional call centers. With a larger applicant pool, companies can be more selective, and as a result, most agents have higher educational backgrounds, many with advanced degrees. Because telework agents are generally experienced and more mature workers, the average tenure tends to be notably longer within a teleworking environment; reported attrition, on average, drops to around 10 percent. Hiring and training costs decrease, and employee and customer satisfaction typically increase. Many businesses have also reported increased productivity and higher up-sell and cross-sell rates within telework models. Enabling Efficiency The flexibility offered to both the agent and the company drives a win-win situation, since teleworking enables call centers to more accurately match staffing to call patterns. Agents can select schedules arranged in time increments based on call center needs. Organizations compensate agents for the time they are needed versus compensating eight-hour shifts, during which only two-hours are considered a heavy call volume period. Making Work-at-Home Work Just as with any operational change, moving a traditional call center to a telework model requires careful planning, preparation and reorganization of processes and support systems. Simply put, teleworking is not a plug-and-play solution. Organizations should consider:

• Which processes need to be modified or moved?
• Should we in-source or outsource the telework model?
• What security and management processes need to be adjusted or created to support the new model?
• If utilizing an outsourcing provider that employs work-at-home agents/contractors, what type of governance model needs to be created?

The unique set of challenges and solutions presented when managing a virtual workforce are critical factors in the telework model. Agents can no longer be managed and coached simply through the "walk around" method, in which a manager walks the call center floor. Instead, diligent planning and implementation of new processes are required to ensure performance management, agent support and risk controls are in place. Where to Go from Here As today's global businesses face the complexity of balancing demands of providing exceptional customer service with managing corporate costs, outsourcing, offshoring and nearshoring often rise to the top of the list as potential solutions. What executives may not realize is that the telework model provides an option that allows companies to achieve the optimal balance by improving the overall quality and experience of both customers and employees. So, before tackling all too common call center issues of increasing costs, rising attrition rates, poor quality candidate pools and declining customer satisfaction scores, take a look at the telework operating model. You just might like what you see. About the Authors Debra Green is a Senior Director with Alvarez & Marsal Business Consulting in Chicago. She can be reached at: (312) 601-4257 or dgreen@alvarezandmarsal.com. Stacey DeVore is a Manager with Alvarez & Marsal Business Consulting in Chicago. She can be reached at: (312) 601-9035 or sdevore@alvarezandmarsal.com. Alvarez & Marsal Business Consulting works closely with both high-performing and underperforming organizations to improve businesses processes -- efficiently, economically and without disruption. To learn more, visit www.alvarezandmarsal.com.