• September 27, 2007
  • By Marshall Lager, founder and managing principal, Third Idea Consulting; contributor, CRM magazine

Please Hold While I Answer the Doorbell

"Home base" is gaining new meaning when it comes to contact centers and stationing of customer service personnel, according to the latest research from Datamonitor. Between now and 2012, the research firm says, the number of home-based customer service agents will grow at a compounded annual growth rate of 36.4 percent, one of the strongest expansion levels of any outsourcing market subsegment. "The increase in interest in the at-home agent model is impressive, and does not appear to be slowing," states Peter Ryan, Datamonitor senior analyst for contact center outsourcing and offshoring, and author of the report entitled, "The future of customer facing technology in the outsourced contact center." "Based on the heavy levels of investment that enterprises are making in this way of doing business, it is clear home agents are no longer a passing fancy, and are rapidly becoming mainstream." Datamonitor's research across the at-home outsourcing market puts the global number of home-based third-party customer service agents working 20 hours a week or more at approximately 47,000. The great majority of these are based in the United States. However, based on expected growth projections from pure-play and brick-and-mortar vendors, Datamonitor expects the figure to rise to almost 224,000 by 2012. While he doesn't see the U.S. losing its majority, Ryan says there will be an upswing in other major English-speaking countries as well. "We're seeing growth in Canada, Australia, and also in the U.K. There are cultural similarities among these nations and the U.S., in terms of their attitudes toward working from home, technology, and the sort of people who apply for home-agent positions," he says. Ryan cites the new agent demographic that has emerged with the at-home model: Specifically, vendors of home-agent services indicate prospective employees tend to be somewhat older than call-center-based customer service agents, and almost always come with some work experience. "The people applying tend to be in their late 30s to mid-40s, are educated -- some employers are actually requiring university history -- and are otherwise stable," he says. "Many are homeowners, and are seen as more reliable and having a better attitude." Qualitative evidence suggests this translates into higher customer satisfaction scores and lower rates of attrition, with corresponding reductions in recruiting-and-training expenditures. "Unquestionably, rising costs are causing contact center outsourcers in Western locations more headaches than ever," Ryan states. "To a large degree, this inflation is based around employee churn, which is a phenomenon that the home-agent model does not seem to have encountered to date." He goes on to note that "the reduction in overhead by using home agents has also served to lower overall prices of labor, which can be passed directly back to the client." The payoff, he says, may transcend mere dollars and cents: "If this can be tied to higher rates of end-user satisfaction, it translates into a winning investment for the outsourcing client." Also driving interest in at-home agents is the alternative they provide to sending work to offshore or near-shore locations, according to Datamonitor. By lowering costs and reducing concern about the integrity of infrastructure and public security, investors are beginning to see the home-agent model as a viable alternative to established agent centers in multiple locations globally. An alternative -- but not a wholesale replacement: In fact, the report takes pains to note that the home-agent model will never eliminate offshore outsourcing entirely. At-home agents merely serve a growing but specialized niche, the report states, and the need for large numbers of offshore agents with multilingual capabilities and 24-hour availability will remain a priority for outsourcing clients. As service providers introduce or expand home-based agent activities, they must develop new processes to accommodate new parameters. "Providers need a realistic recruiting strategy, high-end data security and fraud prevention, and a means of ensuring agent quality," Ryan says. "If they can answer those three questions, they will find their niche." Providers are already beginning to address concerns over data security and agent reliability among home-based agents, with increased reliance on existing infrastructure: thorough background checks on prospective employees and real-time monitoring analytics. Despite certain other concerns specific to the development of at-home agents, Datamonitor feels that this business model is sure to gain significant traction from companies interested in lowering overall costs while keeping their customer-facing services onshore. In addition, the quality that can be derived from a typical home agent is reportedly very strong: Providers are quick to cite the high levels of motivation shown by an older workforce that has more experience in a professional setting, motivation that inevitably leads to improved end-user interactions. These factors are hardly new -- but taken together they present a solid picture of home-based contact center outsourcing. "Let's be frank: The home agent has been covered extensively, and nothing will blow the lid off the story," Ryan says. "It's a different atmosphere with different challenges, but you can get a lot more productivity. We're very bullish about the industry." Related articles: Feature: Home Bodies
Cut contact center operating costs, reduce churn rates, and up flexibility--a serious look at the at-home agent model. Viewpoint: Managing Home-Based Contact Center Agents Best practices for contact centers' success. Keeping Balance in the Center Organizations no longer have to choose between efficiency and effectiveness as contact center technology evolves. Here, five approaches to service and efficiency equilibrium. More CSRs Are Staying Home U.S. home-based agents represent a small portion of total customer care reps, but their ranks continue to swell, thanks to macroeconomic trends. Lending a Helping Hand Business outsourcing provider Pearson Government Solutions answers the call of thousands who take employment for granted with those who cannot. Home Shoring Is Gaining Attention A new report highlights the unique role telecommuting agents play in the rapidly changing call center workforce.
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