Who's Afraid of Big, Bad Outsourcing?

"Can I help you with your problem?" means the same thing all over the world. A new report from Jupiter Research finds that despite the hype around customers' aversion to outsourcing, only 17 percent of online customers say that it affects their purchase decisions. According to the study, consumers are much more concerned with the quality of the service than where it's coming from. The report, "Customer Service Outsourcing," focused on the state and proliferation of outsourcing today and found that although the level of outsourcing customer service continues to remain relatively flat, the attitudes companies and consumers display concerning outsourcing is shifting.

The number of companies in the past two years that are outsourcing customer service has remained relatively stable. In 2004 29 percent of companies outsourced their customer service, and in 2006, this shifted slightly to 28 percent. However, companies are moving away from a blended approach to outsourcing-keeping some services in house while shipping others out-and more and more are moving towards fully outsourced services. This reflects a change in attitude, according to the report. Zachary McGeary, analyst for Jupiter and author of the report writes, "Companies' shift suggest a relatively more favorable market perception of outsourced service operations." Jupiter attributes this change to persistence on the outsourcing providers part to dispel negative press and unflattering stereotypes.

The blended approach to onshoring and offshoring has become less popular as well, according to the study. In 2004, 29 percent of companies that outsourced services did so through a mix of both onshore and offshore providers, but in 2006, only 12 percent of companies engage this blend. Today, offshoring has become a more widely adopted practice with the number of companies who outsource services solely offshore raising from 16 percent in 2004 to 22 percent in 2006. Onshoring continues to be the most widely accepted option for outsourcing, but according to the report, "Negative press has done little to reverse the growth of offshore customer service outsourcing."

Negative press has not affected customers' ideas about outsourced services either, the report finds. McGeary writes, "Online consumers remain largely apathetic to outsourcing." Only 17 percent said that it would affect their buying decision, compared to 59 percent who said that they would be affected by the efficiency of response to their inquiry. In fact, outsourcing of customer service came in as one of the very lowest concerns for online customers, far after knowledgeable customer service representatives, access to live representatives via phone, and speed of email response.

The report indicates that although some aversions to outsourcing remain, these are merely road bumps, not blockades, McGeary writes. "Although cultural and linguistic barriers are often highlighted as inhibitors to the success of offshore outsourcing, companies are finding ways to maximize the quality of outsourced service both onshore and offshore."

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