DENVER CO — The CEO just didn’t feel right.  Experts from two of the largest and most well-known consulting firms in the world had told him the contact center BPO deal on his desk was ‘in market’, and that he should sign it.  But still, the idea of giving an outsourcer a multi-year exclusive 9-figure deal made him pause.  Instead of signing, he picked up the phone and called the contact center consulting experts at Eventus Solutions Group.  That turned out to be the right decision.  Eventus was able to show the CEO of this well-known non-profit how to deploy an alternative outsourcing model that has since saved the organizations tens of millions of dollars while also increasing customer satisfaction ratings by 17% and reducing average handle times by 19%.

Like many non-profits, this organization made extensive use of contact center outsourcing.  The original proposed deal was a traditional exclusive, long-term BPO contract under which the outsourcer would provide everything necessary to provide member support for the non-profit: facilities, labor, a command center, a comprehensive technology stack including CRM, ACD, IVR, QA and WFM systems, and finally implementation and integration of the technology stack.

Traditional outsourcers argue that since they specialize in providing contact center services, their cost per minute is lower, and their quality is higher than what non-contact center specialists can provide. However, the traditional outsourcing model is heavily skewed in favor of the outsourcer, not their client. Once the contract gets signed and the price per minute gets fixed, traditional BPOs have little incentive to improve service levels. Furthermore, any efficiency improvements they make enhance their profitability, not the client’s cost model. Finally, the comprehensive nature of the technology stack provided, as well as the required implementation and configuration of those technologies, makes these contracts ‘sticky’, as changing providers and re-implementing the entire technology stack is complex and costly.

Eventus showed the organization an alternate business architecture Eventus calls ‘Champion/Challenger Outsourcing.’  This new model relies on three primary principles:

Multiple Vendors Compete for Volume 

Instead of contracting with a single exclusive outsourcing provider, break the work up and hire two or more providers that compete with one another for volume.  Using this model requires changes to traditional contracting, vendor management and performance management and command center practices.  However, by shifting volumes for future periods toward the labor provider(s) providing the best efficiency and quality for the current period, the outsourcing client benefits directly from both a cost and a customer satisfaction perspective. Furthermore, over time, the client can replace the poorest performing labor provider with a new challenger to take on the current champion, driving further improvements in quality and productivity.

Control the Technology

Instead of depending on a contact center technology stack provided by an outsourcer, modern cloud-based platforms allow outsourcing clients to own and control their technologies and implementations.  Since cloud-based platforms work over the Internet, agents can be physically anywhere – at one or more labor providers, in-house, or even at home.  As a result, the client’s technology can support outsourcers’ agents wherever they are.  Moreover, controlling their stack also means the client owns and controls the implementations of their technologies.  Therefore, implementation of each component only needs to be performed the first time it is deployed, and changing out or adding new labor providers becomes primarily a user account provisioning task from a systems perspective.  The bottom line benefit to the client of this model is flexibility – they can outsource, insource, change outsourcers or deploy hybrid models without having to re-implement contact center technologies each time they make a change to their business architecture.

Hire Multiple Labor-Only Specialists

Since the client now owns and controls their contact center technologies, they no longer need to obtain it from a traditional, full-service BPO provider.  Instead, they can contract with smaller, specialist labor outsourcers who are eager to provide dozens to hundreds of agents and the facilities to house them. The large BPOs hate this model because the traditional approach works so well for them, but numerous small, hungry and growing specialist labor providers are more than happy to work on this basis.  Furthermore, since their overhead is so much lower, their hourly rates are often significantly less than the big BPO vendors.  Finally, these small specialist labor providers are available on-shore, near-shore and off-shore to support different clients’ specific requirements

By putting labor vendors in a position where the best provider gets the bulk of the volume on an ongoing basis, Champion/Challenger Outsourcing can generate dramatic improvements in customer satisfaction, as well as significant reductions in operating costs. Since this project began, our client has seen their customer satisfaction ratings increase 17%, while their average handle times have decreased 19%. At the same time, they have saved over $25 million in operating costs over the initial three-year period.

“Ten years ago, the big BPOs had advanced contact center technology you could only get if you outsourced all our business to them,” said Craig Tobin, Eventus managing director. “Nowadays, cloud-based technology platforms have leveled the playing field, enabling new business models like Champion/Challenger Outsourcing that provide dramatic benefits for outsourcing clients.”

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