Research Paper Example on Call Center Outsourcing in India: Cost and Quality

Executive Summary

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The call center outsourcing is one of the key trends in the 21st-century across the globe. The sector is exhibit high growth rate in India. The process is associated with cost reduction and enhanced customer satisfaction levels; however, limited literature exists regarding the implication of the strategy and the associated growth in quality of service. This study is centered on this gap, which showed that the attrition-based factors such as low pay, job insecurity, poor working environment, lack of career development, and poor change management affect the level of quality. Nevertheless, through strategic human resource management and planning, the sector will attain high quality and sustainable competitiveness.

1.0 Introduction to the Study

1.1 Background of the Study

The onset of the 21st-century revolution was characterized by numerous changes in line with customer centricity to business development. The level of customer satisfaction called for developed methods and mechanisms centered on improving the capacity of the organization to meet the needs of their clients. One of the measures based on the market trends that was introduced in the corporate sector was the use of call centers to address customer queries (Shar & Rainayee, 2014). Call centers became a popular tool for customer management, which brought a new dimension called business process outsourcing because most organizations south to perfect their call center services through the external professional acquisition of the desired talent.

In India, one of the concerns of the call centers was the need for sustainable culture development that could encourage high and continuous customer satisfaction levels. From the year 2014, the revenue generated from information technology as well as business process outsourcing (BPO) has been improving from the estimated $109 billion because of the call center efficiency (Shar & Rainayee, 2014). Although call center outsourcing has assisted most organizations to cut down the cost of operation, the question of quality remains a critical concern. This paper examined the effect of quality about call center outsourcing in India.

1.2 Objectives of the StudyLahiri and Pangrikar (2013) noted that call centers have contributed to the growth of most of the organizations across different industries. According to the two scholars, the benefits cuts across the manufacturing, the information technology, education, and other service sectors. The recent developments have indicated the possibility of quality deterioration because of the external and internal factors within the Indian call center industry. The outsourcing strategy has been one of the key achievement and transformational approach to customer centricity; however, the existence of attrition poses a significant threat to further growth (Shar & Rainayee, 2014). This study investigated the quality-related factors of call center outsourcing in India. The following were the key objectives associated with this study.

To determine the rate of quality of service associated with call center outsourcing in India

To determine the key attrition elements that affect the quality of services related to call center outsourcing in India

To establish the best alternative solutions that could enhance the level of quality of services related to call center outsourcing in India

2.0 Literature Review: The Call Center IndustryThe call center is the most recently developed industry across the globe. The need for advanced customer service asked for the establishment of contact centers that will enhance the level of interaction between businesses and the prospect clients (Naidoo & Neville, 2005; Subramanian & Arivanandan, 2009). Having a strong relationship with the customers has been noted to be rewarding for the business especially in a competitive market. The growth of the call centers has been steady from the 21st century, and more progress was witnessed in 2013 based on the major classifications associated with the industry (Lahiri & Pangrikar, 2013). The level of technological advancement, the aggregation of various communication channels, social media shifts, and the need for market analytics, have contributed to the tremendous change exhibited in the sector.

The basic idea behind the call centers is the need for customer management and satisfaction based on the objectives of the organization. Lahiri and Pangrikar (2013) pointed out that the process of retaining and acquiring the customers depends on the incorporation of the centers into the structure and culture of the organization. The need to viewing the contact centers as essential tools for customers feedback management as well as market analysis is based on the centrality of market segmentation and competitive advantage for the success of a business venture. The advancement of technology such as the introduction of the non-voice channels meant for the automated customer responses has cut down the cost of operation and enhanced the level of customer satisfaction through constant and continuous interaction (Lahiri & Pangrikar, 2013).

On the other hand, Shar and Rainayee (2014) ascertained the existence of limiting factors that could affect the sustainability of call center services. The factors that the scholars pointed out constituted the possible attrition that could extend to the quality of service. The nature of job satisfaction levels of the outsourced professionals, especially in India, was noted to depict a negative effect on the success of the sector in future. Nevertheless, the study showed a clear correlation between cost reduction and outsourcing, which was a benefit for organization adopting the trend as part of their structure and strategy to customer centricity.

Over the years, the contact center outsourcing industry has been considered a diverse and complex sector. However, three major classifications have been developed as the basis of the segmentation approach. The first consideration is the industry segmentation composed of the banking, telecommunication, retail, and travel and hospitality sectors (Lahiri & Pangrikar, 2013). The geographical segmentation is based on the key corporate regions across the globe. Moreover, the offering segmentation is classified into domestic and offshore segments. A definite highlight of the call center sector is shown below.

Table 1: Overview of the Call Center Industry

INDUSTRY SEGMENTATION GEOGRAPHICAL SEGMENTATION OFFERING SEGMENTATION

Banking and Finance

Telecommunication services

Retail-Oriented services

Technology-based sector

Travel and Hospitality

Other services Australia, New Zealand, Singapore, China, India, United States, United Kingdom, Indonesia, Japan, South Korea, and the Philippines among others Offshore segment

Domestic segment

Analysts have pointed out that the Indian call center sector has grown tremendously with the capacity to advance to greater sustainability levels in future. The estimated growth rate aggregate stands at 45% in the last five years compared to a cumulative global rate of 10%. The value shows a higher development rate, which is a potential for revenue enhancement (Lahiri & Pangrikar, 2013). Alternatively, the other indicator associated with the rate of growth is the reduction in cost associated with customer management through regular interaction. Experts have also predicted a consecutive exponential growth index in the next five years that will position the market in global competitive position. The major considerations in Indian sector have been the accountability of the qualitative dimensions of the outsourced call center services. Nevertheless, the major driver of growth has been pointed out to as the cost factors where the low prices of acquisition of professional services in the country are affordable for most organizations (Holman, Batt, & Holtgrewe, 2007). The geographical advantage that emanates from the time zone element positions the country is an ambitious corporate scope. Furthermore, technology, workforce, and government policy have enhanced the growth witnessed in the country (Lahiri & Pangrikar, 2013).

3.0 Methodology3.1 Research Questions and HypothesisThe research questions associated that guided this study were developed from the key study objectives. The scope of each issue as used to establish the proposed hypotheses. Therefore, the research questions were as follows.

What is the rate of quality of service associated with call center outsourcing in India?

What are the key attrition elements that affect the quality of services related to call center outsourcing in India?

What are the best alternative solutions that could enhance the level of quality of services related to call center outsourcing in India?

The study expected to find factors such as job security, pay, working environment, and lack of promotional strategy as the main factors that jeopardize the anticipated quality of the call center services in India. Moreover, the study hypothesized that improving the working environment and pay, having a competent promotional strategy, and enacting policy for job security would improve the level of quality.

3.2 Research MethodThe research was based on both a qualitative and quantitative approach. A mixed approach was effective since the objective were set to examine the rate of quality of contact center operations as well as the contributing factors associated with attrition that affects the quality of contact center services. Therefore, the mixed approach method was chosen because it provides a wider perspective on the subject being investigated, which increases the level of validity and reliability.

3.3 Sources of DataA greater portion of the research was based on an original analysis where the data was gathered through interviews where the researcher interacted with a call center expert. The secondary sources were majorly used for literature review and recommendations as well as highlighting the background of the study. The interview was objectively centered on the aims of the research and the questions asked have been outlined in the appendix. Based on the need for confidentiality associated with social evaluations, the interviewee personal details remained anonymous upon request; nevertheless, such a move did not affect the research process and findings.

4.0 Discussion and Findings4.1 FindingsThe interview focused on the quality of service associated with the call center outsourcing in India. The responses were built around five major metrics of quality based on customer perspectiv...