How Smartshoring Improves Call Center ROI
Introduction
For many businesses that have them, call centers are often thought of as an obligatory cost. It’s seen as something that a business has to spend money on, but there’s always a desire to bring the expense down by whatever means, rather than invest in the business’s customer experience, which could have a greater return than the business expects.
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Table of Contents
Why most businesses misunderstand call center ROI
Customer support is, in most circumstances, the touchpoint where customers will interface with your brand most frequently. The quality of the customer experience created by a customer support interaction goes beyond the call itself, acting as customer retention when done right, as well as good word-of-mouth for the brand. That fact alone changes CX expenses from an obligation to a direct revenue driver.
Traditional outsourcing models just weren’t built with this paradigm in mind, unfortunately, centering cost reduction in the equation. That’s precisely where smartshoring fits into the equation, providing an updated value proposition that allows brands to evolve their CX outsourcing model to one that enables more effective revenue generation.
The problem with cost-only metrics
When companies over-rely on cost-per-call as a metric, it centers on the idea that each of these customer calls costs money. While that is intrinsically true and important to track, focusing too much on how much each interaction costs will inevitably instill companies with a desire to shrink those costs. Cost per call is useful in understanding how much each call costs a business, but it doesn’t say anything about how much each call gains for a business.
By optimizing for cost alone, businesses end up putting very little time, effort, or money into the customer experience, ignoring that the ROI on a quality customer interaction can far outweigh its initial spend, either through retention, customer lifetime value, or even through well-considered upsells.
What is smartshoring, and how does it change the ROI equation?
Smartshoring acts as a hybrid outsourcing model, which creates a blended team built of onshore, nearshore, and offshore agents. Each customer call is routed to the agent best equipped to answer their inquiry. The conventional method of outsourcing typically prioritizes the cheapest option available, while smartshoring will match the interaction type to the location and talent who are best suited for it, boosting the customer experience as well as operational efficiency.
This is a marked difference from the old one-size-fits-all view of outsourcing, evolving to something more deliberate, resulting in a model where high quality and cost-efficiency aren’t mutually exclusive.
Matching work to the right location
The logic behind smartshoring is that customer interactions will naturally have varying degrees of value and complexity, and as such, should be handled with the unique approach they deserve.
This strategic distribution has the dual benefit of both improving a brand’s cost-efficiency and its customer experience at the same time. Smartshoring allows call centers to take interaction type into account and intelligently route calls to the appropriate agent for the job using AI-powered automatic call distribution (ACD) technology.
The 3 ways smartshoring improves call center ROI
Smartshoring has a major impact on the ROI of your customer experience expenses. The 3 key ways that smartshoring can boost call center ROI are:
1. Lower costs without sacrificing CX
Smartshoring is an excellent way to lower costs, but not because it prioritizes the cheapest options, but because it strategically prioritizes the right options for each case, matching the labor cost with the value and complexity of the particular interaction.
When the more common, transactional interactions are handled offshore, where labor tends to be more affordable, the average cost per contact is significantly reduced. Additionally, reduced overhead and greater cost-control can be achieved through more purpose-built infrastructure, as well as a more consolidated model of vendor management.
Quality is still paramount, and can still be preserved in a smartshoring model by handling the interactions with higher stakes and complexity onshore, where it’s easier to align language, culture, and skills with the target market’s needs.
2. Higher revenue per interaction
In addition to cost reduction, smartshoring also actively increases revenue from customer support.
By ensuring that the agents best equipped to handle given situations are designated and empowered to do so, the outcome greatly improves. The faster response times inherent in this model improve both the conversion rates and customer satisfaction scores (CSAT), and with better handling of sales and retention conversations, and the ability to foster stronger customer relationships, smartshoring can drive higher customer lifetime values in the long run. The outsourced customer support benefits of smartshoring go beyond mere operational efficiency, providing measurable returns in revenue.
3. Scalable, more efficient operations
An incredible aspect of smartshoring is the faster ramp it provides for growth and seasonality. Scaling in-house can be slow, complicated, and quite expensive. But through a robust BPO partner with a smartshored delivery model, businesses can scale their call capacity faster and more reliably without increased overhead, whether it’s needed for long-term growth, a period of seasonal demand, or for a new product launch.
By scaling operations through smartshoring, companies boost their efficiency, which is borne out through key performance indicators (KPIs) like first call resolution (FCR), average handle time (AHT), and repeat contact rates.
How to start transitioning to a smartshore model
Making the change to a smartshore model isn’t done overnight, but rather through a strategically phased approach.
- Audit current call types and costs: Categorize your calls by aspects like their complexity, value, and the skill level required to handle them. This will be instrumental in highlighting the types of interactions that could benefit from offshore delivery, as well as those that need a potentially finer onshore touch.
- Identify redistribution opportunities: Where does your current model tend to mismatch interaction value with agent skill? Are there areas where you are paying higher rates for results that don’t justify those rates? Are there conversations with high stakes for your revenue that aren’t receiving the resources they need?
- Take a phased approach vs full overhaul: Try smaller pilot programs with offshore routing for a segment of your more routine conversations. From there, expand gradually based on performance data, only when the model is validated by your KPIs.
- Align with a BPO partner: Through the whole process, be sure to align closely with a BPO partner who has expertise and experience with these types of transitions.
Common mistakes to avoid
- Going fully offshore too fast: When you don’t have a full idea of which of your interactions are best suited to offshoring, pushing too fast to offshore everything is a major risk. These transitions are well-served by gradual experimentation to be done right.
- Prioritizing cost over CX: Especially during the design phase, this can be a fatal mistake for your smartshoring. While cost is a factor in any good business, if it’s the only priority, CX quality will inevitably suffer.
- Lack of clear KPIs: When smartshoring operations don’t set out with well-defined metrics to quantify success, there’s no clear way to evaluate performance and make adjustments as needed.
- Misalignment between CX and business goals: The best call center strategy is the one that aligns closest with what the business actually wants to achieve.
Why smartshoring is the future of CX with high ROI
By treating a hybrid outsourcing model as a strategic asset instead of a way to cut costs, companies can gain an incredible competitive advantage that allows them to operate more efficiently, provide crowd-pleasing customer experiences, and even generate revenue.
Smartshoring is an excellent model to achieve those results, but the model itself isn’t the whole story. For best results, the execution of a smartshoring model by a competent BPO partner can bring the whole thing to life.
ROI CX Solutions provides those results and offers world-class smartshoring to businesses like yours. Connect with us today to learn more about what we can do for your organization.
