Thursday, September 27, 2007

Home-Based Contact Center Agents Rapidly Becoming Mainstream

The home is gaining new ground when it comes to call centers and stationing of customer services personnel. According to recent research published by Datamonitor, there will be significant growth in outsourced contact center agents based around the at-home model. Between now and 2012, Datamonitor expects the number of home-based customer service agents to grow at a compounded annual growth rate of 36.4%, one of the strongest expansion levels of any outsourcing market sub-segment.

Based on extensive research across the at-home outsourcing market, Datamonitor projects that the global size of the home-based third-party customer service agents working 20 hours a week or more, currently stands at approximately 47,000. However, based on expected growth projections from pure-play and bricks-and-mortar vendors, Datamonitor expects it to rise to almost 224,000 by 2012.

Currently, the majority of home-based customer care agents are overwhelmingly based in the U.S. The prime verticals for this service are technology, healthcare, tourism and travel & insurance. This is due to the fact that all these sectors are highly specialized and in many cases, it is hard to recruit customer service agents for actual contact centers.

A further driver for many firms to look to at-home agents is the alternative it provides to sending work to offshore or nearshore locations. With lower costs and less concern about the integrity of infrastructure and public security, investors are beginning to see the home agent model as a viable alternative to moving agent positions to multiple locations globally.

However the home agent model will not impact that of offshore outsourcing massively over time. At-home agents serve a growing but specialized niche, and the need for large numbers of agents offshore with multilingual capabilities will remain a priority for outsourcing clients.

With many investors still worried over the integrity of customer data, there remain worries in the minds of many prospects over how secure the at-home agent model is. However, Datamonitor’s research has shown providers of these services have been able to address these concerns by deploying thorough background checks on prospective employees, as well as by providing real-time monitoring analytics.

Despite certain concerns surrounding the at-home outsourcing market, Datamonitor feels that this business model is certain 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, which will be another driver for companies to gain from excellent end-user interactions.

More information can be found at

Tuesday, September 25, 2007

Spending on Knowledge Management Will Hit $73B in 2007

According to a new report released by AMR Research, U.S. companies will spend $73B on knowledge management software in 2007, and spending will grow nearly 16% to an average of $1,224 per employee in 2008. As a growing number of needs and initiatives are left unsupported by established enterprise applications, the demand for KM technologies has increased, leading to record-level activity in knowledge management; content management; navigation, search, and retrieval; and collaboration platforms.

Other highlights of the report include:

  • Collaboration, digital asset management (DAM), and customer- and supplier-facing portals are the biggest areas of planned investment.
  • The preferred KM purchasing models are shifting from traditional licensing to software-as-a-service (SaaS) and open source.

More information can be found at

Sunday, September 23, 2007

Worldwide IT Services Market On Track to Grow 9 Percent in 2007

Despite the slowing U.S. economy, growth in IT services is expected to remain solid as worldwide IT services end-user spending is forecast to exceed $730 billion in 2007, up 8.7 percent from 2006, according to Gartner, Inc.

Core outsourcing (IT management and process management) remains the highest growth area in the market. In 2007, core outsourcing services are on track to represent 41 percent of total worldwide IT services end-user spending. Process management services are typically funded outside of IT budgets and IT management services replace internal IT spending, so growth in these outsourcing segments often occurs even in the face of restricted growth in IT budgets.

The development and integration (D&I) segment continues to exhibit steady growth fueled by regulatory and compliance initiatives, and a continued push for improved business change management and agile architectures driven by merger and acquisition activities. The worldwide D&I segment is forecast to reach $225 billion in 2007, up 9 percent from $206 billion in 2006.

More information can be found at

Technorati Profile

Wednesday, September 19, 2007

Implementing Web Self-Service Merely to Reduce Call Volume Can Have Negative Consequences

Companies have implemented web self-service with a myopic focus on call avoidance and deflection, without paying attention to usability, ease of information retrieval, content performance management and customer experience. These issues continue to dog web self-service implementations, according to a 2006 survey of contact center, help desk and customer service managers and executives, sponsored by eGain Communications.

The biggest impediment to web self-service adoption is the fact that customers prefer to speak with a live phone agent. The aforementioned issues with web self-service are perhaps driving this preference. While phone channel preference ranked as the top impediment to web self-service adoption with 54% of respondents citing it as an issue, content maintenance ranked second at 37% and difficulty in accessing content ranked third at 36%.

Customers who encounter problems with a self-service session typically escalate their issues to an assisted interaction channel such as email, chat or phone. About half of respondents surveyed (47%) said less than 10% of their self-service sessions are escalated to assisted service, while 30% say between 10% and 25% of these sessions are escalated. At the high end of the scale, 4% are seeing more than 75% of self-service sessions result in escalation. While these escalation figures may seem acceptable, they do not capture customer abandonment of the web site due to bad self-service, which could lead to lost sales and reduced customer satisfaction.

Savvy companies realize that bad self-service is worse than no self-service. They are getting past “me too” customer self-service by delivering exceptional customer self-service experience through innovations such as chatbot self-service and flexible information access methods including guided help. They are reducing the cost of knowledgebase maintenance by leveraging automation for adaptive content management in the form of ongoing content performance monitoring, triggers, alerts and workflows that sustain content relevance and performance.

More information can be found at

Tuesday, September 18, 2007

Study on Customer Loyalty Reveals Employees Are the Most Critical Customer Service Asset

According to a new survey conducted by The Ken Blanchard Companies, organizations that have excited and passionate people are more likely to create a service-focused culture that delivers great customer service. And having a customer-focused workforce means that organizations must treat their people well so they, in turn, will treat their customers well. Employees are in fact an organization’s most critical customer service asset -- one that requires focused development and nurturing.

In fact, the survey data shows that 74% of respondents declared that their organizations were highly focused on customer service improvement. However, only 44% indicated that their organization had a formal process for achieving these desired service improvements.

While respondents cited that serving the customer is everyone’s responsibility, they agreed that leaders and customer-facing employees have the primary ownership for creating a positive customer experience. Yet only 48% responded that their customer-facing employees are truly empowered to take action to resolve a negative customer experience.

Respondents stated further that customer-facing employees and leaders should be the primary recipients of training. This is supported by Blanchard survey data in which respondents cited training as the number one strategy for improving service, followed closely by making an organizational commitment to create a service culture.

When organizations create an environment that allows employees to win and be passionate about what they do, employees in turn take care of the customers at a level that causes customers to return year after year. Strategies such as smart hiring, training, managing performance, and creating a recognition culture can help organizations’ develop their most critical customer service asset -- their people.

More information can be found at

Friday, September 14, 2007

The Future of Global Contact Centers

According to new research from Business Insight, the growing contact center market continues to proffer new revenue potential for vendors in emerging and established markets. However, as developed markets begin to mature, effectively enhancing the strategic identification and exploitation of opportunities will become a requisite core competency for successful growth sustainability.

Some key findings from this report:

  • Over 800,000 hosted Application Providers (AP's) will exist globally by 2010.

  • Contact center outsourcing deployments in mature vertical markets will rise from 0.87 to 1.25 million APs during the period 2006- 2012, although annual growth will fall by 8% in the same interval.

  • Remote (virtual) workers represent a significant expansion in contact center functionality, despite only constituting a small percentage of APs, encompassing 354,000 workers in 2007.

  • The Indian contact center market is suffering a decline in annual growth, falling by 30% between 2005 and 2009, due to the maturing market and increased competition from offshore locations.

  • The public sector is the fastest growing global vertical market.

  • APs in Central and Eastern Europe are set to grow by 71% to 308,800 between 2004 and 2009 with this growth driven by offshoring and outsourcing.

  • More information can be found at

    Wednesday, September 12, 2007

    65% of Companies See Benefits of Utilizing Hosed Contact Center Model

    According to a new report by the Aberdeen Group, seventy-nine percent (79%) of Best-in-Class (BIC) firms see optimizing their service delivery model as a way to reduce up-front technology costs to increase availability. Furthermore, by utilizing a hosted model, 65% of BIC companies see benefits from flexible On Demand licensing and an increase in available functionality. Thirty-nine percent (39%) of survey respondents also say they use or plan to use an outside firm to manage their contact center resources, further positioning themselves to cut costs and provide around the clock service to customers.

    A large percentage (50%) of BIC organizations indicate that top pressures to continued success are Total Cost of Ownership and increasing availability to customers. To further mitigate TCO, Best-in-Class firms (72%) look to moving support traffic to the channel best equipped to handle customer issues. Although 50% of Laggard companies see this as a pressure, the other half do not and thus may be missing a major opportunity to cut costs. A top challenge BIC organizations face when providing increased availability of contact center resources is providing the right mix of tools such as automatic call distribution, which is implemented by 90% and 43% of BIC and Laggard organizations, respectively.

    How do companies know which technologies they should be using? By measuring their key performance indicators (KPIs). With approximately 90% of all BIC companies measuring KPIs, Best-in-Class companies undoubtedly see value in measuring.

    More information can be found at

    Monday, September 10, 2007

    Help Desk Managers Not Completely Satisfied with Technology Investments

    Ninety-nine percent of IT help desk managers say that they have made a substantial investment in developing and implementing technology to provide better help desk support for end-users, yet only one third are completely satisfied with that investment, according to new research conducted by SupportSoft, Inc.

    A key reason for this dissatisfaction points to an inability to instantly access completely up-to-date diagnostic information, despite the fact that 97 percent of IT help desk managers agree that having up-to-date diagnostic information is important in resolving end-user problems. IT help desk managers surveyed said that having instant access to accurate diagnostic information would make it faster (66 percent) and easier (62 percent) to diagnose and resolve problems.

    However, help desk managers aren't necessarily taking the steps to ensure timely access to accurate diagnostic data:
  • 60 percent of IT help desk managers are not confident that the diagnostic information in their IT asset management database is up-to-date at any one point in time

  • Nearly one quarter (24 percent) of IT help desk managers say that diagnostic information is keyed in manually into their call tracking system

  • Two-thirds (66 percent) of IT help desk managers say that it takes them 6 minutes or more to thoroughly gather diagnostic information about an end-user's computer when an incident is opened, and one in three say it takes them 11 minutes or more

  • Nearly all (98.5 percent) IT help desk managers say that if a call is escalated, their Level 2 and Level 3 analysts have to re-input data the Level 1 analyst already gathered

  • More information can be found at

    Wednesday, September 5, 2007

    Ratio of IT Support Staff to Employees Falls Short, Particularly at MidSize Firms

    Just as we thought we were moving the image of the help desk in the right direction, it seems as if it still has some big hurdles to overcome. According to a new survey by Robert Half Technology of 1,400 CIOs, those polled said their companies’ technical support teams are, on average, 40 percent smaller than they optimally should be.

    CIOs were asked, “What is the ratio of internal end-users to technical support employees at your company?” The mean response was 136:1.

    CIOs also were asked, “What would be the ideal ratio of internal end-users to technical support employees at your company?” The mean response was 82:1.

    Survey results also indicated that CIOs from the largest companies (greater than 1,000 employees) were closest to their ideal level of technical support, with a ratio of end-users to IT staff of 118:1 versus an ideal of 82:1. Farthest from their ideal were CIOs from midsize firms (250-499 employees), who said that their ratio of end-users to IT support staff is 131:1, when in a perfect world it would be 64:1.

    We all know overworked, understaffed IT departments generally equals frustrated and stressed out workforces, which in turn, affects the treatment of customers and overall productivity. As we have mentioned before and will continue to do so, those companies with a dedication to great service - both internal and external – will continue to be the ones to thrive and flourish.

    More information can be found at

    Monday, September 3, 2007

    Keeping Technical Skills Up to Date Stresses Many IT Workers, But Coping Strategies Help

    There are many professions out there that require a continual update of skills in order to remain licensed or certified. IT is no different in that respect; what is different is that frequently an IT professional’s skills may be depleted over time as new technologies emerge as opposed to accumulating as many other careers do.

    This fact frequently causes a high level of stress. According to a new study from the Richard Ivey School of Business, although all IT professionals do not view the requirement to continually re-skill themselves as a stressor, many do. With companies spending 1.5% to 7% of their gross revenue each year on IT investments and innovations, this level of investment puts substantial pressure on IT professionals to maintain and gain skills to put these technologies in place effectively.

    The study also highlights the importance of monitoring the strain that results from the constant demand on IT professionals to update their technical skills because the threat of technical obsolescence may result in a higher rate of absenteeism, work burnout and a desire to change careers. Managers can help by providing IT professionals with concrete resources such as research time, opportunities to attend courses, and physical facilities that facilitate trial and error.

    In addition, the research shows that IT professionals who deploy different combinations of coping strategies end up with different levels of distress. They fared best by using a combination of problem-focused coping and emotion-focused coping.

    More information can be found at

    Saturday, September 1, 2007

    Expectations For Outstanding Customer Service Higher Than Ever

    In our last blog entry, we discussed the importance of issue resolution rate to customer satisfaction levels. Another new report, a Harris Interactive study sponsored by RightNow(R) Technologies, also illustrates just how important customer service is to companies: 80 percent of consumers will never go back to an organization after a bad customer experience, up from 68 percent in 2006. That’s a significant percentage jump in just one year.

    The report revealed that service is a significant differentiator for companies: 51 percent of consumers cited "outstanding service" as a top reason they continue to do business with a company. Another 60 percent noted "outstanding service" as a top reason they would recommend a company. Not only does great service keep customers, it gets you new ones. A pretty basic idea, but some organizations still don’t get it.

    Finally, and most interesting to me, the study found that some consumers feel sick and become outraged after a bad customer service experience with companies. For example:

  • 74% registered a complaint or told others;

  • 47% swore and/or shouted;

  • 13% posted a negative online review or blog entry; and

  • 29% got a headache, felt their chest tighten and/or cried.

  • With such negative physical reactions to poor customer service, it is no wonder that a person would go out of their way to avoid interacting with a company that made them feel this way.

    More information can be found at