Would you offshore your call centre now?

This week's revelations over the theft last year of $350,000 from US Citibank customers are likely to have repercussions well beyond the four unfortunates feeling the pinch.

Not only does the incident threaten to undermine the entire offshore outsourcing market for call centres, but it is almost certain to lead to calls for stricter regulation of business process outsourcing (BPO) activities in a more general sense.

But anyway, not to walk before we can run, let’s recap on the story to date: Four Citibank customers noticed that money was missing from their accounts and alerted Citibank to the situation. Citibank traced the incident back to the call centre of its business process outsourcing provider, Mphasis, in Pune, India, and three former employees were subsequently arrested along with nine other alleged gang members.

The three are accused of stealing the customers’ phone numbers, tricking them into giving the PIN numbers of their accounts during an off-site call and transferring funds into fraudulent bank accounts belonging to other members of the group.

And all this despite the fact that Mphasis has BS7799 and CMM Level 5 quality certification.

The company itself claims that the findings of initial investigations vindicate it by showing that its security procedures and detection systems worked and that enforcement was key to catching the culprits.

But the National Association of Software and Service Companies in India appears to be taking a dimmer view of the incident and has stepped in to try and limit potential damage.

It now plans to set up a national database to register members of the country’s software development and outsourcing industry. These details will be checked and verified by an agency and potential employers will pay for information about staff backgrounds during the hiring process.

But will it be enough? Forrester Research, for one, thinks not. Instead, it expects the number of organisations outsourcing their call centres offshore to plummet by as much as 30 per cent over the coming months, driven partly by a desire among organisations to set up their own captive centres abroad in a bid to exert greater control over operations.

However, the researcher makes it clear that this situation hasn’t only been brought about by security concerns. Regulatory pressures and the resultant concentration on risk management issues combined with high levels of customer dissatisfaction have also caused a backlash.

And what all this means is that, for the time being at least, any decisions by companies thinking about ramping up existing initiatives are likely to be put on hold. Not good news for the call centre offshore outsourcing industry.

But there are also lessons to be learned from this in a broader sense. The question is, if the quality of Mphasis’ business processes was good enough to pass stringent certification requirements, is there another factor at play here?

Forrester raises the spectre of staff turnover and this is certainly not a phenomenon that is limited to the offshore world. Attrition rates have currently peaked at between 50 and 100 per cent in the BPO world at least, and this level of churn simply undermines organisations’ ability to stick to defined process and do sufficiently rigorous background checks – they simply don’t have time or resources to do so.

So there are lessons to be learned here for all of us and one of the biggest is that keeping call centres working effectively is not just a matter of upping staff productivity levels. It’s about ensuring that the psychological contract between personnel and the organisation is functioning effectively and that employees are happy, loyal and motivated enough to stay.

And for this, there is no quick fix. While things like competitive salary and benefits always help, they aren’t enough on their own. Most people also want ‘soft’ benefits such as feeling fulfilled in their job, gaining a sense of accomplishment and enjoying the environment they work in.

To achieve this, however, it is as much about getting management style right as it is about engendering a positive corporate culture. What it is certainly not about is sticking in a computer system to keep tabs on people. So be warned.

Cath Everett
Guest News Editor
editor@mycustomer.com

As always, please use the 'Add your own comment' link below to post your thoughts on this article. Do you think this case will mark a shift in attitudes to offshore outsourcing?