Did you know that it could cost a company up to six times more money to replace a customer than it could to work to keep an existing customer? Customer call centers are an important part of customer retention, yet call centers are often outsourced to other companies. Increasingly, outsourcing has become a component of supply chain management operations. Outsourcing refers to the contracting of manufacturing or other tasks to independent operators. In a number of areas, outsourcing call center work to foreign countries was economically beneficial, but not always the right move for customers involved. Companies are now engaging in homeshoring and Artificial Intelligence (Al) to efficiently meet customer needs. Read the case below and answer the questions that follow. Part I: Especially in high customer-contact industries, outsourcing call center work to foreign countries such as India has been economically beneficial but not always the right move for the customers involved. Although foreign call center employees are well educated and often extremely polite, language and cultural differences can sometimes be too much. Technology has allowed companies to use alternative methods to the traditional call center, including homeshoring. With homeshoring, customer-service agents located in the same country as the customer work from their own homes. 1-800FLOWERS was an early adopter of homeshoring. After outsourcing its call center to a foreign country, 1-800-FLOWERS conducted a call center test and discovered that customers often ask florists for sympathy, decorating, and relationship advice. The cultural differences were frustrating to both overseas employees and customers, though no one was at fault. Likewise, major airlines like JetBlue and American Airlines also allow agents to work from home. Using homeshoring is a way to keep call center work in the same country as the company or customers, while also reducing costs. Part II: Homeshoring is beneficial to the company, the employee, and the customer. By using homeshoring, companies experience reduced cost of office space, salary, and benefits while getting higher levels of customer satisfaction. Most athome agents are independent contractors, which means they do not receive benefits. Even so, many home agents are happy to trade the lack of benefits for the flexibility offered by homeshoring. Home agents can set up their own hours and work as little as 15 minutes at a time. Of the employees working at established company call centers, only about 20 percent have college degrees, but more than 75 percent of agents working at home have some college experience. As a result, homeshoring results in increased customer satisfaction with the call center experience. Part III. Homeshoring is becoming increasingly popular among those looking for work that fits in with other aspects of their lives. A large percentage of home agents are stay-at-home parents, many of whom worked outside the home prior to having children. Working at home has also opened doors for the disabled, military spouses, and retirees. In 2019,58 percent of all call centers reported using at least some home-based employees. Especially as companies struggle with returning workers to an office environment following the 2020 Coronavirus pandemic, it is expected that more companies will rely on homeshoring to meet customer call center needs. 1e. Call centers provide a service, which means their outcomes are Call centers provide a service, which means their outcomes are Multiple Choice tangible. usually not customized. inseparable of production and consumption. imperishable. Which of the following industries is not associated with a significant customer-contact component thus is least likely to use homeshoring? Multiple Choice tax preparation manufacturing real estate health care 1a. 1-800-FLOWERS decided to homeshore because of 1-800-FLOWERS decided to homeshore because of Multiple Choice cost customer satisfaction. efficiency. logistics. 1b. Many companies like 1-800-FLOWERS hire a ... Many companies like 1-800-FLOWERS hire a separate company to manage the call center operation, which is referred to as Multiple Choice outsourcing. scheduling. homeshoring. offshoring. routing. 1d. Which of the following benefits of outsourcing would not apply to service firms... Which of the following benefits of outsourcing would not apply to service firms like 1-800-FLOWERS? Multiple Choice increased efficiency decreased cost greater customer satisfaction manufacturing standards
