Understanding the Hidden Cost of Outsourcing

When a start-up looks to scale or expand through outsourcing, it can feel like entering a maze with no map to guide you. Search engines frequently point to large BPOs suited for major, well established companies. And when start-ups do eventually find a partner that’s more able to meet their needs, securing the right service level agreement is far from straightforward.

1. Don’t be seduced by low cost outsourcing models

Managing expectations and being clear about what you want to achieve is key. As enticing as $11 an hour cost plans are, it could be a waste of budget unless you realize what you are not paying for. Your total costs will quickly become much higher with add-ons unless you know what to ask for. 

Many are shocked to suddenly find out that their agreement doesn’t cover sick pay, holidays, training or any meaningful analysis of the service being provided. When a few members of staff are off sick, big gaps can suddenly emerge in your customer service coverage, as there will be no one there to take calls.

2. Ask the right questions so everyone is clear on what’s expected

This confusion is frequently compounded with the knowledge that most agreements don’t cover any quality assurance either. Are you improving customer satisfaction levels? Dealing with customer queries more promptly? Achieving customer retention? You will never know unless robust KPIs are in place.

It’s common for start-up founders to find it difficult at first to relinquish control of their business when they engage with an outsourcing partner. And the only way to ensure high standards are maintained is to find a model that covers the total cost of meeting your KPIs. So ask the right questions. What do you measure? How do you recruit? Are you committed to training? Do you provide coverage in the event of sickness? 

Because models that only cover the cost per hour for an employee cut corners on quality.

3. Make sure you track outsourcing progress

At Enshored, we’ll make sure there are no hidden extras and that your customer service plan not only gives you great value, but covers everything you need. From making sure there’s a 10-ring call response, team cover in place, holidays and training for all staff, and a quality assurance plan to make sure teams are accountable for customer service, we offer comprehensive support so you don’t have to worry.

This support includes brand voice and tone guidelines, which will monitor and track the quality of tone and how effective call resolution is, as well as best practice on other channels such as chat and social media.

Without this, you will not have metrics for team improvement to deliver better customer service and help your business grow.

4. Talk to the team leaders

Arguably the best way to know if your money is being spent wisely is to talk to the team leaders that will be driving your outsourcing plan. These are the people whose job it is to jump into the trenches when problems occur; they’re the ones who set benchmarks and manage progress, and they’re responsible for setting a training-based culture to drive continuous improvement. 

They will also oversee hiring and you will want to make sure that they are recruiting the right people that align with your business.

5. Don’t forget culture

Once you’ve identified a total cost solution, asked the right questions to build a service level agreement that works for you and made sure you’re managed by capable team leaders providing quality assurance and tracking progress, you will have a much better understanding of what you’re paying for.

But there is one other vital element to consider that will never be included in your bill – and that’s the client’s culture. This is an intangible cost and one that’s critical to the success of any business. Get this right and you won’t have to pay other intangible costs such as loss of goodwill or brand damage. 

So ask further questions to get a sense of their culture by finding out how they manage difficult situations, whether they have a training focussed culture and how open they are to innovation among other things. 

To avoid getting hit by hidden outsourcing costs, founders need a complete picture of what’s been offered and what customer service goals you want to achieve.

That way you’ll stay in control and ensure that, instead of ending up on a painful path of frustration, you quickly get onto a high growth trajectory.
To find out how we can help you, contact our team