Outsource service providers need to understand the key role they play in the management of a company’s brand. Those that adopt a brand management philosophy will succeed. Those that don’t run the risk of being marginalized.

Consumers of outsourced client service need to ensure their supplier is accountable for brand development that is congruent with the company’s interest. Outsourcing client service a key point of experience delivery.

For clients can be effective only when managed with the eagle eyes of a brand-focused executive.

Key Points From This Bulletin:

  • Outsource service providers need to understand the key role they play in the management of a company’s brand. Those that adopt a brand management philosophy will succeed. Those that don’t run the risk of being marginalized.
  • Consumers of outsourced client service need to ensure their supplier is accountable for brand development that is congruent with the company’s interest. Outsourcing client service — a key point of experience delivery for clients — can be effective only when managed with the eagle eyes of a brand‐focused executive.

Questionable Service Quality With Outsourced Service Providers Creates a Brand Development Issue.

Credo Consulting recently interviewed senior executives at a number of companies that use outsourcing models to deliver elements of their companies’ client service. We asked them, “Who runs your client service? And what has been your experience with your service providers?”

What follows are a selection of comments from our interviews. These help illustrate some of the issues that executives have to grapple with as they make the decision about whether to “buy” (i.e., build the systems and processes internally) or “lease” (i.e., outsource the execution to a service provider.) While we did find executives that were pleased with their outsourced service providers, these were invariably operations purists that admitted they have not fully rationalized the client service centre’s role in managing the brand.

COMMENT #1: “Our client service management is outsourced to [ServiceCorp], if you’re familiar with them. They do all their own internal self‐monitoring and training, but, that’s problematic, in my mind. For example, in the last month there were literally thousands of our calls that went to [ServiceCorp]. We had absolutely no control over these calls. These were calls from our advisor base — our clients! — and the intelligence from these calls is simply not coming back to us as a company. We completely miss the opportunity to:

  1. Interact with our clients,
  2. Learn from what they are asking and saying; and,
  3. Manage the client’s perceptions of us.”

Service Providers Must Be The Conduit of Important Learning About Clients

Credo’s Perspective: Any touch‐point a company has with its client presents a moment of truth; an important opportunity to affect and correct the position of the brand. It’s critical that marketing executives know how the company’s brand is being managed if they are going to control it effectively. The outsourcing of any touch‐points is a tremendous potential brand risk. Certainly outsourcing, where you have no effective way to either control the interaction or observe and learn from the interaction, presents such a risk.

Client service centre managers need to appreciate their roles as brand stewards. They are people that have direct impact on the customer’s perceptions of a company’s brand. As brand becomes a more important asset that differentiates competitors, outsourced client service providers need to be prepared to offer assurances that their representation is congruent with their client’s branding interests. Further-more, this will increasingly mean that service providers will have to offer better feedback to their clients about what they are continually learning from clients.

COMMENT #2: “We’re going to take back the control of our client service delivery. However, before implementing our own management and call monitoring program, we do need to affect change in the way we conduct our client service. We want to do this before we begin our own measurement. We already know our service supplier is failing us. It’s unfortunate, but we have no idea of the quality of service that is being delivered by our service provider. When you figure that the average life of the rep at [the company we’re using] is two years or less. We know that the knowledge base that they are working with simply cannot meet the standard that is expected by our clients…”

Consider Rep EXPERIENCE and Not TENURE

Credo believes that comment #2 presents a misconception. A client service team may be comprised of people that are relatively new to the role at the organization, but they may actually bring considerable knowledge and client service delivery skill to the table. If you’re considering using a service supplier, your company needs to ask the question about the knowledge, skills and abilities of the team members that will actually deliver the goods. An outsource service provider should be able to deliver a level of comfort that their team’s experience can effectively deliver your brand.

COMMENT #3: “The … seasoned reps at this outsourcer will answer questions in any given day about as many as six different fund complexes. If a representative is not as experienced, the company will allow them to field calls related to two different companies. So there can be a representative sitting there when a call comes in, and they can tell by the line’s signal that it’s for one company or another. There’s a whisper saying it’s [company X] or [company Y,] so they know what company it’s for and how they should answer the call as they are picking it up. But, even if somebody is “seasoned,” … they may answer questions on behalf of six different companies. What they use is their own internal intranet‐style system, for lack of a better descriptor. It’s a system that posts all of the “permissions” and “answers.” So, if they get stuck on a question, they bring up an internal notes system to say “you’re allowed to say this about [ServiceCorp],” or “here’s [ServiceCorp]’s policy about another matter.” Clearly, all of the companies that are using [this outsource service provider] or other outsourcers are getting homogeneous representation in some respect. It’s tough to build a differentiated brand in that manner, when you’re not controlling the experiences you’re delivering to your customers and when you don’t have adequate mean of even examining those experiences.”

Service Provider Info Systems Should Distinguish and Differentiate

From comment #3, Credo believes that an outsourcer’s information systems — the systems that keep your information at the fingertips of the individuals that are creating your brand — should be a point of differentiation. Your service provider should be able to impress you with the tools that their team members use to access the information they will use to serve your clients.

COMMENT #4: “Most of the customer service reps are contract workers and not full time. There’s a lot of seasonal and part time workers. And, they are low paid. So, why would I trust my $300million book advisor who has $40million banked with me to somebody who is being paid $12 an hour. Someone who has no vested interest in whether or not they give good service? That’s absolutely insane.”

COMMENT #5: “We don’t know what we’re doing with [ServiceCorp]. We’re at a point of frustration from really not knowing what level of service is being delivered, while at the same time being given assurances. They tell us that they pull 15 calls per month per rep for review. But those will not all be calls made about our company; many will be for other companies because their reps will obviously answer calls about a bunch of different companies in a shared services environment. Is 15 calls per month enough? In one breath we get assurances that they have proper protocols in place. But, in the next, we learn that they have hired a consultant from The States to revamp their entire metrics system on how they judge call interactions. They are revising their whole system.”

Credo believes that as a consumer of outsourced service, your relationship with your service provider must be highly cooperative. It can develop in a highly cooperative and constructive manner if, early on, you establish mutual expectations with respect to communication protocol. Establish how often you’ll speak…and what you’ll cover when you do speak. Don’t assume that the sending of reports can effectively supplant face to face or discussion time…because it won’t.

Be Clear; Build Credibility

Comment #5 illustrates the importance of clarity in messaging along with the management of perceptions. Credo’s brand measurement and management model identifies credibility as a critical driver of support. When a company delivers mixed messaging (as was described in comment #4,) it undermines its credibility. In such circumstances the service provider will likely lose the business. This speaks to the importance of establishing clarity of communication.

If the service provider had been clear about its objective in renovating its system, indeed, if it had taken time to ensure its renovation efforts had been positioned this in a constructive light, the outsourcer might have seen this as value added rather than as a deficiency.

Lease or Buy?

Companies must work tremendously hard to develop their brand. Other Credo research has clearly demonstrated that effective branding drives additional sales. Branding involves creating and managing the client’s experiences with your company. Outsourcing of the client service activity involves having people that are external manage the delivery of clients’ experiences. It is critical that users of outsourced client service effectively monitor the nature and quality of what they are buying.

Comment #4 suggests that handing critical client service delivery to temps, part timers or that are low paid is a ridiculous premise. This is not true. What is ridiculous is the premise of abdicating responsibility for a critical brand management touch point. In truth it’s negligent on the part of the brand manager. If you’re going to entrust $50million accounts to $12/hr labour, then you need to watch very carefully over the shoulders of those that are interacting with your important clients. The cost of training, measuring and communicating with the outsource service supplier has to be a component of the “lease or buy” equation.

What’s In A Wrong Number?

You Decide! Credo recently called a the telephone number listed on a company’s web page in order to be connected to a project manager at that company. We dialed the number listed on The Company’s own well‐identified website at 8:27am. We were connected to an automated outgoing message: “This is [ServiceCorp]. Our offices are closed. Please call back during regular business hours.” We were summarily disconnected. We checked the number on The Company’s website, dialed it again…and got the same message. “This is odd,” we thought. “We’re calling one company and getting another!” A third attempt, at precisely 8:31am, was answered by the smiling voice of a service rep for The Company that we had been calling originally.

It was too late; however. The outsource service provider had blown The Company’s cover; the brand of The Company we had been calling had been compromised. The outsource service provider had neglected an apparently minor detail — setting up the automated outbound message as though it were The Company’s phone number rather than the outsource service provider’s number. In so doing, the service provider had revealed to us (and poten‐ tially all of The Company’s clients) that The Company had outsourced its client service department.

This seemingly minor issue actually speaks volumes. It compromises the experience that The Company is trying to create for its clients.

Research for Wealth Managers

Credo Consulting Inc. works with companies in the wealth management industry. Our clients include many of the industry’s largest asset managers: mutual fund companies, banks and insurance companies. Credo also works with a number of investment and insurance brokers/ dealers as well as with several industry associations.

Credo helps its clients by providing independent, objective research consulting services. We provide insights based on measurement for management.

Most of Credo’s research focuses on a combination of:

  1. Brand gap measurement and management;
  2. Sales Force and Distribution Effectiveness;
  3. Econometrics; and,
  4. Product development.

While our focus helps clients with various aspects of marketing management, we regularly conduct customized research projects to help clients gain critical perspective on their unique circumstances. Accordingly, much of our work is never published. Credo’s objective guidance will help you understand how your company is performing both practically and in the eyes of your clients. Our work will help you establish process for managing perceptions and various aspects of performance over time.