Impact of Outsourcing on Effectiveness of Call Center Services

Call center is the frontline of communicating with customers. This paper reports the findings of a survey on service effectiveness of call center operations of mobile communication service providers in Turkey that either use in-house or outsourcing method. The primary objective of this paper is to explore how the customers of mobile communications service provider companies perceive the inbound call center processes for speed, easiness of use, first call resolution, effective inquiry and in doing that what qualities they display. For this purpose a survey was conducted with the customers who use call centers either to make an inquiry or to complain about the services. The aims were: to specify the typical behavior of mobile communications service users; how the firms handle inquiries or complaints; if they solve the problems for good and in what time or how long it takes to get an answer practically useful; to reveal the speed and timeliness of the processes. The survey was conducted with the mobile phone users in a highly populated area of Istanbul.


Introduction
Although some parties may call it "contact center" while some others "customer interaction center" and the like, "call center services/operations", the term I prefer to use in this article, makes companies understand how their product or service is perceived by their customers and how it is acknowledged by them. Indeed, today call center services is an indispensible part of any operational Customer Relationship Management (CRM) system. It is a critical area where the customer's experience and attitude towards the company are developed by transferring the complaints or requests of the customer to the headquarters where all the operations are planned and executed as a whole; the quality of customer service basically depends on the effectiveness and responsiveness of the system to customer inquiries.
The call center is often the first and only link a customer uses to a business. In everyday operations it is the exclusive means of collecting customer contact information. It is critical because a customer's experience on the phone can directly affect the perception of the company. A major element of any effective call center operations is its capability to respond back as quickly as possible with a welcomed solution. From the call center representatives' view, effectiveness of a call center is accepted as the complete understanding of the problem or issue, finding quick and tailor-made solutions and immediate response to customer inquiries. From the customers' angle it is easy access to the center, less menu, less waiting on the line and surely seeing that problem is solved or inquiry is fulfilled.
Ever since the 1990s, the role of call centers has been transformed from simply dealing with customer inquiries to performing integrated marketing functions. The modern call centers manage a wide array of customer interactions including voice, e-mail, online interaction, self-service assistance, and collaboration. It also serves "customers" other than consumers, including business partners, employees, and field agents. Firms are starting to view contemporary call centers as preferred and prevalent channels to acquire and retain customers, enhance customer relationship and grow long-term revenue, rather than thinking of it as a cost to be minimized. The management of call centers has become an important part of CRM strategy.

Customer experience is defined and informed mostly via the interactions customers have with the
employees. Sadorf (2009) states that arming call center employees with an understanding of customer requirements remain top priorities for ensuring the call center is leveraged as an asset for improved customer relationships and driving business results.
Customer call centers run into trouble when they deviate from the service expected; ironically most businesses are aware that it's easier to retain a customer than go for a new one. If you can't retain why go after another. Thus, retaining customers is undoubtedly a vital task for any company to survive. To keep customers on hand is a function of the quality level of customer service. Better customer service means higher customer satisfaction, more loyal customers and longer loyalty of customers.
Call Center Representatives (CCR) have a significant influence on service recovery, customer satisfaction, and firm profitability. Data shows that customers' perceptions of a firm are strongly influenced by the interpersonal interactions that they experience when they voice complaints to a live person (Tax, Brown, & Chandrasekharan, 1988). Indeed, firms that fully compensate customers fail to get a return of investment if their customer-contact employees are rude and unsympathetic (Tax & Brown, 1998). Increasingly, complaint management and service recovery are accomplished through inbound call centers (Schmid, 1997;Tippen, 1996). Research has verified that complaint resolution by a centralized call center is a cost-effective way to increase the probability of customer repurchase decisions and to deliver significant financial benefits (Oetting, 1997;Stuller, 1999

Quality in Call Center Services
Call center service is basically one of the economic ways of saving some of the valuable time that a customer spends (therefore pleasing customer) and also saving office personnel's time (therefore cutting costs). Certainly there are other parameters to have and operate a successful call center. Before anything, it should be designed and to solve problems of customers quickly, precisely according to their needs. But how do we define effectiveness?
Effectiveness is a measure of how system performs or if a system achieves its predetermined goals and it is usually measured as outputs produced in a certain time limit. is their personal interpretation of the service and quality provided by the organization. Staples (2006) argues that although efficiency never loses its importance in business but in an industry that's largely transitioned from one-dimensional call centers to e-mail, web chat and the full-fledged multimedia contact center, making a center more efficient isn't enough to make it competitive. As technology continues to empower consumers with e-services and multimedia interaction options, efficiency-driven metrics such as average talk times don't always gauge an agent's actual performance.
Nor do they reflect the customer pulse needed to improve service levels across multiple channels.
McMurray (2008)  Managing any call center operation today means walking three tightropes pitting efficiency (which is all too easy to calculate) against effectiveness (harder to measure and repair). This applies to sales efforts, in support, and in overall operations. It also cuts across different kinds of centers, whether they are multi-site captive (in-house) or outsourced, inbound or outbound (Price, 2005). Today in so many organizations efficiencies are often measured in talk time per hour. What is often forgotten is the concept that a representative simply multiplies or amplifies an existing process with its existing efficiencies (or inefficiencies). What is equally important is the effectiveness of the process in producing the desired result.
Too much focus has been placed for years on call-handling efficiency; handling the maximum number of calls at the lowest cost. On the other hand, not enough time or effort goes into improving the effectiveness of the business processes, the people executing them or the ways in which they use of calculation for the effectiveness of the call center is based on determining the level of customer satisfaction with the call itself.
McGarahan (2007) points out that contact centers over-emphasize quantity or volume type metrics. They look at how many calls, average speed to answer, time in queue, call duration. This is over-emphasizing only one perspective. Nadorf (2009) remarks that the majority of performance measurements in the call centers today are "efficiency" metrics. Such performance measurements and metrics are focused on wait times, abandon rates, first call resolution, etc. While these performance measurements are important, the most effective performance measurements we can use are those that incorporate qualitative feedback directly from the customer-performance measurements that provide insights into the "effectiveness" of call center operations.
How well are we building customer relationships? How satisfied is the customer with the treatment and engagement they have with the call center representative? How does the customer rate the overall experience? If call centers are able to measure the quality of a representative sample of their support contacts from post-contact customer satisfaction surveys, then it would be possible to schedule the "speedy" and "slower" representatives in a way to get maximum productivity and quality performance.
McGarahan (2007)  that allows you to achieve that metric but sacrifices some other type of important behavior. In other words, the emphasis on quantity sometimes sacrifices the quality of the experience. You need a quantity/quality balance, an individual/team balance, a cost/effectiveness balance, and of course you need to look at the efficiency and effectiveness of representatives as well.
The key factor is to determine what the real objectives of your call center and how the call center measures results? If it is to retain customers and is measured by first call resolution, routing to the right person, less number of repetitive calls. By aligning the call center's objectives with its measured results and taking into account effectiveness as well as efficiency, a call center can optimize its true production.

Outsourcing: Is It an Effective Alternative?
According to Bendor-Samuel (1999) when companies treat their call center as a liability or as a "cost of doing business", its effectiveness is limited. One option to consider is outsourcing. This enables outside experts to handle the process -experts whose core function is the proper operation of a call center.
Putting a company's IT functions in the hands of qualified professionals also provides a business with the ability to concentrate on its strategic functions. Instead of spending time and energy operating a call-center, a company can invest those resources in marketing strategies or improving the company's product which in the process may reduce the calls that come into the call center. With both sides, the customer and the vendor, specializing in the activities they do best, the highest-quality product can be produced and marketed. Outsourcing of the workforce management function allows companies to gain access to workforce management capabilities without the cost of purchasing and supporting new technology and the need to hire, train and support internal staff. Outsourcing gives smaller organizations the ability to increase their service levels and reduce labor costs without making a substantial investment in technology. (Cuccinelli, 1999) A call center outsourcing offering designed to improve revenue opportunities and optimize customer experience while reducing support costs and investment requirements is preferred by many organizations.
On the other hand, one counter idea to this is that outsourcing staff does not know the products well enough to support the customer service.
Outsourcing proves to be a useful tool in many cases not just for removing the need of keeping extra workforce but it also generates the possibility of operating from a point where the employee costs are less in comparison. Today a lot of companies send their call-center operations overseas that most people no longer expects to talk to a native English speaker when they place a call to a customer-service hotline. For instance, one notable Japanese computer company has been carrying out call center operations worldwide from an operations base located in Istanbul. India is probably the best example of this. But that's not the problem. The problem is that so many companies decide to export flawed call-center practices along with the jobs. Slack (2009) indicates that outsourcing isn't going to solve a company's problems if it has inadequate analysis procedures, agents who don't know products or poorly configured automated software solutions.
Outsourcing has grown enormously over the past few years, however, most of the attention so far has focused on the economics of the transaction, and much less on the human element involved in the transaction. Raghuram (2006) suggests that it is challenging for the representatives to identify with client organizations because of cultural differences, tacit contexts and lean communication media used to connect across vast geographical distances. The weak client identification may result in poor performance, inability to build trust with customers and long-term customer satisfaction. However, skillful individuals and organization initiated practices such as careful employee selection, intensive training help a lot to deal with these challenges.
Yet there has been limited research on the influence of call center representative behaviors on the effectiveness of service recovery. Since the voice of the customer service representative is the only element on the front stage of the service operation, Pontes & Kelly (2000) propose that the oral competencies of these agents would have a significant influence on customers' perceptions of the firm. The outsourcing of any technology-oriented business process is quite critical. Whether a company is outsourcing the call center or the entire IT department, there are certain guidelines that must be followed to ensure a successful outsourcing relationship. The service should be well integrated into the company's business operations to keep the customer service flowing uninterruptedly.

Methodology
This paper presents a study which explores the differences of outsourcing and in-house call center Turkcell and Vodafone are pursuing different policies in call center operations; Turkcell outsourced so-called operations to a third party while the latter is using its own staff to handle this formidable task.
What we try to achieve, in this paper, is whether these two different organization types operate differently in enhancing effective customer experience. Thus, this study can be regarded as a preliminary analysis exploring the current status. In this study a statistical package (SPSS 12.0) is used to analyze data. A survey is designed to be carried out with two leading GSM companies in Turkey with inbound call centers to see if there is a meaningful difference on either way between using in-house or out-sourced services.

Data Collection Procedure
In this survey which is based on a descriptive research model, the population consisted of randomly selected respondents who either use Turkcell or Vodafone GSM services. The main question at the beginning was where and how to carry out the survey. Since the research was about how the customers perceive the call center services asking questions directly to the users of this service was to be the best possible way to conduct the data collection process.
A questionnaire was decided to be the main tool for data collection and Bakırkoy area was selected as the survey field not just because it is the biggest province of Istanbul but also represents the city's diverse population fairly well. The questionnaires were filled in simply by directing questions to the participants and 95 completed questionnaires were then taken for the final work-out. This figure is reasonable and within the survey standards, thus acceptable for evaluation in the later stages of the research.

Research Design
The questionnaire developed for the research consists of 20 questions and it has basically two sections.
The first group of questions was the main section of the research which aims at disclosing the reasons for inquiring, the steps taken by the call center representatives in handling the inquiries/complaints; if reached the right person at first contact, the duration and number of calls that inquiry/complaint is solved/answered, the probable causes of unsolved complaints in to customer's opinion, the result of customer contact (satisfied with the outcome), the state or action of customers (no action, dissatisfied, switching brand) if the outcome is not as expected. A few questions in the second section aim to identify the general characteristics of the respondents, namely age, education and job status.

Findings of the Survey
Among the people who took participation in the survey, majority was subscribers to Turkcell with 70 (73.7%) and the rest is Vodafone with 25 (26.3%). Survey respondents' distribution according to education status is as follows: elementary school (9.5%) high school (38.9) college or university (48.4) postgraduate (3.2). Among the group, 29.5 per cent did not mention using call center as the main inquiry channel while 70.5 per cent have actually used the service. Of the respondents not used call centers 20 per cent preferred channels other than call center for inquiring or complaining about the service they were getting and only 9.5 per cent said that they didn't have any reasons to use the service (see Table 1). In order to see if there is any dependency between the company using outsourced call center and the company using in-house call center on the basis of communication channel preferred by their customers, the chi-square test has been carried out and found out that there is no dependency. Therefore the customers' choice of communication channel is not dependent whether the company uses in-house or out-sourced call center.

Table 2. Frequency Distribution of Actual Inquiries
To get information about product/services is the most frequently inquired subject with 37.9 per cent of the all responses. The product/service relating problems account for 12.6 per cent of the inquiries.
Technical support is the third with 10.2 per cent. Cross tabulated data shows that the frequency of inquiries is almost identical for both companies especially for the most frequently asked questions.
Figures show that the first three items cover almost 61 per cent of the inquiries (see Table 2).
The need of communicating with call center is examined for age, education and job status of the respondents. When chi-square test applied it is found out that type of inquiry is not dependent of age and job status but dependent on education.
The reason for calling Call Centers is also investigated for both out-sourced and in-house services.
Chi-square test indicates that need of calling is independent of the choice of outsourced and in-house operations. This implies that there is no meaningful relationship between the type of inquiries and having out-sourced or in-house call centers. To sum it all up we can say that the age, education and job status were found to have no effect on the choice of outsourcing and in housing of the call center services.

Effectiveness
There is a significant relationship between the representative's problem-solving initiatives before the conversation ends and the type (out-sourced or in-house) of the call center services according to customer perception. This means that customer perceives that outsourced call center is more effective than the in-house call center in solving customer's problem during the first call (see Table 3). The responses indicate that contacting call centers is dependent on the type of problem to be solved via call center representatives. Customers for whom the problems are solved at first call are more likely to re-use the service. Other findings related to this are as follows: Provided that the problem is not solved at the first contact both out-sourced and in-house call center operations have no relationship at all with the time limit given by the representative for the solution of the problem. Also customer's calling back when the problem is not solved in the specified time limit is not dependent on this choice either. There is no significant difference between these two types of call centers on the basis of the given time limit in which the representative would call back.
Although there is no significant difference between these two types of call centers on the basis of negative behavior of CCR's towards customers, nevertheless the case is different for the positive qualities of the representatives. In customer's perception the outsourcing firm's call center is significantly different than the in-house call center for at least one of the positive qualities of CCR's.
The outsourced call center is found out to be superior to the in-house in the quality component of warm reception and understandingly manner when interacting with customers (see Table 4).

Service Quality
The core of the research lies in the overall assessment of the service quality criteria. The criteria are investigated on two aspects: what is expected on customer's side and how it is satisfied in customer's perception (see Table 5).

Table 5. Service Quality of Call Centers (Expected vs. Realized)
Customer perceived service quality of call centers in general is found distinctively lower than the customers' expectations. There is no distinction on this result on the basis of call center type. When it is further investigated on that basis there has been no indication that there is any significant difference in the service level of both types.
The probable reason for which a problem is not solved according to customer evaluation is asked to the respondents and the replies were tabulated (see Table 6). In fact, the replies to this question make one thing certain; customers see representatives as the main barrier preventing the solution. that a CCR can do. These findings were tested again for a relationship with the call center type chosen and no relationships were found.

Table 6. The Probable Causes for the Unsolved Complaints as Stated by Respondents
One last finding is that in both cases majority of customers would call again and there is no significant relationship but the re-call ratio is distinctively higher for the outsourced firm than that of in-house one.
The individual decisions taken by customers that are unsatisfied with the call center service indicate no significant difference and therefore is not dependent on those two types of call center services. The decisions ranged from switching to other GSM brands to staying with the brand, namely continuing with/without dissatisfaction, trying other communication channels. A small fraction of the respondents leave the decision open saying that it will depend on the circumstances (see Table 7). Another striking finding is that Turkcell's customers are less tolerating if they are not satisfied with the service they are getting. The ratio of customers who says "will switch to other brand" is 30 per cent while those who say "will stick to the brand" accounts for nearly 67 per cent which is two thirds. For Vodafone the ratio of "loyal" customers is higher with 80 per cent. To interpret this data is open to further elaborations. What we could reasonably express is that Turkcell customer's expectations are slightly higher than those of Vodafone.

Other Findings
There are some other findings which are more general but worth mentioning. One of them is that routing calls to other persons had a meaningful relationship with at least one of the inquiry type and that was found to be the inadequate information relating to the promotional product/services. This means that whenever this type of inquiry occurs the first representative is most likely to transfer the call to another person.
Furthermore the frequency of transferring calls is found to be in relationship with one of the inquiry type. It is the registering for a new service and at least 3 transfers for this inquiry are encountered.
Making inquiries is not dependent on the caller's age or job status according to the results of the Mann Whitney test. However, education status has a meaningful significance on contacting the call center.
Further tests were carried out to understand at what level it has significance and it turned out to be the elementary school level. Those who didn't go any further than elementary school were using the call center service more frequently than the other levels of education.

Conclusions & Further Research Implications
Finally we are going to sum up what we had about the quality levels of GSM companies' call center services with reference to out-sourcing and in-house call center operations. In this research only customer perception of (in customer's eyes) the quality of the service has been taken into account.
Surely, outsourcing decision depends on many other factors, including direct and indirect costs, savings and other benefits if there is any. The most challenging outcome of the survey was that outsourcing option at some parameters can excel in comparison to in-house operations of call center activities.
The company with outsourced call center is more effective in solving customers' problems at first call.
Customer satisfaction in general and call-again ratio is higher for outsourced call center. Main reason for that is the attitude of representative, more precisely the warm and understanding approach towards customers. Although there is a result which may seem negative at first sight for outsourcing the call center there might be some explanations for that. For instance, frequency of call transferring is higher for the outsourced service still it could be regarded as an advantage because when further investigated on the level of customer's satisfaction and speed of solving customer complaints/inquiries there is no significant difference between these two types of services. This might be due to the considerable www.scholink.org/ojs/index.php/jar Journal of Asian Research Vol. 5, No. 4, 2021 42 Published by SCHOLINK INC. emphasis given on specialization in the customer relations so that the customers already know that this is done to make sure that they receive better service.
One further suggestion is that effectiveness of the representatives and infrastructure must be gauged with simple measurements. This represents a challenging area where future research efforts might be concentrated. Building visibility of call center metrics directly to the call center representatives allows them to have direct accountability for serving the customer. Giving the call center's customer feedback to quality assessment groups and supervisors helps to build coaching and support systems for call center representatives and enable them to continuously improve their support to customers, one of the more effective performance measurement tactics.Thus, we conclude that outsourcing emerges as a better option for call center organizations of GSM firms in regard to the quality level of the service that customers are receiving.