In the competitive business world, choosing between an internal (in-house) and outsourced contact center is a crucial strategic decision. Each option has advantages and disadvantages that must be considered. This KPSG article will explain the pluses and minuses of these two options.

Outsourced Contact Center

One BPO service that is often used by companies is contact center outsourcing. By handing over contact center management to an experienced BPO service provider, companies can focus their internal resources on other core aspects of the business. Here are the advantages and disadvantages.

Advantages of Outsourced Contact Center:

  • Cost Efficiency: Outsourcing reduces infrastructure, technology and training costs. Labor costs may be lower in alternative geographic areas. Example: Companies do not need to spend large amounts of money to build new contact center facilities or purchase sophisticated hardware and software.
  • Specialty Skills: Outsourcing providers bring experience and best practices to improve customer interactions. Example: BPO providers have agents who are trained and experienced in handling a variety of customer service situations, which can improve service quality.
  • Scalability: Easily adjust operations based on call volume fluctuations. Example: When call volume increases suddenly, such as during a promotional campaign, a BPO provider can quickly add staff to meet demand.
  • Technology Access: Gain access to a powerful technology stack. Example: BPO providers typically have the latest customer relationship management (CRM) software and analytical tools that can improve efficiency and service quality.
  • Focus on Core Activities: Direct internal resources to core business functions. Example: Internal teams can focus more on product development and marketing strategies without being distracted by contact center operational issues.
  • Global Reach: Serve customers across multiple time zones and languages. Example: Companies can provide 24/7 service to customers worldwide, increasing customer satisfaction and retention.

Disadvantages of Outsourced Contact Center:

  • Less Control: Outsourcing means giving up some control over customer interactions. Example: Companies may have difficulty ensuring that BPO providers fully follow their brand guidelines and customer service policies.
  • Data Security Concerns: Sharing sensitive data with third parties increases security and privacy risks. Example: Companies need to ensure that BPO providers have strict security measures in place to protect customer data.

In-House Contact Center

Although contact center outsourcing offers various benefits, some companies choose to manage their contact center in-house. Maintaining a contact center as part of internal operations can give a company greater control over customer service and tighter integration with its business strategy.

Advantages of In-House Contact Center:

  • Direct Control: Directly manage customer interactions, quality standards, and agent training. Example: Companies can quickly adjust customer service approaches based on direct feedback and business needs.
  • Cultural Alignment: Aligning customer service with the company’s values ​​and brand identity. Example: In-house agents can be specially trained to reflect the company culture and work ethic, providing a consistent and authentic customer experience.
  • Immediate Feedback: Closeness to internal teams facilitates continuous improvement. Example: Customer service issues can be handled immediately by involving co-located management and operations teams.
  • Data Security: More control over data security and compliance. Example: Customer data remains within the company infrastructure, reducing the risk of information leakage.

Disadvantages of In-House Contact Center:

  • Higher Costs: Requires significant investment in infrastructure, technology, recruiting, and training. In addition to being time-consuming, it also makes it difficult for the company to focus on its core business and is usually very complex if managed internally. Example: Building contact center facilities, purchasing hardware, and salaries and benefits for in-house employees can be very expensive.

Summary

The decision between choosing an internal or outsourced contact center really depends on the company’s specific needs and business strategy. Outsourcing can offer cost efficiencies, scalability, and access to advanced technology, while an in-house contact center provides greater control, cultural alignment, and better data security.

For companies that want to focus on their core activities while still providing high-quality customer service, outsourcing can be the right solution. However, if the company prioritizes direct control and cultural alignment, building an internal contact center may be more appropriate.

KPSG as a provider of BPaaS and CXaaS services is ready to help you determine the best contact center strategy for your business, either through internal or outsourced solutions. With our experience and expertise, we are committed to improving the quality of your customer service and supporting your business expansion. Contact us now!