12 Oct On-Shore, Near-Shore or Off-Shore Call Centers: Which One is Right for Your Organization?
Why outsource your organization’s call center service? The financial benefits of an outsourced call center are measurable, but also there are other efficiencies that reduce burdens and responsibilities for busy companies. Once a business hires a call center, they free up their time to accomplish more important tasks and can be more effective in their day-to-day job. The degree to which you can benefit from subcontracting your call center depends on your choice of partner, and choosing the right partner requires comparing your options against your needs and concerns.
What exactly are your outsourcing options?
You have three:
Outsourcing within the same country.
Outsourcing to a nearby country with similar time zones, such as Costa Rica or Panama.
Outsourcing to a faraway foreign country.
Even though an outsourced call center functions similarly no matter where it’s located, each type has its own unique characteristics, affecting your costs and even customer satisfaction. Keep the following in mind when choosing the right type of call center for your organization.
On-shore call centers have experienced rising costs since the pandemic, making them out of reach compared to near-shore and off-shore call centers. That’s even considering higher NPS and more production. However, on-shore call centers have lower costs in terms of travel and most are close enough for an overnight trip, if necessary. If travel to your call center is often necessary, this can offset the higher costs.
Near-shore call centers are less expensive than on-shore, but more expensive than off-shore. As far as travel is concerned, it’s more expensive than on-shore, requiring several travel days minimum. Also, Fortune 100 companies are raising costs in many LATAM countries ($30+/hour).
Off-shore call centers are the least expensive, and their costs have stayed fairly consistent over the past 5-7 years. However, frequent travel to them drives up costs, requiring 7-10 days for one visit.
Hybrid call centers are becoming more prevalent with larger BPOs in order to have the best of all worlds, keeping costs down while keeping customer satisfaction high.
Keep level of involvement in mind when selecting a call center solution, meaning how do you want to manage the remote teams? The farther away you are from the call center; the more you must rely on the statistics and not the people. You can have an ad-hoc meeting with an on-shore group to get a sense of what is happening and how to make changes. For off-shore call centers, it’s mostly about KPIs and following objective patterns. This means less subjectivity and “feel” of the calls, which is important to make improvements when necessary.
On-shore call centers offer easier management involvement to maintain since everyone is together in one main location, other than those with remote locations.
Near-shore call centers take managing by numbers, but a rotation of your employees in the near-shore facility makes the process easier.
Off-shore call centers have many employees managing intra-day results remotely, as well as numerous meetings to make sure goals are being met. It’s a potentially unwieldy process, but open lines of communication reduce the burden.
Data & Privacy
You know more about your data privacy and security protocols than anyone. Since you’re likely more familiar with your country’s privacy and data protection standards, you’ll know what security protocol and technologies will work best to keep your information secure.
Many data privacy acts in foreign countries are not the same. The United States may have stricter cybersecurity regulations than some countries with offshore services. While they may not contradict each other, countries other than the US may not provide the level of protection you need. In addition, while the call center itself may be compliant, THEIR vendors may not have the proper security controls. Certainly, an on-shore call center provides the most robust protection for your data and for privacy.
Types of Calls
The types of calls your call center receives is based on your business and goals. Call types can fall under one or a combination of the following depending on your customers’ needs:
- Conversational: better for on-shore call centers
- Informational: better for on-shore call centers if customers have varying needs; off-shore can manage these as long as the representatives can speak your desired language conversationally and there is a basic script or answers to follow
- Transactional: off-shore call centers can handle these
- Script-based or Free-form: off-shore can manage these as long as the representatives can speak your language conversationally
Let the customer experience be your guide here. Using English words, but not pronouncing them in a way that is familiar to the customer and the feeling of being two seconds behind the conversation while trying to “translate” English words into familiar phrases that English speakers recognize could lead to lower customer satisfaction.
- On-shore call centers have regional dialects, but they are mostly understood by the other regions
- Near-shore call centers may lack prosody where these subtleties lead to a less than desirable call outcome
- Off-shore call centers may have completely different speaking tones (sing-song, curt, emotional)
How much control and influence do you need over your call center? There are not many employ-at-will countries. In many countries, the 12th month rule applies and pays employees one-month salary for every year they are there. In India, a letter must be sent to the government advising you are letting an employee go.
On-shore call centers are easiest influenced either by being more present at the call center or having more tacit knowledge of domestic operations. Plus, on-shore human resource provides the most seamless, streamlined, and simple approach to managing people.
Near-shore call centers are somewhat easy to influence, but still difficult to exert the control needed to make changes on the fly in many situations. Both near-shore and off-shore solutions for Human Resources have many country specific regulations that protect the employee.
Off-shore call centers are beholden to country specific rules, making influence and control more restrictive. With the right BPO, all aspects of human resources can be managed by one single group.
On-shore attrition has taken huge hits from COVID and gig economy workers. While your organization doesn’t benefit from learned experience from long-time representatives, it is the call center’s burden to hire, train and retain.
Near-shore attrition comes in waves as more large corporations enter the market.
For off-shore solutions – other than price, low attrition is the largest reason given for going with this option
Want to Speak to an Agent?
Close to half of consumers still would like to speak to a live agent on the phone. Chat comes in second at 23%. Where is that percentage likely to go in the next 5-7 years? What will ultimately take the #1 spot? The points above and these questions are going to drive your decision on which type of call center is best for your organization.