/ Employee Outsourcing

Employee Outsourcing: Challenges and a Solution

What is Employee Outsourcing?

Outsourcing is when an organization contracts with another organization to provide services or products of a major function or activity. Work that is traditionally done internally is shifted to an external provider.

While outsourcing continues to grow in popularity, it is key for teams and business to ensure that outsourced agents are used efficiently and effectively.

Quality Outsourcing Requires Overcoming Challenges

Researchers in the fields of Strategic Marketing, Business and Management, Supply Chain Management, and Human Resource Management have discussed the following impacts on employee outsourcing success:

#1 Agent Turnover

The turnover rate for these agents is, on average, up to 25% per year, and according to a Cornell University study of outsourced agents:

The costs of turnover are high. On average, replacing one agent equals 16% of the gross annual earnings of a call center worker – that is, the simple replacement costs of one worker equals about two months of a typical worker’s pay. If lost productivity is taken into account, replacing one worker equals between three and four months of a typical worker’s pay. 1

It is well-known (and supported by research) that training has a positive impact on turnover. Merlin guides provide in-software walk-through guides that agents can access every time they complete a task -- this allows them to train and perform within the actual software programs they use each day. This increasing productivity for newly hired agents, while helping to decrease turnover in agents already hired.

#1 Accurate Reporting

Outsourced agents often have specific targets that measure and define their succes (i.e. "calls must be answered within 60 seconds), and these results must then be monitored by a person, if not by a team of people. 2 The better the accuracy and frequency of this reporting, the more the hiring company is able to maximize the benefits of outsourcing while mitigating the risks.

Merlin provides Admins with up-to-date access to guide use and completion metrics, as well as compliance notification acknowledgments.

#1 Customers' Expectations

Especially in regards to customer-facing employee outsourcing, it is important that customer service and satisfaction not suffer in a way that negatively impacts the costs saved by outsourcing in the first place.

According to a study published in the Journal of Strategic Marketing, successful employee outsourcing can lead to increased customer satisfaction if there is adequate performance criteria and feedback, effective communication, and top management support and involvement. 3 Through Merlin's many features (interactive guides, FAQs, links, and notifications) managers are able to provide in-the-moment support to all agents.

Merlin Guides provides increased quality, automated metrics and speeds up process changes.

With Merlin:

  • Agents do the right thing at the right time, every time: With our Smart Guides, you can ensure that they are taken through the guide every single time. Ensuring they don't miss a step in your process and are following each step correctly along the way.
  • We track everything: You're able to see which agent did which task, when they started, how long it took and if they finished the task as well.
  • Process changes are instant: When you make a change to a guide, it can be pushed to all agents straight away. No need to monitor whether they are using the new or old process. We've also created a new process change acknowledgment feature to ensure that all agents are aware of new information and processes.

Employee Outsourcing Research Sources:

  1. The Global Call Center Report: International Perspectives on Management and Employment
  2. The Effect of Training on Employee Performance
  3. Outsourcing of Customer Relationship Management: Implications for Customer Satisfaction
  4. The Perceived Impact of Successful Outsourcing on Customer Service Management
  5. Outsourcing — The Benefits and the Risks