Outsourcing Customer Service to the Philippines Pros and Cons

Outsourcing customer service to the Philippines is picking up steam. In today’s economic landscape, outsourcing customer services to countries with significantly lower labor costs than the US or many Western European countries is becoming an increasingly-attractive option for many business owners looking to significantly cut costs without compromising the great customer experience their customers keep coming back for.

Whether or not to outsource customer service can be a tricky decision, something that should not be taken lightly. Business owners know that their company will be judged by the level of customer service they provide their customers. Why? Because a smart CEO understands the value of delivering timely, consistent, and most of all, great customer service.

The rising adoption of social media has given each and every single one of your customers a voice, a loud one at that. This means that just about anyone can raise hell with just simple one tweet or status update. For many business owners, the thought of just one pissed off customer with an axe to grind is absolutely terrifying and for the right reasons! It can take years to build a great reputation but only one second to ruin it.

Providing great, consistent customer services day in day out in no easy task for any business, which is why it’s best to leave it to the experts. However, just like with any business decision, there are pros and cons. Lets go over them, shall we?

PROS

Cost Savings

The biggest reason is obvious – cost savings. It’s no surprise to anyone that cost savings has always been the biggest driver for companies to outsourcing their customer support to countries like the Philippines. Companies have realized routine savings of 50% or more on labor costs by going overseas. The savings are enough to make anyone seriously consider taking the outsourcing route, and rightfully so.

Availability of Workforce

One of the greatest things about outsourcing is that countries such as the Philippines seem to have an never-ending supply of talent waiting at your disposal. Let’s face it, finding customer service people back home its not easy, finding people good at their job is even harder since people aren’t exactly lining up for customer support jobs left and right.

Working as a customer service representative is is often seen as a filler job that someone would take in between semesters at college, which is why most people don’t really take it seriously since it is usually just a stop gap measure before they are on to something else.

The same can’t be said in the Philippines where call center and customer service workers are proud to do what they do, which is why customer service jobs are always in high demand.

Increased Focus

Let’s face it, most company founders have never run a support organization, and don’t know the first thing about how to set up processes, which tools to use, or even what great customer service looks like.

Outsourcing your non-core competencies like customer service, to an expert will allow you to focus your valuable time on just developing and growing your business. You can work on the stuff you actually enjoying doing, like innovating your products and conducting sales, rather than dealing with petty office problems and operational necessities that don’t add anything to the bottom line and distract you from the main goal.

Increased Peace of Mind

You’ll be leaving something isn’t necessarily your speciality, to a true subject matter expert, with a proven track record. Isn’t it comforting to realize that you can enjoy the peace of mind that stems from knowing that the job will be done right, the first time. No learning curve required.

CONS

Affect Brand Image

For companies with a small town or localized brand image, outsourcing may not be a good fit for their branding strategy. Outsourcing in some cases, like for voice or phone work, may be noticed by your customers and your brand image will be affected. So if that sounds like a genuine concern to you, you can start by outsourcing non-voice tasks, like chat support and take it from there.

Loss of Control

Many CEOs are reluctant to outsource because of the feeling that they will lose control, and the quality they have worked so hard to build up may be compromised.

This feeling of loss of control can be mitigated with proper planning and communication, and by putting in the right performance metrics to continually measure the output of your overseas CS team and ensure that everyone is aligned towards the same goal.

Culture Differences

As you communicate with your Filipino team, you will notice some cultural differences. For example, in the Philippines it is considered rude to say “No”. They consider it impolite as well as a matter of “saving face”. A CEO must be aware of these minor cultural differences and nuances.

Like any major business decision, if you decide to outsource your customer support to the Philippines, you need to make sure you fully understand the pros and cons and the risks involved.

A great way to drastically reduce your risks is to pick a solid provider with a proven track record. Choose the right sized BPO provider as well, don’t choose a massive company that won’t give your account the time or attention it deserves. Start small and then ramp up after you you’ve gotten proof of concept. Also, check references and make sure you have legal recourse with any provider you choose.

In an increasingly interconnected and globalized economy, it’s easier and more cost-effective than ever to outsource customer service to the Philippines, whether you need voice or non-voice tasks done.