When to Consider Outsourcing Service Support Posted on December 4, 2019 The importance of building a World Class Post Sale Support operation is critical to the success of your business. Key factors to achieve success include: • Focus on the Customer • Commitment to Service Excellence • Running your Service operation as a Profit Centre vs. Cost Centre • Utilization of Technology to improve productivity • Investment in your people What happens when the financial commitment is limited in your organization? What if your Business strategy is inconsistent with a Best-in-Class (BIC) support model? Does that mean Customer Support and Satisfaction will suffer? There are few organizations with the resources to invest unencumbered in all areas of their operations. Compromises must be made to achieve balance. Corporate strategy as well business conditions will drive allocation for investment. Recently, considerable focus has been placed on investment in R&D and Sales & Marketing. This is logical as these areas drive top line growth. The investment to build a World Class Service Support operation can be costly as well as time consuming. Competing for the needed resources can be challenging when economic conditions are less certain. Traditionally, this leads to decisions that force service operations to be treated as a cost centre. Such an approach can lead to less than optimal customer satisfaction metrics thus, driving down customer retention and loyalty. It’s important to adjust internal strategies to optimize investment and resources without losing sight of the BIC support model. Often, business strategy does not adequately address Post Sale Service Support. Product Development, Marketing and Financial and Operational improvement is more commonly emphasized in strategic plans, leaving service support buried in operations. A balanced scorecard approach to drive strategy has been a popular tool to emphasize all facets of an organization’s strategy. Customer Support options should be considered equal when developing strategy. Will Customer Satisfaction suffer without proper investment and strategic focus? History shows Yes. Businesses need a balance of investment, strategy and focus to ensure customer loyalty and retention. There are options available that can help when investment and/or strategic intent are not adequate with a BIC support model. One option to consider is an outsourcing approach to service delivery. Traditionally, organizations have considered outsourcing as a last resort option. There is a perception of risk with loss of quality, brand and the customer control. These are valid points and need to be taken under serious consideration. However, many organizations don’t have the choice nor the financial wherewithal and time required to build a BIC model. When managed properly, outsourcing can be an alternative to achieve success. There are outsourcing options for most functions of a Service Operation. Typical outsourced functions include Customer Support, Technical Assistance, Service Sales, Field and Depot support and Logistics. Outsourcing can be leveraged to augment capacity or provide total support in markets where resources are better focused on top line growth. The key to a successful outsource program relies on that selected provider to drive a BIC model delivery and their ability to implement support around your expectations. Advantages to Outsourcing: Provides ability to add service capacity without the addition of internal headcount. Many companies maintain tight control of headcount during difficult times. Outsourcing service functions allows headcount allocation to be focused in more critical areas such as Sales, Marketing or R & D. Expense reduction. Labour and overhead are typically reduced when utilizing outsourcing partners due in part to their focus on Service Delivery and ability to capture synergies. The advantage of tapping into the technical expertise of outsourcing providers based on the varied client and equipment base they support. This can be leveraged to quickly bring services online. Outsourcing providers who focus solely on BIC service delivery afford their clients the ability to draw on their expertise to improve service operations. Lastly, it’s important to consider how this will impact your people. Outsourcing need not be contradictory. Depending on the extent of your outsourcing requirement, many employees will remain with the business. When leveraged for added capacity, the additional support will improve workload requirements. Employees can be redeployed to other productive tasks such as Service Sales, Customer Interface, Operations or, trained for career development opportunities in other disciplines. When properly managed, outsourcing can be a positive for the employees involved. Consider the options and keep employee satisfaction in mind when navigating the process.