Welcome to Issue 08 of Outbound Focus, a free email publication of Sytel Limited.
This issue, we are taking a back seat, to bring you contributions from not one, but two leading lights of outbound from around the world; Sean O’Keeffe, Managing Director of O’Keeffe & Swartz, an outsourced call center in South Africa, and Cliff Hurst, writer, consultant and international speaker, from the US.
In This Issue
- THE OUTBOUND DIALOGUE
with Sean O’Keeffe.
- TIP OF THE MONTH
PRM, not just CRM, by Cliff Hurst.
- CANDY STORE
a double helping of candy.
THE OUTBOUND DIALOGUE
For this issue, we spoke in depth with Sean O’Keeffe. Sean is Managing Director of South African outsourced call center, O’Keeffe & Swartz, and is Director for Telemarketing Affairs for the SA DMA. We invited him to talk about the current state of outbound in his ever-changing country.
i) What is the size of the outbound industry in South Africa, both in absolute terms and relative to inbound?
In absolute terms, it is probably a lot less than many think, and could even be less than a 1000 seats, in terms of those employed in call centers, and excluding the one or two man shops. There is a major industry survey underway that will eventually generate accurate figures, but there are none available right now. Inbound is substantially bigger with many thousands of agents. My guess is that outbound is further behind inbound here than it is in other countries.
One reason perhaps that outbound is lagging behind is that large sums have been invested in inbound technologies in recent years, but without the payoff that people expected, and there is a reluctance to take the next step, into outbound.
ii) Do you see any major changes on the horizon, that will hinder or foster growth?
The early major spend in call centers, as in other parts of the world has been in financial services. The industry here is faced by legislative changes on advice similar to those in the UK and Australia about ten years ago. That could hinder growth.
Data privacy, too, could be a threat as the legislation here is often poorly drafted and rushed through. There is uncertainty about the way in which the Data Privacy legislation will pan out.
The outbound industry is experiencing growth despite this. Insurance companies and banks have been using outbound for cross-selling for some time, but retailers are just beginning to see the potential of CRM and take an interest in telemarketing.
iii) What are the secrets in attracting, training and retaining good agents in South Africa?
[laughs] Our secrets are closely guarded! The main factor is that our recruitment is a rigorous process, and is currently being revamped to make it more so. We operate under the maxim that if you hire smart, you don’t need to manage hard. The problem we often find ourselves up against is that the standard of education of applicants is often very low. We are still suffering from a braindrain. As with other industries, most of those with a good education leave the country, and those that don’t leave, command very high salaries.
Our training in sales and customer service is mostly outsourced, but with a continual training process occurring on the job.
The biggest factor in agent retention is that we maintain a healthy, people-focused working culture and environment. The result of this is that agent loyalty is very high, and so turnover is low. We pay about 10% above average, although this is performance-based.
iv) Typically what kinds of campaigns are companies running and why? e.g. customer care, lead generation, cold calling, etc.
The majority of outbound campaigns are for debt collection. The financial services industry does a lot of follow-up and cross-selling to existing customers. Only a small proportion of outbound is business to business.
v) The South African DMA has quite a sophisticated code of practice for controlling outbound calls. Is this ‘more honored in the breech’ or are call centers complying with it?
The code itself is one of the best in the world, but debt collection centers so far haven’t worried too much about codes of practice.
vi) Other countries have seen a general trend towards outsourcing. What is the trend in South Africa and why?
The growth in outsourcing many people were predicting a few years ago has turned out to be very gradual. The reason again is that although call centers are technologically quite sophisticated, there is often a lack of good management and agent skills.
As for other sectors, there doesn’t seem to be an awareness of, or need to adhere to, the code.
vii) Given the moves toward racial integration in the past decade, is there a corresponding trend toward multiculturally targeted campaigns? How does this affect agent selection?
There has been a swing toward English as the main language for sales calls, but there has been some opposition to this. South Africa has eleven official languages! I have seen no one campaign that aims to cover them all. Some are conducted in the five main languages, but most often campaigns are quite specific in their target demographic. There is a far greater mix than ever before, but this has not come without some backlash. For example, it has been shown that blacks don’t always want to be sold to by blacks, although I expect this to change over time. Right now it is a hard, customer-driven reality. We have found that matching the demographics of agents to prospects’ preferences yields up to five times the results than otherwise.
viii) Do you see many cross-border campaigns, into the rest of Africa or further afield? If so, what are the drivers?
There is very little cross-border calling, and none that I know of right now, mainly because the cost of telephony makes it prohibitive.
Another factor is that the telephony infrastructure across the rest of Africa is often quite poorly maintained and unstable. Also, you have to fish where the fish are. Most of the money is in South Africa, so that is where we target.
ix) In what ways, if any, have the end of sanctions and the acceptance of South Africa into the international community impacted the call center industry?
There has been a technology explosion here, with the result that we are up with the rest of the world in terms of technological resources and expertise. But there are two key areas we need to focus on, if the industry is going to grow in the way that many would like. The first of these is people and process. Drastic improvement is required in both, and primarily this means education and training. The second is the cost of our phone calls. I am embarrassed to tell you how much it costs to dial both within our country and abroad, just believe me that it is many times equivalent costs in countries that we aspire to match, such as the US and the UK.
Telecom deregulation is pending and we will see some real competition for Telkom in 2002. I hope it is not too little too late. If we can get our people and processes sorted as well, then to go back to your previous question, I don’t see why we couldn’t develop a substantial cross-border business in time, much the same as we see happening in India now.
x) In summary, what do you think are the cornerstones in the operation of a successful outbound call center in South Africa?
I know these themes keep recurring, but let’s not lose track of them. People, process and technology. If we can make these work in harmony then we will have a winning formula.
Many thanks to Sean for spending time with us.
If you are a leading outbound specialist, and would like to be considered for an interview for Outbound Focus, just send us an email.
TIP OF THE MONTH
This issue’s tip is from Cliff Hurst, founder and president of Career Impact, Inc., a training and advisory resource for call centers. Cliff is a strong advocate of customer service as a strategic management issue, and so we invited his views on just where outbound customer relations should be headed.
PRM, Not Just CRM
CRM is all the talk in the teleservices industry. And that’s good, as far as it goes. But what we really need, and have generally overlooked, is what I will call PRM.
That stands for Prospect Relationship Management.
The outbound industry (and here I refer principally to B2C, Business to Consumer calling) was built on the assumption that there exists a vast and inexhaustible supply of prospects. In the US, the number of households is around 100 million. For a long time, that did seem limitless.
Prospects were like buffalo on the prairie and cod in the sea. Both species seemed so numerous as to be inexhaustible. So, they were hunted with abandon. Until it was too late. Bison were driven nearly to extinction and the commercial cod fishing industry waits idly for news that the fish have returned. They haven’t. And may never.
This whole issue around the effective and ethical use of predictive dialers is not so much a technological one as a perceptual one. Arguing whether a reasonable delay in connecting a called party to an agent is two seconds or five seconds or fifteen seconds is just part of the picture.
The bigger issue is, what do we really think of prospects?
I argue that the assumptions on which this industry have been built are no longer tenable. Though few will admit it, the governing principle behind the practice of outbound telemarketing has been that there is always another prospect to call, so it doesn’t matter what we do to aggravate, annoy, or anger this one. If such a perspective once worked, it no longer holds.
The American consumer who is amenable to receiving telemarketing calls is an endangered species. A large part of that 100 million-prospect base is now at risk for having been “over-fished”.
We need a new mindset.
We must recognize that prospects are a renewable, but limited resource. If we over-do the annoyance factor, they will go away and won’t come back. Laws will be passed to put more and more people off-limits to marketeers; technology will deliver ever-greater control to the consumer; and response rates will fall so precipitously that the economics of outbound telemarketing stop being profitable.
If you think that this analogy with buffalo and cod is far-fetched, think again. A predictable and unnerving pattern exists in the exploitation of any limited resource, even renewable ones. And the consequences, clearly demonstrated in the world of natural resources, are much the same in the world of consumers. The phenomenon is one that Dennis Meadows, et al, in their landmark book ‘Beyond the Limits’, call “overshoot”.
To overshoot means to inadvertently go beyond the limits of sustainability. In the world of natural resources, overshoot occurs when fish or timber or bison are harvested at a rate beyond their rate of reproduction. As a consequence, their population drops precipitously, with little or no warning, and may never recover. If they ever do come back, recovery can take generations. Overshoot can be hastened by technological advances, such as the bored rifle, the railroad, the diesel engine, the refrigerator ship, and the dialer.
In the US B2C telemarketing industry, we are fast approaching (if we have not already reached) overshoot. Predictive dialing has been the chief technological advance that made overshoot possible.
The only remedy is to begin immediately to recognize that prospects are a limited and precious resource. We must treat each prospect we dial as if this conversation may be the last one that this person is willing to have with a telemarketer. Ever. We must narrow our calling lists to improve the likelihood that our offer will be of interest to the person we reach so that we stop wasting people’s time with untargeted offers. We must use predictive dialers in a responsible way. Nuisance calls must be no more than an occasional hiccup in achieving gains in dialer productivity. We must, in short, begin to pursue PRM.
Cliff Hurst is the author of ‘A Career for the 21st Century: A Handbook for Call Center Agents’ and ‘The Five Principles of Business Leadership’. He has been a speaker at many national and international conferences, and his articles have appeared in TeleProfessional Magazine and elsewhere. His workshop on ‘Coaching the Call Center Coaches’ is run from Newfoundland to Florida. You can reach Cliff by sending an email to email@example.com.
If you are a leading outbound specialist, and would like to contribute to our Tip of the Month column, just send us an email.
As it is almost Christmas, we are giving you two for the price of one!
Sticking to the Script #1
Sara connects to another prospect.
Prospect – Hello?
Sara – Hi! My name is Sara and I’m calling on behalf of the Automobile Asso…
Prospect – Wait a min… oh, *&$!! (Sound of tires screeching, followed by glass shattering)
Sara – Er… We’re offering a special deal on breakdown insurance at the moment. Would you be interested?
Sticking to the Script #2
Agent – Hi, could I speak to the person in charge of purchasing, please?
Switchboard – I’m sorry, Mr. Ronson is on vacation. Would you like to hold?
Know any good outbound anecdotes? Send us an email.