Outsourcing a Contact Center Vs Homeshoring


When a company decides to hire a third party agency to carry out certain tasks, like customer service or product support, this is what we call as “outsourcing”. More importantly, I’d like to refer to them as third party call centers if they handle product support, customer service, technical support, and even booking tasks.

The main reason why companies decide to outsource their customer service needs to a third-party call center is that they can save as much as 50% in operating costs. They can also enjoy several benefits like:

1.) They don’t have to worry about who to hire and who to train for their customer service and product service operations.
2.) There’s no need to invest in infrastructure and technology. It’s being handled by the third party organization.
3.) Professional workforce will handle the customer service and product support operations of the company.

But outsourcing has its downsides. One of which is maintaining brand integrity. Given that an organization can only do so much in sharing their expectations with the third party agency, there will be misunderstandings along the way and the mistakes and actions of the third party agency will reflect the organization’s standards.

As such, before any organization decides to outsource, they need to pay attention to an agency’s experience, workforce quality, the clients handled, and their billing procedures.

Definition of Homeshoring

Homeshoring is similar to outsourcing, but you are referring your operations to people’s homes. A lot of businesses, mainly call centers, are now jumping the homeshoring bandwagon to enjoy a lot of benefits. Homeshoring allows call centers to reduce their operation costs because their workforce are located at home, and thus, there won’t be a need to spend a lot of money on utilities like water and electricity. On the other hand, employees can work from the comforts of their own home. Employees, who are telecommuting, also get to reduce their expenses on gas and avoid the stressful commutes to get to work.

On one hand, a call center agency that deals with homeshoring may opt to pay their telecommute agents a lower rate than that of full-time on-site agents, but they shouldn’t write off minimum wage. Call center agencies are expected to follow minimum wage laws and other policies governing the call center industry in any country.

But homeshoring also has its downsides. One of which is the availability of the agent. Sometimes, home emergencies can distract an agent and may force him or her to log out during his or her shift. Technical issues like power outage, loss of Internet connectivity, and hardware malfunction can also be detrimental to a home agent. Because there’s no one there to provide immediate support, let alone back-up for hardware or Internet connectivity, the agent will not be able to log in.

The bottom line

Homeshoring and outsourcing may be similar in nature, but they have their own pros and cons. When an organization does opt for outsourcing or homeshoring, they need to be aware of the risks involved. As I mentioned earlier, the biggest risk here is brand integrity so an organization needs to be careful when it comes to picking out which company or individual to outsource or home source their needs.