Outsourcing Is Not Broken. Your Approach Might Be.
Outsourcing is the open secret of the customer service industry. It can be done very, very well or very, very poorly. The truth is that outsourcing succeeds or fails for predictable reasons. The formula is simple, but the discipline is rare.
Here is the simple formula for outsourcing:
1) Understand why you want to outsource. This is usually because a company needs more staff than they want to hire, or because they want to focus on other skills and proficiencies within the company. Does your tech company want to focus on delivering the best software-as-a-service? Or do they want to be the best customer service company? Both are incredible company missions, but they can also compete for finite company resources. Outsourcing your customer service allows you to direct internal resources toward engineering, tech debt, and product velocity. (Every company has its own focal point. Be clear on yours.)
H&R Block is a familiar example of seasonal outsourcing. Companies with significant annual peaks often scale through staffing agencies rather than hiring and laying off employees each year. This is the most basic example of outsourcing.
An example of outsourcing for specific skills is offshoring for language skills. A company that wants to provide Spanish support for its customers hires customer service agents in Latin America.
2) Ensure that what you outsource can be measured. This sounds simpler than it is, especially when a small or mid-sized company engages its first BPO (business process outsourcing) provider. How will you measure the success of a team that is not under your direct control? Key performance indicators must be clear, accurate, and tied directly to the work the BPO is performing. If you cannot measure it, you cannot manage it, and you certainly cannot outsource it.
Measurement is the backbone of successful outsourcing. Without it, everything else becomes guesswork.
3) Ship great training with the outsourced process. Well, ship training anyway. If you can’t train another team how to do the outsourced work, you don’t actually have a process.
At one tech company where I worked, I met with a manager eager to get help for her overburdened team. She was relieved that our existing BPO had resources available to take on back-office processes that were drowning her team. “But we won’t be able to train them; they’ll have to do that themselves.” I assumed it was a bandwidth issue and asked for the training materials. “There aren't any," she said. New hires were learning from whoever happened to be sitting next to them. It was a terrible onboarding experience and a red flag. If your process is straightforward and consistent, you can build cohesive and accurate training. If you cannot build the training, the process is not real.
4) Provide resources and knowledge articles for questions. Even the most straightforward process will require escalation or an exception. Where will agents go for answers or help?
When I was setting up a customer service organization for a brand new streaming service with no customers yet, the instructor and I sat down with the payments team to ask questions for the billing class. The payments team was irritated that we were asking for time. Both of us had worked at Netflix, and we had seen the many ways billing could go wrong.
I remember the payments manager saying, “You’re overcomplicating this. We charge a monthly price and accept credit cards. What else do you need to know?” My instructional designer peppered him with questions as his eyes grew larger.
“If the monthly charge fails, how soon will you retry the card?”
“How many times will you retry the card?”
“When will you cut off their service?”
“Will you cut off their service?”
“Will you notify them first that you are going to?”
“Who will send that message?” “Will it be email? A text? A banner on the website?”
“Has Marketing been involved in the email draft?”
“Has customer service leadership been informed of the volume those calls will drive?”
“What is the message agents will provide if service has been provided because a card failed?"
The payments manager had envisioned a simple system. A card would be charged, funds would be collected, and the work would move forward. He was a talented program manager in his previous domain, yet this new territory required a different level of operational thinking.
Even the simplest processes need documentation, decision trees, and clear answers for customer service teams.
Outsourcing isn't always easy, but it can be managed well. It requires clarity, measurement, training, and accessible knowledge. When companies follow this formula, outsourcing becomes a strategic asset rather than a gamble. When they skip these steps, no one is happy with the results, and customers and agents are the first to suffer.
