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Thinking both knowledgeably and strategically about business and information technology outsourcing is a mission-critical requirement for all enterprises moving toward core-competency-based business models. Questions being asked by Senior Management include: Does it ever make sense to externally source a strategic function? What is the appropriate mix of internal and external resources and services? The answers to these questions could result in the outsourcing of your support operation.

You may not be aware that an assessment is occurring, or which factors are being used to assess your help desk environment. If an assessment is performed, some factors will be outside of your control and others will be within your control. Doesn’t it make sense to positively influence the factors that you can control?

This article identifies the factors that are being used in a senior management assessment, describes how benchmarking can help, and gives you some strategies you can use to defend against outsourcing.

Core Competencies

Senior management should be continually assessing each function being performed within the company (and each service being purchased by the company) to determine if it is a core competency. These are any activities that management feels are a strategic strength. Keep in mind, that these are not necessarily limited to the core operations of the company. You may want to have a discussion with your manager about whether your function is considered to be a core competency. Other questions you might ask include:

Business Combinations

If your company is acquired or merged with another company, there will be an assessment of locations and functions to be preserved, grown, or eliminated. The impact a merger will have on your support organization is unpredictable. However, while you do not have any control over your company’s decision to enter into a business combination, you can safeguard your support organization by addressing the factors that are within your control.

Customer Satisfaction

The ability to identify your customer bases and satisfy all of the customers who contact you for support — end users in a help desk operation, customers in a customer support operation, and employees in an employee support operation - is the factor over which you have the most control.

The indirect customer should also not be ignored. In an internal support organization, this might include support groups such as Facilities Management. In a customer support operation, this might be the sales force or other team members who receive calls from dissatisfied customers. Everyone connected with your support organization should agree with your processes for escalating issues and measuring and reporting customer satisfaction. Strategies you can use to elevate the level of service you are providing to your external customers and recommendations for increasing the level of internal satisfaction with your support organization are identified later in this article.

Costs

Cost management is a big part of any support manager’s job. Regrettably, in most companies, the definition of cost management is managing to a department budget. However, there are other, more meaningful, ways to measure your costs. A common way to measure costs in a help desk is the cost per seat. This is the total cost of support divided by the total number of end users, or end user workstations. This number is important because it is used when analyzing the help desk’s outsourcing potential.

Customer support operations might choose to measure their costs on a per customer basis, per product sold basis, or perhaps a per incident basis. Care needs to be taken to ensure that you are accurately measuring your output. Think of this: the true measure of output is a satisfied customer, but if the customer never contacts your call center, how should this be factored into your measurements?

Revenue Generation

One potential outcome of successful support or service contact with a customer is an up-sell or a cross-sell. Some customer support operations are successfully generating sales from inbound contacts. When it comes time to perform the senior management assessment, it will be a more difficult decision to outsource your operation if it is generating revenue. Your company will have to forgo the revenue generated by your support operations or ask an outsourcer to do up-sells and cross-sells. Neither of these options is very appealing to management or potential outsourcing companies.

Management Perception

Management’s perception of your operation is vitally important. It will determine whether management is predisposed to consider arguments from those who want to outsource your support organization. Some of the same methods discussed above to manage your indirect customers can be applied here. In addition, you need to make your own manager an ally. He or she is in the best position to effectively communicate with senior management. Getting your managers buy-in could mean the difference between keeping your operation in house and outsourcing them to a provider.

Benchmarking means knowing the services, service quality, and costs of other organizations that provide similar services. Even though it may seem like comparing apples to oranges, it is important to know how well those who perform services for their own company are doing, as well as, how those who perform services for others are doing. It’s important to understand that management only sees fruit – not apples or oranges. No matter how unique you think your support organization is, a senior management assessment views your service as a commodity.

Benchmarking information is important, but can be misunderstood by senior management. They might receive benchmarking information from a research firm that assumes a certain cost structure, which could differ in structure from the information your the Accounting department provides (probably your department budget). Or, a competitor might approach them with information on their proposed costs, which represents a third cost structure. It is dangerous to presume that management knows how to interpret these cost structures effectively. Helping management better understand industry benchmarks is crucial to gaining their buy-in.

Depending on what type of support operation you manage and who your customers are, it may be difficult to claim that your function is a core competency. However, customer support operations in e-commerce environments are gaining importance because managers are finding it increasingly difficult to satisfy customers after the sale. This is hot right now and may be a useful trend for you to investigate. In many companies, a multi-channel (telephone, voice mail, web, e-mail, and chat) support operation that is highly integrated with the company’s sales and back-office operations can become a core competency.

Customers are increasingly demanding service on their own terms — choosing the time, choosing the channel, and even switching from one channel to another whenever they want — and they want each channel to be aware of all interactions and the total relationship instantly. In addition, customers demand a consistent customer experience. They want response times and services to be the same from one interaction to the next over time. This is the area where the science of running a support operation is put into play. People, processes, and technology all need to be managed effectively in order for you to be successful.

• Define a robust set of processes for each type of customer interaction and service to be provided. Examples of these processes are incident management, problem management, change management, knowledge management, service level management, and recovery management. Implement the processes into your automation, training, and performance evaluation programs.
• Define a desired skill set for use when hiring support professionals. Hire only people who possess the required characteristics and who have the required skills or the aptitude to learn them. Continually train and assess all your people on these skills and characteristics. Keep your requirements up-to-date.
• Make sure your incentive programs are motivating your staff to do the right thing. Incenting them to keep support calls as short as possible may not be consistent with your customer satisfaction strategy. The details recorded in the call tracking system will give you the information you can use to create a successful motivation program.
• Implement technology thoughtfully. Every support operation needs a telephone system and a call management system to record information about each customer contact. If thoughtfully implemented, this will provide you with information you can use to identify and justify other needs, which may include a knowledge management system, diagnostic and repair systems, or other channels to communicate with your customers.
• Design a strategy for serving customers via multiple channels. Support operations have traditionally relied heavily on live telephone support, which has been augmented with voice mail and interactive voice response systems. The Internet is now enabling a new class of highly interactive support channels such as self-help, e-mail, chat, and, soon, voice over IP. In the next two years, customers will be demanding support over WAP-enabled portable communications devices. This is no time to focus on the duration of a phone call.
• Establish service levels for all important services. Establish service levels first for those services that the customer sees and feels, then drive backward into your processes to establish service levels for each step in the service delivery process. Pay special attention to hand-offs between different support organizations. In a help desk, this would include second level support groups, network administration, and purchasing. In a customer support organization, this would include shipping and billing, and in an employee support operation, this might include delivery of employee benefits statements or an outside catering service.

Satisfying the other support organizations is a by-product of satisfying the primary customer base. However, remember that these other support operations only see the exceptions, which are usually the dissatisfied customers. The wise support manager overcomes this fact by supplying information that is positive or neutral. Information on call volumes, first call resolution rates, and customer satisfaction surveys can present a more positive impression of your support operations.

• Provide clear and obvious escalation paths for customers within your support operation so that they do not escalate issues that are within your control. If an issue is escalated, make sure your support organization addresses the problem decisively and to the customer’s satisfaction. These issues can become your "moments of truth" to turn a dissatisfied customer into a delighted customer.
• Produce reports that are meaningful to this special set of customers. They will need to be concise and probably in chart format. What would be meaningful to these customers? Ask them directly.
• Provide clear defined processes for handling issues that customers escalate to these other organizations. For example, when an employee calls Facilities Management because no one in IT has responded to their request to move a printer, you should have a process for rapidly moving the printer and assessing what went wrong with the original request. Once you determine the error, make sure your peer in Facilities Management knows what you are doing to prevent this "glitch" from happening in the future. This seems simple, but it is powerful when done correctly.

Influencing a positive management perception is done in a similar way. However, management needs to see information on costs as well. To create the best perception, influence your management to see your support operation in these ways:

• The support operation is satisfying its customers.
• The support operation is cost effective.
• The support operation is always improving and is keeping our company current in the face of changing requirements.
• Customer support (or help desk or employee support) is a core competency of our company.

Timely delivery of essential information is the best way to communicate with management. Some ways you can reach senior management include:

• Providing your management with information that can be shared at executive meetings.
• Including positive information in a newsletter or e-mail newsletter program.
• Including positive information in your annual planning and budgeting packet.
• Educating management on the benchmarking information that you find for your industry – not just the numbers but the conceptual understanding of what they represent.

Managing your costs is much more than watching what you spend. Making wise investments can have significant medium- and long-range impact on your costs. Don’t measure your costs based on your existing operation. Instead, measure them based on the value that you bring to your customers. For example, reducing the cost of each support phone call is a worthy goal, but if your customers’ needs are more thoroughly satisfied by reducing the need to call, maybe it is not the most strategic goal for your support organization. Focus on your customers’ needs! In the long run, self-assisted support or automatic support may be strategic objectives that deserve some investment.

Having an integrated set of service levels and common processes that span multiple departments is an excellent way to improve and manage your service delivery, but actually integrating your operations takes service delivery to a higher level. The help desk that monitors the network and takes certain repeatable actions or that distributes software directly to user PCs on demand, is harder to outsource than the help desk that passes these problems or requests along to another support group. The customer support operation that posts adjustments directly to customer accounts or that enters orders directly into the manufacturing planning system is harder to outsource than the customer service department that fills out a form and sends it along. The employee service operation that reprints lost 401(k) statements and proactively adjusts the heat in a building where employees are working on Saturday, is harder to outsource than an employee support operation that doesn’t. You get the idea.

Everyone in the help desk industry knows about the "outsourcing" companies. IBM, Compaq, EDS, and CSC are familiar names, but there are many smaller companies competing for a piece of the help desk dollar. Look at other companies in your area and your industry. Do you see any trends or patterns? Identify the companies who have outsourced their help desk, then identify the outsourcing companies. Learn as much as you can about these contracts, including cost per seat or per server, whether they’re implementing support topology strategies such as centralization, and how other important technologies and processes are being utilized. Take a close look at their multi-channel and self-help strategies. The point is, often there are reasons other than reducing costs that made the outsourcing deal attractive, and, chances are, your management may perceive the same reasons. You need to get out in front of the parade.

Benchmarking is an important tool that will help you with some of the above activities. It’s important to understand the common benchmarks that are used in your industry. Research and consulting firms, publications, and industry trade associations are good sources of information on this topic. It’s important to get a good operational definition of the benchmarks being used – not just the numbers themselves. You will need this information to present to management, either in a pre-emptive fashion or in a reactive fashion if an outsourcing assessment is already being performed. For example, in a help desk the annual cost per seat is a number that is commonly used, but what costs are really in a number like that? Is it just the first level help desk, or does it include the second and third level groups? Does it include just the people costs, or does it also include the costs of the system management and help desk tools being used? Does it include the costs of the hardware and software being supported? Are there additional costs per server that are important? Understanding these operational definitions can help you analyze your own numbers and defend yourself from an outsourcing pitch.

I suggest you manage your support organization as if you were an outsourcing company. In addition to support professionals, supervisors, system administrators, and knowledge administrators, you need to perform roles such as account manager, marketing analyst, and product manager to be able to withstand competitive attacks. Understanding your customers and competition, while gaining management buy-in through benchmarks and cost control, are some of the ways you can defend your support operations. By working proactively to develop your organization as a core competency, you ensure its survival as the back-bone of your company.

High Tech High Touch Solutions, Inc. (TM) is an established partner in the assessment, integration and professional staffing arena. We help managers of IT help desks, customer support organizations, and employee service organizations create high impact, high performance support centers through implementation of our proven methodology. For more information about our services, or to schedule a free consultation, please call (425) 398-9292, or visit us on the web at http://www.hthts.com.