Perfecting Service Management

Issue #95

Tuesday, April 25, 2006

Measuring the Outsourcer Results
by Craig Bailey

This is the fourth article in our series on maximizing outsourcer relationships. The prior edition discussed the importance of establishing and managing to policy. We will now discuss the topic of creating realistic, aligned and measurable goals.

To set the stage, let's assume that you are an enterprise solutions provider and have outsourced your telemarketing function. What would you suggest that the telemarketing outsourcer focus on for performance metrics? Would it include metrics such as daily talk time or number of dials each day? To be clear, these are important metrics to know, but they certainly do NOT represent the primary objectives of the telemarketing function. These are purely production or activity measures, not measures of results.

Why then are they measured, you might ask? Because they are easy to track via the phone system. Fair enough. But you want more from your outsourced telemarketing function.

If you want a finely tuned outsourced telemarketing function, I'd suggest that a set of metrics to consider would include:

  • Number of leads generated per week
  • Accept / reject ratio (by your sales team)
  • Revenue contribution of leads generated
  • Profiling and nurturing progress

Tracking the above gives you a very good sense of the "results" created by the telemarketing function.

Once the metrics have been defined, a next step is to take a baseline of current performance (how well you are doing today) and set realistic goals for continuously improving. This includes "baking" the key performance metrics into SLAs that you will build into the contract with the outsourcer. And, in doing so, consider a win-win scenario. For example, if the outsourcer "under-achieves" (doesn't achieve the defined SLAs), then your bill is reduced by some agreed upon percentage or amount. If the outsourcer over-achieves, then you pay them a premium or bonus for doing so.

And there you have an aligned set of metrics. It is realized that some of the suggested metrics may be difficult to measure (e.g., profiling and nurturing progress). However, if you are using an effective CRM process and system, then this should be a breeze. Need help in this regard? Give us a call. In the next edition of this newsletter, we will cover including your outsourcer within the inner circle.

In closing, if you'd like an objective perspective on how effectively you are managing your outsourcer relationships, give us a call. We would be happy to perform a situational assessment, providing you a read-out of what is working well (to keep doing), opportunities for improvement and a pragmatic road-map for closing the gap between where you are and where you want to be. Alternatively, if you are considering outsourcing as an approach to addressing key business needs, we can help you evaluate options (including the basic question: does outsourcing even make sense for us), consummating the relationship through implementing the standard operating practices to ensure an ongoing and effective relationship. In fact, we have the references to prove it!

View previous articles in this series.


+ Measuring the Outsourcer Results
+ Recommended Reading

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Score 2006 Symposium
Join Customer Centricity president Craig Bailey as he moderates one of the tracks at the annual Symposium for Customer Operations and Relationships Exposition, sponsored by Omega Management Group Corp. and Customer Relationship Management Institute (CRMI). The symposium will be held June 12-15, 2006, at the Seaport Hotel, Boston, MA.

Recommended Reading
This issue we recommend CRM Today Magazine article Get Your CRM to Work the Way You Do, Not The Other Way Around by Jim Stout. Mr. Stout encourages you to understand what motiviates - or inhibits - CRM adoption by business users. People do not like change - despite the fast-paced evolution of technology - so make sure they understand exactly how CRM will make their lives easier. And keep CRM simple - let it model your business, not vice versa.

About Customer Centricity, Inc.
We strengthen overall company performance through better service delivery and management.

We boost efficiencies in front-line customer service and technical support teams, order processing, fulfillment, field service, logistics and other key operations functions.

In short, we align the resources of your organization to exceed your customers' expectations in the most effective and efficient manner possible.

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