Another
Perspective on Outsourcing
October 25, 2004 - by
Robert E. Stevens, GENESIS II
(The
Second Beginning) E-Mail: views@aol.com
I have written a number of times on the
topic of
outsourcing, the latest being April 13, 2004. I just received an email
article
from a
friend living in Ireland, Gerry McGovern, addressing the same topic.
Following
are excerpts from Gerry's article.
Today
most organizations
pretty much
wash their hands of the customer after they've sold them the product.
You are
supposed to outsource and offshore the non-essential functions, so that
you can
focus on what really matters, and on what you do really well. If this
is the
case, then support must be one of the most minor functions within the
modern
organization. The customer gets their questions answered by a third
party
contractor who has a couple of weeks training and reads from a script.
Many
organizations are
digging a deep
grave for themselves. They think that they can basically wash their
hands of
the customer after they have sold them the product. That may boost
short-term
profits but will create an increasingly disloyal customer base.
Customer
loyalty has
become much
more a factor of habit than of love. Most customers are staying with
products
not because they care about them, but because it's too much hassle to
change,
and because they feel the competition is probably just as bad.
I
believe that
increasingly the real work of
branding will occur at the support level. The real test of a
relationship is
what happens when something goes wrong, that's where brands of the
future will
get built and destroyed. Forget the TV ads that tell us imaginative
lies, the
rubber hits the road at support.
Products are
becoming more and more
the same, made from the same parts, doing the same things. What will
give
organizations of the future a competitive advantage is the set of
relationships
they have established. Organizations that oursource their support are
outsourcing their customer relationships and oursourcing their brands.
You can
read more of Gerry's perspectives at
http://www/gerrymcgovern.com.
In Accounting we focus on the gain and
loss of
dollars. In the overall scheme of business we need to focus on the gain
and
loss within attributes. Someone once told me it takes ten times as much
effort
to get a new customer as it does to keep an existing one. I wonder how
& where
outsourcing fits in the model of customer retention?
Outsourcing
is usually conducted with a cost
savings
in mind. However, there is no such thing as a "free lunch" or as
Newton would say, for every action there is a reaction.
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