New Tree Header

[Back]
Next
POPSG
home
MRlibrary
Sorensen
Associates
[Views home]
Views
Researcher
Resumes
In-store
Bibliography
Register for
Email Views
[Next]
Previous

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.


Sponsor: Sorensen Associates Inc     Portland, OR: 800.542.0123     Minneapolis, MN: 888.616.0123
the in-store research company™  --  Dedicated to the relentless pursuit of WHY?

[Back]
Next
POPSG
home
MRlibrary
Sorensen
Associates
[Views home]
Views
Researcher
Resumes
In-store
Bibliography
Register for
Email Views
[Next]
Previous