When does outsourcing work in customer service?

Outsourcing of service activities is particularly common in the IT and software sector. In mechanical and plant engineering, the tasks are generally too complex to be outsourced to external parties. Under what circumstances and in which areas can it still be worthwhile?

The ServiceLobby is essentially aimed at people who are After-Sales and want to develop this area strategically. Outsourcing, on the other hand, sometimes goes hand in hand with a certain disdain for a business unit. Especially if the entire business unit is to be outsourced. However, if outsourcing is carried out with a sense of proportion, the effectiveness of the service department can actually be increased by focusing on core competencies. This is not an either/or decision. The question is rather: How much outsourcing do I want in customer service?

In mechanical and plant engineering, only simple activities can be outsourced

In some industries, it can make sense to hand over the entire customer care center to an agency. This is particularly the case in areas where the same errors usually occur and can usually be resolved by telephone (e.g. software support in the commodity sector, Microsoft Office, etc.).

This is hardly possible with technical customer service in mechanical engineering. An external service provider will never invest so much time and money in building up technical expertise that they could even largely take over your service for you. This is why only outsourcing of simple activities is an option here. However, this can also significantly increase efficiency in our sector.

The impact of outsourcing on the perception of corporate culture

You should also always bear in mind that service is a touchpoint where your company comes into contact with the customer. Service employees are a figurehead for your company and play a major role in determining the perception of your brand. If you hand this over to external parties, you are of course also giving up an important lever for communicating your corporate culture to the outside world. Clear guidelines should therefore be defined with regard to the performance of the service and appearance at the customer.

Additional interfaces and more difficult quality assurance

Outsourcing creates additional interfaces that can complicate and slow down processes. This should always be taken into account and planned for when implementing a strategy. Suitable countermeasures against these tendencies must be defined. This is particularly important because outsourcing means you are already relinquishing some control over the core elements of service provision, making it more difficult to guarantee a high level of quality in your services.

More on the topic Quality assurance in after-sales.

Outsourcing opportunities in customer service:

The following examples do not claim to be exhaustive. You are welcome to read our article on the various Roles in after-sales to check whether there is potential for outsourcing in other areas of your department.

1. 1. Call center activities can often be outsourced. Here we are talking about answering phone calls, documenting the customer problem and assessing the urgency of a claim. Particularly in times of limited capacity, it is an advantage if call center agents coordinate the processing of calls, clarify the cases in advance and forward them to office technicians in a next step. This greatly reduces the workload for your remote support and cuts costs. This simple task can easily be outsourced to a reliable partner.
2. 2. also in the Field Service there are plenty of opportunities. Of course, complicated tasks, such as repairs in particular, usually have to be carried out by your own technicians, who are very familiar with your machines. Within the scope of Installations However, there are a lot of simple tasks that can also be carried out by external personnel at a much lower hourly rate compared to your service technicians (mainly mechanical tasks such as positioning the machines, pulling cables and laying cable ducts, etc.). The implementation of Maintenance is also a task that can sometimes be outsourced if the company's own capacities are insufficient.
3. 3. employees who have left your company for various reasons (Retirement, personal changes...etc.) can often continue to work for your department. As freelancers on a contract basis, such partners can make their skills available and you do not have to immediately write off such particularly capable people. In some cases, this makes growth possible without increasing the number of employees.
4. 4. another area with a lot of outsourcing potential can be found in the area of Administration. Travel expense reports, invoicing and bookkeeping are tasks that you don't necessarily have to take care of yourself.
5. 5. the settlement of the Spare parts business can in many cases be outsourced very profitably from storage to delivery. In this way, a much better performance is often achieved in this area. Customers benefit from faster delivery and fewer shipping errors. If the in-house spare parts warehouse is not operated efficiently, this can also result in considerable cost savings. Specialized providers are generally far more effective in this area.
6. 6. Sales activities can be outsourced, especially when it comes to higher-value services. The commissions here are high enough to make this business model worthwhile for external parties. This will certainly also create opportunities for you. However, you should never completely dispense with your own sales teams so that you are not left in the lurch if external partners leave you. It is simply safer to stand on two feet.
7. 7. an opportunity could also arise in the area of Tool management if you can find or set up a specialized company for this purpose. The organization of shipping and return transport of required special tools is not exactly optimal in many service departments. An external service provider could concentrate its efforts on ensuring a smooth process.

Which areas cannot usually be outsourced?

Outsourcing can only relate to tasks that do not require any special knowledge of your business area. Remote support can therefore usually only be carried out by your own employees, as your in-house technicians have to find solutions to very different problems. Only someone who is familiar with your machinery can do this.

All activities related to the coordination and strategic development of the service department cannot be outsourced to third-party companies. This applies to areas such as deployment planning, management and the like. On the one hand, service providers would have to be heavily involved in their own processes and, on the other, you would have lost all opportunities to develop and expand your customer service.

Why not take a look at your organization to see whether outsourcing might not offer an advantage in certain areas? If you take care to work with reliable long-term partners and limit yourself to selected activities, you can certainly gain an advantage. Particularly in difficult economic times, it can help to make your costs more variable and not sit on a large block of fixed costs.