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Customer Service Trends: Out-Sourcing

One of the most controversial developments impacting customer service is the move by many companies around the world to establish customer service functions outside of either their home country or the country in which their customers reside. Called out-sourcing, companies pursue this strategy to both reduce cost and also increase service coverage. For instance, having multiple customer service outlets around the world allows customers to talk via phone with a service person no matter what time of day. The ability to move service to another country is only viable in large part due to technological developments (see Internet Telephone below).

But such moves have raised concerns on two fronts. First, many see this trend as leading to a reduction of customer service jobs within a home country. Second, customer service personnel located off-shore may lack sufficient training and often lack an understanding of the conditions within the customers’ local market both of which can affect service levels. At the extreme a poorly managed move to out-source customer service can lead to a decrease in customer satisfaction which in the long-run could affect sales.

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