Telework boosted by virtual call centers, Part 2

Companies wide-eyed by bottom-line savings

Last week we discussed how transitioning to a home-based call center makes for happier workers, better retention, easy recruitment, higher productivity — and overall better customer care. A long list of benefits, yes. But the one that’s missing is the one that’s actually driving this market: cost savings.

Of course, the other “fuzzy” benefits on the list save plenty in their own right. But not enough to get most businesses’ attention. But money saved by getting rid of entire buildings? That message they hear loud and clear.  

Time and again at the recent Call Center Demo Show in Dallas, panel speakers said the reason they went virtual was to get rid of the building. To consolidate office space, shut down floors. Again and again, hands would spring up. How did you get rid of your building? How do I get rid of my building? It’s costing me a fortune. Can I really do this?

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Last week we discussed how transitioning to a home-based call center makes for happier workers, better retention, easy recruitment, higher productivity — and overall better customer care. A long list of benefits, yes. But the one that’s missing is the one that’s actually driving this market: cost savings.

Of course, the other “fuzzy” benefits on the list save plenty in their own right. But not enough to get most businesses’ attention. But money saved by getting rid of entire buildings? That message they hear loud and clear.  

Time and again at the recent Call Center Demo Show in Dallas, panel speakers said the reason they went virtual was to get rid of the building. To consolidate office space, shut down floors. Again and again, hands would spring up. How did you get rid of your building? How do I get rid of my building? It’s costing me a fortune. Can I really do this?

Another message the audience really heard: “We pay our home-based agents less.” That’s not to say companies are cutting salaries. But when they hire directly into the home, many said they pay on average about 20% less.

Why? The current thinking is that sending someone home to work is the equivalent of giving them a raise of $4,000 per year, meaning they save that much in car gas and maintenance, dry cleaning, clothing, etc. That $4,000 figure was mentioned often at the show.

At the show, Michael Amigoni broke down exactly how much money he saved by transitioning his company, ARO Outsourcing, to virtual agents. People were on the edge of their seats. Hands went up, people scribbled Amigoni’s figures in their notebooks. See for yourself why:

Before: 100 agents in a brick-and-mortar call center

• 45% turnover per year
• Agent hiring/training $7,000 per year
• Overhead cost per agent (facilities, etc) $5,000 per year

After: 100-agent virtual call center

• 10% turnover per year
• 15% productivity gain (measured by number of calls taken, length of call, etc.)

Calculation of savings:

• Overhead cost: 100 x $5,000: $500,000/year
• Reduced turnover: $7,000 x 35: $245,000/year
• Productivity gain: $25,000 per agent salary x 15 agents: $375,000/year

Total savings:

• Overhead cost: $500,000
• Turnover cost: $245,000
• Productivity: $375,000

Total: $1,120,000 per year

Amigoni saves more than a $1 million a year. And to clarify, that 20% productivity savings Amigoni states, which is easy to measure in a call-center environment, translates into bottom-line savings by cutting his staff by 15 agents, saving him $375,000 per year in salaries.

The best thing, Amigoni says? “The people provide their own building.”

See what I mean by “virtual call centers boost telework”? Eight years ago, some visionaries inspired by its fuzzy bottom-line benefits applied telework to their call centers. Today, mainstream companies are crunching the numbers — savings in office space and salaries —and pushing to virtualize parts of their operations. They’re driving telework, first into their call centers, then, who knows where?     

Amigoni has a good idea. Next week, more on ARO’s plans to push “call center telework” to other segments of the office.

Read more about telework in Network World's Telework section.