The uncertainty that has pervaded business since early 2020 shows little sign of abating. Within this vortex, the next chapter of economic uncertainty will be based around the prospect of recession as opposed to health crises or geopolitics. Rising prices, climbing interest rates alongside falling corporate profits and tumbling stock markets are all wreaking havoc on consumer confidence.
This should have the BPO community on edge. Past slowdowns caution that outsourcers endure their own disruptions in tough times. But, strategic CX planning can mean the difference between a commercial disaster and weathering a possible recessionary storm to come out stronger in the end.
Being an optimist counts for a lot in life. After all, no one enjoys spending time with those who are excessively negative in their outlook. But being a realist counts for much, too. Accordingly, any smart BPO executive should be digesting news of recent economic uncertainty with a heavy dose of pragmatism. Reports of falling retail activity published in the last 24 hours, along with H2 economic growth downgrades, are only the latest indicators of a fragile and slowing global economy. Over the past year, concerns about a tightening labor market inducing inflationary pressures have all but come true, with the Federal Reserve and the Bank of Canada hiking interest rates and the Bank of England following suit in all likelihood. Overall, the outlook for consumer activity looks grim.
One result of slowing consumer activity is fewer interactions between end-users and the enterprises from which they buy products and services. And, like a badly recycled plotline indicative of present-day Hollywood, this is a movie where savvy BPO watchers already sense the ending.
Rewind to the 2008 / 2009 financial meltdown. At the time, the outsourcing community loudly forecast a boom in business. Third-party CX service providers were sure to reap massive volumes of workstations as enterprises shed their captive contact centers to save costs. And, while this did occur to a point, it was not nearly as significant as executives anticipated. Rather, the decline in consumer activity impacted outsourcers as much as it did in-house operations. In the end, the workstation gold rush for BPOs failed to live up to expectations.
Now the outsourcing community needs to learn from the past and be innovative in winning new business. This means identifying fast-growing sectors that have a higher propensity to outsource some or all CX operations and, regardless of economic climate, aim to win deals with enterprises in these verticals through a combination of competitive offerings and subject-matter expertise. More digitally-driven industries such as e-commerce, digital enterprises, gaming and Fin Techs fall into this category. There is also considerable potential in the domain of sectors that are of a higher complexity such as health care (payer and provider), pharmaceuticals, and upper-end financial services (including insurance and investments).
Equally, providing enterprise CX departments with the higher-value services that they require needs to be a goal among outsourcers. The recently published 2022 Ryan Strategic Advisory Front Office CX Omnibus Survey shows that most captive contact centers will see a crunch in operating budgets in the coming months. This will restrict investment in advanced CX technologies and processes—and BPOs could bridge this gap. Yet, these solutions must be accessibly priced, and where possible, offered as a service as opposed to a capital cost.
Still, the most important thing that outsourcers need to focus on in the face of economic uncertainty is keeping existing client engagements as happy as possible. To make certain that revenues are maintained during a slowdown, which could easily become a prolonged recession, maintaining and enhancing existing relationships will be crucial.