Industry Commentary

CX Reshoring Filled With Uncertainty

By August 26, 2021February 14th, 2024No Comments

As the summer winds down and customer management professionals around the world contemplate a return to work, there is an understandable desire to try new things.  After all, the world of CX is built upon innovation and challenging existing delivery norms.  Indeed, given the industrywide focus on driving better quality interactions, it is no surprise that the topic of reshoring work from overseas may emerge as a potential approach.

However, while this angle is always worthy of discussion, the feasibility of reshoring in large volumes may prove counterproductive in the current environment.  Of major concern is a hot labor market in Western demand locations, which is proving a challenge for CX operators, and this is unlikely to change any time soon.

On the surface, the desire to bring some—or all—of a contact center’s capacity back home makes a great deal of sense. Hence, the announcement that leading food ordering portal Just Eat would be repatriating roughly 1,500 contact center jobs to Sunderland in the UK from existing facilities in Bulgaria and India.  Conventional wisdom dictates that in an ideal world agents based in the same location as an enterprise’s consumers will drive better outcomes than CX representatives in the offshore or nearshore.  Cultural affinity should mean a better overall level of interaction, thereby cementing a stronger relationship between the parties.

Likewise, on paper the argument around the stability of the domestic delivery point is very relevant. This is especially pertinent now as offshore CX BPO mainstays such as South Africa and Colombia have been riddled with unrest. The working assumption is that onshore delivery will be inherently less prone to disruptions than those overseas.

But, going on the assumption that all things are equal in the current marketplace is problematic.

Consider the issues that many contact center operators are facing when it comes to labor.  In major Western markets, the ability to recruit for many front-line jobs has become nearly impossible, due to concern about workplace safety and ongoing government pandemic supports. Those choosing to currently work on front-lines also face considerable pressures that may discourage them from staying in such roles.  In onshore customer experience, where the perception of limited career opportunities has been endemic, this places pressure on recruiting quality staff. Given this, labor costs are almost certain to rise in Western locations.

Then, there is business continuity.  One of the CX hallmarks of the past 18 months has been the idea that operations are best served when delivery programs are diversified across different locations and platforms.  The concept of centralizing contact center functions in one region or country goes against the grain of what has become an established best practice.  North America, Western Europe or Australia / New Zealand are not immune to extreme weather, electricity outages, or protests, each of which can adversely impact CX delivery. Guarding against service disruption, whether onshore or offshore is crucial in 2021 and beyond.

The customer management community appears of mixed mind when it comes to reshoring.  In fact, roughly 3-in-5 respondents to this year’s Ryan Strategic Advisory Front Office Omnibus Survey that currently deploy offshore agents indicated a reluctance to bring these roles back home.  This is not to say that domestic delivery does not have a role to play in a strategically considered CX approach; there are strong arguments for limited onshore deployments as part of a balanced platform. Anecdotal evidence suggests that BPO providers are finding that prospective clients more than ever seek at least some workstations to be housed domestically, in a micro-site or incubator environment.  The key is that business continuity must be at the heart of any plan to ensure balanced, cost-effective and quality delivery.