NelsonHall: Customer Experience Services blog feed NelsonHall's Customer Experience (CX) Services program is designed for organizations who need to understand, adopt, and optimize the next generation of customer service models for their business, including omni-channel services and the application of advanced analytics, alongside traditional voice and other contact center services. <![CDATA[COVID-19 Accelerating the Future of CX Work: Teleperformance EMEA]]>


The COVID-19 crisis is forcing a rethink of the CX delivery model with large contact centers. The fundamental question is how to maintain people’s health and safety in an open floor space with hundreds of seats, continuous face-to-face interactions, shared equipment, and 24x7 operations. For many outsourcing clients, the pandemic was the trigger to adopt work-at-home (WAH) for the first time. Two months later, these forced WAH pilots have their first results, and the emerging picture of a future CX work environment marks several changes.

In this post, I look at how Teleperformance is addressing the challenges of the pandemic and the next stages of their CX delivery plan in EMEA.

The pandemic is also a crisis of communication

The magnitude and speed of the pandemic and the resulting lockdowns at national, regional, and city level prompted Teleperformance to migrate 75% of its ~70k frontline workforce in EMEA to WAH in four weeks. It also reorganized the remaining contact centers under new health and safety policies. For each EMEA country, Teleperformance worked with clients to adapt the schedule to the local regulations such as curfews in Albania, Egypt, Lebanon, Madagascar, and lockdowns in Tunisia.

One of the less discussed challenges of the crisis is a general lack of reliable information and direction. Based on the experience of its Chinese operations, in March, Teleperformance issued global guidelines and a health and safety dashboard and began measuring regularly. It also organized bulletin boards, weekly newsletters, and daily CEO chats in every country. The health and safety guidelines included detailed cleaning protocols, sanitization of workstations and equipment before each work shift, temperature checks, where legally allowed, physical distance markers in offices and recreational spaces, availability of disinfectants and gels, closure of some common areas such as training and breakrooms, and opening of isolation rooms at every site. In some locations, the company also has an onsite physician to check symptoms and prescribe quarantining of individuals and teams. The company also procured six million face masks for its employees.

For the migration to WAH, Teleperformance prepared e-learning modules for the agents on working from home with recommendations on setting up the workspace, time management, and the importance of taking breaks. It also included tips on separating work and personal environments. For the managers, the modules focused on remote management, with team and one-on-one communication and some additional skills such as technical support.

(Un)expected effects of the WAH transition

For Teleperformance, the transitioning of processes to the WAH environment brought some expected and unexpected benefits. Not surprisingly, it had a massive drop in employee attrition rates, but it also experienced a 50% lower absenteeism even compared to before the pandemic. While the AHT increased, productivity improved and NPS and CSAT scores remained stable. The company is now running an employee survey to evaluate sentiment and satisfaction with the transition, and gauge interest in continuing to work from home. The initial feedback points to a large proportion of agents willing to go back to the call centers.

One of the biggest challenges of WAH delivery is engaging employees and alignment with the supported brand. Teleperformance EMEA benefited from moving experienced agents with classroom training and already immersed in the brand culture and values.

The company HR is addressing this distancing with several initiatives. It started virtual Zumba, yoga, and cooking classes, weekly happy hours, and lunch breaks with the CEO. New hire recruitment moved completely online and over video, bringing a higher attendance rate. It is also piloting fully virtual classroom training in Germany using Blackboard.

In May, it unified these capabilities under Teleperformance cloud campus with virtual talent acquisition, training, development, coaching, team building, learning, client interaction, quality control, and data security management, as well as social interaction for employees.

The future of CX is a mix of brick-and-mortar and WAH

Clients reacted with different speeds and agility to the crisis, with proactive organizations partnering with Teleperformance to quickly activate BCP and move agents and equipment to the home in the early days of March. Other clients, for example in BFSI, delayed decisions until mid-April, often awaiting inputs from their internal IT functions.

With the easing of movement and lockdown restrictions in certain European countries, CX services clients are opening discussions with Teleperformance to return to brick-and-mortar operations. However, this return faces far more questions than the initial WAH shift. For example, how to organize the contact center under social distancing rules, plus the question of whether the additional costs make it sustainable. Teleperformance EMEA calculated that a full return to physical centers with social distancing requires 2.5x its existing office space. The other big risk is the medical uncertainty and potential new wave of infections later in the year.

Regardless of any medical developments, the future of CX delivery will be a combination of on-site and remote working. Teleperformance is now planning for the partial return to brick-and-mortar operations with logistics steps, infrastructure changes, and floor changes such as workstation separators to comply with social distancing guidelines. 

The new hybrid model is a must-have for risk mitigation, but it also opens opportunities for multilingual delivery in EMEA with cross-border access to talent. Teleperformance’s experience shows certain markets such as Egypt and Romania have a strong appetite and capability for WAH. The crisis also shifts other aspects of the industry, such as sales, where Teleperformance EMEA adopted virtual pitches and site visits.   

Managing a distributed workforce entails a redesign of many CX operational processes, from different ways of organizing training content and teaching, to the recruitment of candidates specially selected to work remotely. The main objective now is negotiating with clients to reach a healthy balance of brick-and-mortar and WAH.

<![CDATA[Supercharged Technical Support: Augmented Reality with CSS Corp’s KYRA]]>


In a new social distancing world, most traditional face-to-face customer service tasks have had to digitize quickly. This trend is not new, but for some processes, it required the adoption of emerging technology and different operational models. A prime example is customer premise visits by engineers for equipment installations, parts replacement, and technical support. For several years, CX services vendors have worked on visual support and remote diagnostics, and are now looking to Augmented Reality (AR) to lift technical support to the next level. CSS Corp has already developed its proprietary technology in the space and is now working on AR deployments.

KYRA: AR-enabled CX & enterprise support

CSS Corp sees AR-enabled CX and support across three use cases:

  • Visual self-service, where the AR provides visual guidance to users on product features and interactive how-to user manuals
  • AR integrated virtual assistant, which automates the user engagement with intelligent bots using AR projections and overlay
  • Remote agent assistance to resolve user issues from a distance with AR markers and overlays.

The company has a pilot of AR visual self-service for a U.S. multinational telecom equipment manufacturer with products in the fixed, wireless, and IP technology space. The AR has step-by-step visual user guides and in-depth installation manuals, component descriptions, component usage instructions, and remote visual troubleshooting. The implementation has an integrated virtual assistant.

The user or field engineer scans a QR code on the packaging leading to the AR support web page downloading an app on their smartphone. She or he then asks the bot for a virtual user guide. The customer focuses their mobile camera on the equipment or error message, and the AR support interface identifies the product model and downloads the correct user guides and knowledge articles. It displays the components and narrates within the AR environment. The virtual assistant explains how to set up and use the components using animations and AR markers. In addition to the spoken and written instructions, it allows image scrolling and freezing and control with voice. The bot then reads the device screen to determine if the installation is successful and guides the user to enter configuration commands.

If the initial installation fails, the computer vision identifies the error message, and the bot starts interacting with the user via chat or messenger to troubleshoot the issue and guide the self-service steps within the AR. If the issue still cannot be resolved, the bot escalates to a live agent who initiates a secure AR session on the support app by sending a link. The transfer displays to the agent the transcript and completed steps and auto-creates a ticket and case history in the client CRM.

For the client, the initial results of the pilot in 2020 show 23% faster issue resolutions for AR supported interactions and 38% AHT reduction with the automation. For 20% of the volumes, the realized end-to-end automation efficiencies reached 94%.

Challenges to the spread of AR

Historically, AR adoption for remote collaboration stumbled due to a lack of high network bandwidth and speed. The proliferation of fiber optic broadband and the rollout of 5G will eventually resolve this challenge. In the meantime, CSS Corp’s KYRA uses cloud-based lightweight AR technology.

Another common concern for all two-way video chat remains security and privacy protection. CSS Corp addresses this issue by masking to the live agent all sensitive user information such as passwords and blurring outside objects. It also ensures that the tools are PCI DSS compliant.

Lastly, customers are often reluctant to download another app, and its usage sharply decreases after the initial setup. Here, CSS Corp works with clients to offer additional incentives and features in the app to drive regular user engagement.  It also provides the SMS/email links to user, to start the remote assistance with the agent.

KYRA: AR-optimized field operations

Other opportunities for KYRA, which CSS Corp actively explores, are enabling field engineers with virtual technical assistance in a live environment for remote installations, deployments, repair, and maintenance. An example POC is for a telecom and media brand which struggles with high-volume dispatches for no-fault cases and low fix rate, requiring additional visits in close to a quarter of cases. CSS Corp’s AR proposal includes remote issue resolution, improved due diligence before the dispatch, and remote consultation for the field engineers. It estimates to eliminate 90% of the no-fault dispatches and reduced unscheduled truck rolls by ~25%, resulting in cost savings, improved customer satisfaction, and freeing up technicians’ time.

In addition to managed services, the AR and app technology, the company trains the ML algorithms with real-life drawings and component libraries, and the algorithm annotates issues for self-learning. The company builds process logic and rules and expands the knowledge base articles with rich media content.

AR Future

The future options before AR and VR use in CX are significant, not only because of the growth of AR-capable smartphones, but also the increase of use cases such as testing designs and trying products virtually. The current lockdown has triggered companies to move from innovating to adopting AR. For example, IKEA, a pioneer with its 2013 AR catalog, acquired AR startup Geomagical Labs in April, and British online retailer ASOS launched its own AR tool in May.

CSS Corp believes the technology is an excellent enhancement for remote expert collaboration to guide local technicians by projecting problem resolution for quicker handoff. For communication and information system clients, it integrated the AR with its managed services platform Contelli, mapping clients’ infrastructure and applications.

AR is also applicable for engineer education, with CSS Corp already training its distributed workforce operating in WAH mode with AR simulated environment; for example, for out-of-scope devices.

CSS Corp is now identifying client segments in consumer electronics, networking, and connected environments suitable for AR-boosted technical support.

<![CDATA[Concentrix Messaging & Bots: Innovation During the COVID-19 Crisis]]>


One of the memes during the COVID-19 crisis asks ‘who led the digital transformation of your company?’ with the options of ‘the CEO’, ‘the CTO’, or ‘the virus’. The global emergency has severely impacted CX, forcing many organizations to shut down or limit their contact center operations when they are most needed. A side effect is that, where available, self-service, customer-facing bots, and asynchronous messaging prove their efficiency in handling large volumes, 24/7. As a result, for many CX services clients, the pandemic will trigger a call to action and jumpstart CX innovation programs.

Concentrix messaging

Private messaging use has exploded in recent years, and for younger generations it surpasses traditional social media. Its benefits are numerous – it runs voice and text; it is mobile, asynchronous, private, timesaving, low effort, and retains the conversation thread. It is also a richer channel, allowing hyperlinks, documents, pictures, videos, stickers and emojis, and interactive widgets such as carousels. All three of Apple, Facebook, and Google (with RBM) are pursuing opportunities in the space, opening the API for development and business use.

Concentrix has been working on its messaging offerings since 2016, when it started with WeChat in China. In early 2020, it launched a comprehensive offering called Concentrix XP Messaging. Concentrix XP Messaging includes support resources along with the messaging and automation platform. The company identifies the CX opportunity for messaging deployment and designs, implements, manages, and optimizes the bots coupled with live agent support. It offers the pre-built APIs and integration accelerators for the messaging apps and also provides and maintains the third-party software. Finally, it establishes and delivers the reports and insights on metrics, interactions, volumes, and utilization levels.

The ideal path is when customers initiate the message, a bot responds with selected answers, and if live agent support is required, it automatically transfers with contextual information. Agents can invite bots back to the conversation; for example, to handle payments. Bots can also proactively initiate conversations. The messaging platform handles the queuing, routing, delivery of messages, and live transfers. For the customer service agents, the messaging platform integrates directly with the CRM and it is presented as a unified queue regardless of the customer channel – web or in-app chat, messenger, SMS, or social media DM. Contact center managers have a real-time and historical view of performance and traffic.

On average, Concentrix sees at least a 26% productivity gain from increased concurrency and efficiency compared to chat, and up to 50% compared to voice. The deflection rate from voice, email, and chat to messaging can reach ~30%. In addition, ~85% of customers return to the channel with typically higher CSAT scores of between 7% and 11% compared to traditional channels.

Before the global impact of the pandemic, Concentrix had several thousand messaging agents supporting clients in financial services, technology, telecom, and retail. It provides B2B and B2B status checks, appointment setting, customer care, L1 technical support, upfront marketing and sales over WhatsApp, Messenger, Apple Business Chat, and SMS.

Interactions suitable for messengers & bots

Increasingly, Concentrix is identifying new use cases for messaging with its clients. The discussions often evolve from a substitute for traditional chat or email to customer journeys suitable for self-service and automation with bots and messaging. For example, for a U.K. retail brand, it added a messaging option on the IVR to prompt SMS use with ~90% adoption rate. Usually clients are surprised by the potential scope of up to 50% of voice interactions suitable for messaging and up to 100% from text channels. Concentrix models show potential cost savings of 20%, 30%, 70%, depending on the level of automaton, the original channel, and delivery location. For example, for a retail provider in the U.S., it provided a messaging application allowing customers to engage over web, SMS, Apple Business Chat, in-app messaging, FB Messenger, Twitter, and WeChat. It also deployed proactive outbound messaging via SMS from agents or systems based on business rules. Concentrix integrated an APIs to client systems to present offers and achieve in-channel purchase completion.

The company developed a digital operating model to recruit, train, and performance manage messenger agents and set up different quality standards and KPIs. The agent profile is a digital native with advanced typing speed and understanding of the conversation styles and tone using emojis, shorter phrases, and more direct language. The agents have to be confident in multitasking as the environment is fast-paced with higher concurrency than chat (as high as five to seven sessions) and smaller after-call work. Across its messenger population, Concentrix sees an 8% greater training graduation rate and a 16% higher retention rate.

Messaging bots in time of crisis 

While phone hotlines have been the go-to response during the pandemic emergency, private companies and government bodies have also taken up Q&A bots on messengers to help the public. For example, WHO launched a COVID-19 bot on Viber and the Pakistani government started a virus hotline over WhatsApp.

Concentrix developed several use cases to address the pandemic, with Q&A bots offering general COVID-19 information for a company, brand, or product-specific statements, safety recommendations, and retailer updates about openings and closures. These types of bots require no client IT involvement and have rapid 24 to 48 hour deployment cycles. With massive volume demand on the contact center in certain verticals in the current situation, it proactively offers self-service bots to existing chat clients. These bots apply effectively in basic triage scenarios such as status updates, warranty and replacement, and new product order and pricing info.

For example, for a multinational printer company, Concentrix provides technical support outside the product warranty and sells support subscriptions over the phone, email, and chat. Due to the COVID-19 emergency and higher than normal volumes, the client needed an alternative channel. Within two days, Concentrix developed, tested, and configured an SMS bot, created the content and bot flows and set up an IVR prompt to drive customers. The bot answers the most common call types such as wireless connectivity and Windows updates. It also links customers to ‘how to’ instructions and troubleshooting videos for printer and PC issues. The messaging bot deflected 10% of all traffic to self-service and the client plans to expand to other programs.

Future interface

Messaging is one of the most promising future customer interfaces, with a far greater pool of transactions applicable to its use. Its current and potential benefits are expanding, such as the integration of Apple Business Chat, eliminating the need for user authentication and the deployment of messaging in Google search. The pressure on brands to patch their CX brought about by COVID-19 creates the need to add a more productive and user-friendly channel. Over time, it can also fire up the opportunity for conversational commerce.

<![CDATA[Alorica Harnesses Technology to Engage Gen X, Y & Z Workforce]]>


High employee attrition rates are the norm in contact centers, with companies maintaining a constant recruitment, training, and onboarding pipeline. As generations X, Y, and Z come to represent the majority of the workforce, these new workers have different career aspirations, work values, and learning styles. For CX services providers with global delivery networks and demand for specialized agent skills, workforce engagement becomes a priority. The most effective ways of finding, hiring, training, and preserving talent combine people analytics, bots, mobile apps, and other tech solutions with new HR models.

Here, I look at Alorica’s investments and practices in engaging new generation employees by harnessing technology.

Bot recruiters

Since 2018, starting in the Philippines, Alorica has had a dedicated recruitment chatbot to field applicant questions, perform initial screening, and organize interviews with one-click applications. The bot is on the company Facebook page for each country. In 2019 it expanded the tool to certain LATAM and India delivery markets.

For general company inquiries and available positions, it has a FAQ bot called AVA (Alorica Virtual Assistant) on the official Alorica webpage. AVA is an in-house company development using Microsoft NLP layer. The bot also answers question through Google Home and Alexa. Alorica is now customizing AVA for internal use to enable employee HR self-service for its 100k people in 14 countries. It will answer general questions related to HR, policy, payroll, and PTO and has basic service desk functionality, e.g. password reset.

Alorica also developed a physical robot on wheels which is in pilot at select contact centers. It greets applicants, answers questions, and provides information on the company and the recruitment process.

Evolving trainee engagement with digital tools

In 2019, Alorica launched Connect, its own employee engagement and training progressive web application using IP. It has sections with new hire content, quizzes, and surveys, prompting trainees to increase their competencies. Through team and leader boards, new hires can see their progress and individual standing.

On Connect, employees can also submit their mood and confidence levels anonymously on a daily basis. Trainers and managers then view a dashboard with the overall team mood and performance in real-time and break it down by time slot and competency. The company analyzes the overall data to identify pain points during the onboarding journey at macro, country, site, and team level. Alorica is now establishing ‘hypercare committees’ in each contact center to respond to employee feedback on various topics from management to IT and facilities.

It also has gamification elements for agents to win points for different interactions with the app. Agents can use the accumulated credits to acquire badges and build customized avatars.

Connect is available on both Android and Apple devices, with an initial roll-out in three regions with selected clients in the Philippines, Guatemala and Panama, India, and the U.S. For data protection and to meet employee work hour restrictions, the app is geofencing certain sections, so users can only access on work premises. Over the first three months of the pilot, Connect had ~10k active users. In six months, Alorica achieved eNPS scores improvement of 10% of the global average.

Virtual microlearning for new generation workers

The Connect app is at the core of Alorica’s approach to training next-generation employees, for many of whom this is their first full-time job. Connect has a digital backpack with microlearnings to help trainees organize their knowledge and access it. The app offers bitesize information with instant responses and gratification, while ensuring the agent has minimum viable proficiency. The company’s design team is tasked with converting many of the materials into visuals.

Within the app, it is now building Alorica Academy for learning content, including topics outside the immediate work environment such as negotiation skills and business software. Alorica Academy piloted in the Philippines in February 2020.

Alorica is also testing the use of VR with a virtual classroom and an avatar trainer to guide employees through the learning material.  

Automation of the -30 to +90-day employee cycle

Alorica’s objective is to automate and enable self-service for the complete new hire onboarding process. It plans to move AVA to a cognitive conversational level to assist applicants and collect process feedback. For employees, on the development roadmap are seven POCs for self-service features. The bot will link with backend systems such as Oracle, payroll, and WFM. Alorica also wants to enable AVA on the physical robot and deploy it on the contact center floors to engage with agents, answer their questions, and play training videos.

The company plans to integrate the bot with Connect and transform the app into the main HR source for employees, including for schedule management. Next, it is localizing and expanding the app to new delivery geographies and languages and incorporating the ESAT surveys for additional feedback.

<![CDATA[WAH CX Delivery Extending Beyond North America: Lessons from Transcom]]>


As businesses brace for the effects of the Covid-19 virus, one direct impact is already happening: the mandatory shift to work-at-home (WAH) in China created the world’s biggest remote working experiment. In CX services, this health hazard is putting the WAH model top of mind for both providers and clients. While virtual work has been gaining traction in the last few years, this external factor can now trigger its global expansion. 

WAH shows significant recent growth

The first WAH agents in CX services started in the late 1990s in the U.S. but this has remained a relatively small proportion of the workforce – just 5-10% for the major CX services providers. Since around 2016, in U.S. and Canada, it has attracted interest from new clients such as utility and energy companies and greater focus by CX services suppliers. These two markets represent between 80% and 85% of the global WAH population. For CX services vendors, the acceleration of WAH has come as a response to saturated urban markets, low national unemployment rates, minimum wage increases in certain states and Canadian provinces, and the demand for specialized talent.

Since 2018, Transcom saw the trend in the market and decided to change all its North American operations to virtual working, also hiring a practice leader in early 2019. Currently, it has ~1k full-time employees in 33 U.S. states and six Canadian provinces supporting e-commerce & retail, consumer electronics, telecom, travel, and SME clients with customer care and technical support services, primarily over voice as well as email and chat.

Lessons from Transcom

Transcom has approximately 14 years of experience in work-at-home delivery, starting initially in Europe. It has developed a dedicated WAH recruitment approach with skill-based testing, technical skills and digital literacy exams, scenario and voice analysis, behavioral and competency-based interviews, and background I9 checks, where permitted. It hires only 5-10% of applicants, with the highest throughput results from its referral program. For training, it uses virtual training to replicate different aspects of classroom training with instructor-led and self-paced content. The company has COPC certification for all its WAH employees, covering coaching, monitoring, outlier management, and adopting various incentives such as pay-for-performance, schedule flexibility, and career advancement.

Transcom’s distributed agent infrastructure enables a locked-down virtual desktop environment. The company tests the VPN connectivity between Transcom, the agent machine, and the client’s data centers to ensure the quality of the connectivity from point-to-point. For security, it employs two-factor authentication, no agent administrative rights, limited USB devices, user and computer Group Policy Object, and PCoIP session management and tuning. For its flagship consumer electronics client, it supplies the agent computer.

Clear benefits and new challenges

The WAH model offers labor cost arbitrage opportunities, better talent retention, and adds resources with different skillsets, typically higher educational attainment, and increasingly younger agents from the millennial generation who prioritize flexibility. The model also provides business continuity and disaster recovery (as with the current virus threat).  

For clients, the virtual workforce gives significant scalability during peak seasons. For example, for a multinational e-commerce and retail brand which had a peak Christmas 2019 period with ~37K emails and hundreds of social media posts accumulated in a few days, the backlog challenged the 50-strong support team. Transcom recruited and trained 50 additional employees (200% flex up) on a temporary basis in three business days, delivering the staffing before the Christmas holiday and sustaining it for ~30 days until volumes returned to normal. The company delivered 12% CSAT improvement and mitigation of negative publicity for the brand.

In addition to the traditional challenges with security and data protection, the increasing complexity of work drives the need for another level of onsite employee engagement. Transcom is evolving WAH to a ‘community approach’ where it hires people virtually around a hub such as a coworking space or college campus to conduct ongoing monthly skills training.

Global reach

More and more companies now understand that virtual work offers a dynamic and flexible way of working with access to their target talent. Virtual working in CX services is expanding in new countries such as U.A.E. (Sutherland), Scotland (SYKES), Germany (Webhelp), Colombia (Teleperformance), India (Tech Mahindra and Teleperformance), and Japan (Teleperformance).

In 2020, Transcom is expanding its WAH agents to Germany for onshore, and Poland, Croatia, and Serbia for nearshore German. It is integrating its operational best practices and technology while relying on the local market presence and HR expertise. The company is attracting interest from new economy brands, for example in travel, usually influenced by young leadership familiar with the model in their operations.

For the U.S. market, Transcom is offering its ‘community approach’ targeting premium segment white-glove support that can be dynamically localized around retail stores or high-value customer concentrations. With the service, it targets automotive brands, retail, software and consumer electronics manufacturers.

<![CDATA[Teleperformance Optimizes its Go-to-Market with Digital Integrated Business Services]]>


At the end of January 2020, NelsonHall attended Teleperformance’s global analyst meeting in Mumbai. Here are some insights into the company’s progress since the Intelenet acquisition in October 2018 and the formation of Teleperformance Digital Integrated Business Services (D.I.B.S.).

Repositioning as a knowledge partner

Teleperformance’s reorganization in 2019 to form Teleperformance D.I.B.S. was a step towards unifying the company’s offerings, placing the ~100 proprietary platforms under one umbrella, and optimizing the go-to-market approach. D.I.B.S. includes the company’s vertical specific business process management services, analytics, intelligent automation, and digital transformation capabilities, which also covers the recently launched Innovation and Experience Center in Santa Clara. 

D.I.B.S. has a dedicated technology, analytics, and process excellence practice (T.A.P.) with its own P&L. It serves as an internal catalyst (and educator) for the entire organization regarding transformation. The knowledge practice currently has ~600 experts including data scientists, developers, Lean Six Sigma Black Belts, COPC practitioners, and CX consultants. While Teleperformance aims to scale the team to ~1k people by the end of 2020, the ultimate goal is to democratize and embed the ‘transformational DNA’ across the company. As a first step, T.A.P. is identifying projects in key markets; for example, partnering with sales staff in Colombia and France. It also organizes internal webinars and training sessions on topics such as RPA and analytics. The objective is to upskill employees across the organization to identify value addition opportunities and to know the basics of which processes to target for automation and analytics deployment. Further, T.A.P. looks to find potential synergies in integrated business services, starting with the operations in India.

An example opportunity is in integrated business services with the company’s Finance & Accounting practice. Teleperformance has ~90 F&A clients supported by ~10k employees in 12 countries. Over the last two years, the work has gradually shifted towards more complex work and contextual tasks such as financial planning and analysis (FP&A), tax, treasury and other niche areas under record to report (R2R). As a result, it offers aggregated packages of products, including intelligent automation with their micro tools strategy, analytics, and F&A talent who bring global and local accounting standard experience and knowledge.

India’s booming CX services market

For Teleperformance, India is both a high-potential delivery location and a target domestic market. For example, a large proportion of the T.A.P. resources are in India. At the moment, the company has ~80k people in the country, with approximately half supporting the domestic market. It continues to scale, with capacity expansions in 2019 focused on Tier 2 and 3 Indian cities. Teleperformance plans to further add new locations mainly in Tier 2 cities for international email and chat work. High-growth verticals include BFSI, healthcare, and travel.

In a recent interview, Teleperformance CEO Daniel Julien placed a big bet on India, predicting that the workforce in the country will increase to ~150k people in the next few years.

Engaging a new generation workforce

Teleperformance’s market vision for ‘High Tech, High Touch’ relies on remaining a people-centered business where the company recruits, trains, coaches, and manages a global workforce. With more generation Y and Z cohorts dominating the labor pool, Teleperformance is reinventing its recruitment and talent engagement practices. The company employs psychometric assessment-based hiring to identify dark personality traits, particularly with a view to preventing intentional security breaches. In recruitment, it also evaluates the emotional intelligence of applicants and actively involves social media as a channel, a practice widely adopted in India.

In training, the focus is on self-learning games, comics, video learning, and delineation of career paths. While the traditional agent learning curve is disappearing because of self-service and bots, the company is shifting to bite-size learning and gamification using video, leaderboards, props-based learning, VR/AR, e-learning platforms, simulations, and exploration games.

Another approach to attract and retain talent is work-at-home-agent (WAHA) to complement on-site delivery. Teleperformance is increasing its WAHA population and has ~10k FTEs globally, with only 60% in the U.S. In India, it plans pilots in 2020 out of two major cities for chat and email customer care for international and domestic clients; for example, in retail. These plans are dependent on regulatory approval. As a next phase, it will include voice services as well.

The Fourth Industrial Revolution already impacting CX services

Most of Teleperformance’s ~850 clients are facing significant disruption from digitally native competitors, new technology such as cloud and IoT, and shifting customer profiles and preferences. The new economy clients have a different set of requirements, prioritizing scalability and multinational delivery to meet high growth patterns; for example, social media and e-commerce platforms looking for content moderation services. In this environment, Teleperformance looks to offer an in-depth understanding of the client industry and provide horizontal technology, processes, and people across the customer journey. Part of these investments include setting up the CEO office of ‘Transformation’ headed by Bhupender Singh, partnerships with process mining firms, doubling down on its internal cybersecurity expertise, expanding the T.A.P. practice, and a potential M&A to add more digital and/or consulting capabilities.

<![CDATA[CX Services M&A Activity Hots Up: Why Telus International is Acquiring CCC for €915m]]>


Telus International announced last week the acquisition of Competence Call Center (CCC) for ~€915m. The deal marks the biggest M&A in front-office BPO (CX Services) for 2019. It is also one of several investments in the DACH region and part of a global trend for market share acquisitions.

CCC gives Telus International scale for DACH markets

CCC is a private CX services provider founded in 1998 in Austria. It has ~8.5k employees in 22 locations in Austria, Bosnia and Herzegovina, France, Germany, Latvia, Poland, Romania, Slovakia, Spain, Switzerland, and Turkey. In Germany, the company has eight sites including two in Berlin (the company’s HQ), as well as one each in Vienna and Biel, Switzerland. Its nearshore footprint for German-speaking markets spreads across a number of established locations such as Poland, Turkey, and Romania, and more recently Sarajevo in Bosnia and Herzegovina.

This addition significantly boosts Telus International’s delivery for DACH markets, complementing its centers in Bulgaria, Romania, and Ireland, and expanding its ~5.5k employees in Europe. Once finalized in Q1 2020, the deal will bring Telus International’s total revenues to ~$1.3bn.

The supply problem of German-speaking markets

Germany, Austria, and Switzerland are high-value CX services markets facing a challenge to source native speakers cost-effectively. At a full employment rate, around 3-4% in these countries, the onshore options for outsourcing companies are limited. Over recent years, site openings increased in the north and northeast Germany (e.g. Rostock, Stralsund) or closer to the country’s borders to capture a wider employee pool (e.g. Aachen). Pilots with work-at-home delivery are also underway, for example, by Webhelp.

Another solution has been to increasingly relocate native speakers to Mediterranean countries, offering one or two year contracts and the benefits of a lower cost of living, warmer weather, and better work-life balance. This model contributes to the multilingual capability in Barcelona, Lisbon, and increasingly Athens.

Lastly, vendors are entering new destinations such as BiH, Kosovo, Montenegro, North Macedonia, and Georgia, which can offer German language competency but at a smaller scale.    

Acquisitions to expand delivery scale in core geographies

In 2019, CX services vendors picked up opportunities for inorganic growth in core markets, often adding capacity with tuck-in deals or buying shares in new verticals. For example:

  • In the U.S., TTEC bought FCR bringing in ~80 clients and new centers in Oregon and Montana
  • In Ireland, Infosys BPM bought Eishtec
  • In Germany, Transcom acquired TMS Connected! to grow in the energy sector and ASA Informationsdienste in the media space
  • In France, Tessi added French CX services provider ADM Value for €110m
  • In LATAM, Covisian acquired Avanza’s CX services business in Iberia and LATAM after the earlier acquisition of Grupo GSS in  the same regions
  • In Spain, Konecta grew with retail sector specialist Sum Talk
  • In Italy, Comdata Group invested in the addition of PayCare financial services provider.

All these acquisitions come on top of growing client demand for multinational scale and the need for solid multishore delivery while guaranteeing operational standards and consistent CX across geographies.

Acquisitions of diversified and value-added services

This year also continued the trend of service extension M&As in higher-value offerings. Major areas again were CX consulting, digital marketing, and UX design capabilities, including:

  • transcosmos’ November addition of Tokyo social media marketing agency Interest Design
  • Tech Mahindra’s BORN Group, which offers strategy consulting, content creation, and marketing production
  • AlmavivA’s new UX/UI and digital services agency Wedoo.

Part of this vertical integration is also vendors bringing in-house CX automation technology and resources, most notably Webhelp’s purchase of Romanian RPA developer PitechPlus and Konecta’s purchase of the Brazilian Uranet.

For Telus International, CCC brings a different capability – experience and clients in content moderation and trust and safety services. The German Network Enforcement Act of 2017 and similar regulatory plans in Austria, France, and across Europe created a significant market for human moderators, trust and safety specialists, and community managers. Both Telus International and CCC support Facebook for the German market with several hundred German speakers onshore and nearshore. Now, the merged capacity will create scale and strengthen the company’s domain experience.

Consolidation and M&A opportunities in 2020

This deal will drive Telus International to the cusp of the largest global top 10 CX services providers by revenue. With last year’s Concentrix–Convergys, Teleperformance–Intelenet, Arvato–Saham Group, and Startek–Aegis M&As, the market consolidated sizably but still keeps its very long tail of regional and local players. This fragmentation does not benefit the industry. At the moment, it captures less than a third of the addressable market.

As a private company, Telus International benefited from the backing of Baring Private Equity Asia. With a number of PE ownership changes in 2019 for the likes of Webhelp, Konecta, and IGT, and the availability of investment funds, 2020 will see more similar-sized deals.

In the midterm, the increasing client requirements for integrated full-service offerings supported with strong consulting and design expertise, IP, multishore centers, and technology partnership networks will further differentiate the market leaders and will push out smaller and commodity type vendors outside the clients’ supply chain.

<![CDATA[CSS Corp Addresses Commercial Challenges of Cognitive CX Transformation]]>


One of the main challenges facing front-office automation projects is the adoption of commercial terms protecting the interests of both clients and CX services providers. In an industry dominated by traditional per FTE and per hour/minute pricing, to be successful, end-to-end digital transformation requires significant initial investments, new KPIs, a stake from the vendor, and a longer project horizon.

The cannibalization dilemma   

Cost saving is a direct benefit of front-office automation, generated by deflecting traffic from live agents to self-service and improving productivity to enable reduction in required FTEs. Effective cognitive bots deployed in key customer journey stages or back-office workflow can eliminate the need for human intervention and decrease the volume handled, thus reducing vendors’ revenues.

So far, CX services providers have responded by absorbing the financial impact, hoping to protect their position from competitors, gain additional share of the client’s business down the road, or use it as a lever in the next renewal negotiation. However, this approach cannot be sustainable because cognitive CX is not an end solution but a continuous journey addressing customers’ increasing service expectations and growing acceptance of bots. Even in narrow-scope deployments, traditional performance metrics such as AHT lose their relevance when more complex and challenging interactions end up with human support.

Footing the robot bill

Clients commonly do not want to invest heavily upfront, especially when they do not know what outcomes to expect from CX automation. CSS Corp addresses this pain point with an upfront contract commitment to achieve cost out while backloading most of the investment and blending it in the rate. The company’s commitment stems from its significant experience with the specific client and vertical and from its cognitive IP. For example, its first large-scale CX automation project was with an existing home networking client, which CSS Corp has supported since 2005 and is now the sole supplier. The digital transformation with the client evolved from several joint RPA implementations and simplifications such as screen scraping in the past to 22% TCO reduction through automation. The vendor’s domain experience in home networking with multiple clients, accumulated customer data, and digital assets integration practice gives it confidence to accept the risk.

In another example, for a U.S. VoIP service provider, CSS Corp manages sales, customer care, technical support, and retention. It is responsible for increasing sales, reaching retention numbers, maintaining credit per line, and achieving customer satisfaction levels. CSS Corp charges on a ‘cents per active line per month’ basis. The provider owns the automation and tools but has agreed on a penalty matrix for FCR, CSAT, retention rates, etc.

Contracting with ‘unknowns’

In cases where the domain is less mature for the provider, or the client RFP does not give access to internal data, cases, or existing infrastructure, CSS Corp utilizes reference information and demands a clear view of the internal development roadmap. An example is a hardware storage manufacturer which CSS Corp supports in APAC, U.S., India, and Europe with 200 employees. The contract is based on flat per hour pricing with targets to reduce the headcount by year, 1, 2, and 3 with an increasing rate per hour.

A vital element here is the realistic assessment of meaningful results to justify the cost to the client. When these results do not bring savings, the company contracts against customer satisfaction improvements delivered through the CX automation. CSS Corp’s best practice is to employ a conservative calculation in generic cases. For example, it underwrites only 14-16% TCO over three years when the level of automation is limited by the product, languages, or degree of customer base exposure to chatbots.

Workforce model for bot-human support

With both established and prospective clients, CSS Corp applies a workforce model based on the number of eliminated contacts, volume of self-service, percentage handled by a chatbot or voice bot, and efficiency improvement for technology augmented live agents. It also includes the usual quality and SLA terms. If the automation benefits do not materialize, the provider accepts the need to overstaff. If the benefits exceed targets, CSS Corp gains from the additional savings. For ROI calculation to come through, the contract duration typically needs to be three or more years. Also, to win the buy-in from the organization, CSS Corp shares its calculations and research data, conducts onsite consultations, and organizes workshops.

The proper due diligence from CSS Corp requires sign-off on the client product release and IT update schedule. For these requirements it works with marketing, product development, IT, and operations in addition to customer service departments. The client’s IT approval is crucial to ensure an alignment of deployment dependencies and timelines. For example, in one instance, the client’s delayed telephony upgrade pushed the introduction of parts of the automation components back by six months. Here, the outcome-based pricing kicked in only after the infrastructure upgrade was complete.

Co-innovation with pricing

CX automation programs require investments from the client and vendor, and advanced pricing models are a must to ensure ‘skin in the game’ from both sides. True co-innovation entails a more flexible commercial approach which translates into a next-level CX services partnership.   


NelsonHall will publish a Cognitive Customer Experience Market Analysis reports before the end of 2019.

<![CDATA[Entering the Voice Bot Age: Tech Mahindra Launches]]>


Voice bots are a tiny part of the customer service and outsourced CX services market today. However, they are significant both in terms of investment and the attention they are receiving from organizations. In both smart home devices (voice assistants) and traditional telephony, voice bots are growing (*see a sample of news items from October 2019 at the end of the text).

With diverse markets, from automotive to healthcare, with multiplying uses cases from food ordering to job applications, growing adoption in the U.S. and U.K., the addition of new markets (e.g. Ireland) and higher frequency of use, the question for BPS and CX services providers is not when but how to get involved in the digital voice ecosystem. Here I look at how Tech Mahindra has entered the field.

Converting from human-human to human-bot interaction

Tech Mahindra BPS began developing its voice bot in early 2019, utilizing in-house ML and AI capabilities. It started with a simple Q&A bot able to support FAQ type queries. In the second phase, they introduced NLP and NLU into the bot to allow users to paraphrase their questions and receive responses. In the third phase, Tech Mahindra BPS introduced conversational features for the bot to respond to unstructured dialogue outside the Q&A format. Here the conversation can be multi-dimensional, and the bot will comprehend it.

The voice assistant processes data in real-time from systems such as CRM, ERP, billing, and knowledge management, and the algorithm builds a voice response back to the customer. For example, in a current pilot for a telecom client, the bot handles the first steps of a sales interaction and automatically schedules an outbound sales call in the dialer for a human agent to complete the sale. Tech Mahindra achieves this access through an API where available, and in the case of legacy applications it employs its own RPA script in the background to read/write the information.

Partnering in a complex ecosystem

There are different ways to build a bot solution currently: build a bot engine from scratch on Python or another language, customize one of the existing platforms, or create your own bot on existing frameworks from Google, IBM, Amazon, or Microsoft. The last option involves using a ready tool such as Avaamo, Conversocial, or one of many others.

Tech Mahindra combines several approaches. It uses Google Cloud Platform to create chat and voice bots, works with Amazon Lex and Amazon Lambda gateway API to integrate with back-end systems, and Amazon Connect for telephony integration. It also partners with Avaamo for the bot building.

Amazon in particular has an advantage, as it offers both the platform and connectivity and is able to effectively manage the integration of voice bots on a telephony platform. Tech Mahindra is working to deploy the bot over IVR and route it to a live agent if the bot does not understand or cannot respond to the query (a feature not available for smart speakers for now).

Uses cases in telecom

The initial POCs for are with telecom use cases such as price check or billing status update, activating roaming or bolt-on, and in service desk password resets. These processes have high enough volumes and sufficiently straightforward customer journeys to deploy the voice bot. Beyond these first target processes, Tech Mahindra is now looking (with telecom clients) to reduce truck rolls and engineer visits, with the bot guiding the user through technical support queries in scenarios related to faults with fixed line or broadband. The company is also working on similar use cases in the high-tech sector; for example, to help a home appliances manufacturer to schedule appointments and request replacement parts.

These processes are particularly malleable to voice automation as they deliver sizable cost savings with limited opportunities for self-service, especially when the user has no access to the internet. The bot also helps with addressing spikes in support calls during outages and disruptions.

Another key factor is customer propensity for adoption. Unlike a back-office RPA deployment with linear calculations, Tech Mahindra evaluates the ROI by demographic group, geography, and use case; for example, targeting 35-40% deflection in the U.S. in an active age group for technical support interactions.

From POCs to implementations of voice bots leveraging intelligent automation

To address the market potential and demand for CX automation, Tech Mahindra plans to grow its voice bot development team in the next few months. Part of these resources are curators and conversationalists with a degree in linguistics and communications who can develop an effective and natural dialogue. The curators also localize and culturally align the taxonomy and conversation style.

Tech Mahindra will continue to target the communications and high-tech sectors, the enterprise segment, and service desk functions. From a broader perspective, its objective is to implement voice bots in a broader offering, leveraging process orchestration and intelligent automation across the CX journey.


NelsonHall is currently developing a Cognitive Customer Experience market analysis report, analyzing the use of cognitive models and technology in customer experience by Fortune 2000 organizations.

* Related articles:

Reliance Jio launched video and voice call assistant for business clients

BBC adds interactive news on Alexa

Google Assistant adds Cantonese

Amex invests in AI virtual call centre agent startup

<![CDATA[Democratizing Analytics: Tech Mahindra Virtual Analyst]]>


A common theme in NelsonHall’s Advances in Analytics BPS market analysis is that organizations’ need to operationalize data has matured beyond BI and simple visualization. Companies do not want to wait days to build a report and weeks, or even months, to generate insights. They need to fill the AI-analytics continuum, democratize data discovery and data manipulations, and obtain (near) real-time insights.

Tech Mahindra’s Virtual Analyst offering aims to address all three of these tasks by employing the power of cognitive technology.

Virtual Analyst architecture

Virtual Analyst incorporates Tech Mahindra’s visualization IP across tools and third-party NLP engines such as ThoughtSpot and PowerBI. The business model is for Tech Mahindra to serve as a reseller, solution provider, and analytics co-developer for BPS clients, where it offers its domain expertise.

Under Virtual Analyst, Tech Mahindra deploys the NLP and AI engines, and in-memory computation algorithms. It also implements a data visualization layer and distribution cluster manager. The unified platform is supported by an enterprise security and governance layer and includes data connectors and APIs to link various data sources. Virtual Analyst pulls data across sources into a single window, and business users can employ different visualizations to build customized dashboards and perform data analysis through multiple levels of drilldowns. Finally, it has the option for a private or public cloud deployment.

Conversational search to speed up analytics

To simplify analytics consumption, Tech Mahindra’s Virtual Analyst gives users the option to type a business contextual query, even parts of a sentence or key words, in the NLP engine and retrieve an analytics insight without technical assistance. The questions can be both known and unknown. At the same time, it offers clients who want to continue with the current structured visualization approach the option of predefined reports and prepopulated queries. The difference between the two ways of visualization is often in the balance between speed and independent decision making.

Automated insights to kickstart analytics

Virtual Analyst is integrated with a predictive engine to give result-oriented outputs using what-if scenarios and other advanced analytics algorithms and AI/ML models. Even if the user does not know where to start or what information to look for, the software defines some trends and patterns.

Self-service to open analytics to non-data scientists

Virtual Analyst targets data democratization where senior executives and operational staff access the same information and can use visuals created with R scripts to perform advanced data analytics such as forecasting. It also allows the creation of persona-based insights to manage authorizations. Users can create their own customized dashboards with only the relevant insights made available at the visualization layer.

Market opportunities

Sales , marketing and field operations functions are the first adopters of Virtual Analyst looking for easy access and queries. Particularly in the telecom, manufacturing, and retail sectors, Tech Mahindra has several implementations. For a  European telecom, it gives the  executives information on field operations, predictability, and viewing information based on data from multiple-source systems.
The client leveraged it to save charges raised by various contractors.  Additionally, Tech Mahindra provided a probability study to identify contractors to do the work cost-effectively.  Similar clients have achieved additional savings by not upgrading their existing analytics platforms.

In another example for a U.K. telecom, the CMO and every brand manager have real-time insights into campaign performance and week-on-week churn. The company marketers analyze customer details, phone usage, and campaign data from 200 concurrent campaigns and 75m monthly communications to improve targeting and reduce customer churn. The company forecasts a churn decrease by 17% year-on-year.

Tech Mahindra sees increased interest from supply chain and procurement and customer service departments. It has ~12 new implementations of Virtual Analyst.

Next for Tech Mahindra’s smart analytics and visualization

As Tech Mahindra presents Virtual Analyst to clients, a common question is around legacy analytics investments. The provider is addressing it by running Virtual Analyst as a business layer, priced not by the traditional license model but by the amount of processed data. For example, for a U.K. local council, Tech Mahindra uses the existing PowerBI deployment in F&A for the CFO and her team and is now implementing ThoughtSpot for other council processes such as security.

Another target is to cross-sell with technology partners, going to joint pitches with clients. A recent example is a Swiss multinational food manufacturing client where the Virtual Analyst improved the back-office business processes beyond traditional ERP systems and started to provide predictive insights as well.

Tech Mahindra is looking next to leverage its design thinking and assets of its subsidiaries Pininfarina and the BIO Agency to further the possibilities of self-service analytics. On the technology roadmap, Tech Mahindra plans to integrate multiple home grown third-party tools into its BPS Recommendation Engine framework. It also plans to adopt voice command interactions to provide additional value and provide better user experience.

<![CDATA[CX Automation in Practice: Reality Check with Webhelp]]>


The inevitable automation of the contact center role has become such as surefire prediction in mass media, by CEOs, and even politicians, that a more realistic view of the industry may seem impossible. In this blog, I look at Webhelp’s assessment of the CX automation landscape and the realistic challenges and opportunities in the market.

Customer-facing automation requires significant volumes

The majority of outsourced customer-facing automation implementations are around text communication. Chatbots, email bots, and increasingly messenger bots, are also an investment focus for CX services providers, offering more applicable business cases and quicker ROI. The challenge, however, is that phone interactions continue to dominate; for example, for Webhelp, voice represents ~85% of all volumes across their European markets. The shift from voice to non-voice is gradual and for many customers the phone remains the preferred channel to contact brands.

While variations between customer segments (e.g. Gen X and Z) and geographies (e.g. China) can place higher priority on text interactions, the biggest markets remain voice-centric. Automating voice-based scenarios are more complex and hence more costly, with the additional step of transcription and with low accuracy in many languages. A voice automation solution requires more than 100 hours of transcription on a given use case.

On the flip side, the growing adoption of messengers and digital voice speakers by customers can create the necessary potential scale of interactions to justify bot development.  

Self-service vs. generic info automation

With the aim of removing repeatable and low-skilled inquiries, companies are investing in developing self-service journeys. Webhelp estimates that ~15% of interactions can be handled with self-service over the brand website with customer portals, FAQs, interactive tutorials and guides, and through mobile apps. The company provides consulting and advisory services to its clients to identify the relevant processes and customer journey steps to support with self-service, and then promote and redirect on the IVR and during live agent interactions. A common challenge here is that many brands struggle to link the web and contact center journeys and track KPIs by merging web and CRM data at scale. The company’s consulting agency, Gobeyond, has conducted such analysis and estimates that this ~15% potential applies across verticals.

The potential of conversational automation

The scenarios where the customer interacts with a robot, receives personal information, and completes the journey without human intervention are even fewer. Webhelp evaluates this potential at ~13% over the next three to five years. The main reason for this low target is that, for a true cognitive bot deployment, the client needs to reach digital transformation maturity; for example, with a CRM ready to connect to AI, centralized databases, and robust CX infrastructure. Other reasons include the high cost of the technical implementation and integration with various systems, the long deployment timeframe which, coupled with significant ambiguities or dynamics in the CX processes, makes them not ‘AI friendly’. A further barrier can be the risk of low customer satisfaction, especially in long multi-step scenarios.

The challenge with customer-facing robots is the need to synchronize the interaction between customer, live agent, and CX systems. In Webhelp’s experience, automation is successfully deployed mainly in back-office activities with heavy legacy of processes which are not aligned to the technology landscape; for example, in financial services.  

Bot training and bot development

One of the advantages of CX services providers is they can offer sizable resources and domain experience in CX to train chatbots, with agents classifying conversations by intent, analysts creating the taxonomy, and data scientists developing the algorithms in-house. Webhelp began offering these services approximately two years ago with its Technology Enablement division. For example, for Merck in France, it developed a voice bot to answer calls from hospitals and pharmacies about medicine availability and expected delivery times. It coded around 300 medicine names and for each medicine, several dosage and packaging variations. It also developed the NLU model to understand the information. The algorithms further identify pharmacists eligible to access emergency stock.

Launched in June 2018, the bot currently handles ~100 calls daily, processing around half of the total volume. The implementation lowered the cost of operation, replacing the need for doctors and pharmacists from the company to manage calls. The company is now developing a web service, activate order taking, and plans to extend the opening hours.

Automation as a CX enabler

The area where automation is likely to bring the biggest immediate impact is in CX agent augmentation. Webhelp’s experience shows that different types of bots and ML analytics can increase FCR by ~15% when applied to QA, can reduce AHT by 25% with assisted response tools such as NBA, and can improve CSAT by leveraging NLP/NLU models to transcribe, classify, and analyze contact drivers. Next, the company has partnered with speech analytics provider Allo-Media to develop a real-time speech cognitive bot to proactively help agents during calls. Webhelp has identified three use cases: in dynamic sales inquiry checklist, customer data recap, and sales enablement materials. It plans to test the cognitive assistance in a lab environment by the end of the year and real-live implementations in 2020.


NelsonHall will publish a Cognitive Customer Experience Market Analysis report in Q4 2019.

<![CDATA[Comdata: How Customer Insights Are Transforming CX in Retail & CPG]]>


A common theme in the upcoming NelsonHall CX Services in Retail & CPG report is the increasing need by sector clients to generate and operationalize insights from their customers. Technology has shifted the power to consumers who are less loyal to brands and change their buying behavior more frequently, creating micro-segments.

However, while having a wealth of data such as customer feedback, retailers are often prone to sitting on them without interpreting and driving their transformation programs. Comdata’s VOC analytics and customer feedback service, ConsumerLive, aims to assist companies in the end-to-end management of customer insights and has implemented it for several retail clients.

ConsumerLive: platform & service combined

Comdata launched the ConsumerLive platform in 2012 with a French luxury brand looking to streamline feedback surveys in the front office and improve re-engagement with customers. Today, it is a cloud-based PaaS tool comprising:

  • Customer and employee feedback collection with alerts on aggregated performance
  • Real-time reporting and dashboards, and KPI monitoring with mobile app access
  • Engagement module to contact customers directly and prioritize targets
  • Data analytics with supporting market research resources.

The company combines the platform with consulting services, where it develops the business model and ROI, maps the customer journey, mines the data on an ongoing basis, and designs, programs, and executes the surveys. It has developed a five-stage approach to implement VOC programs, covering:

  • Winning executive support
  • Structuring the governance of the program
  • Consulting on change management
  • Prioritizing target customer segments and moments of truth in the customer journey
  • Deploying automation such as semantic analysis.

As a best practice, it focuses initially on quick wins to demonstrate the relevance of the VOC program, and then develops business cases for more transformational initiatives.   

ConsumerLive integrates with client CRMs such as Salesforce through an interconnector, building a single database across platforms to centralize customer feedback with other KPIs.

Customer insights is the DNA of CX in retail & CPG

ConsumerLive has ~20 implementations, spanning 50 countries in Europe, APAC, and Africa in 25 languages, and covers both traditional contact center VOC and wider customer journey and brand analysis. The latter is a focus area, particularly in retail, where clients look to monitor the performance of their physical network and e-commerce omnichannel.

Retail and CPG clients usually want to verify initially that the right customer profiles are interviewed and that a certain conversion rate for the campaign is achieved. Next, they are interested in matching KPIs such as customers’ overall satisfaction or intention to revisit against target sub-segments or geographic markets. Sector clients also filter the free-form comments by different topics such as stock availability or staff responsiveness to identify areas for improvement.

Another requirement is to compare customer satisfaction against market averages or across their network, and drill down to the salesperson or contact center agent level. The mobile app enables store managers to see in real-time the store’s performance and manage their staff or re-engage with customers directly through the platform.

For example, for a French retail chain specialized in home improvement with 300 outlets in the country and ~6.5k employees, Comdata developed customer satisfaction questionnaires, deployed monthly scorecards per store, made the survey results available 24/7, and analyzed ~40k verbatim customer responses in real-time. The client has the main KPIs displayed in its headquarters and stores. Since the program start in 2016, Comdata has conducted 1m surveys over email and SMS with 100k responses, and has contacted ~12k dissatisfied customers.

Improving data mining and expanding to social media

On the roadmap for ConsumerLive is a data mining module to correlate historical information such as purchases against customer feedback, and predict customer satisfaction results. It has already implemented the predictive functionality with one client and is now looking to industrialize it with a separate module.

Comdata also wants to expand to social media feedback, bringing online posts to the customer view. It currently works with Trustpilot to publish part of the user responses on social media and continue with more details in a private survey. While a number of ComdataLive clients have tested new survey channels such as SMS and QR codes, all still rely on email surveys which bring the highest conversion rate and the most reliable results.

Customer insights the foundation of retail transformation

In a data economy, retail and CPG clients have significant needs to map brand and CX attributes which actually drive loyalty and quantify customer behavior trends. These insights are the first step to supporting future investments in phygital, experiential retail, or new models such as subscription.


NelsonHall’s CX Services in Retail & CPG market analysis report and individual vendor profiles are available to clients of NelsonHall’s CX Services program.

<![CDATA[Will Crowdsourced Customer Service Get Solv(ed)?]]>


Crowdsourcing and different types of freelanced customer support models pre-date the current household names using these models in leisure and travel, personal transportation, and delivery services. Many of these early attempts died out because of poor business models, or remain effective today but in niche markets (e.g. gaming) or on a small scale (e.g. U.K. mobile network, giffgaff). More recently, with the increased adoption of work-at-home and the evolution of automation, new players such as Directly are renewing their interest in the space.

Now Concentrix is launching its own marketplace platform called Solv, aiming to offer enterprise level quality support using gig workers.

How Solv works

Freelance workers support brands in the Solv cloud platform, handling tickets routed from the client CRM and originating from chat, messengers, social media, or SMS channels. The customers see the number of available agents, the status of their inquiry, and the expected resolution time. They can see the ‘Solver’ responding to the question and their score and chat in real-time with him/her, then approve when the ticket is closed and rate the transaction.

Solvers accept tickets on their desktop or mobile device, review and respond, and are paid per rated ticket. For each ticket the Solver, in turn, rates the complexity of the issue and can see their CSAT rating and earnings.

The clients have management panels to monitor, verify and manage Solvers, track ticket data and performance, and assign a price per ticket.

Initially, Solv tickets will require no customer data and PCI adherence. Concentrix is adamant about maintaining the channel experience and avoiding transfers between Solv and the other channels. In cases where there are no available resources, it will create the ticket flow back into the client CRM.

Concentrix charges companies on a pay-as-you-go basis to create a dynamic on-demand model.

Attracting freelancers

With Solv, Concentrix is targeting independent contractors who look for additional income on a temp or permanent basis, who want greater flexibility, and have a brand affiliation. The ideal applicant will be a superuser with domain and product expertise, digital skills, and can independently manage their work-life balance. With that goal in mind, the company invested in the platform design to make it appealing to a younger, digitally savvy workforce. Similarly, the majority of recruitment for the platform is on social media.

Solvers go through a two-step registration process where they self-assess their skills and perform brand authentication with video tutorials. The freelancers do not participate in traditional training, but Concentrix will co-create content with each brand, while freelancers also access public domain information and resources.

Solvers can support multiple brands, but Concentrix and the client will approve the available workflows. The workers have no minimum or maximum earnings caps. Solv is not open to existing Concentrix agents, to avoid conflict of interest. The company is gradually opening the platform across markets, starting with the U.S., U.K., Ireland, Philippines, and India to carefully adhere to the regulatory environment, but will scale globally and offers 24/7 borderless support.

Official launch this summer

Concentrix is officially launching Solv during the summer months. So far, it has had several pilots, including a technology gaming brand where it replicated the client’s email and chat L-1 technical support on the platform. Within four months, Solv outperformed the contact center with 20% increase in FCR, 14-16% in customer satisfaction, and 18% in productivity.

The pilots showed a lot more feedback information for brands, as each interaction is evaluated: different levels of needs with certain brands insisting on one hour TAT, while others are accepting days. Interestingly, Solvers had better performance when using smartphones vs. desktops.

Solv drew interest from high tech, travel, retail, and fintech clients, primarily looking to redirect social media traffic and create or transform their existing communities of influencers. It is currently in various implementation stages with six clients across different levels of customer care and technical support, with certain types requiring API integration to the client CRMs.

The future of Solv

While Concentrix is still exploring possible service models with Solv clients, it is also looking to monetize it and create additional platform features. It has already identified several next steps in its development roadmap – it plans to use ML algorithms to collect five-stared answers to feed the FAQ and self-service systems of clients; to price tickets by location; to allow users to select their agent; and dynamically route traffic or limit companies and ticket types based on the Solvers’ skills and performance. Another idea is to add tiers of rewards and recognition to build the reputation of both workers and consumers. The company is also investigating with clients the launch of upselling programs without the Solvers accessing CRM data.

Eventually, Concentrix envisions Solv as part of its broader CX ecosystem, operating alongside its brick-and-mortar, work-at-home, and automated support services.

Solv is trademarked by Concentrix.

<![CDATA[Seizing the Automation Opportunity: Alorica’s Automated Discovery Process]]>

One of the first stumbling blocks of business process transformation is identifying meaningful automation opportunities. A typical process will have a management consultant, system expert, or Lean Six Sigma specialist to monitor manual processes for a set time, collect performance data, and make recommendations. Companies supplement this assessment with executive ideation sessions, operational managers’ workshops, and superuser interviews. The traditional way to speed up and improve the accuracy of this approach is to add more consultants over a longer period of time analyzing larger data sets. Yet, despite these efforts, not every process is observed and not all automation opportunities are identified and prioritized.

In this blog, I look at how Alorica employs its proprietary tools and algorithms to streamline ‘the discovery stage’ and recommend effective automation deployment in the front-office.

From manual to automated discovery 

Alorica has developed an automation approach for the discovery stage, calling it ‘One-Click Automation’. Its unsupervised machine learning algorithms measure agents’ desktop utilization on a select group of 10-20 users. The bot monitors the users’ screen toggle, clicks, data entries and entry type, and tracks time per system and per screen, the time duration for performing each step, and the number of used fields. It counts errors, frequency, variance in the time and data entry quality, the end-to-end handling time, the complexity, and importance of the tasks. It also tracks the underlying communication between systems and exchanged information.

The bot does not capture personal data or other input information, remaining non-invasive to the systems. It also does not intervene with the users’ actions. Once the bot collects enough information (~100k data points per LOB, typically in two weeks), it creates a visual map of the observed processes. The process map visualizes the screens, the start and end points, the navigation between them, and the direction with drill-down functionality. For large product portfolios with multiple support processes (for example, in technical support), Alorica requires a bigger user pool to observe.  

Alorica created the discovery bot in its Digital CoE and Innovation Lab (DCOE) in Bangalore, launched in 2018. The automation specialists in the DCOE analyze the discovery bot results, estimate savings opportunities, and recommend and prioritize bot implementations with workflow business process, exceptions adjudicator, and look-up. Because the collected information shows the actual steps and the specific systems and fields to move the data, the created automation workflows make the bot training quicker and more precise. It also provides cost-benefit analysis and ROI calculation for each automation.

Implementations for a healthcare client

For a U.S. healthcare payer client, Alorica deployed the discovery bots on a statistically relavant number of agent desktops for three days, identifying 150 automation opportunities in multiple processes with tasks such as secondary claims research, multifactor case, clinical guidelines, and Citrix login. The algorithm analyzed the events to measure the number of agents who performed the particular process, its recurrence, and time taken. The team compared the results to the agent training guidelines, then Alorica prioritized with the client 11 automation initiatives that delivered the highest time and productivity savings and ROI and CX improvement.

Alorica ran the discovery bots on both for the client’s  voice and non-voice work. For example, in the client’s back-office, the discovery bots analyzes processes for manual data entry from image and PDF claims received over emails and e-fax. Using third-party RPA & AI partner tools, Alorica created bots to capture and auto-populate fields regardless of the screen or source format while blocking certain data or document areas to meet client or compliance requirements such as HIPAA. It also has exception notifications to inform live agents to validate. Another benefit is that these bots runs 24/7. The automation deployed in early 2019 delivered ~70% headcount reduction of the process headcount who translated the data from the claims to the systems.

The company is now targeting other existing healthcare clients and showcasing their India DCOE as a ‘digital workbench’ for back-office processes, leading with automation. For automation opportunities in voice processes, Alorica is working with several travel, retail, BFSI, media and telecom brands.

Automation in the process trenches

The fundamental challenge of which tasks to automate has many dimensions such as high volume, time-consuming processes, sizable FTE involvement, high error rate, or simply, risk aversion by internal IT teams. To address the latter issue, Alorica automation deployments so far are on its own desktops without compromising, changing or modifying core client systems. The company absorbs the investment cost for running the discovery bots to set up a meaningful discussion with the client’s process owners on the possible cost-benefit and ROI.

A less discussed problem with RPA projects is the impermanent state of business processes with dynamic changes of internal rules, product/services, and system environments. The shelf-life of a bot will be quite short and its ROI smaller without human supervisors who in turn need to be prioritized and allocated based on business decisions. The automated desktop analytics model allows the deep learning algorithms to solve at least the first part of the challenge of identifying process impact. To mitigate automation program redesigns, Alorica’s solution is to focus on mature system infrastructure with a steady release roadmap. 

Another challenge to automation is the incentives for the provider. Through the achieved cost optimization and improved performance, Alorica targets a bigger share of the client wallet, looking to take over higher value processes, and switching to performance-based pricing models. For the above-mentioned healthcare client, Alorica structured the pricing by processed claim, decreasing the overall cost by ~50%.

The value of partnering for automation

While broad statements for full automation attract media attention, the real opportunity in most cases is in the learning. Automation is not likely to change a process but improve it and help increase customer satisfaction. Partnering with an outsourcing provider can deliver faster and better discovery in an ideal scenario, where the vendor has the process and domain expertise and quantitative discovery tools. The next step is to expand automation across both captive and supplier network centers to maximize the benefits.

<![CDATA[IPsoft Looks to Reduce Time to Value While Increasing Return on AI]]>


NelsonHall recently attended the IPsoft Digital Workforce Summit in New York and its analyst events in NY and London. For organizations unfamiliar with IPsoft, the company has around 2,300 employees, approximately 70% of these based in the U.S. and 20% in Europe. Europe is responsible for aproximately 30% of the IPsoft client base with clients relatively evenly distributed over the six regions: U.K., Spain & Iberia, France, Benelux, Nordics, and Central Europe.

The company began life with the development of autonomics for ITSM in the form of IPcenter, and in 2014 launched the first version of its Amelia conversational agent. In 2018, the company launched 1Desk, effectively combining its cognitive and autonomic capabilities.

The events outlined IPsoft’s positioning and plans for the future, with the company:

  • Investing strongly in Amelia to enhance its contextual understanding and maintain its differentiation from “chatbots”
  • Launching “Co-pilot” to remove the currently strong demarcation between automated and agent interactions
  • Building use cases and a partner program to boost adoption and sales
  • Positioning 1Desk and its associated industry solutions as end-to-end intelligent automation solutions, and the key to the industry and the future of IPsoft.

Enhancing Contextual Understanding to Maintain Amelia’s Differentiation from Chatbots

Amelia has often suffered from being seen at first glance as "just another chatbot". Nonetheless, IPsoft continues to position Amelia as “your digital companion for a better customer service” and to invest heavily to maintain Amelia’s lead in functionality as a cognitive agent. Here, IPsoft is looking to differentiate by stressing Amelia’s contextual awareness and ability to switch contexts within a conversation, thereby “offering the capability to have a natural conversation with an AI platform that really understands you.”

Amelia goes through six pathways in sequence within a conversation to understand each utterance and the pathway with highest probability wins. The pathways are:

  • Intent model
  • Semantic FAQ
  • AIML
  • Social talk
  • Acknowledge
  • Don’t know.

The platform also separates “entities” from “intents”, capturing both of these using Natural Language Understanding. Both intent and entity recognition is specific to the language used, though IPsoft is now simplifying implementation further by making processes language-independent and removing the need for the client to implement channel-specific syntax.

A key element in supporting more natural conversations is the use of stochastic business process networks, which means that Amelia can identify the required information as it is provided by the user, rather than having to ask for and accept items of information in a particular sequence as would be the case in a traditional chatbot implementation.

Context switching is also supported within a single conversation, with users able to switch between domains, e.g. from IT support to HR support and back again in a single conversation, subject to the rules on context switching defined by the organization.

Indeed, IPsoft has always had a strong academic and R&D focus and is currently further enhancing and differentiating Amelia through:

  • Leveraging ELMo with the aim of achieving intent accuracy of >95% while using only half of the data required in other Deep Neural Net models
  • Using NLG to support Elaborate Question Asking (EQA) and Clarifying Question & Answer (CQA) to enable Amelia to follow-up dynamically without the need to build business rules.

The company is also looking to incorporate sentiment analysis within voice. While IPsoft regards basic speech-to-text and text-to-speech as commodity technologies, the company is looking to capture sentiment analysis from voice, differentiate through use of SLM/SRGS technology, and improve Amelia’s emotional intelligence by capturing aspects of mood and personality.

Launching Co-pilot to Remove the Demarcation Between Automated Handling and Agent Handling

Traditionally, interactions have either been handled by Amelia or by an agent if Amelia failed to identify the intent or detected issues in the conversation. However, IPsoft is now looking to remove this strong demarcation between chats handled solely by Amelia and chats handled solely by (or handed off in their entirety) to agents. The company has just launched “Co-pilot”, positioned as a platform to allow hybrid levels of automation and collaboration between Amelia, agents, supervisors, and coaches. The platform is currently in beta mode with a major telco and a bank.

The idea is to train Amelia on everything that an agent does to make hand-offs warmer and to increase Amelia’s ability to automate partially, and ultimately handle, edge cases rather than just pass these through to an agent in their original form. Amelia will learn by observing agent interactions when escalations occur and through reinforcement learning via annotations during chat.

When Amelia escalates to an agent using Co-pilot, it will no longer just pass conversation details but will now also offer suggested responses for the agent to select. These responses are automatically generated by crowdsourcing every utterance that every agent has created and then picking those that apply to the particular context, with digital coaches editing the language and content of the preferred responses as necessary.

In the short term, this assists the agent by providing context and potential responses to queries and, in the longer term as this process repeats over queries of the same type, Amelia then learns the correct answers, and ultimately this becomes a new Amelia skill.

Co-pilot is still at an early stage with lots of developments to come and, during 2019, the Co-pilot functionality will be enhanced to recommend responses based on natural language similarity, enable modification of responses by the agent prior to sending, and enable agents to trigger partial automated conversations.

This increased co-working between humans and digital chat agents is key to the future of Amelia since it starts to position Amelia as an integral part of the future contact center journey rather than as a standalone automation tool.

Building Use Cases & Partner Program to Reduce Time to Value

Traditionally, Amelia has been a great cognitive chat technology but a relatively heavy-duty technology seeking a use case rather than an easily implemented general purpose tool, like the majority of the RPA products.

In response, IPsoft is treading the same path as the majority of automation vendors and is looking to encourage organizations (well at least mid-sized organizations) to hire a “digital worker” rather than build their own. The company estimates that its digital marketplace “1Store” already contains 672 digital workers, which incorporate back-office automation in addition to the Amelia conversational AI interface. For example, for HR, 1Store offers “digital workers” with the following “skills”: absence manager, benefits manager, development manager, onboarding specialist, performance record manager, recruiting specialist, talent management specialist, time & attendance manager, travel & expense manager, and workforce manager.

At the same time, IPsoft is looking to increase the proportion of sales and service through channel partners. Product sales currently make up 56% of IPsoft revenue, with 44% from services. However, the company is looking to steer this ratio further in support of product, by targeting 60% per annum growth in product sales and increasing the proportion of personnel, currently approx. two-thirds, in product-related positions with a contribution from reskilling existing services personnel. 

IPsoft has been late to implement its partner strategy relative to other automation software vendors, attributing this early caution in part to the complexity of early implementations of Amelia. Early partners for IPcenter included IBM and NTT DATA, who embedded IPsoft products directly within their own outsourcing services and were supported with “special release overlays” by IPsoft to ensure lack of disruption during product and service upgrades. This type of embedded solution partnership is now increasingly likely to expand to the major CX services vendors as these contact center outsourcers look to assist their clients in their automation strategies.

So, while direct sales still dominate partner sales, IPsoft is now recruiting a partner/channel sales team with a view to reversing this pattern over the next few years. IPsoft has now established a partner program targeting alliance and advisory (where early partners included major consultancies such as Deloitte and PwC), implementation, solution, OEM, and education partners.

1Desk-based End-to-End Automation is the Future for IPsoft

IPsoft has about 600 clients, including approx. 160 standalone Amelia clients, and about a dozen deployments of 1Desk. However, 1Desk is the fastest-growing part of the IPsoft business with 176 enterprises in the pipeline for 1Desk implementations, and IPsoft increasingly regards the various 1Desk solutions as its future.

IPsoft is positioning 1Desk by increasingly talking about ROAI (the return on AI) and suggesting that organizations can achieve 35% ROAI (rather than the current 6%) if they adopt integrated end-to-end automation and bypass intermediary systems such as ticketing systems.

Accordingly, IPsoft is now offering end-to-end intelligent automation capability by combining the Amelia cognitive agent with “an autonomic backbone” courtesy of IPsoft’s IPcenter heritage and with its own RPA technology (1RPA) to form 1Desk.

1Desk, in its initial form, is largely aimed at internal SSC functions including ITSM, HR, and F&A. However, over the next year, it will increasingly be tailored to provide solutions for specific industries. The intent is to enable about 70% of the solution to be implemented “out of the box”, with vanilla implementations taking weeks rather than many months and with completely new skills taking approx.. three 3 months to deploy.

The initial industry solution from IPsoft is 1Bank. As the name implies, 1Bank has been developed as a conversational banking agent for retail banking and contains preformed solutions/skills covering the account representative, e.g. for support with payments & bills; the mortgage processor; the credit card processor; and the personal banker, to answer questions about products, services, and accounts.

1Bank will be followed during 2019 by solutions for healthcare, telecoms, and travel.

<![CDATA[Concentrix VOC: Measuring CX Transformation]]>

Despite the evolution of contact center technology (think conversational AI), the spread of digital channels (think smart speakers), and the dramatic change in the ways companies interact with customers (think mobile-first), the industry KPIs for measuring the impact of these transformations remain limited. CSAT, NPS, and more recently, Customer Effort Scores (CES) measure different elements of CX: the last interaction, customer loyalty, or journey pain points. However, even in combination, they do not answer two fundamental questions: what are the drivers for this performance and what is their direct effect on business targets?

As companies embark on large-scale digital transformation, increasingly focusing on CX innovation, their need to understand the customer and predict business outcomes becomes the key. In this blog, I look at Concentrix’s ‘Voice of the Customer’ practice and how the company correlates VOC analytics to hard business KPIs and evaluates against future customer behavior.

VOC as an integrated approach

Concentrix acquired its VOC practice through its Convergys acquisition. The VOC practice started in the 1980s and currently has ~280 resources in eight countries supporting ~40 clients in ~90 languages and eight voice and digital survey channels. The VOC offerings include:

  • Program design services, with experts to guide the VOC design of surveys, questions, sampling, reporting, and where and how to apply them in the customer journey
  • Program success services, with specialists to handle day-to-day program management
  • People & culture strategies, with resources to design practices to engage employees in VOC
  • Continuous improvement consulting dedicated to realigning processes, policies, and channels to customer needs based on a range of analyses such as issue and impact analysis, root cause and action planning analysis.

Concentrix also has a proprietary VOC platform, ConcentrixCX, which collects and shares customer feedback and manages sample and quotas after interactions in the contact centers, over digital properties, in physical stores, and during field services. Customer feedback is collected via surveys over the phone, outbound calls with live interviewers, outbound IVR, SMS, mobile apps, as well as the traditional pop-up web surveys and emails.

It has a real-time engine for text analytics performing word and sentiment analysis on unstructured data, for example, open-ended comments. It then color-codes and visualizes with an icon the comment emotion for agent-level users and theme emotions for leadership. The NLU elements of the text analytics generate the categories and themes emerging from the text, with Concentrix analysts building the industry-specific taxonomy and dictionaries. 

Its reporting layer includes functionality such as dashboards, reports, and analytics tools with role-based workflows. The reports are customized for the different user levels with different slices of data and tools available for senior management, operational roles, and customer-facing staff. ConcentrixCX has a desktop and mobile version, deployed on a cloud.

The provider offers the platform in BPaaS modular format and has clients on both services and software (most clients) and services only, where it runs the program on the client legacy VOC tool. The clients are a mix of non-BPO and BPO clients. In some of these instances, Concentrix manages the VOC program for the multivendor network. In addition, to target the VOC market, Concentrix has a separate salesforce with its own statements of work and P&Ls.

Challenges in implementing VOC

In the pure SaaS VOC deployments, clients’ small teams often struggle to implement the customer feedback programs at scale with an outcome focused on transforming CX. Instead, they turn into administrative groups to deploy and run the software. Once companies purchase the licenses and roll out the tool, the generated CSAT and NPS numbers remain in isolation unless the organization procures consulting services to advise on an enterprise-wide plan to increase these satisfaction numbers.

Another challenge is that VOC programs are the remits of CX departments which are still on a maturity curve, usually with a limited mandate. Uplift of NPS requires the transformation of various functions in an organization, from marketing and sales to supply chain and IT. As a result, even if the research or customer service group measures feedback accurately and links it to a root cause, they cannot translate the insights into CX strategic actions.

Unified CX measurement framework

Concentrix identified these challenges, particularly in industries with complex feedback measurement environments such as banking, financial services, and healthcare, and proposes a unified approach which focuses on driving organizational changes and outcomes. For example:

  • The reporting layer of ConcentrixCX has alerts and a case management suite triggering notifications from unstructured text such as words associated with complaints. It also has a one-on-one coaching module for frontline employees with guided performance management flows, individualized scorecards with actual customer responses and links to recordings, and built-in rewards and recognitions
  • ConcentrixCX includes a process improvement tool to extract ideas from employees and push them through a process improvement pipeline. For example, a U.S. healthcare company in 2017, used this feature to identify a 24-hour update discrepancy between its online provider network information and the information available to the agents. The agents escalated suggestions to the digital team via ConcentrixCX and closing the disconnect delivered ~7% decrease in call volumes.

An example implementation of the end-to-end VOC approach is for a U.S. regional bank, where Concentrix ran 17 survey programs across channels with ~400k surveys completed since 2018. For this bank, ConcentrixCX has ~10k enterprise platform users, and over the program, the company made and implemented ~71 recommendations resulting in a 10-point NPS improvement in 2018, projected to drive $20m annual revenue gain.

Next for Concentrix VOC

Concentrix is looking at supplementing traditional modes of surveys measuring transactions to conversational micro-journey opportunities where it gathers feedback more naturally. For example, it is investing in API-based technology which will allow integrating survey questions into various devices such as websites, mobile applications, and connected cars. The advantages in asking questions inside the experience are masking the survey part so it ‘does not feel like a survey’ to the customer and thus increases response rates. These more targeted feedback collections also create a more precise picture of the relevance to the specific stage of the customer journey and identify pain points.

Further, the company plans to expand the attitudinal survey inputs with new unstructured data sources such as speech analytics, chat transcripts, and employee notes into the centralized view of ConcentrixCX and move towards a predictive and prescriptive state.

<![CDATA[Proactive Social Media Engagement: Best Practices from Startek & Aegis]]>

Consumers are evolving their preferred ways of interacting on social media: ‘spontaneous’ stories are replacing produced content, transparency and privacy are driving the spread of private groups and influencing regulatory push, and machine learning is personalizing conversational commerce. The impact on brands is greater need for new types of content, investments in automation and analytics, and creation of quality engagement through communities and micro-influencers.

This is where CX services providers target their proprietary monitoring and analytics platforms, their experience in setting up command centers, and capabilities in building cognitive bots. In this blog, I look at Startek & Aegis’ initiatives in this space.

Orchestrating social media engagement

Startek & Aegis both began supporting omnichannel and social media engagements in the late 2000s. While the Startek side of the business was tool-agnostic using a variety of engagement platforms such as Spreadfast, Lithium, Salesforce Social Studio, and Sprinklr, Aegis identified an opportunity for a specialized customer care social media platform and launched a proprietary engagement suite called AegisLISA.

AegisLISA is a modular platform with different product sets for social media listening and monitoring, chat and email functionalities, campaign management and publishing, analytics and insights with data visualization, combined with knowledge base functionality and app development.

Over the last eighteen months (and more recently following the 2018 merger between the companies), Startek & Aegis have invested in the platform to:

  • Grow new LISA social touchpoints from additional social media sites, blogs, forums, news
  • Integrate social chats and mobile
  • Provide publishing for campaign content
  • Enhance data visualization for community management
  • Add chatbot integration.

One of the more actively utilized LISA features is the ratings and review module, where Startek & Aegis pulls information and prioritizes reviews from sites such as Google My Business, Yelp, and Trustpilot, and responds directly to monitor and preserve clients’ brand reputation. For example, for a warehouse club in the U.S., the company is monitoring their Apple iOS store reviews and Google Play store reviews, taking over from internal IT teams.

Using CX services providers for social media support

The most common path for Startek & Aegis’ social media programs starts with a listening and monitoring stage. Once it triages the posts and provides analytical feedback, the client requests the vendor to step in with customer care in-channel. Startek & Aegis supports the client’s customer service teams, marketing functions, and social and PR agencies of record, providing direct interactions with customers in real-time. This intervention eliminates additional tasks to the customer care teams and allows marketing and digital agencies to focus on producing content.

For experienced CX services buyers, ranging from retail, telecom, consumer electronics, and automotive sectors, their minimum supplier requirements are to support digital and automation initiatives. This shift requires engagement with the wider client organization and social media supplier ecosystem; for example, for a U.S. automotive company, the company interacts on a weekly basis with the CMO office.

More recently, the company is seeing increased demand for social community management, responding to proactive campaigns on social media such as hashtag campaigns and helping with brand promotion. For the automotive client which curates its content to a specific customer profile, Startek & Aegis finds automotive hashtags which are brand-aligned but not official company tags, and proactively engages with the users. 

Augmenting omnichannel self-service

Startek & Aegis is seeing increasing client demand for enhancing omnichannel self-service, including over social media. The company usually starts an evaluation looking at inbound voice and digital volumes and breaking them into categories. It then works with its Ideal Dialog subsidiary, which specializes in research for contact optimization, to understand what can be made conversational from an automated perspective.

For clients with existing social media infrastructure who have started implementing bots in their social channels, Startek & Aegis performs a gap assessment and, for example, proposes additional automation. If the client is at the beginning of their digital automation journey, the company will scope out and develop the bot to integrate with LISA. For example, in the retail and e-commerce sectors, simple automation includes store hours and directions over IVR, chat, and web, with more advanced RPA and machine learning to automate order entries, order tracking, and afterhour responses. For example, for a U.S. consumer electronics client for which Startek & Aegis manages all social media including 50 blogs and forums, it is currently building self-service automation for the most commonly asked questions for the e-commerce RMA process. The bot will operate on email and social media channels and will authenticate the customer and provide real-time account status.

In another example, for an Indian bank, the company deployed an integrated social and mobile cloud-based system to enhance CX across omnichannel, introduced LISA, and optimized operations through silo remediation, function collaboration, and leveraging analytics-as-a-service. As a result, the bank’s digital and social presence organically improved to ~30k followers in one year, digital customer resolution improved to 90%, and the bank was able to reach 200-300k unique customers every month only through its digitization strategy.

Evolving Startek & Aegis’ social media offerings

Startek & Aegis is currently looking to leverage LISA across its client base, expanding on its work in the telecom and automotive sectors and in the APAC region, to take it to the U.S. market with retail, consumer electronics, and digital economy brands. One tactic it employs is dedicated innovation sessions organized with the client as an opportunity to look from a strategic viewpoint at the customer engagement roadmap and digital initiatives.

In its LISA product development, the company is integrating additional social messenger apps which are geo-specific; expanding its reputation management services with a focus on review sites; and developing chatbot capabilities using Ideal Dialogue research to make bots more natural and dynamic, and more able to closely replicate human conversation.

<![CDATA[Chat Services: Teleperformance’s Playbook & Targets]]>


In NelsonHall’s 2017 report, ‘Multi-Channel CMS – Delivering Digital Customer Experience’, I forecast that the chat channel, in all its forms, would become 18% of the global CX services outsourcing market by 2020, growing by 30% CAGR. What fuels this sizable growth are the many benefits to brands offering sales and support over text channels, the advancement of customer-facing automation, the spread of messengers, and above all, the high customer adoption rate. Today, social messengers have more active users than social networks, and while the phone channel is not disappearing any time soon, it has become a social norm to text someone before giving them a call.

In this blog, I look at how Teleperformance develops chat services to reach ~11k FTEs globally, supporting chat in 17 languages for ~140 clients across multiple verticals.

Benefits for customers

Live chat, and increasingly cognitive bots, offer real-time context for customers in their interactions with brands. Text channels (from traditional desktop chat to in-app chat and messengers) offer flexibility, with asynchronous conversation, immediacy with the convenience of mobility, and with voice-to-text technology, low effort and lower attention requirements. Text channels also support rich media such as documents, links, images, and videos enhancing usability in sales scenarios to push coupons and to send guides for customer service. They also offer co-browsing and screen sharing for complex technical support. It is not surprising then that chat often has higher customer satisfaction and a higher conversion rate than voice.

Benefits for companies

For companies using chat for sales and support, it offers a range of advantages:

  • True digital support
  • Global reach – for example, Telepeformance’s third and fourth largest chat populations are in Brazil and China
  • Breadth of services – for example, for Teleperformance, ~65% of chat is customer service, followed by ~27% technical support, 4% sales, and 4% other services
  • It has operational benefits, including higher agent satisfaction by lowering fatigue, better WFM with concurrency and blended delivery, better data capture, and better performance monitoring
  • Also, in certain scenarios, it can lower cost by deflecting calls and increasing productivity.

Benefits for CX services providers

In addition to all the end-user and brand benefits, for CX services providers, chat interactions give the option to bypass language barriers and accent-neutrality issues. For example, the newly formed Teleperformance Digital Integrated Business Services (DIBS) has ~1.8k chat agents in India supporting ~20 international clients.

It also opens opportunities to assist clients with their digital channel activation. Teleperformance DIBS has developed a dedicated voice-to-chat deflection product. It detects the customer’s smart device during a call to a toll-free number. If the phone can support rich text, it offers the customer the option to switch from voice mode to chat mode and sends the customer an SMS with a chat link. Teleperformance aims for a minimum 15% deflection rate, on qualified opportunities, by the deployment of TP voice-to-chat.

Text channels are also the preferred environment where CX services companies deploy traditional chatbots and implement cognitive automation in the form of NLP- and ML-supported bots. For example, Teleperformance DIBS has deployed a cloud-based Chat bot for a Southeast Asian postal and logistics services company with operations in 15 countries. Supported since 2014, the company now has ~ 30% of its chat volumes in purely transactional interactions. Teleperformance deployed automation to help agents with suggested responses and quicker retrieval of knowledgebase articles. In December 2018, it launched a customer-facing bot called Sophie for self-service. As a result, the client experienced ~43% volume containment in chat, 30% improvement in customer satisfaction, and 18% cost savings within a four-month period.

Requirements for chat implementations

Successful chat programs define a channel-specific strategy which encompasses identifying its suitability, selection and integration of required technology, operational management optimization, and the creation of dedicated agent recruitment and training. Teleperformance typically conducts a discovery exercise which assesses details such as proactive vs. reactive chat and level of reporting (following its proprietary 100-page chat playbook which recommends best practices, for example in the suitable number of concurrent sessions, market, and target KPIs). It has dedicated chat success managers to jump-start a chat program, analyze chat performance data, and manage the strategic requirements.

Separate ‘Tiger’ teams specialize in the most popular chat platform integration and customization (LivePerson, Nuance, Oracle, Zendesk, Moxie). There is a chat-specific recruitment framework with checks for typing speed, grammar, and abilities to multitask and respond quickly. For example, two recruiters may engage with the candidate at the same time over chat sessions and track if the applicant answers within 30 seconds. The company also has dedicated training modules including for chat handling skills, writing skills, positive phraseology, and professional vs. social chatting.

An example of a client using chat success managers is an American digital stock agency, for which Teleperformance DIBS supports voice, email, and chat. Starting in August 2018, the chat development team implemented web analytics and proactive webchat based on the customer profile and stage of their shopping experience. Within six months the client had a 47% increase in revenue, an 18% increase in average order value, and a 20% increase in overall sales.

Future of chat CX services & Teleperformance targets

Between the opening of WhatsApp APIs for business, its future integration with Facebook and Instagram, and the dominance of WeChat in China (or similarly, LINE in Japan & Taiwan, Viber in Eastern Europe, Telegram in Iran), text communication will become a game-changer for all B2C brands. While desktop chat still dominates (~60% for Teleperformance) it is gradually being replaced by these newer UIs as companies move to proactively meet their customers on their preferred channel. This change will further the need to perform more complex interactions effectively over chat.

For Teleperformance, the objective in the short term is to add accounts to its voice-to-chat product, to add ~100 client LOBs in chat just in English, and to reach 20k chat agents globally in 2019.

<![CDATA[Enabling CX Digitalization: A Look at CSS Corp's Yodaa]]>


In this vlog Ivan Kotzev looks at CSS Corp’s digital experience suite Yodaa and how it unifies the company’s analytics, automation, and multichannel tools and models for digitalizing support.

<![CDATA[Highlights from Alorica’s Analyst Day, November 2018 (vlog)]]>


Ivan Kotzev shares highlights from Alorica's recent analyst day, including current CX initiatives and focus areas, business growth, and investment priorities.

<![CDATA[The CX Consulting Race: New Players, New Models, and Tech Mahindra’s Example]]>


NelsonHall has recently published a report on Digital Customer Experience Services, and one of the trends explored is the evolving competition in customer experience (CX) consulting. The traditional ecosystem includes distinct players with clear-cut roles:

  • Big five management consulting firms such as Deloitte or PwC, providing strategy-level advisory which covers CX
  • Niche UX design studios, analytics houses, and consultancies focused on certain aspects such as website user experience or a specific function such as customer journey mapping
  • Pure-play BPOs specialized in outsourced contact centers, who have expert knowledge in transforming customer-facing operations and the managed resources to deliver it
  • IT services companies who bring their knowledge in application development and implementation to front office processes.

Now, with C-level focus on CX and companies embarking on digital transformation journeys, the providers’ roles are changing and the new CX consulting model looks more like a unified framework. This model typically includes:

  • In-house management consulting practice with CX labs and access to (own) market research
  • Design and analytics units with IP such as methodologies and innovation labs
  • Technology development and implementation resources, often with own platform stack, with sandbox environments
  • Contact center operational expertise integrated with client programs, from WFM to digital channel activation, to domain and/or service line optimization.

From customer management services vendors to CX transformation providers

Moving towards this delivery model, the traditional customer management services companies began creating their digital units to combine different transformation functions (e.g. Comdata Digital, Konecta Digital, Sutherland Digital). They acquired (e.g. HGS and Element Solutions); placed consulting capabilities upfront in their GTM strategy (e.g. Sitel’s TSC); spun out a separate consultancy business (e.g. Teleperformance’s Praxidia); or partnered with a management consultant (e.g. Atento and FALCONI).

For the multi-tower BPS players, who already have digital transformation capabilities, it means increased focus on CX by their consulting units (e.g. TCS Interactive, Wipro Digital); the acquisition of CX and UX design firms (e.g. TandemSeven by Genpact; Brilliant Basics by Infosys; The BIO Agency by Tech Mahindra); and beefing up delivery presence in the local market, including through setting up CX innovation centers in core markets. 

The example of Tech Mahindra Consulting

Tech Mahindra’s consulting practice is part of the company’s Business Transformation Services and represents ~5% of the annual BPS revenues (FY17). The practice started in early 2015 and currently has 110 consultants working on ~50 engagements in CX, next-gen operations, risk and compliance, and digital technology transformation across Tech Mahindra’s target verticals in front-office, F&A, supply chain and procurement, and service desk. The team consists of management consultants, BPS practitioners, domain and function consultants, and analysts with industry background. They are spread across India, U.K., Continental Europe, Singapore, Australia, New Zealand, the U.S., South Africa, and a smaller number in the Philippines. It also utilizes external resources, including the company’s own The BIO Agency in the U.K. and the wider Tech Mahindra analytics and application development capabilities.

Its clients include both managed services and standalone consulting projects – e.g. for a South African banking client, where Tech Mahindra BPS provides the automation CoE with 15 resources; and for a leading Telco in New Zealand, where Tech Mahindra BPS provides the automation CoE with eight resources. In fact, the majority of the current work is made up of standalone engagements. There are instances when the initial assignment started as a standalone engagement and then moved on to become managed services. The advantage for Tech Mahindra BPS is that such projects build credibility with the client and open the door in organizations reluctant to outsource their front-office immediately.

In CX, the scope includes some internal optimization activities, but the main services are customer journey mapping, customer-centric design thinking, customer behavior studies, and digital assessments for clients. The practitioners employ techniques such as touchpoint analysis, speech and text analytics, predictive analytics, customer journey re-imagination, process mapping and reengineering, performance management and improvement, client workshops, and observations to develop recommendations, create a transformation roadmap, and write assessment reports, and implement it with operations. For example, for an African telecom with high call volumes and increasing calls per subscriber, Tech Mahindra BPS created and deployed a repeat call measurement and management approach, incident tracking, and controls, and established a SLA productivity framework for the social media team. As a result, within a year, the call volumes dropped by 13% (~142k calls) per month, bringing $1.02m in annual savings. Other projects include RPA CoE and implementations of chatbots for telecom and retail organizations.

In next-gen operation services, in addition to performance management and optimization with methodologies such as Lean Six Sigma, the practice also provides benchmarking and comparative studies such as channel evaluations to map the associated benefits and risks with the adoption of a new digital channel for support. Its more recent focus is on lifting the entire operating model of the client. For example, for a European telecom, the company delivered a 15-month project where it evaluated ~2k processes, identified improvement opportunities, harmonized them in line with the service architecture, and supported the automation activities.

An evolving practice

Tech Mahindra BPS consulting is growing with new areas of delivery such as GDPR, knowledge management transformation, digital supply chain, and change management consulting. In the latter, in large-scale operating model transformations, it embeds a change manager to coordinate between the organization’s stakeholders and manage the transition stage.

It aims to maintain its revenue share as the BPS business expands, providing support for ~40 clients in FY18. It also plans to organize its consultants more closely by geography; for example, it already employs a consulting partner for the Americas and another one for EMEA.

A key target area is automation, with each consultant required to assess RPA and intelligent automation opportunities. The objective here is to create a data-based impact model to predict expected business outcomes. At the moment, the company sees significant traction for this automation drive in service desk processes.

An evolving market

The effects of market evolution are:

  • Increased competition for CX consulting projects, serving as an entry point to a larger BPS deal
  • Widening gap between tier 1 CX services providers and the rest of the contact center vendors
  • Integration of contact center outsourcing in a deeper product or service redesign. 

As BPS providers (both multi-tower or CX services pure-plays) look to offer a broader range of consulting services, their main differentiator from consulting firms is their effectiveness in applying the transformation levers of automation, analytics, people management, and eventually, cognitive services to enable their clients to prepare for the future.

<![CDATA[Arvato CRM’s JV with Saham Group Consolidates EMEA Position]]>

Bertelsmann, the parent company of Arvato CRM Solutions, has announced plans to combine Arvato CRM with the CX services business of the Pan-African Saham Group. The joint venture will have 50/50 ownership, with ~ €1.2bn combined annual revenues and ~48k employees in 25 countries. The deal is expected to close in January 2019.

Saham Group & partnership history

Founded in 1995 in Casablanca, parent group Saham has operations in 27 countries in Africa and the Middle East in real estate, healthcare, education, and outsourcing. In 1999, Saham created Phone Group, focused on CX services for the French-speaking markets, and in 2004 partnered with Arvato CRM. The company has nine contact centers in Casablanca and Marrakech, Morocco; two sites in Dakar, Senegal; one site in Lomé, Togo; and one center in Abidjan, Ivory Coast.

Saham has additional CXS businesses in Egypt and Qatar (Ecco Outsourcing, added in 2015) and in Saudi Arabia (Pioneers Outsourcing, added in December 2017). In total, the group adds ~14k employees in seven countries supporting nine languages.

Global presence & expansion plans

The new, as yet unnamed, provider will have a sizable delivery presence in EMEA:

  • 25k employees in ten European countries: Germany, France, Spain, Portugal, Ireland, the Netherlands, Poland, Romania, Georgia, and Estonia. Arvato CRM’s U.K. business will remain part of Bertelsmann
  • 14k employees in MEA countries: Egypt, Morocco, Senegal, Ivory Coast, Togo, Qatar, and Saudi Arabia
  • 9k employees in Asia (India, the Philippines, Malaysia), and the Americas (U.S., Canada, Mexico, Peru, Colombia). 

Its clients are in sectors including telecoms and high-tech, BFSI, automotive OEMs, retail, CPG, and consumer electronics, social media, travel, transport, and hospitality.

Under the deal, Bertelsmann will receive an undisclosed payment and will appoint a new CEO, Thomas Mackenbrock, who says that the company will be debt-free and has plans to expand its regional footprint further and increase its focus on digital services.

The Middle East & Africa offering growth opportunities

Over the last three years, the Middle East and Africa have seen increased demand for outsourced CX, both in the domestic and offshore markets. The drivers behind it are diverse:

  • More stable political environment in Egypt and Tunisia allowing increased offshoring by multinational providers (e.g. Convergys) and domestic players (e.g. Raya Contact Center, Xceed)
  • Renewed efforts to promote South Africa for support to new markets such as the U.S. and Australia (e.g. WNS, Merchants)
  • Cost pressures in the Gulf countries to outsource front office work benefiting multinationals (e.g. TCS, Sutherland, Aegis, Intelenet)
  • Economic growth creating demand for first-time outsourcing, primarily by telecom clients in Sub-Saharan Africa, creating need for onshore centers (e.g. iSON BPO, PCCI)
  • Expanding English and French offshore work from African destinations such as Nigeria, Cameroon, Madagascar, and Mauritius (e.g. Intelcia, Tek Experts).

The new Arvato-Saham company is well positioned to leverage several of these trends and benefit from demand for domestic, nearshore, and offshore CX services.

The growing attraction of CX services

This transaction is the latest in a series this year that typify the consolidation drive and industry investments happening in the CX services market. Bertelsmann was considering the full sale of Arvato CRM to direct competitors, but the creation of a joint venture shows a level of confidence in the positive trends in the market.

Global CX services are gradually shifting towards higher-value, more complex customer interactions and more digitally-focused contracts. Commercial models in the industry are evolving from per FTE pricing and labor-arbitrage, to outcome-based and gainshare requirements where providers are supporting the digital transformation and CX strategy of clients. One of the effects of this will be further consolidation of providers in 2019.    

<![CDATA[The CX Workforce Challenge & How Vendors Are Responding]]>


In February, industry veteran and CEO of SYKES, Chuck Sykes, commented during the earnings call on CX services market trends: ‘… in the U.S., at least in my time, there is no time in the company's history that I can recall seeing this level of labor challenge. And it actually is something that you're going to see in a lot of developed countries around the world.’* In this blog, I look closer at the nature of the CX workforce challenge.

Pressures on the labor market

Multiple forces have contributed to a CX labor gap, including traditional issues such as the negative reputation of contact center careers and the highly demanding nature of customer service work. However, several factors are putting new and lasting pressures on finding, recruiting, and retaining CX employees:

  • Low unemployment rate. In the U.S., the unemployment rate slid to a near 18-year low; in the U.K., it is around 4%, the lowest since 1975; and in certain parts of Germany, local unemployment rates reached as low as 1-2%
  • Minimum wage increase. Governments, often at the local level, have significantly increased the minimum wage in many U.S. states, Canadian provinces, and the state of Karnataka, India, to name a few. Other countries such as South Africa are working towards introducing a minimum wage for the first time
  • Global delivery network maturity. Very few suitable delivery destinations remain unexplored and offer the required combination of skills, scale, cost arbitrage, security, connectivity, and the other factors for establishing CX centers. Places such as Cyprus, Georgia (the country), Kosovo, and some Sub-Saharan countries are attracting multinational CX services providers willing to pioneer delivery. However, with limited scale, they cannot offer a true alternative to more mature markets
  • Increasing demand for employee skills. The traditional agent profile, with language proficiency and basic computer skills is no longer sufficient. Client programs now seek new hires with an industry background, and demand digital skills and the ability to engage and lead unscripted conversations. The agent who takes inbound support calls is not necessarily the one who works on webchats and is likely different from the one who supports Facebook Messenger inquiries.

Immediate impact & vendors’ initial reactions

The immediate reaction of CX services vendors is to increase agent salaries, often absorbing the initial impact on margins, while re-negotiating the cost structure with existing clients, or at least planning for increases when it comes to contract renewal time. Labor market pressures are also driving more active selection of bids, including walking out of existing underperforming programs (e.g. Conduent, Convergys).

Another approach is to increase use of nearshoring and offshoring, even in industries which traditionally shied away from the model, e.g. brick and mortar retailers, airlines, and utilities. Certain destinations such a Jamaica, Colombia, Romania, Malaysia, and the Philippines continue to benefit, but often by expanding into tier 2 and 3 cities.

RPA and intelligent automation is probably the most underused opportunity, with CX services vendors increasing its adoption across multiple contact center processes, from traditional back-office work to front-office tasks. Providers and clients have significant runway to reach the balance of machine and live agent support and to achieve scale and maturity of automation and cognitive analytics deployments in contact centers. Still, the adoption of this technology will not dramatically alleviate the shortage of skilled agents, as live support moves to higher value, more complex interactions.

Alternative contact center models, employee engagement & the rise of work-at-home  

Employee recruitment, performance management, and engagement combined is another area where CX vendors are making investments to counter labor challenges, utilizing technology and analytics such as recruitment bots (e.g. Alorica), mobile learning (e.g. Sitel), coaching bots (e.g. C3), engagement apps (e.g. Concentrix), and career development (e.g. Teleperformance University).

As part of these strategies, vendors are also increasingly focusing on the work-at-home model. Providers such as Transcom in the U.S., HGS in Canada, and SYKES in Western Europe are actively employing the work-at-home model for full-year programs, gaining access to new talent, often with specific industry skills such as healthcare, insurance, and travel (e.g. Intelenet), or creating presence in untapped labor pools such as Alorica’s military veterans and spouse programs.

Another vendor initiative is opening small-scale urban contact centers to cater for the labor pool in these locations. Such micro centers with less than 50 people are being developed by transcosmos in Japan and Invitel in Germany.

And a further opportunity

Companies managing internal CX operations are facing the same labor market pressures. This situation creates an opportunity for outsourcing providers to differentiate based on their ability to source talent and place it in the right delivery model; but also based on their ability to engage employees, transform the nature of support work, and elevate the role of the CX agent.


* Taken from the Seeking Alpha Earnings Call Transcript: SYKES Q4 2017 Results

NelsonHall recently published its Digital CX Services market analysis report, available to CX Services program subscribers. For access, please contact NelsonHall Client Services Director Keith Maclean.

<![CDATA[Tech Mahindra BPS’ Approach to CX Process Automation]]>


Currently, the level of automation in the front-office is lower than it is for middle and back-office processes, with reasons including the lower cost of handling customer-facing processes, established offshore models for labor arbitrage, and lack of client interest. However, the upside of this relatively slow uptake is that automation can now be applied to multiple areas of CX, including:

  • RPA on manual tasks
  • Workflow automation
  • Knowledge management bots
  • Next-best-action tools and guided scripts
  • Cognitive virtual assistant supporting live agents.

Automation can be applied to a variety of processes, from contact center back-office work to live customer interactions; from traditional calls and emails to chats and social media; and in the internal processes of customer service operations in recruitment, training, coaching, performance monitoring, and compliance. Here I look at how Tech Mahindra’s Business Process Services (BPS) division is approaching the automation of CX processes.

Traditional RPA

For most organizations, there are still a lot of opportunities in their legacy applications to bring RPA and point solutions to remove bottlenecks, eliminate manual errors, and reduce processing time. Tech Mahindra is addressing these needs with a dedicated automation practice. The practice consists of a ~ 90-person RPA team, with another 70 resources involved in platform development, sharing common skills such as .Net, Java, Python, and machine learning.

Tech Mahindra has developed a proprietary automation framework called UNO (Unified NexGen Operations). UNO has two versions: UNO-P, which partners with the big automation OEMs (Blue Prism, UiPath, Automation Anywhere), and UNO-R, the in-house bots and automation models for unified desktop and front office automation. Typical implementations for back-office robots include exception handling, re-try of failed requests, transaction logs, audit trails, and bot monitoring and control. UNO-R's key features include 360-degree customer view, auto tracking, auto sign-in, and assisted automation during live agent interactions. Across both versions, Tech Mahindra has approximately 60 implementations.

Intelligent automation

While two to three years ago, Tech Mahindra’s efforts focused on automation of highly repetitive manual processes, current developments are moving to intelligent automation with ML algorithms such as OCR, orchestration, and automation of running the bots. One area where the company invested in digitalizing the experience through automation is agent training: it converted the training process from trainer-led to an automated platform.

With a proprietary simulation tool, X-PERIO, Tech Mahindra’s BPS division implemented the new agent training process for a U.K. telecom client with ~5k CX employees. The provider lowered the training time from 8-10 weeks by 40%, delivering £350k in annual savings. The training throughput increased from ~82% to ~95%, while automated scoring eliminated the trainer’s qualitative assessment of agents’ floor readiness. In addition, 92% of the learners rated the content highly, and the customer NPS increased by 26 points. The company also uses the data in agent gamification.

Tech Mahindra BPS created bots to tackle frauds – e.g. in the telecom environment, where promotions with new flagship phones result in increased fraud attempts. A fully automated process replaces the previously manual checks, with robots taking data from the registration, CRM, and payment systems and verifying the number of account payments and usage in the last two weeks against a ‘hot names’ list of known fraudulent addresses and numbers. The algorithms then compare against the daily sales and stop those at risk, scheduling and assigning a call back to a live person. As a result, the initial fraud team of 38 members was reduced to 14 analysts who work on optimizing the bot for future fraud trends.

Similarly, in the phone selling process for telecoms, Tech Mahindra BPS replaced the manual quality assurance process with automated audits which matched the requested and offered phone versus customer eligibility. The automated audits cover 100% of daily sales and have no delay, as it operates 24/7. The company has deployments for telecoms clients in the U.K., Australian, and Philippines markets.

Evolution to cognitive services

Conversational bots still need time to reach true maturity, but many of the current applications use contextual bots to address specific business needs. Tech Mahindra has developed a platform, called GENIE, which offers scenario-based learning, real-time feedback, and independent learning where the bot converses with multiple trainees at the same time. For example, traditional mock calls performed before a class of new hires are replaced by the individual conversations with a bot. GENIE asks and answers questions and can be configured on different levels of conversational complexity. It also scores the trainee’s performance on process knowledge such as customer identification steps and productivity (how long the trainee takes to answer).

Tech Mahindra is also looking to replicate its automation algorithms for other industries – one of the benefits of automation is that it allows relatively easy replication of codes and scripts with few customizations required to use it in different areas and industries. Tech Mahindra is now piloting its fraud prevention automation for a financial institution for credit card issuing and expanding the training bot across its entire agent population.

<![CDATA[Concentrix Acquires Convergys, Becomes Second Largest CX BPS Player Globally]]>

With its Q2 results yesterday, SYNNEX, the parent company of Concentrix, announced its intention to acquire Convergys, the second largest CX services provider and a public company with ~$2.8bn annual revenues. SYNNEX will pay ~ $2.43bn (includes $26.50 per share and repayment of $315m net debt). The transaction is expected to close by the end of 2018.

The largest CX Services provider in North America

Convergys has ~115k employees in ~125 delivery centers in 30 countries. Its biggest market is North America, with 74% of its global revenues (~$2.07bn in 2017) coming from the U.S. Onshore in the U.S. it has ~20k employees in ~47 centers, supported by offshore centers in India, LATAM, the Philippines, and Southeast Asia. Convergys also has a sizable presence in Europe (onshore and nearshore).

The company has ~265 clients in the communications & media, high-tech, retail, BFSI, automotive, and healthcare sectors. Communications, which forms 43% of the business today, has been experiencing strong headwinds and volume fluctuations, with revenues steadily declining over the last three years. In Q1 this year, the revenue decline in Convergys’ largest client AT&T was ~$40m. Despite this dependence on a very soft sector, Convergys has been able to stabilize its operating margin (7.1% for 2017, down -30bps y/y) by rationalizing capacity in the U.S., adding new clients in Europe, and diversifying to other verticals.  Its retail segment in particular, including consumer goods and travel, has been successful, growing at 15% y/y in Q1 2018.

Convergys will bring in proprietary VOC analytics and reporting platforms, an RPA practice, and digital channel expertise.

Combined for scale

With the acquisition, the ~$2bn Concentrix will add ~$2.7bn in annual revenues and ~$380m of adjusted EBITDA in the first year, including cost synergies of $150m in 36 months. The combined company will have ~650 clients, ~225k employees in 40 countries (12 new geographies for Concentrix).

Concentrix’s last two acquisitions, the digital development and consulting company Tigerspike in 2017 and BPS provider Minacs in 2016, also added horizontal and vertical capabilities with analytics, development, consulting resources, and tools.

The biggest benefits for Concentrix with the new acquisition will be:

  • A significant expansion in its delivery footprint, including in the challenging German market
  • The addition of a multi-national client base to cross-sell and upsell digital capabilities in consulting, automation, mobile app development, and marketing optimization.

CX consolidation accelerates

This major deal comes two weeks after Teleperformance’s announcement of the Intelenet purchase and on the heels of this year’s StarTek-Aegis merger, Comdata’s M&A expansion in France, Webhelp’s shopping spree in Europe, and an overall trend of vertical and horizontal additions by CX services providers.

What is driving the consolidation at this pace is the high level of industry fragmentation (the leading three players have less than 10% market share) and the need to scale investments in new technology and value-add offerings. The major factors here are the competitive landscape and new CX client needs:

  • Contact center services specialists are being challenged by multi-tower BPS pureplays and ITS/BPS players offering consulting and transformation services on top of technology expertise
  • Clients are looking for a multinational standardized delivery with a healthy mix of onshore, nearshore, and offshore locations and local expertise for all major markets for truly global programs
  • Clients require automation and advanced analytics to move performance beyond basic process optimization and continuous improvement. Targets such as cost savings and new revenue generation are mostly maximized with traditional outsourcing models
  • The rapid technology cycles and emergence of new digital channels make clients’ investments in CX tools less sustainable. What vendors can offer is a CX and domain-specific guide to the selection and customization of these tools
  • Last, but not least, the changing corporate strategies incorporating CX in a digital transformation journey, move clients towards providers who can help with the overall puzzle.

One more CX unicorn up for grabs

In 2019, the $4.7bn Concentrix will become the second largest CX services vendor globally, it will rank alongside the likes of big league BPS vendors ADP, BNY Mellon, Conduent, and Teleperformance, and at par with Arvato. For the latter, the planned sale of Arvato CRM Solutions by its owner Bertelsmann remains the last big opportunity this year to buy a sizable share of the CX market.

<![CDATA[Teleperformance to Acquire Intelenet, Makes Strategic Bet on India & Analytics]]>


After several months of media speculation, Teleperformance officially announced yesterday an agreement to acquire Intelenet Global Services from the private equity Blackstone for a total consideration of $1bn.

Boost for Indian market

The deal will expand Teleperformance’s topline growth and have a positive impact of around +10% on the company’s earnings per share in 2018 on a pro forma basis, excluding goodwill. For the fiscal year ending March 31, 2018, Intelenet had revenues of $449m, up +10% year on year, and EBITDA of $83m.

Thirty-four percent of Intelenet’s business is in CX Services, and it will expand Teleperformance’s client base with ~110 logos in BFSI, travel, transport, and hospitality, e-commerce, telecom, and healthcare sectors in the U.S., U.K., Middle East, and India domestic. Across 40 delivery centers, the Mumbai-headquartered Intelenet has ~55k employees in India, the Philippines, U.K., U.S., the United Arab Emirates, Jordan, Poland, and Guatemala.

In the last few years, India has been one of the fastest growing destinations for Teleperformance, and the additional Intelenet footprint will create a combined workforce of ~60k in tier 1, 2, and 3 cities, with the main centers in Mumbai, Delhi, and Chennai. Intelenet will also add a sizable domestic market portfolio of ~$150m of annual revenue.

Entry into diversified BPS

Intelenet will also contribute to Teleperformance’s service diversification, bringing F&A, HRO, and industry-specific services such as mortgage origination, risk management, payment remediation in BFSI, revenue cycle management and coding in healthcare, and a variety of transaction processing services for travel and hospitality clients.

All these services will grow significantly Teleperformance’s ‘Specialized Services’ which include receivables management, TLScontact’s visa processing, LanguageLine interpretation services, acquired in 2016, and the consulting arm Praxidia, established earlier in 2018. For 2017 ‘Specialized Services’ represented ~15% or €638m of the total business.

The value-add of Intelenet Knowledge Services

The other key value-add from the transaction is Intelenet’s investment in digital capabilities. Intelenet’s Knowledge Services arm was founded in 2010 to offer standalone analytics, consulting, and technology development services. Across the different teams and primarily India-based, Intelenet has ~200 employees comprised of business analysts and consultants, researchers, project managers, graphic designers, software developers, analytics modelers, and statisticians, and increasingly ML experts.

These resources have created a stack of predictive and prescriptive analytics models and domain-specific platforms, e.g. for fare automation, loss prevention, disruption management, mobility, and workflow automation in the travel and airline space.

A €6bn business by 2022 & disruption among CX Services leaders

For Intelenet, the deal will finally land the company a strategic investor after several ownership iterations since 2000. For Teleperformance, it will firmly place it on track to reach the target of €6bn revenue and EBITDA of €850m by 2022. Teleperformance predicts the transaction will add at least 1% annual like-for-like growth and 20 bps to the margin this year.

At the same time, the impact on the CX Services market is significant, not only because of the scale of the deal, but also in the context of the pending changes in the top 10. Keeping in mind the expected sales of Convergys and Arvato CRM, it shows the increased pressure for CX Services provider consolidation to meet market demand for digital and consulting services and global delivery.

<![CDATA[The End of Telecoms Sector Dominance in CX Services?]]>


For many years, the telecoms sector has been the dominant market for customer experience (CX) services providers. However, over the last few years, consolidation, flat performance, decreasing margins caused by market saturation, new digital models and competitors, and unfavorable regulations (e.g. Eurotariff) have eroded the significance of the telecoms sector for CX services providers. Indeed, a common boast among CX outsourcing executives is their success in diversifying away from the sector.  

And now, the $26bn acquisition agreement between T-Mobile and Sprint, announced last week, looks set to accentuate that trend. If approved, the deal will leave only three national wireless players in the U.S. and will put further pressure on their CX services providers.

Decreasing share & focus on telecoms

The communications industry remains the largest CX services sector at ~24% of the market in 2017 (NelsonHall estimate), but for most of the leading CX services providers it has been steadily decreasing in the last few years, both as a share of business and in absolute terms, as shown here:

Major telecoms brands such as AT&T, T-Mobile, Tele2, O2, Telefonica, BT, Three, and Telstra remain the largest clients for many CX services providers. However, in times of fluctuating volumes, this telecoms top-heavy client base has adversely impacted several providers in their core markets, though typically the overall growth in other sectors has offset the steady decline in communications. Additional factors such as the high level of self-service, where the sector has been a pioneer, simplification of offerings and product ranges, and demand for cost savings through offshoring, have further impacted the size and profitability of the segment.   

Digital opportunities in other, high-growth industries

The telecoms sector has been leading in the adoption of emerging digital channels such as messengers, in the implementation of contact center RPA, and the use of customer-facing automation through bots. However, partially due to the sector’s success in adopting these digital models internally, and partly due to smaller innovation investment funds, many of the most innovative and largest-scale outsourced CX implementations have been in other industries; for example:

  • Videochat and messengers support in the e-retail, banking, and travel sectors
  • Contact center and back-office automation in financial services, healthcare, and energy & utilities
  • Big data analytics for revenue generation in BFSI, e-retail, and consumer electronics
  • Remote diagnostics and self-healing for tech support in high-tech and automotive.

Major tech players such as Amazon, Alibaba, Apple, Facebook, Google,, and Netflix have now reached the scale of outsourced CX operations previously seen only in telecoms. The added benefit for these companies is their global nature, being able to offer multi-market prospects.  

But evolving telcos can be very attractive clients

Nevertheless, the constant evolution of telecoms’ business models, exemplified by Vimpelcom’s new strategy to reinvent itself as a global tech company, or the recent M&A surge to create telco-media behemoths such as the proposed AT&T Time Warner merger, unlock new opportunities. A great example of telco evolution has been AT&T’s purchase of DirecTV in 2015, which consolidated the outsourcing network but also provided new markets and service lines for AT&T core vendors.

The shift to 5G and IoT and the evolving telco’s end-user needs require proactive support, heavy use of automation and machine learning in the contact center, and always-on digital engagement. All these are current investment areas for CX services providers and, even if not straight away, telecoms will eventually reap their benefits.    


NelsonHall’s pending Global CXS Market Forecast 2018-2022 report and self-service forecasting facility provide industry breakdowns by service line, sector, geography, and vendor. For access, please contact NelsonHall Client Services Director Guy Saunders

<![CDATA[Aegis & StarTek Expand Globally with ~$700m Merger]]>


Last week Aegis Global and StarTek announced the creation of a combined company. The merger will see Aegis majority owner PE Capital Square Partners swap shares with the NYSE listed StarTek, to reach a ~55% stake in the merged company. The deal is expected to close by Q3 2018. Here I look at the implications of the merger.

Return to the U.S. for Aegis

For Aegis, the merger follows its sale from Essar to Capital Square Partners in November last year. It also marks the return to the U.S. market, which the company mostly exited in 2014 with the sale of its U.S., Philippines, and Cost Rican operations to Teleperformance.

Aegis kept its core business in India and Southeast Asia, as well as its client and delivery presence in the U.K., Australia, South Africa, Saudi Arabia, Argentina, and Peru, with the latter two countries mainly supporting the LATAM markets. The addition of the Philippines capacity will provide alternative APAC language delivery to Aegis’ multilingual hub in Malaysia and an offshore location for Australia. Today, the provider has ~40k employees in nine countries and ~$388m in revenues.

Global expansion and new verticals for StarTek

For StarTek, the deal expands the business internationally to APAC, U.K., Middle East and LATAM. Its operations in the Philippines, Jamaica, and Honduras support the U.S. market, representing ~42% of the business.

Over the last three years, StarTek has made significant efforts to return to profitability (posting a $1.3m net loss for 2017) and to diversify its client base, which was top-heavy in the telecoms sector. Three of the four leading U.S. telecoms firms form over half of its $293m revenue. It was somewhat successful in this diversification, particularly in healthcare, but the Aegis merger will add new clients and domain capabilities in BFSI, travel and hospitality, automotive, and public sectors. 

Focus on CX technology and multinational clients

Following the transaction, the top three clients of the combined company will represent less than 30% of the total revenue. Telecoms will remain the strongest vertical for the new entity with sizable clients in the U.S., India, Middle East, and Africa. The deal will also enable further penetration of Aegis’ flagship digital channels engagement and analytics platform AegisLISA and increase investments in cloud technology, analytics, and automation. For example, in U.S. healthcare, where StarTek provides receivables management, nurse triage, enrollment, pharma and medical device management, patient customer care and scheduling, Aegis can contribute document digitization and BPM orchestration capabilities.

Without any client or delivery overlap, the merger will boost cross-sell prospects and expand the global multilingual delivery network to a total of ~50k employees in 60 delivery centers in 12 countries. Focusing on multinational clients in telecoms, BFSI, travel, and e-commerce, the new company can offer scale across markets. A significant opportunity is in global e-commerce and retail, where StarTek issued warrants in January for its existing client Amazon to acquire an almost 10% stake (post shares issued after Aegis-StarTek merger), with full vesting tied to future cumulative revenues to StarTek from Amazon of at least $600m over eight years.

While the new management structure, branding, and operational changes have yet to be announced, the deal is expected to realize over $30m annual benefit to EBITDA from revenue and cost synergies by 2020. It will also mark the continued efforts of providers to adapt to an increasingly digital and value-add CX services market.

<![CDATA[Parsing the Customer Journey: How WNS Translates Data to Insights]]>


NelsonHall recently visited WNS’ Analytics CoE in Bangalore. Research & analytics (R&A) services are key activities for WNS, as a first point of entry into new clients, and also as a higher margin activity in existing accounts. Readers of NelsonHall’s Quarterly Updates on WNS will be aware that WNS is looking to increase the level of annuity revenues from analytics contracts. Our visit gave us an opportunity to catch up with the Analytics Practice and learn about future focus areas.

Analytics domain experts with strong sector focus

WNS’ analytics practice has over 2.5k resources dedicated to the company’s six core verticals, developing specialist analytics offerings in marketing, CX, campaign and loyalty management, and risk & compliance. WNS offers both Analytics-as-a-Service and embedded analytics within its BPS services; in both cases, the focus is on co-creating solutions which weave domain expertise with the tools and models to drive business impact for the client’s specific requirements.

WNS’ proprietary framework WADE covers all analytics activities, from identification and management of data sources to data ingestion & storage, data preparation & processing, data consumption, model building, to the business use. Key WNS proprietary IP/products include:

  • Brandttitude: marketing ‘storytelling through data’ platform
  • SocioSeer: social media insights, sentiment, and benchmarking platform
  • InTouch: social engagement platform with customized responses and prioritization
  • OutReach: campaign management platform
  • Unison: omni-channel integration platform with category-level insights, sentiment analytics
  • Aptymize: WNS’ omni-channel personalization engine
  • Commercial Planning Suite: integrated revenue analytics platform for airlines.

Many of these tools have been developed to address a specific client need, bypassing ISV solutions that do not offer the required domain depth and customization flexibility. WNS then expands the use cases to additional clients or new verticals. For example, the Brandttitude platform was initially implemented for a CPG sector client, mapping marketing and brand performance for product managers, but now also has a version for the entertainment industry, comparing artists’ true value and competitive analysis, and is currently being customized for an insurance client.

Infra to insights

In a world where BPS providers have lots of experience in building data lakes and accumulating data across structured and unstructured data sources, a key differentiation is in translating big data into meaningful insights and then operationalizing these insights on behalf of the client, or drawing them to the attention of the relevant stakeholders. For example, in order to maximize ancillary revenue performance for airlines, WNS has developed a library of propensity models that run on airline ticketing data and are able to predict the likelihood of passengers to buy a specific ancillary product.

These models can be further applied on new ancillaries and bundled offerings, creating an ancillary revenue enhancement plan. The results, when applied to the loyalty database, can also be used to identify members who might be interested in redeeming points for ancillary services. This can help in improving the redemption rates of loyalty members with low engagement levels. WNS claims clients have been able to predict high propensity passenger segments with ~3 times the current conversion rates.

From personalization to hyperpersonalization

WNS’ approach with CoE analytics enables it to both address industry-wide challenges and also to go deep into client-specific issues. For example, it developed a personalization engine to help a global high-end hotel chain in their marketing campaigns. The engine segregates customers based on their lifetime value, identifies target segments, creates offers (drawn from 65 different types) for each customer within a segment, and finally estimates the impact of marketing incrementality. This is often in parallel to the models that the client has developed.

WNS runs all five stages of campaign planning for the client, from data gathering, to model building, through to the campaign hyperpersonalization. The campaign analytics services of WNS has been validated as ‘best in class’ by Wharton’s Customer Analytics Initiative. WNS helps with the campaign deployment and monitors performance. The engagement started in 2009 and has delivered nearly half a million dollars in cumulative incremental revenue for the hotel chain.

Proactive analytics to drive CX interventions

Many clients’ requirements with analytics services are evolving from issue identification to issue prevention. Companies are looking for insights on their customers’ future behavior: for example, to be able to map customers’ propensity to post feedback on social media, or predict delinquency or fraud risk.

To support an Australian insurance company wanting to both proactively identify large loss claims and reduce processing time, WNS deployed insurance SMEs specialized in catastrophe modeling, supported by an experienced assessor. Using dimension reduction techniques, WNS selected 71 features to identify ~25% more large claims within 30 days of registration, reducing the average age of large loss claims by ~30%.

What next for WNS in analytics?

A key priority this year and next for WNS is accelerating the use of AI, and this applies to R&A services as well as to BPS service delivery. WNS has trained more than 250 members through its Mastermind training program on AI/ ML. The team is looking at areas such as deep learning and image recognition. For the latter, WNS has a pilot with a P&C insurer using drone images to perform analytics on damage estimation, also automating the identification of risk factors.

WNS’ analytics practice is beginning to reap the benefits of investments in skills development. In 2016 it established a two-year Business Analytics MBA program with NIIT University; the first group of grads from the program are now integrated with the practice.

So what else should we expect? WNS is expanding its partnerships with AI platforms with NLG/NLP capabilities in multiple languages and is eyeing further M&A opportunities, specifically around cognitive analytics, AI, ML, and smart data discovery. This M&A activity will follow a ‘string of pearls’ approach to cater to specific sub-segments and in areas such as marketing and risk analytics.

<![CDATA[How Indian CX Services' Channel Mix Will Change by 2020]]> In our latest CX services research in collaboration with NASSCOM, we have mapped how Indian CX services channel mix will change by 2020, as shown in the following infographic. 

NelsonHall’s Customer Experience Services program delivers the most comprehensive insight for buyers and providers of CX services. For more information, contact Guy Saunders.

<![CDATA[Key Mechanisms to Boost Your CX Services Performance]]> In our latest CX services research in collaboration with NASSCOM, we identified the top 3 mechanisms for improving key CX metrics: Net Promoter Score, First Call Resolution, Conversion, and Turn-Around Time & Average Handling Time, as shown in the following infographic. 

NelsonHall’s Customer Experience Services program delivers the most comprehensive insight for buyers and providers of CX services. For more information, contact Guy Saunders.

<![CDATA[9 Key Stages of Adoption for Next Generation Customer Service]]> In our latest CX services research in collaboration with NASSCOM, we identified the 9 key stages of adoption for next generation customer service, as shown in the following infographic. 

Insights into the differences across client industries and the best practices applied by vendors are available in NelsonHall’s Customer Experience Services program. For more information, contact Guy Saunders.

<![CDATA[Addressing Political Risks & Regulatory Changes: Priorities for CX Services in 2018]]>


In my predictions for the customer experience services industry a year ago, I noted that political risks will replace security concerns as the biggest external threat to the industry. Looking ahead to 2018, regulatory changes and government policies will have a lasting impact on the selection of delivery locations, country investment plans, and market presence. Here I take a closer look.

Governments’ Influence on Labor Cost Has Immediate Impact

In an industry where labor is the biggest cost, government policies mandating increases in minimum wages have immediate impact on contact center operations. The latest example is the province of Ontario, Canada where the minimum wage increased from CAD 11.60 per hour in October 2017 to CAD 14/hr from 1st January 2018 and will jump further to CAD 15/hr in 2019.  Such mandatory wage increases in countries such as India and Philippines are also breaking historical trends, as Concentrix’s CEO Chris Caldwell pointed out in last weeks’ earnings conference call.

While in the U.S. the federal minimum wage has not increased in more than eight years, states and cities are continuing to set higher rates. With low national unemployment and greater need for new hires with sales and digital skills, the combined effect on providers’ U.S. onshore delivery centers can be a push towards optimization. This optimization may involve scalable markets (e.g. SYKES’ move to more urban locations), growing the number of work-at-home (WAH) staff (e.g. HGS’ WAH expansion in Canada), and overall increased investments in automation to reduce exposure to a volatile labor market. The added benefit, of course, is that by eliminating low-skill tasks, agents can be freed to provide more value-add, sales, and retention work.

Politicians’ Focus on Offshoring Requires Attention

Offshoring is an easy target for politicians, and in the last few years the focus has extended from manufacturing to services relocation. In Washington, the topic remains somewhat under the radar amidst the significant taxation and regulatory overhaul targeted by the current administration. The United States Call Center Worker and Consumer Protection Act, continues to be a part, albeit a minimal part, of the legislative agenda with the latest introduction to Congress in February 2017.

However, the effects of these or similar provisions are difficult to predict, with the closest examples coming from Italy, where the 2017 updates of existing legislation had the following effects:

  • Contact center workers being required to inform users where they are physically located
  • Companies being required to inform the Ministry of Labor of any planned contact center relocation within ten days, or 30 days if the relocation is outside the EU
  • Companies having to register with the Italian Communication Authority (AGCOM) any Italian contact center telephone numbers used for business activity.

Still, the Italian example is not fully transferable to other markets due to the low level of nearshoring/offshoring in the country and the previous adoption of similar steps by the private sector.

Data Protection Laws Already Reshaping CX Service Client Requirements

Unlike the possible changes associated with the laws related to offshoring, security and data protection regulations are already affecting the needs of clients. As NelsonHall explained in this blog, the EU's General Data Protection Regulation (GDPR) coming into force on 25th May 2018 requires service providers to help clients design and execute compliance with the new benchmarks of data protection and data security. CX service vendors have been reacting in the last 18 months by allocating additional resource in data governance and change management, and guiding their clients, including their in-house contact centers during the process (e.g. Teleperformance’s GDPR/BCR program).

The EU regulation is likely to set up the global standard for data protection, but similar rules can also be used to limit access to markets, such as Russia’s 2015 data localization law. It requires the recording, storage, modification, retrieval, and other data management of Russian citizens’ personal data to be done from databases located in the territory of the Russian Federation. As a result, small-scale nearshore/offshore support and sales programs covering Russia became untenable.

Similarly, new and expanded cybersecurity rules such as China’s Public Internet Cybersecurity Threat Monitoring and Mitigation Measures further complicate data storage and data governance requirements by asking companies to continuously feed information on cyberattacks and “cyber threat intelligence” to a centralized government database.

Social Media Content Moderation Laws Create Additional Business

Content monitoring and moderation on social media is on the radar of the authorities in several countries in Europe and in the U.S. The German Network Enforcement Act which has fines up to €50m if the social media fails to remove controversial and hate content within 24 hours is in effect from 1st January. It already forced networks such as Facebook to expand their content moderator teams and add capacity with external partners.

U.S. Immigration Policies & Philippines’ Security Troubles Create Opportunities in LATAM

The Philippines is undergoing a decline in BPO-related investments with new seats growth affected by perceived or actual security risks, fueled by Duterte’s hostility towards the U.S. and most recently the rebel activity in the Mindanao region. This slowdown benefits primarily U.S. nearshore delivery with providers boosting their capacity in Guatemala, El Salvador, Costa Rica, and Jamaica (e.g. Alorica’s LATAM investments).

In the U.S., the Trump administration’s policies towards legal and illegal immigration, such as revoking TPS announced this month and the decision over DACA pending for March, continues to grow the pool of English-speaking, culturally-aligned young people who were forced to relocate. This growing resource has the potential to supply the next expansion of nearshore U.S. capacity. 

<![CDATA[CPG’s Digital CX Future: Notes from HGS Forum]]>


I recently attended HGS’ forum on the trends and challenges in CX for the European Consumer Packaged Goods (FMCG) market. In the company’s West London center, clients and prospects including Colgate, Danone, L’Oréal, Nespresso, Nomad Foods, and Mars discussed the ways customer service can drive ecommerce and augment sales.

Digital as a force for disruption and opportunity in CPG CX

As with other sectors, the CPG market is disrupted by digital economy newcomers using direct-to-consumer models via ecommerce. Added to a stagnant mass market, decreasing customer loyalty, and hybrid shopping, this environment increases the importance of good customer experience. HGS’ Lauren Kindzierski, VP of Solutions and Capabilities, highlighted several approaches to enable digital customer experience, which the company has implemented across different verticals:

  • Activate proactive chat to counteract abandoned shopping carts
  • Roll out mobile chat to increase accessibility
  • Launch self-service resources to minimize costs and improve the customer support journey
  • Use SMS notifications for immediate gratification
  • Build predictive analytical models on chat to segment customers.

A best practice for the company has been to ringfence the launch of a digital channel around a single brand to optimize the processes and technology.

CPG companies are also moving along this digital roadmap, with examples such as Nespresso’s own mobile app which allows users to buy coffee capsules, machines, and accessories on the go; or Nomad Foods, which began by fixing its knowledge base before trying self-service, and is currently trialing webchat in the Swedish market.

CPG’s distinctive challenges with digital CX

In addition to the typical riddles of evolving customer preferences and rapid technological life cycles, CPG manufacturers have industry-specific challenges with the adoption of digitally focused CX. For example, the competition for digital placement, including from vertically integrated brands, can limit product visibility and even narrow online shopping lists to selected brands. At the same time, CPG companies must balance their relationships with retailers and the opportunities for direct sales.

Another aspect is ownership of the online customer experience on retailers such as Amazon, where customer issues can stem from products and service. A solution is for companies to use a tool such as Bazaarvoice to analyze reviews. A different set of challenges come from shared product control within the organization, with marketing and product development departments often not tapping into the insights accumulated in the customer service functions, whether inhouse or outsourced. In HGS’ practice, a great approach is to have the customer care team visit the manufacturing plants and share feedback with the engineers firsthand.

Enabling digital channels for Danone and L’Oréal

In 2016, HGS began supporting L’Oréal from its London office, providing customer care for L’Oréal brands for the U.K. and Ireland markets over mail, phone, webchat, email, and social media, where it listens, moderates and responds to users. Over the last two years, the client has gradually shifted ~33% of all interactions to chat, which has higher CSAT compared to voice. By implementing a feedback loop for updates of the website with insights captured in the contact center, the client lowered the complaints rate from 51% to 39%. On social media such as Twitter, Facebook, Instagram, and YouTube, HGS supports 14 L’Oréal brands ranging from ones centered on a teenage demographic to the premium segment. Immediate benefits of the channel are extended hours of operation, and more proactive management, with efforts now focusing on social network influencers.

Another example of the use of digital channels for CPG companies is Danone. HGS has been supporting Danone since 2014 in the U.K. and Ireland, providing customer care, level 1 and 2 technical support, and social media services. Based out of the London center and also with work at home agents, the program supports expecting and new parents with early life nutrition consulting on a 24/7, 365 basis. The team of midwives, a healthcare practitioner, nutritionists, and counselors with experience in child care and first aid cover multiple channels, including phone, proactive and inbound chat, email, and WhatsApp. A separate quality management team ensures the program is compliant with WHO regulations and with the brand’s own requirements for data control and marketing communications management.

The decision to enable WhatsApp came after marketing research with mothers identified it as a relevant channel across all demographics. In July 2016, HGS launched the channel, and within the first hour registered the first five chats. The service is set up to allow users to add Danone’s contact number and initiate the chat sessions. Users can also push images and videos to the agent and, due to the asynchronous nature, can stop and continue the session over time. WhatsApp volumes have already exceeded those of live chat, with lower AHT compared to webchat.

Advancing on the digital journey

For L’Oréal in 2018, HGS is looking to continue to increase its social media teams, is already piloting Sprinklr as the new social media platform, and is building upon the self-service capabilities. Together with the client, HGS is identifying processes suitable for the implementation of chatbots. The company did a trial in 2017 with a hair dye product line, with a chat avatar advising users on color choice. It is also looking to expand live agent support into social messaging. A major question here is between launching with WhatsApp or Facebook Messenger, with the latter already used by the client in France.

For Danone, HGS has recently switched its platform for WhatsApp, with improved reporting and contact management, and is now planning to pilot video conferencing to act as a triage service for healthcare inquiries. Another pilot is underway to replace mailed paper vouchers with e-vouchers. 

<![CDATA[Arvato UK&I: Bringing Digital & Automation to CX]]>


Recently, I had a chance to visit Arvato’s U.K. and Ireland HQ in Slough, ~20 miles (30km) west of London, to witness its customer experience operations and how the company is applying digital channels and automation.

A mix of public and private sector clients

Arvato U.K. & Ireland provides customer experience services, finance and accounting (record to report, order to cash, collections), supply chain management, payroll, HRO services such as hire to retire, and ITO to ~140 clients, predominantly in the public sector. Its public sector footprint includes councils, municipalities, agencies, and central government departments such as the Department for Transport. For some of the councils, Arvato also provides mailroom and face-to-face offices where the company’s employees work remotely or in mobile kiosks to answer queries and accept citizens’ claims. In total across the two countries, it has ~3k employees, three quarters of which are in customer experience services, based in over a dozen locations.

Arvato UK&I private sector clients come from the automotive, fashion, retail, financial services, and most recently telecoms and the IoT space.

Its sizable public sector footprint is not the norm for Arvato, with other markets such as Germany, Spain, France, and Netherlands having less public sector business. Also, customer experience services in the public sector have specific requirements, often more complex and more diverse than a typical customer care program. A municipality phone line covers citizens’ problems ranging from online help, billing, payments, and public services maintenance, to reporting social care issues and people at risk. It also operates in a regulated environment with additional security prerequisites. To address these challenges, in 2016 Arvato developed a business risk positioning tool called Task. Task presents a real-time dashboard which monitors and audits regulatory and financial risks associated with services being managed. The company has adapted Task for the front office to act as a contractual change control manager and tracker of contact center performance, e.g. against FCA rules. The tool itself came about through an innovation ideation exercise open to all Arvato employees.

Bringing automation to the contact center

Arvato began implementing RPA ~18 months ago with public sector clients and currently has ~50 processes fully or partially automated. Developed in-house and in partnership with BluePrism, the company also worked with private sector CX services clients to automate some of their processes in the contact center. For example, for an automotive client, Arvato runs scripts which populate and execute direct debit changes, lowering the cost per transaction from ~£1.20 to 25p. During the first twelve months of the automation journey across programs, it covered 16 processes resulting in ~£125k savings. Arvato is now working with the automotive brand to automate the handling of finance applications coming from the dealerships, and serviced by ~35 FTEs. Currently, an agent verifies if the documents are complete and checks an applicant’s photo IDs and other documents for AHT of 700 sec. Arvato expects this partial automation to eliminate some of these checks, decrease the error rate of the 60 applications processed by an agent on average per day, and lower the handling time to a few minutes. It estimates the automation will result in £750k annual savings. 

Expertise in automotive CX

In both U.K. and Ireland, Arvato supports several automotive brands offering customer experience services alongside back and middle office support. For example, it has supported Groupe Renault in the U.K. since 2007, and in other European markets since 1999. Arvato U.K. provides customer care over phone, chat, email, social media, web, and white mail, as well as outbound lead generation and marketing, supporting both end customers and dealerships. Beginning with voice and email, Arvato expanded to proactive web chat and social media to generate more leads, with ~60% of new leads now coming over chat. Using the multichannel environment, in 2016 alone, Arvato delivered £3.5m in new car sales from 3.6k leads.

For a German automotive OEM, Arvato also performs proactive outreach to car owners to notify them about due service checks. The company receives automated tickets to prompt phone calls to owners to arrange the visit. As next steps, it is working to push messages over SMS. Arvato has also set up a dedicated team to support the electric vehicle line for the client, where agents work as ‘case managers’, handling prospects from the mailing of marketing brochures to vehicle purchasing, installation of the charging station at the customer’s premise, and ongoing post-sales support.

Digital opportunities ahead

In typical fashion for a Bertelsmann company, Arvato national divisions operate quite independently. Arvato U.K. has developed an adjacent business in cyber security around remote monitoring. Focused mainly on existing public sector clients, the company is now expanding it to the private sector, and was recently awarded a program with a U.K. telecom for L1 and L2 technical support for their home and small office connected security systems. It is also identifying opportunities to productize and further develop Task and deploy customer analytics and next-best-action capabilities, particularly in the retail and automotive space, to boost upsell and loyalty management.

In digital channels, the company is currently targeting a customer-facing automation with a chatbot pilot for a fashion brand. For the German automotive brand, it is looking to launch video chat in 2018, which will connect customers at planned pop-up shops with the agents at the Slough headquarters. It is also investigating opportunities to use VR in agent training to immerse agents in the brand experience.

<![CDATA[Omnichannel, Bots & the Future of CX: Q&A with Head of Prosodie-Capgemini, Erwan Le Duff]]> This month, Capgemini is launching a new version of its omnichannel cloud platform, Odigo™. I interviewed Erwan Le Duff, Head of Prosodie-Capgemini, about the new platform features, the evolution of self-service, and the future of customer experience. Below is a video of highlights from the interview, followed by a brief introduction to Odigo and a full transcript of the interview.



Odigo at a glance

Odigo is a modular platform targeted towards customer care, sales, and service desk processes for end users, company employees, and citizens in the public sector. It has approximately 350 clients in 17 countries and handles over three billion interactions per year, primarily voice, but also chats, email, video chats, social media messages, SMS, and IoT transactions. It has four modules:

  • Odigo Contact Center for omnichannel routing, recording, WFM, and quality monitoring
  • Odigo Concierge, an omnichannel (voice and digital) bot, designed for self-service and qualification
  • Odigo Campaign suite to push messages for marketing campaigns and notifications
  • Odigo Analytics for customer insights.

Capgemini is releasing version 2.0 of Concierge with a chatbot developed completely in-house to enhance next-generation user qualification and self-service. Powered by NLP (Natural Language Processing), the chatbot processes customer questions and answers via texts, images, videos, documents, links, and mini applications, including choice buttons and selection carousels. It is offered as a web and app widget on a mobile SDK, and also on Facebook Messenger.

The machine learning algorithms at the core of the bot learn from interactions and prompt call backs, or schedule an appointment. In case of an unresolved issue, the bot can escalate to a shadow agent in real-time to provide the customer experience and train machine learning. Its API is open and the company can integrate it with existing databases, e.g. CRMs such as Salesforce, Microsoft Dynamics, Oracle, and Zendesk.

Capgemini has been implementing natural language-based IVRs for over 10 years and currently has 25 clients across sectors in English, French, Spanish, and other European languages.


What are the main differentiators of the platform and the new version?

Erwan Le Duff (ELD): It is highly scalable. This is one of the main differentiators, as we see today, more and more large-scale companies are looking for cloud solutions. They’ve been looking for CRM cloud solutions in the past, and are now looking at the cloud for interactions. We are addressing the needs of several thousand agent clients in a multi-country environment. We are also building the platform as open as possible to ease the integration of future channels, but also to help integration with the client IT systems.

We also provide end-to-end solutions. We can come to a client, analyze their current customer experience and current data, look at the customer journeys and transform them, measure the impact for the organization, and provide the technology in parallel to start automating, to deliver true omnichannel experience and break the silos that exist within all organizations.

Concierge v2.0 is really designed to address self-service needs, which are emerging everywhere, by introducing an omnichannel bot.

What drives these developments in self-service?

ELD: We see customers asking for self-service, obviously, but they are also asking for simplicity, quick responses, and 24/7 service. We see this emerging in all sectors. From the companies’ standpoint, there is clearly an interesting business case to automate part of their low-value requests. Depending on the client, we estimate that they represent between 15% and 30%. If they are able to automate part of those requests, it will free up time for agents to deliver more added value, outbound, or campaign management work.

Can you share more about the current implementations?

ELD: We started some months ago with a client in the insurance sector, where we looked at one of their service lines and reimplemented both a chatbot and a voicebot to manage the full process. A customer who wears glasses can call or chat with their insurance provider to know how much they will be reimbursed when they change their glasses. The system identifies the user, guides them through the process, including on the doctor’s paper prescription, and supplies the information. The bot then offers a short list of opticians based on geo-location data or pushes promotions for online sales.

Are you targeting any specific segments?

ELD: We see demand across sectors, but it is true that today some sectors are moving fast and need to transform the customer experience. For example, banks, insurance, retail, and finally, the public sector (we’re seeing this in few countries, including France). It is starting to become cross-sector and the reason is that the number of interactions is consistently increasing and clients are looking at potential automation as a kind of El Dorado.

However, what I say to clients every time is that before starting to look at automation and implementing bots we need to make sure we truly understand the call motives and make sure we focus on the right tasks. This is where our 10 years of experience in implementing the natural language part, including into the IVR, is a big help to understand the requests.

What prevents organizations from achieving omnichannel delivery?

ELD: Some of them are still organized in silos. The same people that manage the voice channel, don’t necessarily manage the email, chat, social media. We see this structure disappearing, but organizations need to fix it quickly. The second reason is the need to look at the agents and the agent experience, and have a strong vision and policy on how to organize channel management from the agent viewpoint. It is potentially a big change, and it may be easier when operations are outsourced.

Do you think the market has moved on from the initial chatbot hype?

ELD: We had a number of clients experimenting with automating certain processes because it frees resources and can increase customer satisfaction. However, it is not only a matter of technology. It is about understanding the call motives, implementing it on the right use cases, and more importantly, making sure the engine is strong enough and uses the right sectorial corpus to very quickly reach 95% natural language recognition. But organizations need to implement it in a true omnichannel situation. You can’t just have a standalone chatbot, because the customer may need to be transferred to a live agent or they may not like talking to a voicebot. It needs to be truly integrated into the omnichannel strategy.

Where do you see the balance between human-assisted and machine support?

ELD: People will be more used to speaking to Amazon Echo and Google Home, and this will increase adoption. Still, all companies know that the voice channel and talking to a human for certain inquiries is the only way to add sales. So, this element will stay, probably focused on more added value and more complex cases, but it will remain. We’ve seen in the last two years pure internet players with only digital channels now coming to voice. In four to five years the market can move to more automation, maybe even 50%, but not the majority of interactions.

Automation will potentially reduce the client’s need for agent support, but there is no way to stop this change. Most of the discussions we have with clients are not around removing 20% of the cost in the contact center, instead it’s about addressing increasing volumes and improving the customer experience. At Capgemini, we are proactive with clients to deliver a solution that will help them now and bring benefits in the future.

And finally... What are the next steps for the platform? What capabilities are you looking to add?

ELD: We started client tests with voicebots to finalize the omnichannel part the platform. It will be available in the next couple of months and will offer the same capabilities as the chatbot, based on the same foundations and data access. Our goal is to design the dialogues to adapt to the interface in a similar manner to the text bot, and at the same time, to fully integrate with Odigo modules.

We will continue to develop more connectors to third parties such as Salesforce. The last piece is to expand the use of AI and reinvest in NLP. For NLP, we want to further improve the solution to answer more complex inquiries, and we want AI to be used more and more for real-time, advanced routing of interactions, and ease agent experience by assisting them.

<![CDATA[Transforming a Contact Center to a Profit Center: CSS Corp Client Study]]>


Post-sales support functions are typically cost centers: large, labor-intensive operations with significant overheads and no financially attributable benefit to the bottom line. This environment is changing, with  organizations gradually understanding the revenue generation opportunities in support services such as technical support and afterlife maintenance. I recently had a conversation with CSS Corp about one such example.

Growth through improving performance

CSS Corp began supporting this North American networking OEM in 2003. The client manufactures and sells a range of networking equipment, from hubs and routers to servers and security devices, for the home and small business. At the start, CSS Corp was one of multiple suppliers managing ~30% of the call volumes through centers in India, and eventually Utah and Manila. On the back of CSS Corp’s performance, together with the customer, they have launched a premium tech support offering, a white labelled support service line, and expanded from voice to email, chat, and (over the last two years) remote diagnostics. Today, CSS Corp handles ~55% of the call volumes for the client with approximately 300 employees.

From FTE-based to revenue-based model

The initial pricing model was straightforward FTE-based, dependent on volume forecasts. As CSS Corp analyzed the operation, it identified optimization opportunities primarily with the support process. The client had tried in the past by changing the lifetime warranty policy for its routers to 90 days and pushing sales for warranty extensions, but with limited results. CSS Corp’s proposal focused on the entire experience for the connected home, where the router is just one piece. It offered to sell a premium tech support package covering the out-of-scope and out-of-warranty routers, as well as every connected device in the house. If the issue cannot be resolved or it is due to a faulty product, the customer is entitled to a complete refund.

In turn, the commercial outsourcing model is also modified to transaction-based. The client pays only for the handled interactions at a lower rate compared to FTE pricing, and on top, CSS Corp pays a certain percentage of the generated revenue from the premium tech support sales.

Impact on the provider

For CSS Corp, this shift required changing the operations, with a robust analytics capability to monitor and forecast performance, and a new profile for the support staff. From narrowly-focused technical support agents proficient solely in routers, CSS Corp recruited engineers with competency both in hardware and software to answer the new types of issues escalated by customers. These engineers are supported by a knowledge base and troubleshooting guides, covering the wide spectrum of the constantly expanding connected ecosystem. The company also established a dedicated IoT showroom to test and play with new devices and software. In addition, the team had to have sales skills to identify prospects, overcome objections, and close subscription sales.

The right client

Moving to such a model, incorporating variable costing with revenue generation sharing, requires a certain type of client. Ideally, one with experience in outsourcing partnerships, a level of maturity within the customer experience operations, the necessary volumes, and a higher value product. It fits well with networking OEMs where, for example, if the end user contacts the company several times with support inquiries for their router, the standard profit after tax of 4%-5% will be lost. This approach also requires the product and marketing departments to be more flexible and find creative ways to amend their entitlement and warranty policies.

Addition to the bottom line, and next generation technical support

Between July 2014 and December 2016, the client experienced 275% reduction of its support costs with a comparable volume, and currently receives $0.58 revenue per call handled by CSS Corp while maintaining CSAT of over 92% and NPS above 75%. Through improved training and proactive engagement with the customer during the subscription period, CSS Corp increased the conversion rate from 4.5% to 9.5%, and grew the average sales value by ~37%.

In the last two years, the support team is receiving more targeted and complex customer calls related to smart homes and, more recently, voice-controlled connected devices. CSS Corp is addressing this evolution of the market and customer expectations by continuous training, but also by driving active delivery frameworks. It analyses logs for the interoperability of devices, creates self-service troubleshooting guides for the users, and enables omnichannel support through the company’s proprietary Activai mobile app. CSS also recently started a pilot over social media.

<![CDATA[Omnichannel Entropy from a Customer Experience Perspective: Macy’s Journey]]> The traditional (and now universally accepted as outdated) model for multi-channel support looked something like this, with differences primarily between the types or number of channels:

However, as customers became digital and mobile, the model has shifted to something like this:

This model originated with marketers and retailers, where omnichannel means the ability to purchase in the physical store, online, via the phone, or mail order. However, as channel technology matures, as markets are disrupted by new economy brands and, above all, as customers radically change their behavior, the omnichannel relationship between customers and brands has also evolved from this simplified understanding. The current picture resembles a unified environment, allowing fluid migration of customers across interlinked channels, easily switching between self-service and assisted support, live and virtual agent, digital and non-digital channels.  

From Channel Proliferation to Channel Entropy

When, at the end of 2016 and early this year, we conducted our study of multi-channel customer experience, voice search was hardly on the radar. Very few CX vendors were looking to the space and there were no implementations. Today, an increasing number of providers and their clients are planning pilots or already running implementations over Amazon Echo and Google Home. They have recognized that the opportunities of the channel are significant, while its adoption is rapidly growing: from the untapped market of users without ability or skills to operate the traditional GUI of the internet, to the fact that voice search has a captive audience, required to link their account information.

At the same time, when we looked at voice, which had been predicted to all but disappear in the contact center over the next few years, the reality of outsourcing providers and clients shows that, while in steady decline, voice will remain the largest part of their revenues and more than half of their interactions until 2020. As voice calls move to chats and simple, repetitive interactions become automated, calls handled by agents become longer, more involved, and more complex. This entropy is affecting most channels, creating new use cases and addressing new customer needs – and at the same time, making the consistent customer experience across channels more difficult.

Macy’s Omnichannel Journey

In the retail sector, the significant adoption of online discovery, buying, and support, makes achieving this balance even more prevalent. For Macy’s, which manages three separate brands with unique identities and customer focus, the combination of 825 physical and speciality stores, voice and digital channels for sales, customer care, and collections across several service lines and products, the key factor when enabling a new digital channel is making sure it resonates with the customer. The company has had chat support for over seven years and has introduced social media in the last two, but still the majority of the traffic continues to come from voice.

Consistent with the market, Macy’s is seeing an increase in chat and social media interactions, reflecting changing customer expectation. While Macy’s customers may differ in their preferences for self-service or live assistance, voice or digital, they are all having less time to spare, are almost always connected, demand greater personalization, and expect frictionless service. As a result, social media and chat are a big part of the company’s future sales and support strategy.

In addition to customer care, Macy’s currently uses proactive chat for cross-selling and conversion on its websites, and earlier in the year has officially launched a virtual agent. The chatbot was developed with Microsoft, and piloted in June for the desktop checkout web page, answering the top questions identified from live chat data. The bot has now expanded to the mobile version. Although in the early stages, the trial has shown consistent customer effort scores, resolution rates, and acceptance by users. Macy’s is now looking to expand the bot to social messengers and other sections of the FAQs.

Analytics, Automation & AI: Key for the Next 3 Years

Macy’s forward-looking and cautious approach to channel enablement is reflected in many of the client interviews we conducted for our multi-channel and retail and CPG customer experience studies. As shown in the graphic below, clients are predominantly satisfied with the multilingual capabilities of their providers, and their experience in reducing costs, implementing new channels, and creating dedicated centers of excellence for them. However, vendors are not yet meeting expectations in delivering effective benefits in the areas of analytics, RPA, and AI. 

Client satisfaction with a range of CX benefits compared to their future importance 


The omnichannel environment creates an enormous amount of data, which a human analyst and traditional statistical tools cannot process. The leading CX vendors realize this change and are actively investing in the space. Ability to use machine learning algorithms, to deliver real-time insights, and to automate contact center processes will be the biggest differentiators in the near future, not just for outsourcing providers but for all CX organizations. From a channel perspective, it means that whether a brand is using chatbots or video or remaining primarily voice, these capabilities are needed to provide a true unified channel experience.


On 28th September, Brian Stout, Senior Vice President Omnichannel Support at Macy’s Department Stores, and Ivan Kotzev, CX Services Lead Analyst at NelsonHall, recorded a buy-side webinar: Macy's Omnichannel Journey - from Voice to Chatbots. The webinar is available for NelsonHall’s Buyer Intelligence Group members. For membership details, contact Vicki Jenkins.


<![CDATA[Hungry for Hungary? Why the Country’s Talent Feast is Attracting International Investment]]>


I was privileged to be invited recently to a customer and analyst event in Budapest, Hungary hosted by Cielo. Great, I thought – I’ve never been there, maybe I’ll see the Danube and a few historic buildings. And from that perspective, Budapest did not disappoint; it was understandable why there were so many tourists visiting, enjoying the hot September weather. But the event itself was a real eye-opener to the potential of this city and country, why it is a very cosmopolitan place to live and work, and why so many international organizations have set up offices/call centers here.

So what attracted an organization like Cielo to set up a delivery center (DC) here? On the second anniversary of the opening of its Budapest DC, Cielo’s Matt Jones explained why. At the time, when Cielo was hiring 10,000 professionals annually across 20 countries, many being in central Europe, it needed a DC location that would best serve its mix of clients. Cielo looked at a number of cities: Kiev, Ukraine; Prague, Czech Republic; Warsaw, Poland; and Budapest, Hungary. Of these, Budapest proved most suitable for Cielo’s DACH clients (those in Germany, Austria and Switzerland).

A number of criteria were taken into consideration.  To ensure Cielo could live by its “we become you” high touch mantra for all of its European clients, it needed to hire qualified talent with strong bi- or multi-lingual capability. The table below shows the comparison between Budapest, Prague and Warsaw.



Whilst the three cities were strong regarding qualified and bi- or multi-lingual talent, Budapest better matched the languages used by its clients and had the greatest number of universities from which to source talent for itself and on behalf of its clients. In 2015, Cielo’s Budapest DC opened with three employees. Now it has 63 employees, speaking 18 languages (many employees speaking three or more), supports 17 clients hiring in 41 countries. The availability of local talent has enabled Cielo’s DC to scale quickly based on client demand.

The availability of such talent has been a key factor in other shared service centers (SSCs)/DCs being located in Hungary, as it is now the third largest SSC market (with over 100 SSCs) after Poland and the Czech Republic, as business process outsourcing has taken off in the region, with ongoing investments coming from Western Europe or the U.S.

Another advantage for Budapest is its location in the center of Hungary, at the crossroads of three main pan-European transportation corridors. According to HIPA (2017), Hungary has more than 1,800km of built motorways (with 690km planned), the third highest road density in Europe, and the fifth most dense rail network (7,712km). With 5 airports too, Budapest is a two-hour flight from most places in Europe.  Budapest’s geographic accessibility was another key reason for Cielo to locate its European DC there.

Hungary also has the highest rate of broadband penetration among the V4 countries (a cultural and political alliance between the Czech Republic, Hungary, Poland and Slovakia) at 133% of the EU average, and the world’s third fastest 4G network speed (this maybe something to do with the fact that five of the major global network/telecommunications companies are located there), giving potential investors something to consider.

Cielo’s clients supported from its Budapest center come from the following sectors: engineering, technology, manufacturing, FMCG, pharma, medical devices, diagnostics, healthcare and insurance.  Hungary itself has a strong presence in automotive engineering (with a $26.5 billion production value) with the likes of Audi, Mercedes Benz, Suzuki and Opel (and a further 39 of the top 100 automotive suppliers) operating from there, mainly based in western Hungary. The technology sector is strong, with 15 of the largest global technology companies (including IBM, Oracle and SAP) having a presence in Hungary, all having been there for over 10 years. The food industry is also a strong sector, with nine large companies investing in Hungary in 2016-17 (including Nestlé). This offers Cielo the opportunity to grow its client base in Hungary further, in industries with which it has a strong track record.

With the Hungarian government offering state aid (cash grants or tax allowances) mostly in either western or eastern Hungary in the areas of investment, training, R&D, and employment tax allowances, Hungary is likely to continue to attract international organizations to set up a presence there, giving Cielo further opportunity to grow.

So, at first glance, it seems that there are plenty of appetizers on Hungary’s menu to attract investors into the country. However, closer inspection reveals that some things are not so appetizing about the country’s labor market. Hungary is proving to be a highly competitive location in the war for talent, and over 70% of organizations are already struggling to attract the right candidates (source:, 2017). Motivators cited by candidates are a good salary, fair management/leadership, a stable workplace, fair working hours, and an interesting job. Candidate pain points are lack of useful information in job descriptions to make informed decisions about the role, and no communication from the hiring organization at the end of the hiring process. suggests that organizations need to embrace the concept of candidate experience, develop persona-based employer branding, leverage technology to speed up the recruitment process, provide the right information to candidates, and offer interesting roles.

Cielo, being one of very few talent acquisition vendors located in Hungary, is uniquely positioned to leverage its expertise with Hungarian-based organizations. So, Cielo – what are you waiting for?


<![CDATA[Customer Experience in China: Teleperformance Welcomes the Digital Leap]]>


NelsonHall recently attended Teleperformance’s annual analyst event in Xi’an, China. The location was selected to highlight the strong growth of Teleperformance in China, and to showcase latest initiatives to extend its influence in this very distinctive customer experience market.

Early entrant in China’s BPO market

Teleperformance entered Beijing in 2007 with ~300 employees. The initial focus was on multinationals requiring a high-quality standard of support for the domestic market and eventually offshore support for Japan. Today, the company has ~5.5k employees and ~5k seats with two sites in Beijing, and one each in Nanning, Kunming, Foshan outside Guangzhou, and Xi’an. Together with the company’s visa application processing service, TLScontact, it has 21 locations nationally. The company’s revenues from the country increased fivefold since 2013.

The different locations in China have their own specific offerings, with a clear differentiation between tier 1 and tier 2 cities. For example, Beijing offers language capabilities in north Asian languages, and Teleperformance hires native speakers or near-native speakers to support Japanese and Korean markets. Others such as Nanning cater for Vietnamese, while Foshan offers Cantonese language capability (and Teleperformance can recruit from the larger labor pool nearby). And others such as Kunming, where Teleperformance opened its 400-workstation site in June 2016, provide unique greenfield opportunities. In this tier 2 city with a population of six million, Teleperformance is the only multinational customer experience service provider, and the only other major contact center is run by the state-owned China Telecom.

One of the last delivery destinations offering scale

From a customer experience services perspective, China is one of the last countries where providers can achieve large scale delivery. The northwestern city of Xi’an is a good illustration. Teleperformance entered the eight-million metropolitan area three years ago, starting with 100 staff, to become currently its largest Chinese center with 3k employees supporting domestic and multinational clients in the e-commerce, logistics, and high-tech sectors. Xi’an is an attractive city for BPO, serving as an educational hub for the province and boasting a high-tech and engineering history with a dedicated economic and technology development zone, available office space, the support of the local government through tax incentives, and overall cost savings of ~10% compared to Beijing.

The challenges for entering a market such as Xi’an are twofold. The first is the unique business environment where private enterprise and foreign investments can be established under the economic plans of the state and party. Even before the company’s official entry into the country, Teleperformance founder Daniel Julien traveled to China, including Xi’an, and selected an experienced country CEO, Joseph Wai, who previously worked with locally-owned BPO companies. For a market where even global multinationals such as Google and Facebook cannot enforce their position, the importance of the local executive team should not be underestimated.

The challenges of the Chinese labor market

The other challenge is the labor market. The BPO sector is an unknown for young Chinese graduates. The direct competitors for agent roles are not other BPOs or contact centers but the wider service economy. Teleperformance addresses this issue by promoting its career development program, which offers quick progression opportunities, the strength of the brands it supports (seen as a prestige factor by applicants), its social program (which in Xi’an includes a transport service), and even the modern setup of its centers, consistent across the locations.

For management roles, factors such as limited English skills and difficulty of relocating due to residency benefits tied to a city, but above all the historical lack of customer experience culture in China, necessitate the selection of management talent from within.

Customer service in China is undergoing a shift

The customer experience services market in China is highly fragmented, with thousands of local contact centers supporting even nationwide brands on low cost, low standard models. Traditionally, state-owned service companies have very limited practice in customer experience, and private brands similarly have made only limited investment in support, including basics such as 24-hour operations or non-voice channels. This situation is changing rapidly.

Migration from a manufacturing to a service economy, raising wealth creation by the private sector, an exponentially increasing urban middle class population, and digital enablement are combining for the first time to create a need for providers of international standard customer experience services such as Teleperformance. This shift is being seen by Teleperformance, which began to add domestic clients in the last two years, including some of the largest national e-commerce brands. One of these e-tailers has asked Teleperformance to host customer experience roundtables to establish best practices.

A digital leap in customer experience through WeChat

Probably the biggest opportunity in the Chinese customer experience market is the high adoption rates of mobile and digital technology. With ~700m mobile internet users currently, with double-digit year-on-year growth in user numbers, and significant growth in levels of internet usage, the country has embraced digital entertainment, gaming, shopping, payment, travel, and communications. The flagship of this digital wave is the instant messaging platform WeChat. Tencent’s WeChat dominates Chinese internet with an estimated 880 million monthly active users. WeChat is a ‘super app’, an ecosystem of apps for messaging, calls, social networking, media consumption, shopping, payments, video, music streaming, and gaming. It is a preferred internet entry point and the main communications channel between B2C and C2C. Its proliferation in the offline world is achieved through widespread usage of QR codes, with payments over the platform reaching everything from online purchases and utility payments to personal fund transfers and gifts such as ‘virtual red envelopes’ (based on the Chinese tradition of hongbao, where money is given to family and friends as a gift).

For domestic brands, WeChat is the channel of choice to market, sell, and now support. Teleperformance is also focusing on the channel. It has developed integration between its proprietary CRM platform TP Client and WeChat, and is currently working with clients to pilot customer care voice and chat programs before the Q4 seasonal sales peak and the 11th November shopping day.

Teleperformance’s continuing growth in China

China will remain a target market for Teleperformance in the coming years. The company wants to create its own pipeline of potential locations supported by government incentives and considering factors such as accents and language capabilities. The share of domestic logos is expanding, with clients realizing the benefits of working with global providers, and fueled by the evolving customer experience culture. A key part of this growth is WeChat, where it aims for more client programs, and eventually to add automation functionality.

<![CDATA[Reshuffle in the European Customer Management Services Market: Comdata Acquires French Provider B2S]]>

On June 8th, Italian BPS provider Comdata announced the acquisition of the French group Izium, which includes the CMS provider B2S, for ~€200m. The acquisition will be the first entry for Comdata in France and will lift the company to a top 5 CMS provider in Europe with estimated proforma revenues of ~€750m for 2017.

Entry into a mature and healthy French CX market

Under the deal, Comdata will acquire 100% of the Izium group’s subsidiaries:

  • Contact center service provider B2S, offering customer care, technical support, sales, and collections to the French market from 10 onshore and offshore locations in Morocco and Madagascar
  • Colorado Consulting, a CRM consulting firm supporting the French domestic market and French multinationals abroad with a strong luxury brands portfolio
  • BCust, a call center technology and CRM system integrator
  • CMS, a B2B debt collections business.

Together the four firms have ~6k employees, 150 clients, and 2016 revenues of ~€180m. Maxime Didier, founder and majority shareholder of Izium, will reinvest in Comdata Group, becoming the second largest shareholder (11%) after PE Carlyle Group (~80%).

The French market is attractive for Comdata as the third largest in Europe (NelsonHall est. $3.1bn for 2017) with an established mix of onshore and offshore delivery. It also has better average margins compared to Italy and Spain and interesting sales opportunities for first-time outsourcers and even in mature segments such as telecoms and media.

Prospects in provisioning and middle office support

Comdata also looks to utilize sales opportunities to expand the customer facing services of B2S with its own experience in back office management for customer service. It offers order management, claims processing, service provisioning, field support, middle office, B2C collections, and document management for telecom and energy clients in Italy. Comdata has been supplying these services to several of the clients since the early 2000s.

In other sectors, such as banking, Comdata operates as the de facto front and back office, offering document processing, digitalization, and account management. For example, for an Italian online bank, Comdata delivers post-sales support, account and claims management, and collections. As part of this service integration, Comdata has reengineered support processes and applied automation to achieve efficiencies.

This approach for an incremental increase of the share of wallet also relies on the B2S client base in new verticals (automotive, retail, and travel) and on cross-selling in geographies for telecoms, BFSI, energy, and utility multinational clients.

Fast track to the top 5

Following the investment by Carlyle Group in 2015, the Milan-based Comdata embarked on an active M&A path combining in-market consolidations to diversify its sector exposure and win market share and add capacity, with the goal of entering the largest European markets:

  • In 2016, it acquired the Spanish CMS provider Digitex, which added ~16k employees in Spain, Colombia, Mexico, Peru, Chile, Guatemala, and El Salvador
  • Later in 2016, it bought the Turkish CMS vendor Win Bilgi Iletisim, with ~3k staff in Istanbul and Eskişehir
  • In 2017, it expanded its Spanish footprint with the ~600 staff call center Overtop Projects

Comdata growth plans

Comdata expects to close its French acquisition by August, start the integration process, and eventually rebrand all its acquisitions to a single brand.

Comdata sees increased client requirements for scale of operations in both onshore and offshore, vendor consolidation, and pan-European support. That is why it aims to become a top 3 vendor in each of the markets it operates and plans to grow through organic and active M&A in Continental and Northern Europe.

<![CDATA[Amelia Enhances its Emotional, Contextual, and Process Intelligence to Outwit Chatbots]]>

IPSoft's Amelia


NelsonHall recently attended the IPSoft analyst event in New York, with a view to understanding the extent to which the company’s shift into customer service has succeeded. It immediately became clear that the company is accelerating its major shift in focus of recent years from autonomics to cognitive agents. While IPSoft began in autonomics in support of IT infrastructure management, and many Amelia implementations are still in support of IT service activities, IPSoft now clearly has its sights on the major prize in the customer service (and sales) world, positioning its Amelia cognitive agent as “The Most Human AI” with much greater range of emotional, contextual, and process “intelligence” than the perceived competition in the form of chatbots.

Key Role for AI is Human Augmentation Not Human Replacement

IPSoft was at pains to point out that AI was the future and that human augmentation was a major trend that would separate the winners from the losers in the corporate world. In demonstrating the point that AI was the future, Nick Bostrom from the Future of Humanity Institute at Oxford University discussed the result of a survey of ~300 AI experts to identify the point at which high-level machine intelligence, (the point at which unaided machines can accomplish any task better and more cheaply than human workers) would be achieved. This survey concluded that there was a 50% probability that this will be achieved within 50-years and a 25% probability that it will happen within 20-25 years.

On a more conciliatory basis, Dr. Michael Chui suggested that AI was essential to maintaining living standards and that the key role for AI for the foreseeable future was human augmentation rather than human replacement.

According to McKinsey Global Institute (MGI), “about half the activities people are paid almost $15tn in wages to do in the global economy have the potential to be automated by adapting currently demonstrated technology. While less than 5% of all occupations can be automated entirely, about 60% of all occupations have at least 30% of constituent activities that could be automated. More occupations will change than can be automated away.”

McKinsey argues that automation is essential to maintain GDP growth and standards of living, estimating that of the 3.5% per annum GDP growth achieved on average over the past 50 years, half was derived from productivity growth and half from growth in employment. Assuming that growth in employment will largely cease as populations age over the next 50 years, then an increase/approximate doubling in automation-driven productivity growth will be required to maintain the historical levels of GDP growth.

Providing Empathetic Conversations Rather than Transactions

The guiding principles behind Amelia are to provide conversations rather than transactions, to understand customer intent, and to deliver a to-the-point and empathetic response. Overall, IPSoft is looking to position Amelia as a cognitive agent at the intersection of systems of engagement, systems of record, and data platforms, incorporating:

  • Conversational intelligence, encompassing intelligent understanding, empathetic response, & multi-channel handling. IPSoft has recently added additional machine learning and DEEP learning
  • Advanced analytics, encompassing performance analytics, decision intelligence, and data visualization
  • Smart workflow, encompassing dynamic process execution and integration hub, with UI integration (planned)
  • Experience management, to ensure contextual awareness
  • Supervised automated learning, encompassing automated training, observational learning, and industry solutions.

For example, it is possible to upload documents and SOPs in support of automated training and Amelia will advise on the best machine learning algorithms to be used. Using supervised learning, Amelia submits what it has learned to the SME for approval but only uses this new knowledge once approved by the SME to ensure high levels of compliance. Amelia also learns from escalations to agents and automated consolidation of these new learnings will be built into the next Amelia release.

IPSoft is continuing to develop an even greater range of algorithms by partnering with universities. These algorithms remain usable across all organizations with the introduction of customer data to these algorithms leading to the development of client-specific customer service models.

Easier to Teach Amelia Banking Processes than a New Language

An excellent example of the use of Amelia was discussed by a Nordic bank. The bank initially applied Amelia to its internal service desk, starting with a pilot in support of 600 employees in 2016 covering activities such as unlocking accounts and password guidance, before rolling out to 15,000 employees in Spring 2017. This was followed by the application of Amelia to customer service with a silent launch taking place in December 2016 and Amelia being rolled out in support of branch office information, booking meetings, banking terms, products and services, mobile bank IDs, and account opening. The bank had considered using offshore personnel but chose Amelia based on its potential ability to roll-out in a new country in a month and its 24x7 availability. Amelia is currently used by ~300 customers per day over chat.

The bank was open about its use of AI with its customers on its website, indicating that its new chat stream was based on the use of “digital employees with artificial intelligence”. The bank found that while customers, in general, seemed pleased to interact via chat, less expectedly, use of AI led to totally new customer behaviors, both good and bad, with some people who hated the idea of use of robots acting much more aggressively. On the other hand, Amelia was highly successful with individuals who were reluctant to phone the bank or visit a bank branch.

Key lessons learnt by the bank included:

  • The high level of acceptance of Amelia by customer service personnel who regarded Amelia as taking away boring “Monday-morning” tasks allowing them to focus on more meaningful conversations with customers rather than threatening their livelihoods
  • It was easier than expected to teach Amelia the banking processes, but harder than expected to convert to a new language such as Swedish, with the bank perceiving that each language is essentially a different way of thinking. Amelia was perceived to be optimized for English and converting Amelia to Swedish took three months, while training Amelia on the simple banking processes took a matter of days.

Amelia is now successfully handling ~90% of requests, though ~30% of these are intentionally routed to a live agent for example for deeper mortgage discussions.

Amelia Avatar Remains Key to IPSoft Branding

While the blonde, blue-eyed nature of the Amelia avatar is likely to be highly acceptable in Sweden, this stereotype could potentially be less acceptable elsewhere and the tradition within contact centers is to try to match the nature of the agent with that of the customer. While Amelia is clearly designed to be highly empathetic in terms of language, it may be more discordant in terms of appearance.

However, the appearance of the Amelia avatar remains key to IPSoft’s branding. While IPSoft is redesigning the Amelia avatar to capture greater hand and arm movements for greater empathy, and some adaptation of clothing and hairstyle are permitted to reflect brand value, IPSoft is not currently prepared to allow fundamental changes to gender or skin color, or to allow multiple avatars to be used to develop empathy with individual customers. This might need to change as IPSoft becomes more confident of its brand and the market for cognitive agents matures.

Partnering with Consultancies to Develop Horizontal & Vertical IP

At present, Amelia is largely vanilla in flavor and the bulk of implementations are being conducted by IPSoft itself. IPSoft estimates that Amelia has been used in 50 instances, covering ~60% of customer requests with ~90% accuracy and, overall, IPSoft estimates that it takes 6-months to assist an organization to build an Amelia competence in-house, 9-days to go-live, and 6-9 months to scale up from an initial implementation.

Accordingly, it is key to the future of IPSoft that Amelia can develop a wide range of semi-productized horizontal and vertical use cases and that partners can be trained and leveraged to handle the bulk of implementations.

At present, IPSoft estimates that its revenues are 70:30 services:product, with product revenues growing faster than services revenues. While IPSoft is currently carrying out the majority (~60%) of Amelia implementations itself, it is increasingly looking to partner with the major consultancies such as Accenture, Deloittes, PwC, and KPMG to build baseline Amelia products around horizontals and industry-specific processes, for example, working with Deloittes in HR. In addition, IPSoft has partnered with NTT in Japan, with NTT offering a Japanese-language, cloud-based virtual assistant, COTOHA.

IPSoft’s pricing mechanisms consist of:

  • A fixed price per PoC development
  • Production environments: charge for implementation followed by a price per transaction.

While Amelia is available in both cloud and onsite, IPSoft perceives that the major opportunities for its partners lie in highly integrated implementations behind the client firewall.

In conclusion, IPSoft is now making considerable investments in developing Amelia with the aim of becoming the leading cognitive agent for customer service and the high emphasis on “conversations and empathic responses” differentiates the software from more transactionally-focused cognitive software.

Nonetheless, it is early days for Amelia. The company is beginning to increase its emphasis on third-party partnerships which will be key to scaling adoption of the software. However, these are currently focused around the major consultancies. This is fine while cognitive agents are in the first throes of adoption but downstream IPSoft is likely to need the support of, and partnerships with the major contact center outsourcers who currently control around a third of customer service spend and who are influential in assisting organizations in their digital customer service transformations.

<![CDATA[Closing the Gap in Healthcare: TeleTech’s Approach]]>


In April 2017, TeleTech acquired healthcare BPS provider Connextions for $80m. The acquisition makes healthcare the second largest vertical for TeleTech, expected to reach ~21% of their annual revenue at ~$300m. I spoke with TeleTech recently to discuss the acquisition and their focus on the healthcare space.

TeleTech’s Healthcare Business at a Glance

TeleTech’s healthcare clients include payers, providers, pharma and medical supplies, medical devices and wellness brands. The company supports these clients from 20 domestic, nearshore, and offshore centers and with ~10k associates, including work-at-home. The size of the support population has grown eightfold over the last four years, adding ~2k roles in 2016 alone, including 900 licensed agents to support Medicaid and Medicare open enrollment.

For the top U.S. healthcare plans, TeleTech offers services in consulting, platform design and integration, revenue generation, and member care services. With its long-term client relationship in the space, TeleTech provides enrollment, sales support, member services, provider, and dental and vision services, and wellness outreach. For example, on the consulting side, TeleTech has helped a healthcare payer redesign their training curriculum to reduce the training time and improve the speed to proficiency, bringing cost savings and being utilized by TeleTech staff and the competing vendor agents.

The Connextions Value Proposition

Connextions was part of Optum since 2011 and offers member acquisition, retention, and customer care services to healthcare plans such as Medicare, Medicaid, individual and group, healthcare providers, and pharmacy benefits managers. The acquisition added new logos for TeleTech to reach ~20 core clients in the sector.

The company gains ~4k agents across the U.S. TeleTech expects the deal to add approximately $115m in revenue annually and to be EBITDA accretive in 2017, bringing the total customer management services business to ~$1.2bn by 2018 from the 2016 level of ~$924m (total company revenue was $1.275bn). Connextions also brings its proprietary healthcare CRM bConnected with embedded workflows, HIPAA compliance and security features, and capability to send the caller a microsite with plans comparison. It also extended the services portfolio with healthcare financial member services, back office and claims support, and telehealth.

U.S. Healthcare is the Most In Need of Customer Experience Improvement

The U.S. healthcare industry is behind the leading sectors in customer experience, with customers facing a limited and complicated enrollment process, lack of visibility of benefits, and disconnected support for member services. TeleTech leverages its experience in other industries to identify opportunities for improvement in healthcare. For example, for a medical and health network in L.A., it provides a single hub for information with a unified phone number for patient access to the hospital, clinics, and doctors, with ~40-50 agents offering concierge level services by locating providers based on proximity and past performance.

The open enrollment for Medicare and the private healthcare exchange, which are inherently seasonal, require quick ramp up of licensed agents in January to facilitate the shopping experience and convert leads until mid-February when the period ends. To license an agent for all 50 states costs upwards of $5k, in addition to training. TeleTech addresses this challenge by placing licensed agents to other programs in the off season, offering a work-at-home model, and working closely with schools of licensing agents. As a result, it is able to scale and bring back experienced agents who require less time to train, at a fraction of the cost of a new hire, and have on average a 25% improvement in their conversion rate year over year.

Another approach is employing new channels and technology in the telesales process. For example, for a healthcare client, TeleTech deployed a private chat channel for outbound call agents to offer customers the option to connect on a mobile device or desktop PC and continue the interaction on the digital channel with co-browsing functionality to draw, highlight on the screen, and send documents. On webchat, TeleTech has added historical information for past interactions with the customer, e.g. time spent on the website, pages viewed, and plans selected – thus giving context to the agent. With these chat capabilities, TeleTech experienced an NPS improvement of ~10-15%, better conversion rate than phone sales, and an increase in self-service adoption.

Remote Support Opportunities & Wellness Outreach

The requirements for healthcare providers and insurers are moving gradually to a more comprehensive view of the healthcare experience with strong use of analytics and digital technology. For example, six months ago, TeleTech started a program to provide video support for patients discharged to their homes to deliver a decrease in readmission rates and improvement in patient satisfaction with their healthcare experience. The patient gets a tablet with a video call button directly connecting with an agent who can see the patient in their home and on the CRM platform carry out an inventory of their medications, vital signs measurements, and check on the patient status and notify a care team if required. Beginning with a dozen agents, the company is looking to combine the current onshore and work-at-home model with offshore support.

TeleTech is also looking to wellness outreach as a strong opportunity to increase the value of healthcare and close some of the gaps for healthcare customers. For several clients, it delivers medication adherence, which includes data analysis for gaps in maintenance medication, and engaging the member with a phone call to understand the issue and offer alternatives. In turn, the medication adherence impacts the 40 metrics forming the healthcare plan star rating.

Under this changing perception of the market, and empowered by senior executive support, TeleTech is actively pursuing similar opportunities for a more holistic approach to healthcare services.

<![CDATA[Virtual Assistant I Am! CSS Corp Looks to Yodaa]]>

The idea that the future model of customer experience includes a high level of automation is already widespread. A whole ecosystem of developers and vendors is catering to an emerging mass market of bots and virtual assistants. And users and brands are discovering more applications of automated support over text and voice as bot libraries grow rapidly.

While the learning curve for users is a lot quicker than for command-line or form-based interfaces, and we all adapt to conversational interfaces, businesses have a window of opportunity to provide an efficient and effortless customer experience. In this window, technological capabilities and business processes will need to stop playing catch-up and start meeting rapidly evolving customer expectations.

Technical support in the IoT and connected home world

Most of the media coverage is on the use of virtual assistants in marketing, sales, or basic customer care. However, in technical support, the undercurrents of IoT and the connected home will drive an even quicker adoption and ROI. The multiple connected devices spreading around the home and the office increases potential set-up failures and interoperability issues, raises support costs, and (as OEM device margins decrease), lower support funds. The networked relationship between customers, products, and brands creates more complexity while simultaneously expanding to the early and late majority of the market. In turn, these user segments perceive product quality a lot more in terms of product experience; for example, the ability to self-install or receive instant support versus the actual technology. Combined, these factors aggressively force technical support down the virtual assistant and natural language path.

CSS Corp’s Yodaa: the Cotelligent virtual assistant

As a specialized technical support vendor, CSS Corp looked to address this reality with a new engagement platform with a common interface called Yodaa. Yodaa includes pre-packaged modules for premium tech support, analytics, virtual assistant, knowledge management, and mobile app, powered by machine learning and NLP.

CSS Corp developed Yodaa with three questions in mind:

  • Is the platform intelligent enough to eliminate a call – i.e. can it identify a pattern among the registered issues and problems to proactively feed the product developer?
  • Is the platform flexible enough to evolve – i.e. can it learn from the new issues that arise?
  • Is the platform independent enough to remove the need for human intervention – i.e. can it create a fix by itself, for example with a return merchandise authorization, to identify the type of request and automatically trigger the process and push notification updates to the user?

These challenges might be part of a typical RPA integration: what CSS Corp adds is the substitution of human decision making with that of Yodaa. For example, when dispatching a new device, it goes through some 20 different checks such as validating the serial number, checking the warranty period and the bill of payment. Under a business process automation all these steps can be performed by a machine, but for support steps (e.g. in case of a dispute management), Yodaa uses natural language processing and text mining to remove human intervention, and applies machine learning to train itself to modify the business rules on a per case basis.

Over a four-month period this year, CSS Corp implemented the platform with a global gaming brand which consistently requires resolution of a high number of complex inquiries with a range of issues following a typical new version release. Before the release launch, agents created standard operating procedures within the platform’s drag and drop flowchart builder. After the launch, Yodaa learned from the live chat and email interactions how to (e.g.) access a new game level or reset settings to resolve gamers’ inquiries. So far, the vendor has been able to eliminate between 15-25% of the interactions associated with the new version release.

Still at the early stages of this engagement, CSS Corp expects Yodaa to deliver on average 50% reduction in call, email, and chat interactions for technical support, to improve agent productivity by up to 30%, and increase the customer satisfaction by 25%.

Bringing Yodaa to the call center with Amazon Connect

To jumpstart the adoption in the contact center, CSS Corp will integrate Yodaa with the newly launched Amazon Connect cloud-based contact center solution. Amazon Connect places phone, email, chat, messenger, and voice search interactions on a single CRM which enables the virtual agent to learn from one data source, answering simple queries and routing the complex ones to human agents. For clients with an existing knowledge base and standard operating procedures, Yodaa will search throughout for answers, but in the case of new or unsupported questions, it employs information retrieval techniques to obtain appropriate responses from the web. The ambition is for this continuous learning to eliminate and deflect an increasing number of questions, making human agents highly specialized subject matter experts. 

Technical support for the voice-enabled channels 

The next steps for the Yodaa developers are improving deep learning, and adding new business processes and verticals, e.g. pharma. Another focus area is support over the voice-enabled channels such as Amazon Echo, Google Home, and Apple HomePod. The company is working on adding skills and integrating NLP to resolve technical support questions addressed to voice engines. It has already set up demos where Alexa is guiding the user on how to set up a router or on the status of their device delivery. 

<![CDATA[HGS Turns to Sheila & Veronica to Help Enhance the Digital Customer Experience]]>

NelsonHall recently attended the HGS Analyst and Advisory Summit in NYC. The event combined client perspectives with an update on the company’s healthcare business, a review of the latest offerings within its DigiCX suite of digital services, and discussion of the changing nature of customer experience (CX).

Optimizing the healthcare payer member experience

In 2015, HGS acquired a majority ownership in Colibrium, an Atlanta headquartered health plan marketplace with its own proprietary Healthcare CRM overlay. Today, Colibrium has ~10m members across its ~50 deployments. Through the merger Colibrium benefited from HGS’ healthcare experience in several ways:

  • Payer, provider, and broker front and back office services
  • Large-scale clients
  • Offshore, nearshore, and onshore work-at-home (WAHA) delivery model supported by 12k employees, of whom 1.1k are qualified nurses.

HGS’ ambitious plans for the healthcare industry include adding additional clinical services for both the payer and provider markets, obtaining the required license for claims coding and clinical work in all 50 states, and expanding the WAHA model.

The larger challenge in the space is how to acquire, engage, and retain plan members, who are digitally connected, have little plan loyalty and trust in the system, and believe that healthcare is expensive, confusing, and hard to understand. In an environment where customers can purchase life insurance on their mobile, shop for pharmaceuticals across national borders, and have wearables for health monitoring, outsourcing providers such as HGS can stand out by offering a unified experience. For the healthcare providers, HGS aims to deliver regulatory expertize, cost optimization, and scalability during the peak January-February season. In the next stages, it plans to generate richer business insights by analyzing usage activity, member behavior, and VOC.

But for the digital members, HGS is looking for a new approach to the member lifecycle. This includes driving online traffic and lead generation for open enrollment, engagement through click to chat and web portal shopping, support from a human or virtual assistant called Sheila (running on messengers and webchat), as well as self-service set-up, nurse concierge, and proactive support and extension to the wellness industry.

Design thinking for digital CX

In the middle of last year, HGS officially launched DigiCX. DigiCX is a suite of multi-channel CX services including chat, social, email, SMS/text, and messaging channels under an automation and analytics framework. The identifier of DigiCX is the self-service lead. HGS looks to enable digital transformation through an “outside in” and “inside out” design thinking approach that champions self-service and automation, which in turn fund the required investments in tools and consulting resources. For example, the company is working with a global CPG company to conceptualize and create a chatbot avatar for sales and level 1 service queries. For a high-end consumer electronics brand, a recent HGS win, the provider automated 48% of customer emails such as order status and product registration, and for technical support uses NLP to guide customers to troubleshooting videos. The next phase is an SMS bot to automate shipping status inquiries. The bot will be called Veronica.

The combination of customer-facing automation, self-service, and digital channels carries a number of direct business impacts. It lowers costs on average by ~20% in the first phase, adds new channels to meet customers where they naturally prefer, extends the hours of operation, yields more business and VOC insights on the product and services, generates new revenue streams, and improves customer satisfaction.

From their implementation experience, HGS has identified several take-aways:

  • It is important to focus on the outcome and handle the whole engagement, but start with a quick deployment
  • Automation may cannibalize voice volume, but as new channels open it will increase interactions and the overall business pie will expand
  • Identify customer conversations, not messages or calls. Pivot to automated conversations and keep the live agent support using analytics to decide when to turn it on/off
  • More and more clients bundle customer care transactions with digital marketing and sales.

Investment in current channels and future analytics

HGS is actively adopting the emerging channels of social messengers such as WhatsApp and Facebook Messenger. Markets such as North America show significant opportunities for messengers to be the default sales and support interface. While the asynchronous nature of messengers empowers customers in the support processes, HGS is initially eyeing the sales processes. The company is working with technology partners and clients to optimize consumer lead generation, where the interaction begins in the messenger and then a live or automated agent identifies the moment of truth to drive the contact through the sales funnel process. As the early market examples have shown, communication over messengers increases advocacy for the new generation of digital consumers.

With the support of machine learning, bots are integrated into live conversations over messengers to manage a larger share of the customer lifecycle, giving responses and finding answers, moving away from objective to subjective ones. As a CX provider, for HGS this means a further push towards the IT path with customer interaction analytics, rich media analytics, predictive modeling, NLP, and cognitive computing. The company is boosting its technology competencies through partnerships with AI start-ups and own analytics platforms looking to integrate machine and human led interactions as the optimal way to transform CX.   

New objectives for outsourcing clients

An undercurrent of all these consumer and technological changes is the shifting focus of outsourcing clients. As Chris Lord, HGS Global Head – DigiCX, Growth, Strategy and Marketing, highlighted, the target contacts in the client organizations are changing to product owners and marketing execs, and their expectations are for the provider to have the domain insights and expertise to merge CX with sales. As more senior leadership conversations switch towards uplift and new sales, the goal for HGS is to measure the ROI from the digital transformation by delivering a business case with an incremental value proposition.


<![CDATA[Augmented Humans Will Expand the Digital CX Frontier: Lessons from Sitel Summit]]>


Last week, NelsonHall attended the Sitel Summit in Miami. Titled ‘Expanding the Digital CX Frontier’, the event was an opportunity for Sitel to update the analyst community on their new structure, introduce new senior executives, show its new global HQ, and share first-hand experiences of successful CX digital journeys.

From contact center company to a group of global CX services

Almost two years after French Acticall acquired Sitel, the company is changing to an ecosystem of ventures where the contact center business is a part, albeit the largest one by a measure, along with:

  • The Social Client: a digital and social marketing consulting company
  • Learning Tribes: learning and development company
  • Customer Insights: an analytics unit
  • Premium Tech Support division
  • Novagile: a technology and software development company
  • Extens: a consulting practice.

These brands are run separately, with their own P&L, strategy, and target markets as a way to preserve the entrepreneurial DNA, stay close to the clients and be innovative and diversified. This is an approach which Acticall maintained in continental Europe throughout its history of M&A and spin-offs. The unifying objective is to create a ‘toolbox in customer experience’, as the CEO, Laurent Uberti described it.

While the challenges of competing strategies and disparate sales and marketing will emerge, the financial backing of the Mulliez family allows the company a longer investment horizon. Over the last year, the Mulliez family, with its $95bn multinational ownership in retail and distribution, has provided the initial support to finance the Sitel acquisition and restructure its debt. The support by this multinational conglomerate offers opportunities for country or industry-specific synergies across the shared assets. For example, in China, where the flagship retail brand Auchan has a $17bn business and will be a new target market for the Acticall Sitel Group.

At the same time, the most immediate opportunities for the group are to land and expand across its existing client base (e.g. in new markets such as North America for The Social Client and Learning Tribes, or Brazil for Premium Tech Support). In Europe, past company experience showed that every $1 generated by the ventures brings $5 to $7 in contact center business. The group objectives range from the short term (~30% of the U.S. clients having more than one service penetration) to the five year plan for a 20% share of global revenue delivered by non-Sitel ventures.

Main player in the customer experience revolution

The tactics for this approach vary between the different units, but common across all is to target digital opportunities. For example, addressing channel adoption with chatbots, where The Social Client has currently deployed ~25 in Europe; self-service communities, which Acticall runs for major French brands such as SFR; visual IVR, for which it has partnered with a leading provider in Europe; and mobile only methodology. The latter paradigm is the current solution to the challenge of the ‘end of traditional interfaces’, as described by the new Social Client GM for North America, Gordon White. In a world where messaging apps have 2.6bn users, surpassing those of social media, and becoming de facto new OS, vendors such as Sitel need to look for the new channels and formats where CX will be delivered.

Unsurprisingly, automation and NLP will play a big role in these digital transformation journeys. Sitel wants to position itself as the complementary provider for automation in a future where AI will become a commodity while remaining at the current ~70% accuracy. By the end of 2017, under the leadership of CMO Arnaud De Lacoste, Sitel plans to develop a bot engine working alongside third party NLP, leveraging access to large datasets of chat transcripts and employing its labor force to train the bot on process and client-specific lingo. The ‘bot supervisor’ will then offer real-time agent feedback and next-best-actions, improving quality and delivering an estimated 5% NPS boost on average. The project starts with English and moves to other major European languages next.

Digital transformation is slow but brings better margins

Across the different presentations at the event, a consistent topic was concentration on the digital roadmap, earning executive support, and empowering frontline staff instead of over-focus on technology. These different journeys may require:

  • Moving digital ownership from IT to marketing, as was the case with Wyndham Hotel Group, where CMO Barry Goldstein took on a digital enablement journey with its 8k hotels in 70 countries
  • Expanding to video despite initial opposition, as Don Deliz from Intuit described, where the ~600 seasonal work-at-home tax advisory began offering one-way video conferencing with co-browsing capabilities while maintaining a professional appearance and protecting personal data
  • Applying human intelligence at the core of the process, as Peter Francis from T-Mobile explained, to drive digital adoption and, in the case of T-Mobile, making the asynchronous in-app chat a primary contact channel with a newly formed team handling 100k messages weekly at 30-40 concurrency and 4.5/5 CSAT performance
  • Creating an engrained CX culture, like the example Doug Woodard shared about a Capital One agent going beyond her training and company procedure to deliver a highly personal and compassionate service to a war veteran.

Regulators vs augmented humans

The question on how to find, engage, and support agents in their increasingly complex and data-rich interactions was a running theme during the summit and covered exclusively by the Learning Tribe management, who mapped the trainee journey similar to the customer journey, with accents on requirements for mobility, interconnectivity, peer-to-peer support, and efficiency. On the flip side, Brandon Casteel from CareerBuilder painted an unflattering picture of poor applicant experience against an increasing skill shortage in the U.S. market. To add to the complexity, lobbyist Chris Putala explained the state of the Washington legislative environment, which reintroduced in 2017 the U.S. Call Center Worker and Consumer Protection Act, trying to curb U.S. call center offshoring.

As a global vendor, Sitel plans to hedge against these risks by further enhancing its multi-shore model, aiming to grow its U.S. domestic and nearshore footprint in Honduras, to enter new African locations in support of the French market, and expand its China presence from training and development to contact center services. Still, despite these new developments, the fundamental question for Sitel remains how to evolve from a contact center to a context center, able to bring emotion and value to the customer conversation at scale, with the support of new technology and augmented humans. 

<![CDATA[WNS Brandttitude: Serving Marketers with Advanced Brand Analytics]]>


While Facebook banks on the smartphone camera to digitalize offline relationships, and sales people use Snapchat to sell real estate, the main challenges for marketers to reach this level of interaction are structural – how to visualize huge amounts of disparate data to get actionable insights fast at a granular level. Here I take a look at how one CMS vendor, WNS, is tackling these challenges by providing an advanced business intelligence platform for brand performance and customer experience analytics to its clients.

Productizing marketing data visualization with Brandttitude

WNS’ Analytics practice has been offering data aggregation, reporting, and visualization of marketing information across multiple industries for more than ten years. Throughout this period the main client need has been to track the brand performance globally and locally, compare it historically, and benchmark against competitors. With its specific domain focus, WNS developed its knowledge of what marketing data to mine from where and which metrics to show and how to present them to marketers. For example, answering top of mind questions such as the fastest penetrating category or the most frequently purchased brand.

At the beginning of 2017, the provider decided to productize the offering through Brandttitude. Brandttitude is a BI analytics cloud platform which ingests data across sources, integrates, and presents them on a visualization layer accessible through mobile devices.

WNS launched the platform with a CPG client, a French food manufacturer. Brandttitude integrated and correlated the previously isolated customer survey reports from third parties such as GfK and TNS, household TV viewing stats from the likes of Kantar, point of sale resources such as Nielsen, and the client’s own shipment data on a quick stats section to uncover insights such brand lift and market reputation. The API pulls automatically from these syndicated databases and clusters and aggregates them according to market and time period. WNS is now planning to procure these data directly and do analysis independently.

With the French CPG client, WNS is rolling out the platform for multiple national markets in a region, where it has added another six data sources. One of these additional resources has been macroeconomic data from Euromonitor and Frost & Sullivan catalogs to identify correlations between volume and value changes with macroeconomic shifts.

How is my brand doing?

With all these different data sources, for marketers to assess product performance means translating the information into insights to create a single brand story. Brandttitude presents key metrics for a brand, such as value phase, affinity score, and repeat buyer percentage in one location. At the back end, it harmonizes and integrates data from 35-40 markets currently and four different data sources delivered in various formats and styles.

It also hosts a KPI library listing all metrics with an option for the user to plug and play KPIs, create customized views and, thanks to a separate API for each metric, visualize it on external tools. For the retail and CPG space, these are ~150 metrics. It further allows the user to correlate these trends and picture them on a single chart or table view (including mapping competitor performance and a drill-down by geography), and annotate and share them with other platform users within a collaborative space.

With a different set of data sources, clients have requested WNS to customize the platform to handle their specific set of needs. For example, for a U.K. insurance client, Brandttitude will have to manage complaints, claims, policy data, and contact center information to map the customer experience with a particular insurer at a personal level. For example, how many policies a customer has, what complaints they raised, how many times they contacted support, and how many days it took to settle a case and settle an amount. Also, the update frequency has to cater to the daily cycles of work. Similarly, customization will be required for a potential deployment for a convenience store chain in Switzerland by adding e-commerce data.

Domain knowledge enabled by technology

The social networks’ three-sided markets of users, content providers, and advertisers come with massive amounts of data at the individual level and understanding who to target with a Facebook dark post or how to publish effective Instagram Stories is a stepping stone. While marketers can use Tableau and QlikView to solve their technology needs for brand management, with Brandttitude WNS wants to position itself as an industry knowledge curator.

For the next versions of the product, WNS plans to accept information which is not in number formats, such as pdf and serve as a data repository for macroeconomic statistics. The key development, however, is the addition of a machine learning-powered analytics layer which will build upon the descriptive features to add diagnostic and predictive capabilities. For example, it will forecast revenue or create simple marketing mix outcome models. WNS targets these advanced analytics additions by the end of 2017.


NelsonHall is currently working on a Digital Marketing Services project for publication later in Q2. For more information contact Guy Saunders (

<![CDATA[Consolidation & Growth of the German CMS Market: A Quick Look at Regiocom]]>

On 10th March, German energy BPS and ITO provider Regiocom completed the acquisition of customer management services (CMS) vendor SNT Deutschland to create a €230m provider focused on the German market. Here I take a closer look at the deal, and at the wider picture of consolidation and growth currently taking place in the German CMS market.

An Energy BPS Specialist

Regiocom GmbH is a private BPS firm created in 1996 as a 50% subsidiary of E.ON and fully owned by the management since the end of 2014. Its core speciality is the German energy market supporting energy suppliers, network operators, and metering companies with end-to-end business services from software development and data storage to billing, dunning, market data exchange, and customer care for end users. It has close to 2.3k employees of whom 1.7k people are in front office services based in delivery centers in Magdeburg (HQ), Berlin, Halle (Saale), Salzwedel, Dessau, Kaiserslautern, as well as in Vienna, Austria, and Sofia and Varna, Bulgaria. Its 2016 revenues were approximately €153m, of which ~a quarter are from E.ON.

Acquisition of SNT Deutschland to Expand into Telecoms & BFSI Sectors

The acquisition of SNT Deutschland from investment firm Livia Group will bring Regiocom client base and industry expertise in the telecoms sector (2/3 of the SNT business), as well as financial services and insurance, and leisure and travel sectors. SNT was part of KPN telecom and currently has ~3.3k employees and 2016 revenues of ~€80m. It has centers in Berlin, Essen, Chemnitz, Neubrandenburg (two centers), and Potsdam.

With the acquisition, Regiocom will venture outside the highly regulated German energy sector where it has achieved significant vertical integration with its clients and will create a more CMS focused provider. The combined company will boast a wide onshore delivery network and a small nearshore operation in Bulgaria, where it has recently expanded into a second location in Sofia.

German CMS Market Consolidation Continues

This latest deal comes on the back of a string of acquisitions by global CMS leaders in the German market in the last few years. Since the beginning of 2016, major M&A activity includes:

  • Webhelp buying Stuttgart-based 270 people contact center Ocon in February 2017
  • Convergys’ acquisition of a top five onshore vendor buw for €123m in the summer of 2016
  • Capita Europe buying 3C DIALOG with ~400 staff in April 2016, bringing its onshore centers to 13.

A market with nearshore delivery opportunities limited to certain Eastern European and Baltic locations, the German CMS industry relies on onshore presence challenged by relatively high labor costs and unionization. Until recently the market was distributed among multiple domestic players such as buw, walter services, Bosch services, SNT, 3C Dialog, as well as established global vendors such as Arvato, Teleperformance, Sitel, SYKES, and Transcom.

With the merger, Regiocom will be among the top seven German CMS players by revenue. That said, the expanded Regiocom will operate in the second largest European CMS market, which NelsonHall estimates at $3,765m (2017) growing at 4.4% CAAGR through 2020, which is above the growth rates of France, U.K., Italy, Benelux, and Nordic states.

<![CDATA[CMS in Bulgaria: TeleTech Explores Multilingual Skills & Aims to Move up the Value Chain]]>


Last month, NelsonHall visited TeleTech’s delivery center in Sofia, Bulgaria, to discuss the company’s main European operations and the advantages and challenges of Bulgaria as a customer management services (CMS) delivery destination.

From Sofica to TeleTech

TeleTech acquired a local provider, Sofica Group, in 2014 and rebranded it in 2016. Sofica was one of the first Bulgarian outsourcing providers, created in 2004 and offering customer care, technical support L1, helpdesk, and CMS back office in 26 languages, in addition to HRO, hosting, and Contact Center as a Service. The majority of the work is inbound, operating 24/7, but it also offers outbound sales services. It has ~1,100 people in three centers in Sofia and Plovdiv, and in Skopje, the capital of neighboring Macedonia. The main clients are European and U.S. telecoms, technology, financial services, and travel and transportation brands. TeleTech Eastern Europe also has ~15% domestic business servicing one of the biggest national mobile telecoms.

Advantages of the Bulgarian market

Bulgaria has experienced steady growth in its CMS industry, with major players present in the country since 2003-2004. The country has close to 45k people working in more than 360 outsourcing providers, and this is expected to reach 64k people by 2020 out of an active labor force of 2.4m. NelsonHall estimates that ~23k employees work in front office outsourcing services. In addition to TeleTech, CMS providers present in the country include:

  • Concentrix
  • Convergys
  • C3/CustomerContactChannels
  • Sitel
  • Sutherland
  • Telus International
  • Tek Experts.

In addition, there are several local providers, including 60K, Call Group, and Euro Connect.

The benefits of the country as a front office delivery location are in the deep multilingual skills of the agents, typically fluent in a major European language, but often speaking two or even three languages in addition to their native Bulgarian. For example, in TeleTech’s Sofica center, over 80% of the agents speak more than one language in addition to English and their native language.

Due to a language-focused national education system and a significant number of employees with direct study or work experience in European countries and the U.S., front-office providers are often able to handle multiple markets with the same resources and have a close cultural affinity. Other advantages of the country include:

  • Educated workforce able to provide front and back office services in technical and financial sectors
  • The lowest corporate tax in EU at flat 10%
  • Low office rental space. For Sofia, the average rent for A class business property is €12-€14 per m2
  • Good internet connectivity. Bulgaria often ranks among the top 20 countries globally for average internet speed
  • Physical and time zone proximity to Western Europe with direct flights to most European capitals
  • Stable currency pegged to the Euro.

Challenges of the Bulgarian market

The biggest limitation for the Bulgarian CMS industry is the market saturation. While the minimum wage in the country is one of lowest in Europe at €210 per month, the labor cost, particularly in Sofia, has steadily increased since 2010. For the relatively small agent pool, vendors compete with a sizable ITO sector and in-house support centers, as well as middle and back office outsourcing operations in HRO and FAO. Brands with front office operations in the country include AIG, Coca-Cola, C3i, EXL, Experian, IBM, Ingram Micro, Skrill, and William Hill.

Since 2008, this trend has caused vendors to open centers outside the capital Sofia in tier 2 cities such as Plovdiv, Varna, and Burgas. TeleTech was among the first to open its center in Plovdiv and uses it in support of domestic telecoms clients. Still, these locations cannot offer scale.

Other measures to address the labor shortages have been working with universities and offering free training for prospective agents. For example, in Q3 2016, TeleTech launched TeleTech Academy, a free training program for prospective agents for soft, technical, and language skills, particularly in German and French.

Also, TeleTech and other vendors have successfully expanded their recruitment network outside the country, targeting young people from Spain, Portugal, Italy, France, Netherlands, and Germany who are willing to relocate for the attractive low-cost lifestyle in Sofia.

Objective is to move up the CMS value chain

TeleTech is aiming to evolve its Eastern European operations to a more comprehensive BPO center offering the consulting, analytics, and technology capabilities of the wider company. For Logitech, TeleTech centralized customer care in Sofia, implemented a satisfaction monitoring process linking NPS across the various customer care touchpoints at the agent level, and developed a detractor reduction program. Within two years of the launch, Logitech experienced 70% improvement in NPS, while AHT reduced by 22%.

The vendor has a strong outbound revenue generation experience with several projects in Europe and U.S. for telecoms clients. In the summer of 2016, it started a service-to-sales program for a domestic telecoms firm with ~80 agents. For 2017, the provider is planning to build on this experience by launching a wider customer journey mapping and VOC assessment project for the client utilizing the resources of TeleTech’s Customer Strategy Service unit.

Continuous growth for the Bulgarian outsourcing industry

TeleTech’s objectives to expand into consulting and technology services from its Bulgarian operations is aligned with the development of the country as an outsourcing destination. As a growth strategy for a market relatively limited in scale, Bulgarian CMS vendors are adding more advanced technical support services and more digital channels to the already existing language base.

According to the Bulgarian Outsourcing Association, the national outsourcing industry is expected to reach €2.7bn (~6.0% of the country's GDP) by 2020.

<![CDATA[NelsonHall’s Blogging Year: A Selection From 2016]]> NelsonHall analysts are regular bloggers, and while you might be familiar with a number of them, you might not be aware of the full range of topics that NelsonHall analysts blog about. We thought it was an opportune time to look back and pick out just a few of the many blog articles produced last year from different corners of NelsonHall research to give readers a flavour of the scope of our coverage.



We continue to keep abreast of unfolding developments in RPA and cognitive intelligence. In October and November, John Willmott wrote a sequence of three handy blogs on RPA Operating Model Guidelines:

Turning to Andy Efstathiou and some of his musings on FinTech and RPA developments in the Banking sector:

Regarding developments in Customer Management Services:

Fiona Cox and Panos Filippides have been keeping an eye on BPS in the Insurance sector. Two of their blogs looked at imminent vendor M&A activity:

Blogs in the HR Outsourcing domain have included innovation in RPO, and in employee engagement, learning at the beginning of the employee life cycle, talent advisory and analytics services, employer branding, improving the candidate experience, benefits administration and global benefits coverage, cloud-based HR BPS, and more! Here’s a couple on payroll services, so often an overlooked topic, that you might have missed:

Dominique Raviart continues to keep a close eye on developments in Software Testing Services. For example:

Dominique also keeps abreast of unfolding developments in the IT Services vendor landscape. For example, in November he wrote about Dell Services: the Glue for "One NTT DATA" In North America.

Staying with IT Services, David McIntire:

Meanwhile, Mike Smart has been blogging about IoT. Here are two of his earlier ones:

And Rachael Stormonth continues to consider the significance of unfolding developments in the larger and more interesting IT Services and BPS vendors:

That’s just a small sample of the wide-ranging themes and hot topics covered by NelsonHall blog articles in our trademark fact-based, highly insightful style.

Keep up with the latest blogs from these and other NelsonHall analysts throughout 2017 here, and sign up to receive blog and other alerts by topic area, or update your preferences, here