How to unlock CX performance with smartshoring
Whether facing an economic downturn or striving to meet shareholders' expectations, business leaders often turn to cost-cutting measures to improve profitability. Not all costs carry the same weight. Some costs are good, while others are bad. Cutting bad costs is straightforward, generally makes a lot of sense, and is therefore easier to do. But what happens when we are forced to consider reducing the good costs? Those incurred to meet customers' needs, align with company growth, or are associated with what makes a company unique, such as the cost of customer experience – as an example.
Customer experience (CX) is a competitive advantage, and the most successful organizations recognize how it powers their brand. In today’s world, we all know how a happy customer can amplify what’s good about a product or service, and how a disgruntled one can hurt brand reputation. We also know that when a customer reaches out, it’s often because they haven’t been able to solve the problem themselves. Handling these difficult calls on-brand and on time is why most companies prefer to manage their customer service internally. However, insourcing comes with a price. Under pressure, many businesses turn to outsourcing their customer experience to save on operating costs.
Outsourcing CX
Understandably, outsourcing such a competitive advantage requires careful consideration, especially when weighing offshore versus onshore models. If done well, the right outsourcing strategy can unlock potential and growth. If done poorly, it can significantly damage a brand’s image and bottom line. So, what is the secret to minimizing operating costs without compromising customer experience? It all comes down to building a strong outsourcing partnership and adequately balancing onshore and offshore CX delivery teams.
The best of both worlds: Onshore and Offshore
On the one hand, having customer service teams closer allows for quicker and more effective problem resolution. Proximity means that support teams can better understand regional issues and offer more relevant solutions. This efficiency is particularly important in sectors like telecommunications, banking, and healthcare, where timely and accurate support is crucial.
On the other hand, turning to offshore services allows brands to benefit from cost-effective support. But when CX representatives are located overseas, brands often grapple with the complexities of offshoring and the potential loss of authenticity. Although there is a level of risk associated with it, under the right conditions, offshoring customer service delivery makes a lot of sense, both operationally and financially.
“To benefit from the best of both worlds, businesses must carefully balance domestic and offshore teams.”
A smartshoring approach offers a strategic blend of both domestic representatives and the best aspects of offshore delivery by ensuring optimal customer satisfaction and operational efficiency. While domestic representatives equip brands with the advantages of local representation, offshore teams—supported by strong training on the offer’s specificities and customers' expectations—provide efficient and cost-effective support during extended hours. This way, businesses can become more profitable while final customers enjoy the convenience of help either day or night.
By combining deep local knowledge with global resources, customers receive unparalleled support. This approach maintains high standards and delivers more competitiveness in an ever-evolving market. In today’s business environment, where customer expectations are continually rising, the right combination of local expertise and global reach ensures that customers' needs are met promptly and effectively, reinforcing trust in the brands they love.
Where to Offshore Your CX?
The Philippines - Rising CX and digital talent hub
Under the right conditions, offshore CX delivery makes sense, especially in markets known for developing world-class customer experience representatives and highly sought-after CX digital skills. The Philippines, for example, enjoys a reputation as a high-quality destination for offshore delivery. According to the 2024 Front Office CX Omnibus Survey, based on input from more than 700 CX decision-makers worldwide and published by Ryan Strategic Advisory, the Philippines is one of the most favorable offshore locations globally. Even compared to other offshore heavyweights, the report credits the country as a source of plentiful human and tech talent suitable for outsourcing success.
The Philippines is halfway around the world. Yet, the time zone difference with North America enables a 24/7 operational capability, allowing round-the-clock services. This is particularly advantageous for IT support and customer service functions that require continuous availability. With offshore CX delivery from the Philippines, consumers enjoy the same level of convenience and easy access to customer service, regardless of whether it is day or night.
The Importance of Partnership
When considering smartshoring, teaming up with a CX outsourcing company with the right cultural fit is more important than anything else. The stakes are high, but if well-supported by a partner that truly understands and aligns with the brand’s vision and values, companies can reap the financial and operational benefits that give them a competitive edge.
A smartshoring strategy works well when all parties have a deep understanding of the market and the culture in which the brand operates. Through a careful study of human talent abroad, complementing domestic operations with an overseas team can deliver high value. This is exactly what Nordia did for some of the most iconic brands in Canada. We believe that Canadians deserve the best customer service. In few markets is smartshoring more important than in Canada, where English and French are both widely spoken.
By designing the right onshore and offshore outsourcing strategy for their operations, businesses can optimize their cost structure and proactively anticipate difficult times without compromising customer experience. Start by finding a CX outsourcing partner with the right cultural fit, and then build the smartest CX strategy together.
Question: Using a scale of 1 – 8 (1 = not at all important, 8 = very important), please identify the most important factors that an offshore contact center destination must have in order to be considered by your organization
Source: Ryan Strategic Advisory, 2024 Front Office CX Omnibus Survey, p.96.
About the Author
Chris Courneya is Nordia’s Senior Vice President, Business Development and Client Operations since May 2024. Chris has a track-record of driving organizational growth among some of the largest CX providers – including HGS, Transcom and FoundEver (formally Sitel), and has helped many premium organizations create the right CX partnerships both in Canada and beyond. With 22 years of experience and in-depth knowledge of the Business Process Outsourcing and Management landscape, Chris has a unique understanding of business trends and needs regarding CX operations.