The word “outsourcing” has become an emotionally triggered word, one that creates visions of lost jobs, closed plants, frustrated customers. But it shouldn’t always generate such a negative response. Ric Mims should know. One of the most popular help desk services trainers and consultants, Ric has served the IT support industry for more than 17 years. He began his career in the trenches and progressed through several help desk management positions, on both sides of successful outsourced relationships. Following several years as the vice president of operations for an independent help desk outsource provider, Ric launched his own company, SupportCenter Global Technologies, last year to help IT organizations evolve from reactive to proactive business units.

Daly. Outsourcing continues to get tremendous media attention. To what extent is this topic still a sore spot among today’s IT workers?

Mims. The media focus on outsourcing represents an immediate loss of jobs to most people. In America when you say “outsourcing,” people hear “off-shoring.” And let’s face it, people have lost their jobs. It’s a sore spot. But off-shoring is not the whole story about outsourcing.

Daly. Since off-shoring seems to be on the hot seat, let’s talk about that first. Under what circumstances is off-shore outsourcing a viable option?

Mims. It’s not like off-shoring is a novel idea to global companies. Off shore is just where your company does business. Many companies are implementing a follow-the-sun support methodology—what I call an internal off-shoring approach—that makes perfect sense when you consider the various time zones, service levels, and geo-cultures involved with supporting global customers and employees. Deliver the technical support at the place and time they need it, in a language they understand, and in a manner suitable to the environment.

Other companies, global and otherwise, find service providers in a country off-shore not so much to follow the sun, but to save money through lower labor costs. It’s in this external off-shore environment, particularly for technical support services, where we hear about the nightmares. I make a clear distinction between internal and external off-shore outsourcing. External off-shoring just for the sake of it does not work in a technical support environment.

Daly. What makes it so difficult for external off-shore outsourcers to deliver effective technical support? They certainly have the intelligence and resources at their fingertips.

Mims. In a tech support environment, we service cultures, and individuals within that culture. The external off-shore providers fall short because they struggle to understand the various service cultures they support. Doctors, lawyers, manufacturers, government agencies—each one of these groups has a distinct service culture. And, due to competitive and financial pressures, each service culture has a “fix it NOW” mentality.

Daly. Companies are looking towards off-shore call center providers to handle services like airline reservations and catalog ordering. What are the differences between these types of customer interactions and those encountered in technical support services?

Mims. Certainly, the customer experiences are quite different. In the general customer service interaction, the agent is primarily gathering information and fulfilling an order, with a business objective to drive revenue. It’s a highly functional task that follows a clear line of questions and answers. When a customer calls to place that order or make that inquiry, the result is rather predictable and straightforward, and there is high customer confidence in a positive result.

In the technical support situation, the interaction is usually based upon a problem that has interrupted business. The person calling the help desk must have confidence that the person on the other end is actually willing and able to get him back to work quickly. And, he has to trust that the result is a workable resolution to the problem. The business objective is to reduce down time and drive toward continuous process improvement.

Unfortunately, the external off-shore methodology has not reduced downtime in corporate environments. In fact, various studies have shown that downtime averages as much as two hours per employee per month. Multiply that by the number of employees you have, and you reveal a very costly problem.

Daly. Many industry experts advise IT organizations to outsource non-critical services and then redeploy the workers who had been delivering those services into more value-added roles. What’s your perspective?

Mims. Regardless of the industry you represent or the sourcing options available, outsourcing exists throughout the business world. Companies are outsourcing human resources and accounts payables and receivables and distribution services. The IT realm is no different from the rest of the business world. IT is a business. Bottom line. IT organizations are being asked to do more with fewer resources, people and technology. Sourcing options available today provide IT organizations alternative approaches that can help them maintain budgets and provide the services customers need.

However, reactions to outsourcing get complicated because, all too often, companies that have implemented an outsourcing methodology have neglected to do proper due diligence first. They have identified neither the critical nor the non-critical mix of services, people, or technologies. Furthermore, they have neglected to determine what works from a process standpoint. As a result, they have outsourced the wrong services; they have ended up pushing their intellectual capital and experience right out the door, and they have fallen short in customer satisfaction.

Daly. Outline a scenario where outsourcing is a viable solution?

Mims. A colleague of mine runs a large hospital help desk in the Southeast that was having an issue with their nomadic technicians, dispatched to service their surgeons in their home offices all around the state. Once a problem was escalated to a field technician, that technician was lost for the day as he drove out to the surgeon’s house to solve the problem. It was a very expensive endeavor, from resource time lost to mileage and gas. The manager found a company that sources nomadic technicians. They created a workflow process and service level requirements, then outsourced that service function, automatically escalating those incidents to the outsource partner. As a result, both internal and external customers saw an increase in technician availability and reduced time to resolution.

Understanding what piece of your business is not financially viable for you, knowing your technicians skill sets, balancing time zones and geography—all of these factors come into play when you are making outsourcing decisions.

Daly. Clearly, field technicians driving around the countryside do not add value to the hospital’s core services. What are some other likely scenarios for successful outsourcing?

Mims. Outsourcing is often a solid solution when you do not have the proper headcount to meet the customers’ needs. Consider a new software release, for example, that may generate 10,000 help desk calls per month. Staffing to that level would be cost prohibitive and unfeasible for a situation that could last two months, maybe six. It makes sense to hand off level one support to an outsource provider that has the staffing and flexibility to handle that volume. That outsourcing arrangement could be an off-site or in-house arrangement. But, in either case, it makes business sense to hand that off and use your internal expertise on more value-added functions.

Daly. Let’s get back to resource redeployment. What’s the best approach to redeploying human resources?

Mims. Build a plan that is based upon your core competencies. Do the proper financial analysis, people analysis, needs analysis so that you can identify specifically where the IT organization can best redeploy resources. Know what projects need to be completed and evaluate the skill sets of the current staff to deliver on those. Determine how much time and money will be needed to get your people up and running, and put a training plan in place to align the necessary skill sets with the core competencies. Basically, first develop a strategic plan, then redeploy.

Daly. What are some traps companies can avoid when they consider resource redeployment?

Mims. Some companies pay lip service to employee redeployment and employees end up feeling dissatisfied with their new positions. For example, very highly paid employees are often assigned to multiple projects, increasing their utilization rate to more than 100 percent and as much as 120 percent. They are worked to death in order to maximize the budget. That’s when IT organizations watch attrition rates go through the roof.

Daly. The business objectives of the client and the outsource provider are usually at odds. While the client wants the call volume to decrease, the outsource provider wants calls to increase, since that is the primary source of revenue for the relationship. How can clients help offset this dilemma?

Mims. You want to have the proper client-vendor relationship in place, with clear service levels, and defined incentives that encourage the service provider to reduce the number of calls per month, for example. Then, both sides can work toward the same goals.

Daly. What do companies need to do to prepare themselves better for appropriate outsourcing relationships?

Mims. Outsourcing is just that—a sourcing option. Outsourcing does not mean surrendering. First, study and comprehend your IT organization’s financial goals. Understand completely why you are outsourcing, from a business perspective. Next, know that your own internal processes are actually working, or fix what doesn’t work, before you outsource.

Don’t count on the outsource provider to fix your problems. Too often, companies outsource services for which they have no internal process or structure to begin with and subsequently lean on the outsource provider to make it all work. They essentially hand it off and hope for the best.

Outsource providers know what they know. But, you cannot count on the outsource team to fix your internal problems. That path just brings about unrealistic expectations and missed service levels. Consequently, the trust and confidence necessary to gain the efficiencies and economies that outsourcing promises is lacking, and the business relationship never develops.

Daly. Specifically, what is the account manager’s role in the outsourcing relationship?

Mims. Candidly, when an outsource relationship fails, it is usually the client’s fault, not the service providers. Typically the client does not have well documented, effective workflow processes, nor do they provide the proper account management in order to monitor and oversee the relationship.

An effective account manager serves as the primary liaison between their company and the service provider and is responsible for controlling the business relationship. State the standards you want. Be fair in those expectations. Document your complete workflow process. Develop your full service catalog. Establish your metrics, and hold everyone on the team accountable for performance.

Daly. What kind of guidance do we get from the best practice frameworks, such as ITIL, with respect to outsourcing IT services?

Mims. Most support organizations have been operating without structure for a long time. Following the ITIL process framework, companies are now implementing a distinct incident management process, which, on the back side, brings about trends analysis and problem management. Ultimately, this structure allows a support organization to become a proactive IT resource rather than a reactive one.

Outsource providers are stepping up to implement workflow processes based upon the ITIL framework right alongside their clients. With structure, documented workflow processes, and a strong client-vendor relationship, companies have the opportunity to forge successful relationships that meet the business objectives of both organizations.

Ric Mims brings his insights to HDI 2006 in the HDM certification course, "Help Desk Manager," "A Guide to Developing Your Service Delivery Model," "The Contact Center Manager: Challenges for the 21st Century," and as the facilitator of a lively panel discussion, “Outsourcing Unplugged."

The Daly Interview™ is a publication of Focus Events, Inc. This interview was written exclusively for ThinkService, Inc. by HDI 2006 Program Chair, Cinda Daly, CindaLDaly@alltel.net.

Get Connected. Get Energized. Get Results.
Get it all at The HDI 2006 Annual Conference & Expo
March 19-22, 2006 • Gaylord Opryland Resort, Nashville, TN

Register now for the world's leading event for the service and support industry.

The HDI Annual Conference & Expo is the definitive gathering for service and support professionals. Whether you are a senior executive, a director/manager or a new support manager, HDI 2006 has the practical and success-oriented sessions you won’t want to miss. You’ll choose from 100+ practical breakout sessions from tracks focused on:

• Executive Strategy
• Issues & Answers for Technical Support & Customer Service
• The Human Factors
• The Technology Zone
• Essentials for New Support Managers
• Making Connections

Reward and empower yourself and your team. Transform your attitudes. Gain new perspective on your day-to-day challenges. Keep up with emerging trends and business strategies. Discover new products and services. Renew your commitment to delivering excellent service and support to your customers while improving your organization and your ROI.

Visit www.thinkhdi.com/hdi2006 to view the full conference program!

Call (800) 248-5667 or visit www.thinkhdi.com/hdi2006 to register today! See you in Nashville!