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Offshoring

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As brands plan their customer management strategies and budgets post-pandemic, many are reviewing their balance of offshore / nearshore / onshore. 

To explore how brands can achieve excellence in offshore / nearshore operations, and how this can add value in customer management, we discuss with two Comdata experts – Didier Manzari, CEO of Comdata Morocco, and Pedro Rodriguez, CCO of Comdata Spain – how they are doing this for brands in the French and Spanish markets.

In terms of your own market, what do ‘offshoring’ and ‘nearshoring’ mean?

Pedro Rodriguez: Both are very common for customer management in Spain - together they account for 25% to 29% of revenues in Spain’s contact centre industry. Much of that goes to Latin America, where we have strong cultural and linguistic affinities. Colombia is the most-used location, with almost 50% of offshore revenues, and Peru is also popular. Other locations include Chile, Morocco and Portugal.

At Comdata, Colombia is the external market we use most for Spain. It’s strongly aligned with Spanish culture, and the government has invested heavily in technology, infrastructure and education, but the cost of operations is still competitive compared to Europe. It’s a very attractive place to locate customer management activities.

Didier Manzari: In the French customer management BPO market, around 37% of turnover comes from offshoring and nearshoring. The most popular location is North Africa; also Subsaharan Africa, and Madagascar and Mauritius in the Indian Ocean.

At Comdata France, we mainly use Morocco, where we have 6000 positions across 6 locations in Casablanca, and Madagascar, where we have 1500 positions at one location. 

Which sectors are commonly offshored?

Pedro: In the Spanish market, the critical mass has been in the ‘traditional’ sectors for customer management outsourcing: telecoms, banking, insurance and energy. However, the use of offshoring and nearshoring is evolving fast; it is becoming more common in sectors such as e-commerce and retail, and more sophisticated in the services offered.

And in France?

Didier: In France, these locations are used across many different sectors. If we look at what Comdata is providing in Morocco for French clients, sectors include e-commerce, insurance, energy, multimedia, telecoms, and deliveries/transportation. The services we’re providing for those sectors include front and back office in sales, customer services, technical support and credit collection. 

What are the benefits to clients and their customers?

Pedro: The cost benefit to clients is huge. It varies from market to market, of course, but you could see cost reductions of up to 50% compared to domestic operations.

It also offers excellent scalability. You have access to very large talent pools – especially if you use locations where the cultural and linguistic affinity, education and infrastructure are strong, such as Colombia.

With Spain and LatAm, there’s also a practical benefit arising from the time difference. Peak time for calls from consumers in e-commerce, food delivery, retail and media tends to be late afternoon or evenings, but this is the morning for our agents in LatAm. It works well for shift patterns and workforce flexibility.

In recent years in some markets like the US, there was a reaction against offshoring. But based on conversations we’re having with decision-makers in Spain, we expect it to increase strongly in 2021 and 2022. It’s the best option for many companies.

And what are the main challenges involved?

Didier: One challenge we face with offshoring is that the employees are mostly generation X and generation Y. They have their own expectations in terms of enjoying their work, getting coaching and feedback, and having their contribution recognized. We have to meet their needs and cater for that in our culture, training and performance management.  

We have a number of great initiatives in place in Morocco, including a ‘happiness manager’ function in our HR department. The fact we have been named three times as a Best Place to Work in Africa demonstrates the effectiveness of our work on this! And we know that if we offer a positive experience to our staff, they in turn offer the same type of experience to customers.

Then, of course, there are the challenges you get with all clients – offshore, nearshore or onshore – how to align clients’ expectations and needs with what you deliver operationally, and how to offer their customers a unique CX that builds loyalty. 

Given the challenges and the benefits, how do you achieve excellence? 

Pedro: It’s crucial to work on cultural affinity. At Comdata, we work intensively on this – through training, virtual communications platforms, e-learning, cultural immersion, and much more.

We also use a lot of data-driven training and insights, using data on customer interactions and touchpoints extracted by our data analytics specialists. And, using that data, our agents in different countries are part of the decision-making process on how we can improve the service for the customers they deal with. This means they are completely engaged with the customers and the clients – something that other companies don't necessarily achieve.

So, people are a huge part of how we achieve excellence, and certainly fuel customer management value creation.

Didier: Another key element in excellence is process. At Comdata, we have standardized our operating model and our main processes, so they are consistent and synchronised across our different markets, whether they are done in France or Morocco or another country. This gives clients great security and confidence about our efficiency and quality.

Then you have technology and innovation. At Comdata, we have recognized skills in technology design and the deployment of tools and analytics, and we are constantly improving on that. That culture of innovation runs right through the company.

So, in short, excellence in offshoring comes from how you blend people, process and technology.

In both Spain and France, we’ve heard you talking about ‘augmented agents’ or ‘augmented advisors’ – how do they fit into the blend of people, process and technology?

Didier: For us, ‘augmented agents’ are advisers who have the opportunity to focus on adding value. They can be offshore, nearshore or onshore. 

We provide them with technology and tools to facilitate their work, and they have the technical skills to use these tools to optimize the customer experience. For example, they can use tools or data to provide personalization and the ‘human touch’, or offer upgrades or advice that build customer loyalty and customer value. 

By upskilling and empowering our staff in this way, we also increase job satisfaction and reduce staff turnover.

Pedro: In Spain too, we are big fans of the augmented agent. Predictive technology is a huge value-add for the customer management and CX industry. In today’s consumer landscape, people want engaging experiences. They want advisers who can personalize the interaction from the first moment. 

The augmented agent is about using automation and AI to really empower the human element in the workforce. Comdata is very strong at that. In providing end-to-end services for our clients, both offshore and onshore, it’s a key differentiator for us.

Considering all that, how can businesses and brands choose between offshore and onshore CMO?

Didier: From the French perspective, the outsourcing sector has evolved considerably over the past decade and some attitudes and preconceptions about offshoring have fallen away in favour of digitalized remote management that transcends borders.

The main points of reflection for our clients are therefore, firstly, whether there are any regulations in their country of origin which require them to keep activities onshore; secondly, whether they are considering activities that are best done domestically (such as VIP or consumer); and, thirdly, the balance between cost and quality, and how that works for their business. 

Pedro: Offshoring and onshoring is not just a question of either / or; it’s more about achieving the best balance between them, looking at budget and long-term value. A client could use Spain for some segments or for a particular line of business; and Colombia or Peru for other parts of the business. And into that mix may also come decisions about the balance between self-service and the human touch or the augmented agent. 

For us, it’s all about understanding what the client wants to achieve, and tailoring solutions that create value for them.

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