Mainly because it’s just not very profitable for them anymore:
Americans, it seems, hate calling a help desk or customer service number to find an Indian on the line. Well, guess what, America? India doesn’t particularly want to talk to you, either. As India’s top companies get more sophisticated at taking over outsourced work from U.S. and European multinationals, they’re finding that the lowest end of the business—call centers—just doesn’t pay anymore. “Call centers have become commoditized,” says B. Ramalinga Raju, chairman of Satyam Computer Services Ltd.
Like almost everyone, Indian operators dislike dealing with abusive customers frustrated by shoddy service. But more important, India’s leading outsourcing shops say their U.S. corporate clients continually try to ratchet down prices, which inevitably drives down the quality of service they can provide. So lately, Indian outsourcers have begun turning down call center contracts, preferring better-paying deals for processing mortgages, handling insurance claims, overseeing payrolls, and more.
That doesn’t mean India won’t be doing call center work anymore. But outsourcing powerhouse Tata Consultancy Services Ltd., for instance, has turned away potential clients offering call-center-only work. “We are thinking about whether this is work we really want to do,” says TCS Executive Vice-President Phiroz Vandrevala. At Satyam, just 35% of business process outsourcing employees are in call centers, down from 60% 18 months ago, Raju says. “We try to get into call centers only when it’s in association with other business,” says Raju. And New Delhi-based EXL Services annulled a help desk call center contract with Dell Inc. because EXL was losing money on the deal. In April, 2005, EXL asked Dell to take back that business, but it kept other contracts such as one under which EXL operators call Dell customers to remind them to make loan payments. Dell officials in India didn’t respond to a request for comment.
SEB reader Michi, who sent me the link to the news item, sums it up in this way:
- “Hey, we already pay the tech support drones next to nothing, but I’ll bet we could do it even cheaper….”
“I know! Let’s fire everyone and move our call centre to India!”
“Great! But… wait…. what about when they learn everything about our business from us and then decide they don’t need us anymore?”
“Don’t be silly, that’s never happen.”