First, his company last year outsourced IT services for a small part of its operations -- some call center applications. Now Peters is testing a program that could allow all of his 55 call center employees to work from home.
Peters said last week that if both initiatives go as planned, he thinks he can reduce the cost of booking and processing a reservation by about 35 percent for Outrigger Hotels. The chain is a division of Outrigger Enterprises Inc., which operates 51 hospitality properties throughout the Pacific Rim. Not an Easy Choice
Outsourcing wasn't an easy step for Outrigger, Peters said. He spent more than 18 months researching his options before hiring Echopass Corp., a Pleasanton, Calif.-based application service provider (ASP) that hosts call center technologies for the hotel chain's reservation systems.
Peters said the outsourcing move has allowed the company to eliminate some in-house functions, such as live-chat administration duties that are now handled by Echopass. "The ASP models have really come into their own," he said.
Outrigger's use of an outsourcing vendor for a single IT process mirrors a broader shift away from large, comprehensive IT services deals, according to a report issued last week by Technology Partners International Inc. Increasingly, users are opting to outsource limited operations, such as their help desks, said Peter Allen, managing director at Houston-based TPI.
In its report, the research firm said 293 outsourcing contracts valued at US$50 million or more were awarded worldwide last year, up from 269 in 2004. Despite the increase in the number of such deals, TPI said the total value of commercial outsourcing contracts declined to $75 billion last year, down from $78 billion.
The drop-off was a result of savings from contract restructurings and terminations and the trend toward smaller contracts, Allen said.
Through telecommuting, Outrigger hopes to lower costs by making it easier to add part-time call center workers during busy periods, Peters said. In addition, the company expects that the ability to work at home will help reduce employee turnover rates.
Since November, Outrigger has had four employees working from home on PCs that can be used only for call center work. By next year, Peters wants to be able to offer work-at-home options to all of Outrigger's call center employees, once legacy applications running on back-end systems can be accessed via the Web.
Nationally, there were about 112,000 home-based customer service representatives working for call center services firms last year, IDC analyst Stephen Loynd said in a report released this month. That figure should increase by about 20 percent annually, he predicted.
Although IDC tracks call center workers only in the outsourcing market, Loynd said he thinks that companies with internal call center staffs are providing home-based work options at similar levels.