There are only two things that the call center industry should look out for this year: automation and outsourcing.

Industry sources interviewed by Computerworld Philippines all agree that automation and outsourcing are the most critical trends that will sweep not just the local but the global contact center market as they will eventually determine the success or failure of companies entering this lucrative venture.

Teledata president Danny Cuevas believes outsourcing will eventually be the rule rather than the exception in the local call center industry. But moving towards managed services won?t come easy, he said.

?In our case, we do have a managed services offering as an option for existing customers who need to rapidly increase capacity,? Cuevas disclosed. ?It is a very viable option considering the faster deployment time and lower upfront cost involved.?

Cuevas said a managed services model is ideal for remote locations, where most Manila-based call centers are placing their additional capacity. ?It is not easy to relocate people, and you can?t always be sure of the skill availability in certain localities. So it?s best to enlist the services of a partner with the technical expertise to monitor and manage your remote site for you,? he pointed out.

Even the Philippine Long Distance Telephone Company (PLDT) is looking into this managed services model through its PLDT On Call offering. With partners such as telecommunications equipment maker Avaya and solutions provider Diversified Technology Solutions International Inc., PLDT can readily build and manage a fully functional call center with lower costs and guaranteed service levels.

?There has been a lot of interest in managed services among operators in the country, but what we really wanted to see are customers actually signing up for this service,? Datacraft president and chief executive officer Sonia Magpily told Computerworld.

Magpily is not expecting local companies to immediately jump into the new service model but she remains confident that as more companies see the real money being generated from a hosted call center operation, customer adoption will pick up.

?Apparently, the operators? wait-and-see attitude towards the managed services model is true not only in the Philippines but in the rest of the world,? she said.

Increased Efficiency

?What operators must quickly realize is that the service model is actually the key to unlocking efficiency in the call center,? said Karina Majid, Customer Interactive Solutions (CIS) general manager. CIS is the call center solutions group under Dimension Data.

Now that offshore contact center operations are sprouting in almost every English-speaking country in the world and costs are drastically plummeting due to competition, Majid believes there will come a time when the Philippines can no longer compete in terms of cost alone. Thus, for the Philippine off-shore call center industry to remain successful, operators should focus on increasing efficiency, she said, stressing that call centers in the country should be performance-driven rather than cost-driven.

Citing figures from a benchmarking report, Majid said the average agent utilization in call centers is just 57%. If contact centers in the country achieve a higher performance rating, the Philippines? place in the global call center industry is already assured, she added.

Most operators cannot readily equate increased efficiency with a ?Call Center On Demand? model, but CIS CEO Andrew Briggs said this managed services model is the shortest route towards automation for many call centers.

?There are actually five levels of managed services: maintenance, monitoring, management, improvement and optimization,? he pointed out. ?It is in the last two stages where the service provider infuses newer technology to improve processes, drive efficiency, and ensure that the call center functions optimally. Deploying technologies to boost productivity and increase performance is the hallmark of automation.?

Self-Service

To reinforce automation?s crucial role in the future of the call center industry, Briggs cited the results of a benchmarking report conducted by Dimension Data from July 2004 to January 2005 showing the increasing trend towards ?self service? in the contact center scenario. Defining self-service calls as ?those that can be completed with minimal agent intervention,? he mentioned three areas where self-service applications could be deployed: Web self-service, interactive voice response (IVR), and speech self-service.

The 2005 Benchmarking Report completed in January this year is a global study of 166 call centers in 24 countries. A research company named Merchants Group, which was eventually acquired by Dimension Data, conducted the survey.

?Self-service technology is predicted to grow by almost 180%, with 6% of centers currently using the technology and 17% planning to use it,? an excerpt from the report read. It also indicated that 60% of call centers today are using IVR and in 20% of all interactions, the caller selects to use IVR. Another important finding is that call resolution through self-service channels (76%) is higher than agent assisted calls (50%).

There is a growing interest in self-service technologies in the industry today because call volumes are increasing at phenomenal rates, Briggs noted. In fact, the study shows that 58% of contact centers are experiencing call volume growth in excess of 20% per annum, with half of these centers registering more than 50% annual call increase.

The only way to handle these calls, apart from putting up additional capacity which readily translates to bigger costs, is to raise efficiency, said Briggs. Using self-service technologies is one surefire way of pumping up efficiency in the call center, he added.

?Let the agents handle the more value-added services, and let self-service technologies handle the more repetitive work,? Briggs suggested. ?Of course, ?self-service? tools should be viewed beyond the technology perspective. It?s more than just technology. It should be a strategy.?

The immediate need for such technologies is fueled by the increasing instances of ?abandoned calls? - an important metrics used by senior executives to measure call center efficiency. Higher abandoned call rates translate to lack of efficiency.

?Customers are expecting their calls to be answered more quickly, and are abandoning when they aren?t,? Briggs bared. Time to abandon calls dropped slightly from 71 seconds in 2003 to 65 seconds this year, resulting in an increase of abandoned call rates from 5.1% in 2003 to 13.3% in 2005.

Workforce Management

Apart from self-service tools, Teledata?s Cuevas said automation in workforce management is one area where most operators in the country are moving into. ?Workforce management solutions have been available ever since. Unfortunately, not many call centers are using it, except for the really big players,? he disclosed.

A workforce management solution provides an automated mechanism for agent scheduling, performance monitoring, call tracking, and overall agent management. Companies who don?t have this solution in place usually plot agent schedules manually - a practice that is not only time-consuming, but inefficient as well.

?Of course, when we talk about emerging technologies from call centers, there?s always IP (Internet Protocol),? Briggs said. ?IP is going to radically change the call center market because the flexibility of IP operators can easily move traffic between call centers, allowing them to service more calls with no additional cost.?

Based on the results of Dimension Data?s Benchmarking report, IP-enabled contact centers account for 20% of survey respondents, a sharp increase from the 6% reported in 2003. Furthermore, another 5% of respondents said they plan to deploy IP-based contact centers within the year.

Unlike Time Duplex Multiplexing systems which are premise-based, IP offers greater flexibility. ?Although it is true that there are cost advantages associated with IP, the real benefit of an IP network is its flexibility,? Briggs pointed out.