Editorial
The Gist:
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Incentives are misaligned. BPOs often limit voice of the customer insights because fewer customer contacts reduce their revenue.
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Transparency reduces calls. Educating customers upfront on product limitations and common mistakes lowers service workload and improves satisfaction.
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Better onboarding pays. Companies that invest in onboarding and just-in-time education see fewer support calls and higher customer retention.
Every company has a voice of the customer process. In many customer service operations, the business process outsourcer (BPO) will collect the basic contact data and then produce the first level of VOC analysis. In many cases, the BPO produces even the more sophisticated VOC analysis; this includes recommendations and action plans.
However, this is often risky because a BPO’s objectives are not necessarily the same as the client company’s objectives. Specifically, many BPOs want to handle more contacts to generate revenue, so prevention reduces revenue and profits.
Client companies and BPOs should recognize that preventing problems through transparency, onboarding and detailed root cause analysis benefits everyone. The company, BPO and customer all win, even if it lowers the monthly bill.
Table of Contents
- Why Service Workloads Stay High
- The Limits of Current VOC Efforts
- What Companies Can Fix
- What Do Marketers and BPOs Push Back on?
- What to Ask Your BPO Partner
- A New Path to Higher BPO Margins
- Aligning BPO and Client Priorities
- Core Questions About Voice of the Customer and BPO Strategy
Why Service Workloads Stay High
Incentive Mismatches Between BPOs and Clients
In most organizations that I’ve evaluated, at least 20% of service workload could be prevented through greater marketing transparency, more effective customer onboarding and clearer directions. However, both the BPO and your sales and marketing function don’t really want more transparency and education. Marketing fears decreased sales, and the BPO fears fewer contacts.
Top Drivers of Preventable Service Volume
Here is a general breakdown of the causes of customer issues and questions. This is based on my analysis of over 1,000 organizations across several decades.
The Limits of Current VOC Efforts
Many voice of the customer outputs are intentionally limited and flawed because the incentives for your company and the BPO are different. Certain types of contacts and issues are reported in a way that makes it difficult to take meaningful action. This is intentional in the same way that corporate marketing and sales functions often avoid mentioning product limitations and fully transparent customer onboarding. Marketing doesn’t really want to be transparent, and they may welcome a murky VOC that lets them off the hook.
Interviews with a dozen BPOs found that most view overcomplicated or misleading marketing as off-limits. Instead, they focus on better apologies and clearer explanations to customers. This also leads to the front line feeling bad when they know the customer was misled up front. This issue occurs beyond just the consumer market.
In leading high-tech and financial services firms, promises on delivery time, uptime, documentation, quality and cost often become pain points. These promises, when unmet, lead to significant customer frustration. In every case, service had to clean up the mess without blaming marketing.
Please note that not all BPOs take the easy route of not challenging the client or marketing. I am personally aware of at least three that will transparently identify and communicate issues, sometimes even estimating customers at risk due to the issue. These BPOs have been able to stop competing on price and compete on quality. They can extract a significantly higher price point due to higher perceived value , which leads to higher satisfaction, lower churn and more valuable, actionable voice of the customer results.
Causes of Customer Service Issues
The following table outlines what I’ve seen in most BPOs and corporate insights processes.
| Causes of issues | Recommended response to issues | Usual BPO action/recommendation | % of workload |
|---|---|---|---|
| 1. Expectations vs. design | Modify marketing and sales promise | Explain but don’t fix; generally blame customer | 10%–15% |
| 2. Flawed process | Redesign process to avoid flawed outcome | General recommendation but no cost of inaction | 5% |
| 3. Process error | Enhance process quality | Specific fixes focused on team | 10%–20% |
| 4. Customer errors/laziness | Product simplification and aggressive onboarding | General education, but not enough JIT education or actionable onboarding | 30%–40% |
| 5. External factors | Uncontrollable | Apologize and explain | 10%–20% |
BPOs tend to offer vague, inactionable analysis for the first, second and fourth causes. Sales and marketing resist changing the first two, while clear education and onboarding could prevent the calls in the fourth category. Category five is usually mentioned only in fine print and footnotes.
Missed Opportunities in Customer Education
Upfront education on the most common issues can reduce dissatisfaction and contacts dramatically. For example, when customers learned through onboarding videos that satellite internet is affected by weather, related calls dropped sharply.Related Article: 3 Strategies for Successful Customer Onboarding Compliance
What Companies Can Fix
Getting to the Root of Customer Questions
Look at the types of questions customers are asking and determine the root causes. Support from a quality or continuous improvement team can be valuable. Tools like the Fishbone diagram and the Five Whys method can uncover the root causes of customer problems. What percentage of contacts are due to misunderstandings and incorrect expectations? What percentage are due to customer errors?
Once the granular areas of confusion are identified, the company can eliminate them through product redesign or enhanced onboarding and education. For financial services, this can include JIT popups explaining a transaction or decision. Here are some examples of effective onboarding.
Amazon was able to move the service calls they received from one per 100 orders to one per 10,000 orders by analyzing the root cause of every call. They used Fishbone diagrams and Failure Mode Effects Analysis to achieve this.
An insurance company highlighted the top three issues that surprised consumers in their welcome letter. Knowing the welcome letter was coming, the agents carefully educated people on those issues. Further, consumers bought riders to cover some of those issues. Calls on those three losses declined dramatically. The recommendation to highlight top customer surprises did not come from the BPO. They preferred to handle all the long calls, while the internal voice of the customer process asked what was preventable and took action.
Likewise, a benefits insurance company educated 100 clients on the top ten mistakes they made when adding or removing employees to the benefit package. After the education, calls from the educated companies declined by 30%, and the clients reported service quality had gone up.
What Do Marketers and BPOs Push Back on?
Objection from marketing: Transparency will damage sales, and customers will shop competitors if they’re told of price rises earlier.
Response: Transparency increases trust and willingness to pay a premium. Usually fewer than 5% of customers abandon the sale, but those that remain churn less and are much happier. Also, transparency builds positive word of mouth, which helps win new customers who are significantly less price sensitive.
Objection from BPOs: Transparency and intensive onboarding will reduce calls and accompanying revenue.
Response: Transparency will reduce some customer contacts. However, the BPO can earn more by providing intensive onboarding that improves product value perception, reduces churn and increases satisfaction. All this allows the BPO to charge a premium for its services.
Prevention Over Call Volume
Two BPOs provide practical examples of prevention through enhanced transparency and customer education.
“It is one of our core principles to work with our clients to reduce unnecessary volume by reviewing all customer dispositions reported by the VOC and finding solutions of how to better communicate information before customers contact,” said Othmar Mueller von Blumencron, CRO of VIPdesk. “We have done this successfully with most clients, including cosmetics and a leading baby monitor supplier. We also like to report or at least dotted line report to marketing for precisely the purpose of transparency.”
Meanwhile, Ibrahiem Atshan, VP of ACC Premiere, said, “We are committed to transparent client partnerships in which we identify unrealized cost savings and process efficiencies, even when the impact will reduce our monthly billing. We value the long tenure of those relationships over short term transactional costs.”
He shared several examples. “First, complaint information about a dispensing device was enhanced using a CSR focus group and related to quality, marketing and product design. Likewise, an issue with product use by disabled customers was expanded upon by disabled reps in the contact center leading to changes in the product and marketing messages. Finally, diverse feedback on sponsorship during pride month was encouraged, the full range of feedback including those who disapproved could communicate with a dedicated website that went directly to brand marketing and the c-suite.”
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What to Ask Your BPO Partner
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For the full range of issues you’re handling, which could be prevented if we did something different in product design, marketing, sales or operations? Expect the BPO to flag at least 10% of their workload or they are probably not being candid.
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What are two no-brainer contacts you are handling where effective quick-start communication could eliminate those issues?
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Can you (with the support of your front line CSRs) help us develop 60 to 90 second videos to enhance our customer’s understanding and use of the product?
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What are three complex processes that customers are required to complete where just-in-time education would eliminate the need for contact? Alternatively, can part of the process be simplified or removed?
A New Path to Higher BPO Margins
Experimenting With Customer Education
Don’t just stress cost and operational quality. Do an experiment where you educate customers and track their satisfaction, churn, value for price paid and service workload. Make delight intentional.
Provide consultation and thought leadership on prevention and customer education/onboarding. Create an onboarding service as a new product offering.
Offer to pilot test preventive fixes at the issue level. For example, if a company is getting pushback on higher prices, experiment with different response guidance and proactive communications with customers through quasi-controlled experiments. Amazon does 10,000 A/B tests a year. Work with your BPO and client continuous improvement (CI) teams to build the business case for quality to the CFO.
Related Article: Improve CX With AI-Enabled Customer Onboarding
Aligning BPO and Client Priorities
Fixing the VOC Disconnect
BPO and client objectives are often not congruent. Client companies must evaluate whether the VOC produced by the BPO addresses the opportunities in transparency and onboarding. Preventing issues at these stages is vital.
Core Questions About Voice of the Customer and BPO Strategy
Editor's note: Key questions customer experience leaders are asking about aligning BPO partnerships with transparency, onboarding and VOC goals.
They must agree on shared incentives that prioritize issue prevention, not just volume handling. BPOs should be rewarded for reducing contact drivers.
Use welcome letters, JIT education and onboarding videos to address top confusion points. Transparency early in the journey builds trust and reduces contacts.
Ask what portion of calls could be prevented and request concrete examples. Push for collaboration on education experiments and quality feedback loops.
Many VOC programs are shaped to protect internal politics or vendor relationships, limiting transparency and ignoring root causes.
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