The Consultant's Desk

The Consultant's Desk
Poring over the details on your behalf

Saturday, August 16, 2008

Outsourcing Considerations

Sometimes one small thing is the reason a great function will fail. Some of us remember the Challenger's fatal take-off. The ship, all of its crew and cargo were lost on the lift-off pad because of one loose screw. And the screw was left loose because there was no double check and no one thought it was that big of a deal. But it's the small things that are the fly in the pudding.

A fellow commuter was having more than the usual difficulties this weekend because his Transit Access Pass ("TAP") card wouldn't be accepted. He'd just loaded it with sufficient funds to last through Monday. Still, the card was repeatedly rejected on the last bus he attempted to ride. He had to debark and was determined to test the card on another bus.

However, while waiting for the next bus, he made several calls, one to the company that produces the TAP cards and then to Metropolitan Transit Authority ("MTA") Customer Service.

What the commuter learned was MTA outsources production and maintenance of the TAP system to a vendor. That vendor does not have Customer Support on weekends nor during evening hours but MTA passengers commute at those times as well as during normal business hours. Since it was the weekend, the commuter had no one to turn to at the vendor’s office in order to gain information, support, and solutions. He called MTA's Customer Support as an alternative.

It was admirable how well the man handled each phone call. He asked critical thinking questions of each person with whom he spoke and then asked logical follow-up questions to ensure he had all of the correct information. But MTA did not have good news for him. Their Customer Support is not associated with the vendor and could not step into the vendor's shoes in order to remedy the customer's problem with the card.

This was proving to be a very frustrating situation for the customer. He needed assistance, he required instructions on how to remedy his state of affairs, and there was no one available during these "off hours" who could competently provide that support.

While MTA may have outsourced their TAP program and maintenance to this vendor for a really great up-front price, the costs of having MTA Customer Support explain to passengers that there is no support available during evenings and weekends for TAP need to be factored back into the cost equation. Another cost that needs to be factored back in is the cost of lost revenues from false rejections. And that in turn requires factoring in the cost of lost customers and goodwill. In the long run, this outsourced service could be extremely costly.

This shows us that even though we're busily thinking about the most cost effective way of doing business and saving dollars that can ultimately be passed on to customers in the form of lower prices, we also need to take into consideration when our customers will be using the product or service and whether they will be able to get support when they need it – not at the vendor's convenience.

You may want to add that to your checklist of questions:

"Do you have customer support for this product/service?"

"Is the support 24/7? If not, when is it available?"