22 January 2004 | Simon Binns
Businesses outsourcing call centre operations to India risk damaging their brands and losing customers through poor service, according to a new report.
A review of UK and Indian call centres, carried out by research firm ContactBabel, shows that although labour costs for staff in India are only one-ninth of those in Britain, UK staff answer 25 per cent more calls per hour and resolve 17 per cent more inquiries first time around.
ContactBabel is one of three companies commissioned by the Department of Trade and Industry to investigate how UK firms can fight foreign competition. Its report comes as more firms announce offshore moves.
Last week, insurer Axa and bank Abbey announced they were transferring hundreds of jobs to Bangalore.
But Steve Morrell, principal analyst at ContactBabel, said the trend to outsource call centres was based only on cutting costs.
"In manufacturing, you get pretty much the same shirt, wherever it is made," he said. "When it comes to customer service, you're talking about quality. If people are saying they're moving call centres to India for any reason other than cost, they're liars."
Average starting salaries for Indian call centre agents are between £1,500 and £11,500 less than their UK counterparts.
Morrell added that there could be a backlash against companies that outsource. Some British companies could make a point of advertising that their facilities hadn't been outsourced, he said.
Mutual provider Nationwide has announced that it intends to create 180 UK call centre jobs by 2006 and has no plans to outsource to India.
Philip Williamson, its chief executive, said: "Nationwide is a mutual with strong links to the communities we operate in. We have no plans to desert them. Retaining customers is as much to do with our people and the service they offer. Call centres are at the heart of our offering."