ovum decision matrix: selecting a home-based outsourcing ...€¦ · ovum decision matrix:...
TRANSCRIPT
Ovum Decision Matrix: Selecting a Home-Based Outsourcing Vendor, 2014–15
Publication Date: 25 Sep 2014 | Product code: IT0019-003363
Peter Ryan
Ovum Decision Matrix: Selecting a Home-Based Outsourcing Vendor, 2014–15
Summary
CatalystThere has been significant interest in alternative contact center outsourcing delivery models among
enterprises over the past decade. The work-at-home agent option, in which front-office BPO is
delivered by team members that work out of their residences, has grown in popularity due to its ability
to provide high-quality domestic customer service at price points somewhat lower than could be
achieved in bricks-and-mortar facilities. However, with confusion lingering in the current market
around vendor offerings, it remains a challenge for many prospective clients to determine an
appropriate solution. This Ovum Decision Matrix provides a roadmap for enterprises across verticals
to select from the leading providers of home-based contact center services, given the current state of
the market.
Ovum viewDetermining the right home-based contact center outsourcing services vendor is not easy and
requires a significant amount of due diligence. This is largely because this offering is extremely
commoditized, with limited differentiation among vendors in terms of the features of their respective
virtualized services. Enterprises looking for a home-based outsourcing vendor should evaluate how
players in this space execute (and have executed) contracts, in addition to their respective magnitude
in the virtual contact center delivery market. The ongoing debate about employee-based providers
versus those that use independent contractors has had a limited impact on the vendors assessed.
However, one aspect of differentiation that has emerged is the increasing presence of
bricks-and-mortar firms operating in the home-based contact center market, and the advantages that
these companies can bring in the form of existing contact center operational processes, geographic
presence, and certifications. Ovum believes that these bricks-and-mortar firms are likely to shake up
the established pure-play vendors over the long term, as outsourced home-based agents increase in
popularity as part of a broad enterprise contact center strategy.
Key findings The features offered by leading home-based agent vendors are highly commoditized, with
little differentiation across service lines.
There is limited geographic reach beyond North America among most vendors of home-based
agent services.
Vertical presence and expertise is a key differentiator for providers of work-at-home services.
Enterprises can expect a varied degree of contact channel and horizontal experience from
leading players in the home agent market.
© 2014 Ovum. All rights reserved. Unauthorized reproduction prohibited. Page 2
Ovum Decision Matrix: Selecting a Home-Based Outsourcing Vendor, 2014–15
Vendor solution selection
Inclusion criteriaMany firms provide home-based agent outsourced contact center services. However, for the purposes
of this Ovum Decision Matrix, the following inclusion criteria were applied to vendors:
A proven track record of home-based outsourcing delivery – Each vendor had a history
of providing (and currently provides) home-based contact center services.
Scale – Contact center outsourcers had a minimum level of revenue to demonstrate their
scale.
Confirmation of participation – Each vendor needed to provide Ovum with the relevant data
and qualitative information necessary to thoroughly assess their offering.
MethodologyFeatures assessment
In this assessment, Ovum uses a checklist of features and functionalities to differentiate between the
leading vendors in the marketplace. The assessment criteria for home-based agent outsourcing are
as follows:
Agent monitoring/security – How a contact center outsourcing vendor monitors agent
activity and creates a working environment that secures end-user information.
Workforce management / scheduling – How the contact center outsourcer manages its
work-at-home labor force.
Team communication capabilities – The ability of the outsourcer to facilitate inter-team
communication, as well as communication between agents and their supervisors.
Training – How outsourcers train their home-based agents.
Hiring – The manner in which outsourcers recruit top-quality agents for their work-at-home
deployments.
Certifications – Assesses which vertical or client certifications outsourcers provide to their
clients.
Pricing models – Which pricing mechanisms outsourcers can offer clients, ranging from
time-based mechanisms to pay-for-performance.
Supported agent equipment – Assesses the different devices and technologies that
outsourcers support in their customer-facing activities.
Workforce optimization – The various provisions that an outsourcer has in place to ensure
ongoing improvements in their delivery of home-based contact center activity.
Execution
In this dimension, Ovum reviews the capabilities of home agent contact center outsourcers around the
following key areas:
Maturity – The stage that the service is currently at in the maturity lifecycle, relating to the
maturity of the overall deployment of home-based agents.
Vertical expertise – The industry-specific capabilities of vendors.
© 2014 Ovum. All rights reserved. Unauthorized reproduction prohibited. Page 3
Ovum Decision Matrix: Selecting a Home-Based Outsourcing Vendor, 2014–15
Functional expertise – The horizontal capabilities of contact center outsourcers using the
home-based model.
Channel expertise – The extent to which outsourcers are able to provide home-based
contact center outsourcing services across voice and non-voice contact channels.
Geographic expertise – The experience of contact center outsourcers in providing
home-based agents across different countries/regions.
Virtualized delivery – The extent to which home-based agent vendors provide their services
virtually to their clients.
Agent profile – The type of agents that are being recruited by home-based outsourcers and
the relevant experience that they bring.
Management experience – The tenure of executives guiding home-based agent vendors in
terms of their experience working in this CRM space.
Market impact
In this dimension, Ovum assesses the global market impact of home-based agent providers. Market
impact is measured across seven categories, each of which has a maximum score of 10. For the
purposes of this section, all market data used was from FY 2013.
Revenues – Each vendor’s global home-based revenues are calculated as a percentage of
the market leader's. Overall global revenue carries the highest weighting in the market impact
dimension.
Regional penetration – Ovum determines each vendor’s revenues in four countries/regions:
the US, Canada, Western Europe, and Asia-Pacific.
Vertical penetration – Ovum determines each vendor’s revenues in the following verticals:
energy and utilities; financial services; healthcare; life sciences; manufacturing; media and
entertainment; professional services; public sector; retail; wholesale and distribution;
telecommunications; and travel, transportation, logistics, and hospitality.
Horizontal penetration – Ovum determines each vendor’s revenues in the following
functional areas: customer care; sales and marketing; technical support; non-voice support;
social media; and other.
Channel penetration – Ovum determines each vendor’s revenues from the following contact
channels: voice; email; social media; web-chat; video-chat; SMS; and other.
Language penetration – Ovum determines each vendor’s revenues in the following
languages: English; Spanish (US); Spanish (European); French (Canada); French
(European); German; and other.
Size-band coverage – Ovum determines each vendor’s revenues in three company size
bands: large enterprises (over 5,000 employees), medium-sized enterprises (1,000–4,999
employees), and small enterprises (fewer than 1,000 employees).
Ovum ratings Market leader – This category represents the leading home-based agent vendors that Ovum
believes are worthy of a place on most enterprise selection shortlists. The vendor has
established a commanding market position with a service and record that are widely accepted
as best-of-breed.
© 2014 Ovum. All rights reserved. Unauthorized reproduction prohibited. Page 4
Ovum Decision Matrix: Selecting a Home-Based Outsourcing Vendor, 2014–15
Market challenger – The vendors in this category have good market positioning and are
selling and marketing the product well. The services offer competitive functionality and a good
price-performance proposition, and should be considered for selection.
Market follower – Vendors in this category typically meet the requirements of a particular
kind of customer. As tier-one offerings, they should be explored as part of the selection
process.
Market and service analysis
Ovum Decision Matrix: home-based agent outsourcing, 2014–15There is significant reason for this report to be published at the mid-point of 2014. The demand for
home-based contact center services delivered by third parties continues to grow at a rate exceeding
that of the overall bricks-and-mortar outsourced CRM sector (as per Ovum’s recent report The Future
of Home-Based Agent Outsourcing, IT019-003295), and interest in this business model continues to
gain traction among enterprises across industries and regions.
A number of factors are pushing enterprises in the direction of home-based outsourcing. The most
important include the business model’s reputation for high-quality customer care (due to more
educated and sophisticated agents), lower operating costs due to home agents having fewer
overheads than a contact center facility, and lower rates of agent attrition. Figure 1 depicts the
vendors of work-at-home contact center services that Ovum has classified among the market leaders,
challengers, and followers.
Figure 1 shows the solutions clustered together in the full-scale Ovum Decision Matrix for features
(x-axis), execution (y-axis), and market impact (size of bubble). This figure shows clearly the extent to
which the players offering home-based agent solutions are offering competitive and comparable
solutions. Thus, Figure 2 zooms in on the cluster of vendors in Figure 1 to get a closer look at their
positions.
© 2014 Ovum. All rights reserved. Unauthorized reproduction prohibited. Page 5
Ovum Decision Matrix: Selecting a Home-Based Outsourcing Vendor, 2014–15
Figure 1: Ovum Decision Matrix: outsourced home-based CRM services 2014–15
Source: Ovum
Figure 2: Ovum Decision Matrix: outsourced home-based CRM services 2014–15
Source: Ovum
Table 1: Ovum Decision Matrix: home-based contact center outsourcers, 2014–15
Market leaders Market challengers Market follower
© 2014 Ovum. All rights reserved. Unauthorized reproduction prohibited. Page 6
Ovum Decision Matrix: Selecting a Home-Based Outsourcing Vendor, 2014–15
Arise Convergys Sutherland
Sykes LiveOps
Working Solutions (WS) Sitel
Teleperformance
West
Source: Ovum
Market leaders: Arise, Sykes, Working SolutionsThere are three standout market leaders in the domain of home-based agent outsourcing, namely
Sykes, Working Solutions, and Arise. It is important to note that the field of competitors analyzed for
this report was very strong, and in many cases rankings among all nine were tight due to intense
competition having brought about very strong offerings for all players. However, the three firms
mentioned above stand out across all three categories used for the purposes of this Decision Matrix.
This result will be no surprise to any industry watcher of the contact center space. Each of these
leaders has been providing home-based contact center services for some time, allowing them to
perfect their craft and develop best-in-class business models.
Market challengers: Convergys, LiveOps, Sitel, Teleperformance, WestOvum has identified five market challengers among the home-based agent vendors analyzed in this
report. These challengers are Convergys, LiveOps, Teleperformance, Sitel, and West. Each of these
five organizations falls into this category for different reasons, but it is clear that "challenger" is an
appropriate term, as these five vendors provide intense competition in the virtual-based services
market. It is also significant that four out of the five vendors in this category are bricks-and-mortar
contact center outsourcers that, at various points, have decided to take on the delivery of virtualized
CRM services, providing very strong competition to the pure-play operators. LiveOps, the pure-play
virtual vendor among the five challengers, has a longstanding and respected reputation among both
competitors and enterprises.
Market follower: Sutherland Global ServicesSutherland Global Services is the one market follower in this year’s Decision Matrix. Although
Sutherland’s work-at-home solution has many of the same features as its competitors, it is not as
developed, and its presence in the virtual agent market is much more limited. This has had an impact
on its rankings. However, Sutherland intends to place much greater emphasis on developing and
growing its virtual agent service in the future. If this is handled properly, it should change the vendor’s
classification when this document is refreshed.
© 2014 Ovum. All rights reserved. Unauthorized reproduction prohibited. Page 7
Ovum Decision Matrix: Selecting a Home-Based Outsourcing Vendor, 2014–15
Market leaders
Market leaders: featuresFigure 3: Ovum Decision Matrix: outsourced home-based CRM services 2014–15, market leaders – features
Source: Ovum
In terms of overall market leaders, Ovum has identified Sykes, Working Solutions, and Arise as the
vendors that are setting the standard for home-based contact center outsourcing services. However,
all nine companies examined for this Decision Matrix performed strongly in the features category, with
very limited difference between players in some cases, speaking to the highly commoditized nature of
this industry.
Sykes clearly benefitted from its 2012 acquisition of Alpine Access, which boosted its home-based
offering tremendously (see Ovum’s opinion "Sykes buys Alpine Access: consolidation of home agent
outsourcing space begins"). The results of this year’s Decision Matrix are proof of this, given that
Sykes was listed among the top three vendors in a number of features categories, most notably in
agent monitoring/security, hiring, and certifications.
Working Solutions was also a leader in the features category, which is unsurprising given the
Dallas-based firm’s longevity in this delivery model. Similar to Sykes, Working Solutions was included
among the top three vendors in six categories, faring especially strongly in agent monitoring/security
and workforce optimization.
Arise’s performance in the features category was solid, featuring strongly in three categories: pricing
models, workforce optimization, and agent equipment supported. Interestingly, West Corporation (a
long-time vendor in this space) emerged in the features section as a very strong competitor, featuring
among the top three in five separate categories. LiveOps also performed well in terms of features
offered, placing among the top three vendors in a number of categories, including workforce
© 2014 Ovum. All rights reserved. Unauthorized reproduction prohibited. Page 8
Ovum Decision Matrix: Selecting a Home-Based Outsourcing Vendor, 2014–15
optimization and workforce management/scheduling, which is not surprising given the length of time
this firm has been providing home-based agent solutions.
Market leaders: executionFigure 4: Ovum Decision Matrix: outsourced home-based CRM services 2014–15, market leaders – execution
Source: Ovum
There was some degree of consistency between vendors that ranked as the leaders in the execution
and features categories. Specifically, Sykes once again emerged as one of the top players examined
in this report by counting among the top three vendors in four categories: maturity of offering,
functional expertise, channel expertise, and agent profile. This should come as no surprise
considering the synergies that Sykes was able to achieve through the merging of its home-agent
offering with that of Alpine Access in 2012.
Working Solutions also performed strongly in the execution category, again playing to its strength as a
long-time vendor of home-based agent services. Specifically, Working Solutions was very solid in
vertical, function, and channel capabilities, coupled with a strong showing in virtual delivery and the
tenure of its leadership.
LiveOps was strong in the execution category, which is logical considering the amount of time that it
has been providing home-based contact center services. The firm was included among the top three
in five categories, including maturity of offering, vertical expertise, virtualized delivery, agent profile,
and management tenure. Arise rounded out the top players in this category, ranking in the top three
for maturity of offering, vertical expertise, agent profile, and virtual delivery.
© 2014 Ovum. All rights reserved. Unauthorized reproduction prohibited. Page 9
Ovum Decision Matrix: Selecting a Home-Based Outsourcing Vendor, 2014–15
Market leaders: market impactFigure 5: Ovum Decision Matrix: outsourced home-based CRM services 2014–15, market leaders – market impact
Source: Ovum
Market impact analyses the extent to which a particular vendor is influencing the home-based agent
space, based on its overall presence. The virtual agent space is still relatively immature compared to
the bricks-and-mortar business model, so competitors in this study were quite varied across the
various components of this category.
Arise was the clear leader in the market impact section, counting itself among the top three vendors in
several components, which speaks to the volume of business that the firm currently turns over,
coupled with its reach in different locations, functions, channels, and languages.
Working Solutions and Sykes also fared quite well in the market impact category, placing among the
top three vendors in six of the seven categories. Working Solutions’ only shortfall was in regional
revenue diversity, while Sykes narrowly missed being in the top three in the horizontal section.
© 2014 Ovum. All rights reserved. Unauthorized reproduction prohibited. Page 10
Ovum Decision Matrix: Selecting a Home-Based Outsourcing Vendor, 2014–15
Vendor analysis
Arise – Ovum recommendation: leaderFigure 6: Arise radar diagrams
Source: Ovum
Arise is ranked as a leader in this year’s outsourced home agent Ovum Decision Matrix. One of the
most important reasons for this ranking is its market presence, with it posting the highest revenues
among the companies examined in this report. This is very important for enterprises that remain wary
of the overall financial health of the outsourcers with which they engage (see Ovum’s most recent
CRM Outsourcing Business Trends 2014 report), especially those competing in relatively immature
business models, such home-based agent delivery. Stability via revenue strength was re-enforced by
Arise’s relatively low level of agent attrition, which means lower costs related to recruitment and
training, coupled with higher long-term standards of customer service delivery. In addition, Arise has
been in the home-based delivery market for well over a decade, providing references in terms of
existing clients and proof of concept as a proven vendor in this space.
Arise performed well across all features of its home agent offering, with the firm placing well ahead of
its competition in most categories. However, Arise has fewer certifications than other players in this
space (a number of the pure-play outsourcers are in the same position), and this could prove
problematic for prospective clients in verticals that have heavy compliance requirements with regard
to their third-party contact center delivery engagements.
© 2014 Ovum. All rights reserved. Unauthorized reproduction prohibited. Page 11
Ovum Decision Matrix: Selecting a Home-Based Outsourcing Vendor, 2014–15
Ovum believes that there are a number of good opportunities for Arise as a home-based outsourcing
vendor. The clearest one is regional diversification: Arise has been among the most pro-active
virtualized outsourcers to push into Canada and Western Europe, locations where there is growing
interest in this business model. Arise has also placed an emphasis on growing its revenues and
capabilities in multichannel delivery (including social media), which will likely provide an opportunity as
more home-based clients and prospects aim to consolidate more non-voice work with agents using
this business model.
Convergys – Ovum recommendation: challengerFigure 7: Convergys radar diagrams
Source: Ovum
Convergys brings a number of strengths to the table, making it a challenger in the home-based agent
marketplace. One of the most obvious but compelling strengths is Convergys’s reputation as a
broad-based provider of contact center services and technology. This is a tremendous advantage
when prospecting business from in-house contact center managers that may not be familiar with the
home-based agent business model, but which will likely be aware of Convergys’s brand presence in
the CRM marketplace. Another strength of Convergys’s home agent offering is the functional diversity
it provides to existing and prospective clients through its solid experience and magnitude across not
just customer service, but sales and marketing and technical support as well. Being able to provide
some hub-and-spoke capabilities alongside its virtual capacity is also a strength for Convergys,
especially when seeking new business among enterprises that may wish to begin their home-based
agent experience with less of a virtual focus at the outset. Feature-wise, Convergys places well
© 2014 Ovum. All rights reserved. Unauthorized reproduction prohibited. Page 12
Ovum Decision Matrix: Selecting a Home-Based Outsourcing Vendor, 2014–15
against its competitors in almost all categories, and the investment that Convergys has made in its
training platform, which can be applied both virtually and in-person, is a noted area of strength.
Convergys has a clear opportunity to leverage the broader company’s presence in emerging
work-at-home regions (such as Canada and Western Europe), a factor that has potentially been
enhanced by the acquisition of Stream Global Services at the outset of 2014. Convergys’s name and
reputation in non-US locations will help sell not just virtualized CRM contracts, but the concept of
work-at-home as an acceptable way of providing customer support. Convergys also has an
opportunity to use the expertise found in the broader organization to build out its ability to deliver
work-at-home agents across industries, non-voice channels, and emerging horizontals. Ovum will be
watching how Convergys diversifies its presence in more vertical markets, as a large proportion of its
business is currently concentrated on a limited number of sectors (with particular strength in retail and
telecoms). However, within Convergys’s current work-at-home vertical mix, it is performing a wide
swath of horizontal functions, a strength that it can readily leverage when attacking other industries
with its home-based offering.
LiveOps – Ovum recommendation: challengerFigure 8: LiveOps radar diagrams
Source: Ovum
LiveOps is one of the most established pure-play home agent outsourcers, and it brings a number of
strengths to the table for existing and prospective customers. LiveOps offers a clear advantage in
horizontal delivery, with a very diverse mix of expertise and experience across customer care, sales
© 2014 Ovum. All rights reserved. Unauthorized reproduction prohibited. Page 13
Ovum Decision Matrix: Selecting a Home-Based Outsourcing Vendor, 2014–15
and marketing, and technical support; going forward, being able to move beyond customer care will
be an essential element for any home-based vendor to win new contracts. From a vertical
perspective, LiveOps’s industry expertise in retail, financial services, and healthcare plays to its
advantage, as does its experience in other smaller (yet emerging) sectors.
LiveOps also performed strongly in the features category notably with its agent monitoring/security
service, which ranked well, due to its end-to-end nature emanating from the agent login point to the
storage of data. LiveOps also meets higher certification levels than its pure-play competitors, a clear
advantage when aiming to win contracts with enterprises that place a heavy emphasis on compliance.
Ovum believes that LiveOps is wise with its strategy to increase the diversity of its horizontal delivery
capabilities, which will serve the firm well in a space in which more clients and prospects are
interested in using this business model to handle more than just basic customer care. If LiveOps can
build on its success so far by moving into emerging channels (including non-voice and social media),
it will be in a position to lead the work-at-home industry in terms of best-in-class horizontal delivery.
However, LiveOps should look to expand the weighting of its vertical footprint and expand into regions
outside the US, while ensuring that its work-at-home offering is not overshadowed by its parallel
platform CRM offering in order to reduce market confusion about the company’s emphasis.
Sitel – Ovum recommendation: challengerFigure 9: Sitel radar diagrams
Source: Ovum
© 2014 Ovum. All rights reserved. Unauthorized reproduction prohibited. Page 14
Ovum Decision Matrix: Selecting a Home-Based Outsourcing Vendor, 2014–15
Sitel has been rated as a challenger among the work-at-home players evaluated in this Decision
Matrix. It brings with it a number of strengths, the first of which is very strong brand recognition
(similar to Convergys and other global bricks-and-mortar operators offering home-based services). As
an outsourcer with a broad offering of CRM services, Sitel is well placed to provide clients with
work-at-home services as either a standalone solution or as part of a broader offering. Equally notable
is the strong growth that Sitel’s home-based delivery offering has recently experienced: in the first
nine months of 2013, the firm doubled the size of its virtual workforce, a clear indication that its
virtualized solution is gaining attention in the marketplace. Sitel also deserves recognition for its
vertical expertise using virtual agents, which is pronounced in non-traditional adopters of this business
model, such as travel and tourism, and media. The features that Sitel offers are consistent with the
other vendors evaluated for this report.
The largest challenge that Sitel has to address is its limited market presence in the work-at-home
space. Notwithstanding the rapid growth that Sitel has reported over the past several months, its
overall size in the broader market is still relatively small compared to many of its competitors. In
addition, Sitel’s revenues are heavily weighted toward customer care and voice-based services,
meaning it has yet to carve out a presence in higher-value areas such as non-voice work and other
horizontal functions.
Sitel has a real opportunity to build on its growth to date by leveraging its broader cross-company
expertise to help develop work-at-home services tailored to emerging vertical markets, functions,
regions, and channels. The lack of functional and channel diversification remains a weakness for
Sitel, but by taking advantage of the company’s presence as a leading provider of bricks-and-mortar
services across market segments, its work-at-home business could be enhanced and made attractive
to firms beyond its current client demographic.
© 2014 Ovum. All rights reserved. Unauthorized reproduction prohibited. Page 15
Ovum Decision Matrix: Selecting a Home-Based Outsourcing Vendor, 2014–15
Sutherland – Ovum recommendation: followerFigure 10: Sutherland radar diagrams
Source: Ovum
Ovum has ranked Sutherland’s home-based agent offering as a follower in this report. One of the
primary reasons for this is its market presence: despite its reputation as a leading provider of BPO
services, Sutherland is relatively small as a vendor of home-based contact center outsourcing, posting
the lowest revenues among all the outsourcers examined in this brief, with the overwhelming bulk of
revenues coming out of the US (albeit with a growing presence in Canada).
Sutherland’s deployments are heavily concentrated in a small number of vertical markets, which could
be a limiting factor when going after business in other sectors in terms of industry-based references.
However, Sutherland maintains a relatively large presence in the emerging healthcare segment, a key
industry target for home-based vendors. In addition, Sutherland’s channel deployments are currently
weighted heavily toward voice, and for the vendor to emerge as a challenger or leader in future
Decision Matrices, it is essential that it places a greater emphasis on non-voice channels.
Sutherland’s functionality is concentrated on technical support, which provides higher-margin work for
the firm, but a greater emphasis on other horizontals will be important to make its offering attractive to
enterprises that do not have a technology focus.
However, Sutherland has significant potential as a home-based agent vendor. Currently, the firm
provides some hub-and-spoke functionality as well as fully virtualized capabilities, which is likely to be
a selling point for enterprises looking to use this delivery model. In addition, the features of
Sutherland’s home-based agent offerings are competitive with those of the rest of the firms evaluated
© 2014 Ovum. All rights reserved. Unauthorized reproduction prohibited. Page 16
Ovum Decision Matrix: Selecting a Home-Based Outsourcing Vendor, 2014–15
in this report, with notable strength in the domain of industry certifications, which could appeal to
compliance-focused prospects. If Sutherland can leverage its broader organization’s expertise to offer
a broader functional and channel offering, it could diversify beyond the limited regions and verticals
that it currently services, making it very likely that the vendor would grow as a competitor in this
market.
Sykes – Ovum recommendation: leaderFigure 11: Sykes radar diagrams
Source: Ovum
Sykes’s presence as a home-based agent vendor cannot be overstated: the company was a provider
of these services even prior to the acquisition of Alpine Access in 2012, and it has leveraged the
expertise and technology from this acquisition to craft an offering that Ovum has included in the leader
category of this year’s Decision Matrix. This status was abundantly clear when examining the different
elements associated with Sykes home-agent service, with it exceeding the average ranking in each
category, and coming first in pricing models, team communication, and hiring.
Sykes’s market presence is also strong, with it among the largest providers in the home-based agent
marketplace (second only to Arise). In terms of verticals, Sykes has done well compared to most of
the other outsourcers examined in this report, while still maintaining a heavy concentration in one
particular segment. The same applies to functional and channel offerings in which Sykes’s
home-agent offering is weighted toward traditional customer care and voice offerings (similar to other
vendors examined in this report). Ovum is encouraged by Sykes’s efforts to diversify into the provision
© 2014 Ovum. All rights reserved. Unauthorized reproduction prohibited. Page 17
Ovum Decision Matrix: Selecting a Home-Based Outsourcing Vendor, 2014–15
of non-voice services as well as broader functionality, both of which are higher-margin offerings that
are likely to appeal to a larger number of prospective clients.
In the long run, Ovum feels that Sykes will remain a strong competitor in the provision of home-based
agent services. To date, it has been exceptionally strong in positioning its virtual offering as part of a
broader portfolio of contact center services. The key for the future will be to move beyond North
America, where it has established a strong presence as a vendor of choice, and to use the Sykes
brand in other developed countries where it currently competes as a provider of CRM services.
Teleperformance – Ovum recommendation: challengerFigure 12: Teleperformance radar diagrams
Source: Ovum
Teleperformance has been ranked a challenger in this year’s Decision Matrix. The firm has offered
home-based agent services for some time, but it has not emphasized them to the same extent as
other bricks-and-mortar BPO providers. This is reflected in Teleperformance’s market presence, with
the firm’s revenues among the lower range of firms examined in this report, and it is currently
competing in only a limited number of vertical markets and geographies. In addition, the horizontal
functions and channels in which Teleperformance provides services using home-based agents are
somewhat smaller than some of its competitors.
However, Ovum believes that Teleperformance’s offering has a number of very positive aspects that
position it firmly in the challenger category. For one, it has a strong features offering, with a solid
performance in workforce optimization and agent monitoring/security categories. In addition, the firm
© 2014 Ovum. All rights reserved. Unauthorized reproduction prohibited. Page 18
Ovum Decision Matrix: Selecting a Home-Based Outsourcing Vendor, 2014–15
has managed a relatively low level of home agent attrition, and has a pool of talent with excellent
experience and education. The firm is already doing limited amounts of virtual agent work in non-US
markets (notably Canada and Western Europe), which it can use as a springboard to diversify its
geographic revenue base, a crucial differentiator for success in this sector going forward.
Ovum is also encouraged by the emphasis that Teleperformance has placed on solidifying its
work-at-home offering’s management team, most notably by bringing on a full-time work-at-home
offering general manager, as of July 1st, and through the additions of Jim Farnsworth and Tadd
McAnally, who are leading Teleperformance’s Professional Services Division, and are among the most
respected thought leaders in the work-at-home space. These moves will be vital for Teleperformance
to increase its overall presence in the home agent market, as will applying the same lessons that the
broader company has learned in penetrating new verticals, functional areas, channels, and
geographies.
West – Ovum recommendation: challengerFigure 13: West radar diagrams
Source: Ovum
West is a long-time competitor in the work-at-home arena, and has been ranked as a challenger in
this year’s Decision Matrix. This may come as a surprise to industry watchers familiar with the
pioneering work West has done in providing virtual agent work with both exposure and credibility.
However, West’s overall presence in the home agent market has been dwarfed by many of its
© 2014 Ovum. All rights reserved. Unauthorized reproduction prohibited. Page 19
Ovum Decision Matrix: Selecting a Home-Based Outsourcing Vendor, 2014–15
competitors, and was ranked second lowest among all the vendors examined in this study.
Furthermore, the majority of its revenue comes from the US market.
However, West’s home agent offering holds many positive aspects that merit discussion and position
it as a competitor of substance in this space. For one, West brings very strong features to its home
agent offering, placing it ahead of or equal to the average cross-competitor ranking (no small feat
considering the commoditized nature of home agent delivery). In addition, West has also diversified its
vertical base of clients over the past three years, and while its industry-based revenue is still heavily
weighted toward one sector, Ovum is impressed with the extent to which West has penetrated new
and non-traditional markets for virtual agent delivery. The same applies to both its functional offerings
and multichannel delivery, where West appears to be making the right moves to diversify its
home-based agent offering.
West has all the elements of a potential market leader in the delivery of outsourced home agents, but
the key will be for the firm to position its offering as a part of a broader CRM package that it can offer
to both clients and prospects, so as to take advantage of the growth in this space. It will also be
crucial for the vendor to continue efforts to diversify its services and verticals, and to push its success
from the US into other regions (most notably Canada and Australia).
Working Solutions – Ovum recommendation: leaderFigure 14: Working Solutions radar diagrams
Source: Ovum
© 2014 Ovum. All rights reserved. Unauthorized reproduction prohibited. Page 20
Ovum Decision Matrix: Selecting a Home-Based Outsourcing Vendor, 2014–15
Dallas-based home agent outsourcer Working Solutions has been classified as a leader in this year’s
Decision Matrix. It has been in the business for nearly 20 years and has proven itself to be capable of
adapting its offering to suit evolving business environments. This is reflected in Working Solutions’
revenue, which was among the top three of the firms examined in this report, coming in behind only
Sykes and Arise (the other two leaders identified by Ovum). In terms of vertical breadth, Working
Solutions was the second-most vertically diverse vendor in this study, and was notable in that, from an
industry standpoint, its revenues were not heavily weighted toward one particular sector, something
that was unique among vendors. This diversity was also reflected in the fact that Working Solutions
manages interactions for firms that are relatively evenly distributed across size bands, proving the
company’s ability to successfully manage interactions for the SME market – long a target segment for
the work-at-home market. Indeed, Working Solutions also has one of the most pervasive multichannel
offerings among the vendors profiled, which will be crucial as enterprises look to move their
work-at-home deployments beyond simple voice support. While not as geographically diverse as
some vendors examined in this report, Working Solutions has managed to establish not only a strong
presence in the US, but also a relatively high proportion of business from English and
French-speaking Canada as well.
The features of Working Solutions’ home agent offering are very solid relative to the competition. In
fact, Working Solutions was at or ahead of the industry average in every category (with the exception
of certifications), speaking to the expertise and experience of this firm.
Ovum anticipates that Working Solutions will remain a top-line vendor in the home agent space for the
foreseeable future. Its leadership has remained stable and the company has made the right moves to
draw in new talent when opportunities have presented themselves. The key initiative to watch will be
the company’s attempts to increase its geographic footprint beyond North America.
Appendix
Further reading The Future of Home-Based Agent Outsourcing, IT019-003295(January 2014)
Ovum Decision Matrix: Selecting a Social Media CRM Outsourcer, 2013–14, IT019-003300 (January
2014)
"Sykes buys Alpine Access: consolidation of home agent outsourcing space begins," IT019-003057
(July 2012)
CRM Outsourcing Business Trends 2014, IT0019-003336 (April 2014)
AuthorPeter Ryan, Principal Analyst, IT Services
© 2014 Ovum. All rights reserved. Unauthorized reproduction prohibited. Page 21
Ovum Decision Matrix: Selecting a Home-Based Outsourcing Vendor, 2014–15
Ovum ConsultingWe hope that this analysis will help you make informed and imaginative business decisions. If you
have further requirements, Ovum’s consulting team may be able to help you. For more information
about Ovum’s consulting capabilities, please contact us directly at [email protected].
Copyright notice and disclaimerThe contents of this product are protected by international copyright laws, database rights and other
intellectual property rights. The owner of these rights is Informa Telecoms and Media Limited, our
affiliates or other third party licensors. All product and company names and logos contained within or
appearing on this product are the trademarks, service marks or trading names of their respective
owners, including Informa Telecoms and Media Limited. This product may not be copied, reproduced,
distributed or transmitted in any form or by any means without the prior permission of Informa
Telecoms and Media Limited.
Whilst reasonable efforts have been made to ensure that the information and content of this product
was correct as at the date of first publication, neither Informa Telecoms and Media Limited nor any
person engaged or employed by Informa Telecoms and Media Limited accepts any liability for any
errors, omissions or other inaccuracies. Readers should independently verify any facts and figures as
no liability can be accepted in this regard – readers assume full responsibility and risk accordingly for
their use of such information and content.
Any views and/or opinions expressed in this product by individual authors or contributors are their personal views and/or opinions and do not necessarily reflect the views and/or opinions of Informa Telecoms and Media Limited.
© 2014 Ovum. All rights reserved. Unauthorized reproduction prohibited. Page 22
Ovum Decision Matrix: Selecting a Home-Based Outsourcing Vendor, 2014–15
CONTACT US
www.ovum.com
INTERNATIONAL OFFICES
Beijing
Dubai
Hong Kong
Hyderabad
Johannesburg
London
Melbourne
New York
San Francisco
Sao Paulo
Tokyo
© 2014 Ovum. All rights reserved. Unauthorized reproduction prohibited. Page 23