Santander’s decision to transfer its Indian call centre operations to the UK in a bid to boost customer satisfaction would appear to indicate that the offshore model is “increasingly past its sell-by-date”, according to experts.
 

The move comes less than a week after New Call Telecom announced that it was moving its call centre operations from Bombay to Burnley because the costs of operating in the two countries were now at “absolute parity” but it considered UK staff to be more loyal and efficient.
 
An estimated 1.5 million calls will now also be handled by 500 new Santander staff based in Glasgow, Leicester and Liverpool, bringing the number of UK-based call centre personnel employed by the financial services group to 2,500.
 
Ana Botin, Santander UK’s chief executive, said that the move was “the most important factor in terms of satisfaction with the bank”.
 
“Our customers tell us they prefer our call centres to be in the UK and not offshore. We have listened to the feedback and have acted by re-establishing our call centres back here,” she added.
 
The Spanish firm is now the third largest bank on the high street, following its acquisition of Abbey, Alliance & Leicester and Bradford & Bingley over recent years. Abbey outsourced its call centre operations in 2003 to two Indian centres, one in Bangalore and one in Pune as a cost-cutting measure, which coincided with an increase in the number of customer complaints.
 
Martin Hart, chairman of the National Outsourcing Association, said that the move was “not just a matter of rising costs in India, but falling quality”.
 
“India’s staff attrition rates are at an all-time high – people move on very quickly, for just a few rupees more elsewhere. This means there is not time for adequate cultural awareness training, so quality has dropped,” he said.
 
But John O’Brien, an analyst at Techmarketview, believes that the move is significant because of what it signals about the dynamics in the wider market. Firstly, he said, the average wage for call centre workers in lower cost regions of the UK are now almost at parity with those in India.
 
Secondly, O’Brien pointed out: “Offshoring call centres has often resulted in reduced customer service quality, and latterly increased customer attrition as other providers now offer ‘UK-only call centres’. This has become a real differentiator in the UK retail, banking and mobile telecoms sector.”
 
The third point, which is important given the current economic climate and high levels of unemployment, is that it is very good PR to be seen to be investing in the UK at the moment. To be seen to be ‘putting something back’ rather than just ‘taking something out’ is likely to be “strong selling point for a brand”, O’Brien said.
 
Offshore business process outsourcing providers operating in the UK are likewise changing their strategies to respond to the trend, however. For example, Firstsource won a contact centre deal with Barclaycard last October, which resulted in it taking on 700 bank staff in Stockton.
 
As a result, O’Brien said: “Some back office work will go offshore, but the customer service work remains onshore. However, for UK plc, the true offshore call centre model now looking increasingly past its sell-by-date.”