Call Center Outsourcing: Coordinating Staffing Level and Service Quality
In this paper, we study the phenomenon of
call center outsourcing. In particular we study the contracting issues in an
outsourcing supply chain consisting of a user company, and a call center that
does outsourcing work for the user company. We model the call center as a
G/G/s queue with customer abandonment. Each call has a revenue potential,
and we model the call center's service quality by the percentage of calls served
and resolved (revenue realized). The call center makes two strategic decisions:
how many agents to have and how much effort to exert to achieve service quality.
We are interested in the contracts the user company can use to induce the call center to both staff and exert effort at levels that are optimal for the outsourcing supply chain (i.e. chain coordination). Two commonly used contracts are analyzed first: piece-meal and pay-per-call-resolved contracts. We show that although they can coordinate the staffing level, they result in service quality that is below system optimal. Depending on the observability and contractibility of the effort, we then propose two contracts that can coordinate both. These contracts suggest that managers pay close attention to the contractibility of service quality in seeking call center outsourcing.