Call Centres (Industrial Report) - UK Dissertation Questionnaire Writing Help
EXECUTIVE SUMMARY
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In
2008, the number of call centres (including contact centres) in the UK is
believed to have increased by a moderate 1% to 6324 centres. This is in
contrast to stronger annual growth of between 3% and 6% recorded in the
previous four years. Overall, the number of call centres is believed to have
increased by 14% between 2004 and 2008. The more moderate development in 2008
is largely a reflection of the worsening economic conditions, resulting in an
increased focus on cost cutting measures amongst companies, including call
centre operations. However a downturn is believed to have been avoided, as a
number of call centres continued to expand. Furthermore, the trend towards
returning overseas call centre operations to the UK, as customer relationship
management becomes a higher priority, has also sustained growth in UK call
centre market.
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Cost
pressures and the offshoring of call centre services have been widely cited
as a threat to the industry in the UK, with redundancies and closures of call
centres in the country highly publicised during recent years. Nonetheless,
MBD believe that the shift of jobs abroad has had little impact on the
market, as supported by continued growth in the number of UK call centres.
Furthermore, as a result of recent negative publicity surrounding high
customer dissatisfaction levels with offshore call centres, an increasing
number of organisations have been
returning call centre operations to the UK. Indeed, those companies that have
brought call centre operations back to the UK, have reported increased
customer satisfaction.
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Customer
expectations about knowledge availability have also increased, partly due to
technological advances, while at the same time traditional marketing channels
have become more fragmented, hindering the ability of suppliers reaching the
customer base through traditional methods. These push and pull factors have
ensured sustained growth in the UK market for call centres.
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The
number of agent places in UK call centres has increased in each year since
2004. Between 2004 and 2007, annual growth level remained relatively
consistent at between 4% and 6%. This was followed by a more moderate
increase of 2% in 2008, taking the number of agent places to 595 700.
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The
number of agent positions has increased at a slightly stronger rate than that
of the total number of call centres, reflecting the trend for larger call
centres. Indeed, the average number of agents per call centre has increased
from 90.2 in 2004 to an estimated 94.2 in 2008. Nonetheless, the number of
agent places is believed to understate the total number of employees in the
industry, as many centres operate a shift system, often operating a 24-hour
service, resulting in more than one employee filling an individual
workstation.
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The
telecommunications sector accounted for the largest share of call centre
agent places throughout the period under review. Indeed, in 2008, the
proportional importance of the sector reached an estimated 17%, equivalent to
101 100 places.
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Agent
places in the services sector increased year-on-year between 2004 and 2008.
In the latter year, the number of places reached an estimated 98 200,
representing growth of 2% in the year and of 19% compared with 2004. The
sector includes a high proportion of business-to-business call centres, but
also covers consumer sectors.
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The
proportional importance of the banking sector has remained relatively static
at around 6%. Between 2004 and 2007, the number of places increased by a
cumulative 23%. However, in 2008, the number of places is believed to have
declined by 4% to 35 700, reflecting the deteriorating economic conditions
and the crisis in the financial sector.
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The
‘other’ sector comprises a number sectors including the likes of printing
& publishing, entertainment & leisure, private medical, engineering
& construction etc. The number of agent places reached an estimated 28
700 in 2008, representing a 5% share of the total number of agent places.
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In
2008, the number of agent places in outsourced call centres increased by an
estimated 12% to a peak of 77 600. This follows growth in the previous four
years, with the number of agent places increasing by a cumulative 35% between
2004 and 2007. Furthermore, the proportional importance of outsourced agent
places to the total number of places increased from 10% in 2004 to an
estimated 13% in 2008. Growth in the use of outsourced centres during recent
years, partly reflects growth in the financial services, telecommunications
and retail sectors. Furthermore, the recent increase in business associated
with the energy & utilities, healthcare, travel & tourism and public
sectors is also believed to have had a positive impact on demand.
Furthermore, outsourced call centres could potentially benefit from the
economic downturn, as companies are looking to cut internal costs and are
therefore more likely to choose more cost-effective outsourced options.
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In
2009, the number of call centres in the UK is anticipated to decline by a
moderate 1% to 6254. This is largely due to the current economic downturn
resulting in an increased focus on cost cutting measures by companies, which
is likely to lead to the closure of a number of call centres. However, the
outsourced call centres sector could benefit from the current economic
climate, as companies are focussing on reducing internal costs this
represents opportunities for outsourcing companies offering cost-effective
solutions. Between 2010 and 2013 the number of call centres is expected to
increase, with annual growth levels anticipated to fluctuate between 2% and
4%. In 2013, the number of call centres is forecast to reach 7038, equivalent
to overall growth of 11% compared with 2008. The sectors with the strongest
growth potential for call centres are expected to include energy &
utilities and the public sector.
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Growth
in the market is believed to reflect the continued emphasis on Customer
Relationship Management. Although further growth in offshoring is projected,
this is also anticipated to be at more moderate levels than in recent years,
partially reflecting companies’ increasing awareness of customer
dissatisfaction with service levels received in offshored call centres.
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An
element of growth is expected to arise from Customer Interaction Centres,
with an increase anticipated in companies offering Email response services,
and web-based interactivity in real time, in support of telephone services.
Such services are increasingly regarded as the norm by customers and the
trend has been fuelled by the growth in e-commerce.
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The
number of agent places in UK call centres is projected to decline by 2% in
2009. This is expected to be followed by growth in the following four years,
although annual growth levels are not expected to exceed 4%. In 2013, agent
positions are anticipated to reach 662 344, equivalent to growth of 11%
compared with 2008.
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Productivity
gains are also expected within call centres, partly due to technology
advances in outbound calling. However, there are concerns productivity levels
will decline following the introduction of the Ofcom regulations. With
particular reference to dropped or abandoned calls remaining below 3% in a 24
hour period, predominantly a result of automatic diallers, call centres may
either have to increase employee numbers or invest in technology that ensures
they adhere to the regulations.
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However,
the industry has a reputation for stress and resultant high staff turnover,
although this will possibly improve due to the EU charter for employers and
workers in the call centre, which was published in 2004. The trend for
companies to outsource their call centre operations to lower cost countries
is also set to continue, albeit at a more moderate rate than in recent years,
reflecting increased industry awareness of customer dissatisfaction, which
may take employment away from UK agents.
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Despite
the adverse economic conditions, the number of agent places in outsourced
call centres, is expected to continue to increase in 2009. Indeed, MBD
believe that the outsourced sector may benefit during the downturn, as
outsourcing often represents a more cost-effective option to companies.
Overall the number of agent places in outsourced call centres is expected to
increase by a cumulative 35% between 2008 and 2013, reaching an estimated 104
700 in the latter year. The proportional importance of outsourced places is
also anticipated to increase from 13% in 2008 to 16% in 2013.
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The
pace of software change in the call centre industry has effectively increased
the perceived risk of investment in the sector by many in-house companies,
who fear investing in technology which will be superceded by more powerful
systems in the short term. This has allowed the opportunity for outsourced
suppliers to adopt an added value sector by maintaining state-of-the-art
technology. MBD believe that the outsourced industry will increasingly focus
on providing added value services.
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