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Call Center Vendors Size: Is Bigger Always Better?

This sentiment holds particularly true in the call center vendor outsourcing industry, where the debate over big vs. small vendors is a constant topic of discussion.

The size of a vendor often sparks lively debates and diverse perspectives. Some people believe that the largest call center vendors or business process outsourcers (BPOs) are the most reliable options. This assumption stems from the idea that larger BPOs are safer choices, better at scaling, and more capable of handling complex workstreams than their smaller counterparts.

Our industry is filled with vendors of all sizes, each vying for market share and attention. Given that size is relative, how can you determine if a BPO is too big, too small, or just right for your business needs? Let’s explore this topic further.

What Category Do You Fall Into?

Vendor selection methods vary across our industry. Some brands have pre-set selection criteria that target vendors of a specific size, while others prioritize cultural alignment and other preferences over size and scale.

Regardless of these differences, brands generally fall into one of several categories when it comes to selecting BPOs:

Preferring the Largest and Most Well-Known BPOs: These brands usually target the most visible and reputed vendors.

Defaulting to Oversized BPOs for Smaller Needs: Some brands automatically choose large BPOs even for their smaller outsourcing requirements.

Diversifying from Big BPOs to Mid-Sized and Smaller Providers: Brands that have experience with large BPOs are now exploring mid-sized and smaller vendors.

Using a Mix of Large and Small BPOs: These brands spread their risk by working with large and small providers.

Preferring Mid-Sized Market Leaders and Rising Stars: Brands that prefer mid-sized BPOs are known for their expertise and growing reputation.

Open to Ideas and Exploring Viable Options: Brands are still unsure about their preferences and are open to exploring different BPO options.

Working with Bigger BPOs

The largest BPOs can employ 200,000 and over 400,000 people worldwide and are recognized as prominent names in the industry. These big players often have the most extensive marketing reach and are fixtures on many RFP lists.

The primary argument for choosing a large BPO is its ability to scale across multiple geographies and the convenience of consolidated vendor management. Numerous successful case studies support this strategy. For brands with extensive outsourcing needs, selecting a large BPO is often a necessary and automatic decision. These big vendors typically offer a vast footprint and other value-added services.

However, many brands have worked with us to diversify away from larger BPOs for consistent reasons. Some are content with their bigger providers but want to challenge them, while others have had lukewarm experiences dealing with issues like flexibility, speed, performance, staffing, or stringent contract terms.

Many BPO giants are conglomerates offering services beyond traditional contact centers, such as managed services, IT outsourcing, manufacturing, and software development. While this is advantageous for brands seeking these services, it can be overwhelming for those only looking for top-notch customer contact support. These brands often report being overwhelmed by upselling and cross-selling from other divisions of the large BPOs.

Working with Mid-Sized BPOs

Elite mid-sized BPOs provide scale, diversity, de-risking, expertise, flexibility, stability, quick response times, and avoid bureaucratic hurdles. However, it is crucial to vet these BPOs meticulously for impactful solutions. Choosing a mediocre mid-sized BPO won’t suffice; only top-tier providers can significantly improve KPIs and service delivery.

Critics of mid-sized BPOs argue that they are too small, incapable of scaling, and lack a global footprint. Much of this is a misconception and a sales tactic from larger vendors fearing competition. Many mid-sized BPOs do not aspire to become industry giants.

No BPO is perfect, but brands that choose “right-sized” BPOs often report faster response times, greater agility, quick problem-solving, competitive pricing, solid customer experience, strong frontline depth, well-handled change management, better transparency, and direct access to C-suite executives. For instance, one mid-sized BPO with 15,000 agents across 10 countries supporting over 30 languages has consistently won awards and serves clients who also work with larger BPOs.

Such companies make brands feel valued and prioritized, offering a level of client delight that is hard to find with larger providers.

The Default Syndrome Continues

Many brands with smaller outsourcing needs still default to larger BPOs, mistakenly believing that bigger is better. The sales pitch often claims that every client receives equal attention, but this is not always true. Brands have reported that with some large BPOs, requests outside the contract terms can lead to bureaucratic delays and sluggish responses.

Size Doesn’t Guarantee Quality

It’s a myth that larger vendors offer a safe outsourcing haven. One of our clients chose a top 10 largest vendor, expecting their business to be in good hands. However, the vendor failed to deliver and even suffered a data breach due to their staff, leading to significant reputation damage and cleanup costs.

Such issues can occur at any BPO, regardless of size. The key takeaway is that size does not guarantee quality or safety.

Overconcentration Can Hurt

Proponents of outsourcing to fewer, larger vendors argue that it simplifies management and may come with price concessions. However, these often come with multi-year contracts, limiting the brand’s flexibility.

Overconcentration can also pose risks. If too much business is outsourced to a single or a few large vendors, it can lead to dependency. De-risking or exiting an untenable vendor relationship can be time-consuming and resource-draining, affecting production, performance, and reputation.

Diversification is Key

The Avis car rental commercials famously said, “We try harder.” Smaller BPOs, like Avis, often have more hunger and desire to win and retain your business. Diversification allows you to spread your outsourced headcount across several key vendors, keeping them competitive and ensuring you remain in control.

Big Vendors Make Big Moves

Profit margins are critical, especially in today’s economy. Larger vendors, particularly those owned by private equity, often prioritize margins, leading to significant changes like shedding lower-profit clients or selling off divisions. This can negatively impact client relationships and service continuity.

A Message for Mid-Sized and Smaller Vendors

Mid-sized call center vendors should not rely on the “we’re better because we’re smaller” pitch. They must work hard to prove their value daily, matching their services to their sales pitch. Customer intimacy, shorter turnaround times, and prioritizing client needs are crucial.

In the End…

Vendor selection is about finding the right fit, offer, and timing. The call center vendors landscape is constantly evolving, requiring you to stay updated on developments affecting your selection process.

Brands seek outsourcing relationships with the right balance of scalability, expertise, and flexibility. However, uncovering extraordinary vendor relationships requires significant time and resource investment. Choosing a visible, large BPO is easy, but finding an extraordinary partner who can move the performance needle faster and better is much harder.

Ensure your business is attractive, desirable, and valued by any outsourcer you choose. Don’t become just another logo on the vendor’s masthead. Instead, pick the right-sized, collaborative partners who will be inventive, and nimble, and prioritize your business every day. Make sure senior executives value your partnership and keep their promises because you deserve a top-down commitment.

Consider what your business means to the outsourcer because, in the end, size matters!

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