P>Outsourcing specialist Vertex Customer Management has one large deal under its belt with Hydro One and sees more opportunities by working co-operatively with unions.
Vertex has 27 sites and 5,000 employees in its home country
of Britain and opened two Canadian offices in Markham and London, Ont., in December 2001.
The deal with Hydro One, worth approximately US$200 million over 10 years, was struck three months later in partnership with Cap Gemini Ernst & Young. CGEY led the agreement by taking over some of Hydro’s back-end IT infrastructure and brought in Vertex to take over call centre operations.
Call centre management is central to Vertex’s practice, but the company prefers to work with a client’s existing call centre infrastructure and employees rather than take it off-site. This arrangement can be conducive to working with companies that are unionized, said Vertex’s Canadian vice-president of business development Anthony Horton.
As part of its outsourcing service, Vertex will take over the collective bargaining agreement and work with a union to make sure the transition is smooth. It could be a differentiating factor between Vertex and its Canadian competitors, said Horton. “”There are a lot of operations out there that have not embraced outsourcing because of difficulty with their unions. . . . A lot of telecoms have been reticent about outsourcing those (call centre) jobs because of unions.””
Telcos could represent an outsourcing opportunity for Vertex, particularly those based in the U.S. “”Canada selling its call centre services into telcos in the U.S. — I don’t think we’ve even scratched the surface there,”” said Horton. Vertex established a Canadian presence in part to explore the American outsourcing market.
There may be limits to Vertex’s in-house outsourcing approach, since it inhibits the degree to which a call centre can expand, said IDC Canada Ltd. outsourcing analyst Jason Bremner. Eventually, it may be necessary to move operations outside.
But Horton said that Vertex has been successful in maximizing the potential of the call centres it has worked with. In the case of Hydro One, a call centre of 400 operators was increased to 500 to smooth over the transition to outsourcing, then scaled back to 300. Efficiencies were achieved by adding a speech recognition component to the call centre to allow for a degree of customer self-service. Employees that were let go as a result were then moved over to CGEY.
Vertex’s pro-union approach may help the company garner more customers, according to Bremner. “”I would imagine that to have the transitioning employees on board in support of the transition is critical . . . whether it’s unionized or not. Because of the collective bargaining agreement that almost exclusively governs any kind of union/employer relations, you’d have to have the approval of the union and the union membership to be able to have smooth transitions,”” he said.
In January and February of this year, Vertex completed a telemarketing deal with Waterloo, Ont.-based ISP WorldWithoutWire, and is taking a second look at the Canadian utilities market. There may be an outsourcing opportunity with smaller municipal utilities, said Horton, particularly if they can be grouped together into a single call centre outsourcing arrangement.
Accenture has already had some success with that approach. Enbridge and B.C. Gas came together to provide joint customer care service through the creation of a new company called CustomerWorks, which was subsequently turned over Accenture. Accenture could represent Vertex’s toughest competition in the utilities market, said Horton.