How the Business of Outsourcing Customer Service Began

Outsourced customer service is a practice where a company hires another to handle its customer service usually by telephone, online chat or by e-mail. The major companies that handle this type of work are located in India. The practice has been in place for about two decades, but how and why did it start?

Outsourcing work from the United States to countries like India started in the 1990s. During this decade, companies like General Electric and American Express were expanding and merging. The entities had divisions in countries like India.

The head of GE in the US had a realtor in India help him find an ideal location for its offices there. The Indian head of GE eventually merged his managers with those of American Express. They created a firm that was dedicated to voice operations. They needed this as a means to doing their own communicating back and forth with their American colleagues.

The company took off as a leader in the field of customer service. Businesses in the US quickly saw how convenient and affordable it was to hire the less expensive labor in India. By the 2000s, most major global companies had websites. With the Internet, there were more alternatives to handling customer service.

Instead of relying on phone communications, they could now handle complaints and problems with customers via e-mail, chat and instant messaging. This work could be done remotely just about anywhere making it feasible to do business from the US with people in India.

As the practice became more common, Americans worried that jobs were being taken away from the US. They also felt it was frustrating to communicate with people who were difficult to understand clearly.

When handled well, customer service outsourcing can increase customer satisfaction for large firms. The practice of outsourcing customer service has a bright future.