2015 European Contact Center Outsourcing Visionary

2015

2015 European Contact Center Outsourcing Visionary Innovation Leadership Award

BEST PRACTICES RESEARCH

© Frost & Sullivan 2015 2 “We Accelerate Growth”

Contents

Background and Company Performance ........................................................................ 3

Industry Challenges .............................................................................................. 3

Focus on the Future and Best Practices Implementation ............................................ 3

Conclusion........................................................................................................... 6

Significance of Visionary Innovation Leadership ............................................................. 7

Understanding Visionary Innovation Leadership ............................................................. 7

Key Benchmarking Criteria .................................................................................... 8

Best Practice Award Analysis for Transcom ................................................................... 8

Decision Support Scorecard ................................................................................... 8

Focus on the Future .............................................................................................. 9

Best Practices Implementation ............................................................................... 9

Decision Support Matrix ...................................................................................... 10

The Intersection between 360-Degree Research and Best Practices Awards ..................... 11

Research Methodology ........................................................................................ 11

Best Practices Recognition: 10 Steps to Researching, Identifying, and Recognizing Best Practices ................................................................................................................. 12

About Frost & Sullivan .............................................................................................. 13



Background and Company Performance

Industry Challenges

The contact center outsourcing market in Europe is highly-competitive. It is therefore often

difficult for enterprise decision-makers to differentiate between the services offered by

competing providers and to determine what partnerships best suit their organization. At the

same time, the market inhabits a landscape across which today’s tech savvy consumer flits

at a high rate of speed, utilizing a variety of communication channels with which to express

his or her opinions (i.e. Twitter, Facebook, Instant Message, email, phone call, etc.).

Meantime, in 2015, a high proportion of global consumers believe recommendations from

friends and family are the most trustworthy sources of information regarding brands, up

considerably from just a few years before. All the while, customers dialing into a contact

center embark on a Customer Experience journey which they expect to end with a solution

to their query. They feel more valued when organizations understand and manage this

journey smoothly, by keeping track of all their inquiries irrespective of the medium chosen

for communication. Indeed, organizations are aware that modern consumers can shift

brands if they feel that they are not receiving excellent support.

What are providers of customer care services to do? Particularly within a region as vast and

differentiated as that of Europe? After all, agents often find it challenging to collate

inquiries from different channels and provide good customer service due to issues such as

delays in juggling between various interfaces and uncertainty regarding how to use highly

complicated CRM tools. To address this challenge and ensure customer loyalty, forward-

looking brands are investing in new methods in order to try and improve their customer

service.

Transcom is one provider seeking to deliver a digital solution to client customers that unifies

all communication media in the name of a positive Customer Experience. And in 2015, the

company is looking to innovate its service across the complex European landscape in other

ways as well. As a global Customer Experience specialist, Transcom is a provider that

continues to focus on helping client companies enhance their business performance. Simply

put, Transcom’s vision is to be recognized as a both a European and global leader in its

space.

Focus on the Future and Best Practices Implementation

Criterion 1: Focus on Unmet Needs

Frost & Sullivan is impressed that Transcom is investing in a unique new Europe-based

research and development project over the next three years called “Smart Digital

Ecosystem for Customer Experience Enhancement,” or “LeonarDo 2.0.14.” The project’s

aim is to define solutions, tools, methods, and techniques designed to improve the

customer service process and effectively exploit the potential offered by new digital



technologies. In fact, Transcom is taking the unusual step of partnering with the

University of L’Aquila, which has a strong record of research and innovation, and is part of

a network of small and dynamic enterprises operating in the Abruzzi area in the ICT and

customer management fields. The initiative will be headquartered in Transcom’s L’Aquila

offices in Italy and led by resources provided by both partners involved in the initiative.

Frost & Sullivan is not aware of any other industry initiative that seeks to benefit from the

strengths and insights of a specific academic institution while also benefitting from one of

Europe’s more innovative and entrepreneurial geographic regions.

Criterion 2: Visionary Scenarios through Mega Trends

In an ever more connected world (in its Mega Trends research, Frost & Sullivan describes

a world of “Connected Living” in which consumers use many different devices to

experience compelling new services that integrate video, voice, and data services and

provide access and ubiquitous connectivity anytime and anywhere) Transcom notes that

innovation, agility, and best practice implementation are things its clients expect it to

bring to their customer service organizations.

As the company states, “They want us to push them to stay ahead and to help put them in

a position from which they are able to benefit from the unrelenting change that

characterizes many industries today.” As such, Transcom understands that contact

centers are complex environments which merge many different disciplines and skills, and

continuous improvement is necessary in each individual area, but also in terms of how the

different components are combined into customized solutions for each client.

One additional (and recent) example of the ways in which Transcom is aligning itself with

emerging dynamics (specific to both Europe and North America) and offering customized

solutions to clients is through a new Transcom contact center that was recently opened in

Cali, Colombia that strengthens Transcom’s position when it comes to offshore delivery

capacity for clients in Spain. Transcom believes that demand for Spanish-language

services will increase considerably (both for Europe and North America), and Colombia is a

location that delivers high-quality services in a cost-effective manner.

Criterion 3: Growth Pipeline

Transcom continues to expand into new markets and leverage existing client relationships to

do so. And the company reports that it also has acquired several new clients with global

potential. Meanwhile, Frost & Sullivan notes that Transcom is one of the top players in

terms of delivery capacity in Europe. The company has an excellent mix of onshore and

near-shore delivery locations featuring key multilingual capabilities.

In fact, in 2014, Transcom expanded in Eastern Europe for domestic business (new sites

opened in Szeged, Hungary and Belgrade, Serbia). Meanwhile, Gdansk, Poland also

developed into a multilingual site, primarily for near shore delivery to European countries.



The company also plans to grow its presence in the UK and Germany. In short, Transcom’s

ambitions for Europe remain significant.

Criterion 4: Vision Alignment

Recently, Transcom has pushed organizational changes in order to promote increased focus

and accountability, to better align the organization’s mission, vision, strategy, and

execution. Consider that at the beginning of 2014, the company announced a realignment

of the management structure. Transcom’s President & CEO, Johan Eriksson, assumed

responsibility for the North America & Asia Pacific region. Neil Rae, formerly General

Manager for the North America & Asia Pacific region, now has responsibility for operations in

North America. Siva Subramaniam, formerly Country Manager for the Philippines and Head

of Sales for Asia Pacific, has taken over responsibility for activities in Asia Pacific.

Europe too is being brought into alignment with a changing market environment. When it

comes to the challenging French market, in August, 2013, Transcom signed a €5.3 million

settlement agreement releasing it from any further liabilities with respect to the liquidation

of its former French subsidiary. As the company noted at the time, “The €5.3 million cost

should be viewed in the context of the significant negative cash flows generated by the

former French subsidiary during the last few years, amounting to €12.5 million in 2012

alone.” However, it is important to note that while Transcom no longer has any operations

in France, it continues to offer French-language services to clients from its near shore

centers in Europe and North Africa.

Meanwhile, Germany is being realigned to fit Transcom leadership’s vision. On December

30, 2013, Transcom announced the successful closing of the divestment of its German

Credit Management Services operations (CMS Germany) to Tesch Group, a portfolio

company of Avedon Capital Partners, for €9.0 million on a cash and debt free basis. CMS

Germany had a turnover of €9.0 million in 2012. Frost & Sullivan feels this should mean

Transcom is poised to offer more focused, effective customer care services in the heart of

Europe.

Criterion 5: Process Design

Frost & Sullivan also is impressed with Transcom’s efforts in continually improving its

processes. Consider its focus on workforce optimization. Transcom points out that

workforce optimization is at the core of its client proposition. Its approach to recruitment,

induction, performance management, and organizational culture adaptation has been

refined over many years across several hundreds of deployments in different industries and

geographies. It also invests in processes, methods, and tools with the aim of helping its

employees deliver better services with lower risk, higher consistency, and better efficiency.

Still, in 2013, Transcom looked to make the process around this important function even

better, creating a knowledge base for a global consumer electronics client in order to lower



handle times and improve quality and productivity. Before the implementation of the tool,

information supporting customer service representatives was relatively inconsistent and

resided in multiple, non-integrated, systems. The new one-stop-shop solution brought

together process maps, decision trees, simulators, FAQs, and product how-to information.

The information is refined and enriched by agent feedback, content ratings and rankings of

the most viewed sections. Since the launch of the system, average handle time has

decreased while customer satisfaction scores are up by 14 percentage points.

Criterion 6: Operational Efficiency

Transcom’s approach to delivering a quality Customer Experience is built on operational

efficiency in the realm of data collection and analysis. The company notes that the many

data insights it gathers help enable innovation and also drive greater efficiencies and cost

savings through operational process optimization. In order to run the business more

efficiently and track its performance against key performance indicators (KPIs), data is

automatically collected on Transcom’s 1.4 million daily customer interactions. This is

complemented by additional information, most of which is gathered during live customer

interactions.

Transcom adds that data collection and analysis, root cause analysis, and speech analytics

are becoming more critical as clients expect them all to play an ever-greater role in

improving customer loyalty. And analytics is being applied to an increasing number of

areas, both to improve the Customer Experience and create efficiency improvements in

operations. For example, as the number of interaction channels keeps growing, structured

analysis can help make better decisions in terms of “right channeling” different types of

issues (i.e. proactively directing contacts to the channel that is best suited to addressing the

customer’s need).

Conclusion

Transcom’s suite of CM contact center BPO services includes customer care, sales,

technical support, and collections services, delivered through its network of contact

centers and work-at-home agent network. But the company also offers a broader range

of services, such as legal services tailored for the banking sector, differentiating it from

many of its peers in the industry. Transcom also offers other types of back-office services

and interpretation services in approximately ten languages in a call center environment.

All the while, the company’s leadership continues to push ahead with innovative new

approaches to a sometimes brutally competitive market in Europe. With its strong overall

performance and forward-thinking initiatives in Europe, Transcom has earned Frost &

Sullivan’s 2015 Visionary Innovation Leadership Award for that region of the world.



Significance of Visionary Innovation Leadership A visionary innovation leadership position enables a market participant to deliver highly

competitive products and solutions that transform the way individuals and businesses

perform their daily activities. Such products and solutions set new, long-lasting trends in

how technologies are deployed and consumed by businesses and end users. Most

important, they deliver unique and differentiated benefits that can greatly improve

business performance as well as individuals’ work and personal lives. These

improvements are measured by customer demand, brand strength, and competitive

positioning, as explored further below.

Understanding Visionary Innovation Leadership

Visionary Innovation is the ability to innovate today in the light of perceived changes and

opportunities that will arise from Mega Trends in the future. It is the ability to scout and

detect unmet (and as yet undefined) needs and proactively address them with disruptive

solutions that cater to new and unique customers, lifestyles, technologies, and markets.

At the heart of visionary innovation is a deep understanding of the implications and global

ramifications of Mega Trends, leading to correct identification and ultimate capture of

niche and white-space market opportunities in the future.



Key Benchmarking Criteria

For the Visionary Innovation Leadership Award, we evaluated two key factors—Focus on

the Future and Best Practices Implementation—according to the criteria identified below.

Focus on the Future




Criterion 4: Blue Ocean Strategy

Criterion 5: Growth Performance

Best Practices Implementation




Criterion 4: Technological Sophistication

Criterion 5: Company Culture

Best Practice Award Analysis for Transcom

Decision Support Scorecard

To support its evaluation of best practices across multiple business performance

categories, Frost & Sullivan employs a customized Decision Support Scorecard. This tool

allows our research and consulting teams to objectively analyze performance, according to

the key benchmarking criteria listed in the previous section, and to assign ratings on that

basis. The tool follows a 10-point scale that allows for nuances in performance evaluation;

ratings guidelines are illustrated below.

RATINGS GUIDELINES

The Decision Support Scorecard is organized by Focus on the Future and Best Practices

Implementation (i.e., the overarching categories for all 10 benchmarking criteria; the

definitions for each criteria are provided beneath the scorecard). The research team

confirms the veracity of this weighted scorecard through sensitivity analysis, which

confirms that small changes to the ratings for a specific criterion do not lead to a

significant change in the overall relative rankings of the companies.



The results of this analysis are shown below. To remain unbiased and to protect the

interests of all organizations reviewed, we have chosen to refer to the other key players in

as Competitor 2 and Competitor 3.

Measurement of 1–10 (1 = poor; 10 = excellent)

Visionary Innovation Leadership

Focus on the

Future

Best Practices

Implementation Average Rating

Transcom 9.5 9.5 9.5

Competitor 2 8.0 8.0 8.0

Competitor 3 7.5 7.0 7.2

Focus on the Future


Requirement: Implementing a robust process to continuously unearth customers’ unmet

or under-served needs, and creating the products or solutions to address them effectively


Requirement: Incorporating long-range, macro-level scenarios into the innovation

strategy, thereby enabling “first to market” growth opportunities solutions


Requirement: Best-in-class process to continuously identify and prioritize future growth

opportunities leveraging both internal and external sources

Criterion 4: Blue Ocean Strategy

Requirement: Strategic focus in creating a leadership position in a potentially

“uncontested” market space, manifested by stiff barriers to entry for competitors

Criterion 5: Growth Performance

Requirement: Growth success linked tangibly to new growth opportunities identified

though visionary innovation



Requirement: The executive team is aligned on the organization’s mission, vision, strategy

and execution


Requirement: Processes support the efficient and consistent implementation of tactics

designed to implement the strategy


Requirement: Staff performs assigned tactics seamlessly, quickly, and to a high quality

standard



Criterion 4: Technological Sophistication

Requirements: Systems enable companywide transparency, communication, and efficiency

Criterion 5: Company Culture

Requirement: The executive team sets the standard for commitment to customers,

quality, and staff, which translates directly into front-line performance excellence

Decision Support Matrix

Once all companies have been evaluated according to the Decision Support Scorecard,

analysts can then position the candidates on the matrix shown below, enabling them to

visualize which companies are truly breakthrough and which ones are not yet operating at

best-in-class levels.

High

Low

Low High


Focus on the Future

Transcom

Competitor 2

Competitor 3



The Intersection between 360-Degree Research and Best

Practices Awards

Research Methodology

Frost & Sullivan’s 360-degree research

methodology represents the analytical

rigor of our research process. It offers a

360-degree-view of industry challenges,

trends, and issues by integrating all 7 of

Frost & Sullivan's research methodologies.

Too often, companies make important

growth decisions based on a narrow

understanding of their environment,

leading to errors of both omission and

commission. Successful growth strategies

are founded on a thorough understanding

of market, technical, economic, financial,

customer, best practices, and demographic

analyses. The integration of these research

disciplines into the 360-degree research

methodology provides an evaluation

platform for benchmarking industry players and for identifying those performing at best-

in-class levels.

360-DEGREE RESEARCH: SEEING ORDER IN

THE CHAOS



Best Practices Recognition: 10 Steps to Researching, Identifying, and Recognizing Best Practices

Frost & Sullivan Awards follow a 10-step process to evaluate Award candidates and assess

their fit to best practice criteria. The reputation and integrity of the Awards are based on

close adherence to this process.

STEP OBJECTIVE KEY ACTIVITIES OUTPUT

1 Monitor, target, and screen

Identify award recipient candidates from around the globe

• Conduct in-depth industry research

• Identify emerging sectors • Scan multiple geographies

Pipeline of candidates who potentially meet all best-practice criteria

2 Perform 360-degree research

Perform comprehensive, 360-degree research on all candidates in the pipeline

• Interview thought leaders and industry practitioners

• Assess candidates’ fit with best-practice criteria

• Rank all candidates

Matrix positioning all candidates’ performance relative to one another

3

Invite thought leadership in best practices

Perform in-depth examination of all candidates

• Confirm best-practice criteria • Examine eligibility of all candidates

• Identify any information gaps

Detailed profiles of all ranked candidates

4

Initiate research director review

Conduct an unbiased evaluation of all candidate profiles

• Brainstorm ranking options • Invite multiple perspectives on candidates’ performance

• Update candidate profiles

Final prioritization of all eligible candidates and companion best-practice positioning paper

5

Assemble panel of industry experts

Present findings to an expert panel of industry thought leaders

• Share findings • Strengthen cases for candidate eligibility

• Prioritize candidates

Refined list of prioritized award candidates

6

Conduct global industry review

Build consensus on award candidates’ eligibility

• Hold global team meeting to review all candidates

• Pressure-test fit with criteria • Confirm inclusion of all eligible candidates

Final list of eligible award candidates, representing success stories worldwide

7 Perform quality check

Develop official award consideration materials

• Perform final performance benchmarking activities

• Write nominations • Perform quality review

High-quality, accurate, and creative presentation of nominees’ successes

8

Reconnect with panel of industry experts

Finalize the selection of the best-practice award recipient

• Review analysis with panel • Build consensus • Select winner

Decision on which company performs best against all best-practice criteria

9 Communicate recognition

Inform award recipient of award recognition

• Present award to the CEO • Inspire the organization for continued success

• Celebrate the recipient’s performance

Announcement of award and plan for how recipient can use the award to enhance the brand



STEP OBJECTIVE KEY ACTIVITIES OUTPUT

10 Take strategic action

The award recipient may license the award for use in external communication and outreach to stakeholders and customers

• Coordinate media outreach • Design a marketing plan • Assess award’s role in future strategic planning

Widespread awareness of recipient’s award status among investors, media personnel, and employees

About Frost & Sullivan

Frost & Sullivan, the Growth Partnership Company, enables clients to accelerate growth

and achieve best in class positions in growth, innovation and leadership. The company's

Growth Partnership Service provides the CEO and the CEO's Growth Team with disciplined

research and best practice models to drive the generation, evaluation and implementation

of powerful growth strategies. Frost & Sullivan leverages almost 50 years of experience in

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http://www.frost.com.

Documents

2015 European Contact Center Outsourcing Visionary