With one of the largest acquisitions in the contact center outsourcing market in recent years, Sitel Group is poised to become a powerhouse with its acquisition of SYKES Enterprises, Inc. This union will likely set off greater investment in customer experience management services (CXM) and more industry consolidation. Read on to find out what this big deal will mean.
The contact center outsourcing market is huge, about 90 billion dollars in annual revenues, and the industry is seeing more attention and growth than ever. So, the announcement of the agreement of Sitel Group acquiring all of SYKES’ outstanding shares in a transaction valued at approximately $2.2 billion is another in a growing list of investments in this space, albeit a large one.
Over the last two to three years, most acquisitions by large contact center providers have focused on bringing new capabilities and technologies to an existing footprint, whereas the Sitel Group / SYKES deal calls out gaining additional global presence as one of the main reasons for the acquisition. We have not seen something of this scale for a few years, probably not since the Concentrix acquisition of Convergys.
This acquisition forms a $4 billion customer experience management services (CXM) organization with over 150,000 agents, making Sitel Group one of the three largest organizations in the industry alongside Teleperformance and Concentrix. In this blog, we’ll explore what this acquisition means for Sitel Group, its existing and potential customers, as well as the CXM industry as a whole.
Here are a few of the key impacts we expect:
In terms of vertical expertise, Sitel Group and SYKES have complementary strengths, with Sitel Group bringing presence in the retail, insurance, and public sector spaces and SYKES bringing strength in the technology and healthcare industries.
While Sitel Group’s acquisition of SYKES will bring additional and much-needed digital capabilities to the new combined business, a company the size of the new organization cannot deliver change and adjust to new offerings and skills overnight. It may take some time to fully deliver new digital capabilities at scale.
As the contact center industry aims to better understand the customer and improve customer experience, we’re seeing many investments in the market.
Service providers across the board are investing in technologies and skillsets to become more digital and get ahead of the curve to offer better customer experiences. They are finding organizations more willing to spend money to improve customer service, an area where in the past, they treated simply as a cost base that needed to be reduced, but are now recognizing its potential strategic and topline business impact. Smaller service providers are taking advantage of their agility and are quickly adapting to a digital-first CXM business, and larger providers are having to work hard to keep pace with the rate of digital adoption.
Expect to see more public and non-public deals happening. With the size of this market and everyone working towards digital transformation, a trend that has further accelerated due to vulnerabilities exposed by COVID-19, the contact center outsourcing industry is really ripe for investment.
These deals will result in a consolidation in the marketplace but with bigger market growth. Penetration of contact center outsourcing could increase from roughly 30 percent to upwards of 35 percent in the next few years – resulting in a faster rate of growth than we’ve seen in the past decade.
It will not only be due to big service providers getting even larger. Smaller service providers will need to rapidly articulate their differentiation to remain relevant in a crowded marketplace, such as in a process area or industry domain; otherwise, they run the risk of being in a race towards the bottom.
As businesses across industries adapt to the next normal, digital channels are becoming the preferred, or in some cases the only, way of providing customer support for products and services. While many contact centers are simply unable to handle the increased volume of requests and inquiries with their existing workforce and technologies, some enterprises are already rethinking what customer service stands for. Many are turning to sophisticated Digital Employees, also known as, Interactive Virtual Agents (IVA,) enabled with conversational AI and secure backend integrations to deliver customer service in a scalable and cost-efficient way, without jeopardizing quality.
On this webinar, Everest Group’s Skand Bhargava, a featured guest speaker, joins Jonathan Crane from IPSoft, who are the manufacturers of a market-leading digital employee, Amelia, to discuss how IVA and conversational AI can elevate contact center operations. Also joining them will be Gonzalo Gomez Cid from Telefónica who will be sharing his company’s experience in implementing conversational AI in contact centers.
May 28th, 2020, 10 AM ET
Chief Commercial Officer
Gonzalo Gomez Cid
Global Contact Center Director
Do you know anyone who hasn’t had a frustrating experience because the contact center rep they interacted with didn’t speak their native language? We didn’t think so.
The truth is that while enterprises have multiple business reasons for establishing their contact centers in offshore locations in Eastern Europe, Latin America, and Asia Pacific, the reps’ language and communication skills often have a negative impact on the overall customer and brand experience.
And although many companies have developed their own solutions to assess candidates’ language capabilities, they’re plagued with multiple challenges, including:
Commercial language and communication assessment solutions have been around for years. But innovative vendors – such as Pearson, an established player in this market, and Emmersion Learning, which incorporates the latest AI technology into its solution – are increasingly leveraging a combination of linguistic methodologies, technical automation, and advanced statistical processes to deliver a scalable assessment that can predict speaking, listening, and responding proficiency.
For instance, technology-driven solutions may test candidates’ “language chunking” ability, which means their ability to group chunks of semantic meaning. This concept is similar to techniques that are commonly used for memorizing numbers. By linking numbers to concepts, a person can be successful in retaining large sequences of digits in working memory. Without conceptual awareness, memorization is hard.
During an assessment, through automation and AI, the candidate may be asked to repeat sentences of increasing complexity. Success in this exercise relies on the candidate’s ability to memorize complex sentences, which can only be done when they can chunk for meaning. A candidate’s mastery of an exercise to repeat sentences of increasing complexity is a great predictor of the candidate’s language proficiency.
Organizations that embrace technology-based solutions for language assessments can anticipate multiple benefits: reduced costs, decreased hiring cycle times, improved quality of hires, better role placement, freed time to devote to value-add initiatives, and improved customer experience and satisfaction. Ultimately, it’s a triple win for the organization, its candidates, and its customers.
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The domestic contact center, which accounts the biggest share in the local IT-BPM industry, has successfully managed to shift quickly into the mid- and high-skilled jobs from low-end tasks as new technologies in automation and artificial intelligence are replacing old jobs, a new research revealed.
Uligan noted that the Philippines’ IT-BPM industry annual revenue has reached $27.1 billion of which the contact center segment keeps a bigger slice of the pie — accounting for an annual revenue of $14.6 billion (P759.2 billion) and employing more than 890,000 call center professionals nationwide. Overall, the Philippines accounts for about 18 percent of the estimated $83 billion global revenue by think tank The Everest Group.
Read more in Contact Centre World
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