The Rt. Hon. Patricia Hewitt, Secretary of State for Trade and Industry, Cabinet Minister for Women

UK call centre competitiveness in a global market

But, were the press to join us in this central London location, they would see, not only that we DO have a call centre industry in this country, but that it is vibrant, it is thriving and it is here to stay.

So I’m delighted to be here, and delighted to launch this new study into the competitiveness of the contact centre industry.

This report has been a product of our partnership. It will sharpen our approach as we strengthen the competitiveness of the industry. There’s an agenda here for all of us rally around – raising value, skills and quality across the whole of the British contact centre industry.

It will also help us as we prepare the Trade and Investment White Paper that I will be publishing before the Summer.

It’s also useful, because it draws a line under some of the nonsense that’s been said recently about our contact centres recently.

And a lot of nonsense has been said.

First, they said that contact centres were a thing of the past. That companies would turn to automated methods, making people redundant.

In fact, the report shows the opposite is the case. More and more companies are opting for the human touch above the cyber touch. And they’re doing so because they know that their customers prefer it. Companies who tried to skimp, found that cutting costs, costs customers.

That’s why, instead of contracting, the industry is growing. The report shows the UK’s call centre industry is set to gain around 200,000 jobs in the next three years. Meaning more than 1 million people working in the sector - four times as many people as India by the same year.

Second, they said that all of our contact centre jobs would go to India – we simply couldn’t compete.

Well, we know we can’t compete on cost – and we wouldn’t want to. Indian wages are a tenth of ours.

But we can compete on quality and service. The report shows that British call centres deal successfully with a far higher proportion of calls than Indian call centres.

Third, they said that we shouldn’t want these jobs in this country.

Try saying that to people like the woman I met in my constituency just last weekend. She started working in a call centre just three years ago, when her child was born. When she started she was dealing with routine queries, earning about £6 an hour. Now she is managing a team of 40, her pay has doubled and – with the right training, she has more autonomy and responsibility than she’d ever imagined when she first took the job.

You could try saying these jobs don’t matter in communities like Scotland, South Wales, North East and South Yorkshire… Communities which suffered the loss of manufacturing jobs and now find the jobs they thought had rescued them might go as well.

The truth is these jobs are vital. To people, communities and our economy – as a vital part of our thriving services sector. Which accounts for 21 million jobs and 70% of output.

Our financial services, accountancy and business services are the best in the world. Our contact centre sector must be the best in the world too.

This means we shouldn’t seek to compete with low wage countries for low wage work. We should be persuading other high value economies to come to us for our high quality skills and service.

This means change. Because, although we have the second largest contact sector in the world, other countries are pulling out the stops to challenge us.

India – producing 1 million graduates a year, many of them fluent in English.

Ireland, the Netherlands and South Africa too – where they don’t have the cost advantages of India, but they have a closer cultural affinity with British consumers. And the report shows there’s a direct and proportional relationship between cost and cultural fit.

We shouldn’t fear the growth of other economies. A job gained in India or Ireland doesn’t mean a job lost here. Our slice of the cake doesn’t get smaller, the cake gets bigger for all of us.

We need to position Britain according to our strengths, and where others are unbeatable on cost, we are unbeatable on quality.

The best British call centres are the best in the world. Offering high value businesses, high skill professionals. Which is why the best British businesses have opted for British call centres.

Like the Royal Bank of Scotland and RHL (which provides contact centre services for BSKkyB and Scottish Power).

Or Interflora, EDF, the Carphone Warehouse, Nationwide, Legal & General, Alliance and Leicester and Co-op.

The list of companies who have opted for Britain’s contact centres is long and it is growing.

But although we have many of the best contact centres, we have some bad ones too.

Poor companies who regard contact centres as a cost drainer, rather than a value adder. Who leave their staff unempowered, unskilled, unqualified. And leave their customers boiling instead of glowing…

We need to turn these around. The report highlights three ways we will achieve this.

First, by raising the value within our contact centres.

The best contact centres don’t drain costs – they provide profits. They’re used to enhance reputation, extract information and sell new goods.

In any small firm, ringing phones are greeted with a flurry of excitement and enthusiasm – the MD will frequently take the call themselves. They do this because they know that, just as night follows day, so profits and opportunities follow a customer call.

It shouldn’t be any different in a large firm. And, in our best British based operations, it isn’t. Like at ING Direct. There, members of the board stepped in to answer the phones when demand became too high for the contact centre to manage.

Of course, not each and every call will be high value. There will always be a need for repetitive tasks, such as reading out bank balances and meter reading.

But the strength and future of British contact centres will come from the higher value end of work - cross selling, building up knowledge, improving service, adding value. Not the lower value work.

Key to raising value is of course raising skills, the second challenge.

Every good contact centre should have skills at the top of the agenda. The higher up the skills ladder the employees go, the higher value the business generates, the more likely the customer is to buy more.

A business that doesn’t invest in skills loses not just business but staff too. And, as the report shows, it costs £2,500 to recruit a contact centre worker.

So we need to work together - using skills, training, qualifications and advice to raise contact centres from call handling through to call and customer management.

In Government, we’re promoting workplace learning, tackling literacy problems. The industry is also putting skills to the top of the agenda.

The CCA’s Standard Framework for Best Practice, the principle of which is “happy and fulfilled staff dealing with satisfied customers” is an example of the excellent work the industry is doing.

The third vital area is raising efficiency.

First and foremost, contact centres are about people. So efficiency means winning the trust and commitment of your staff, through proper dialogue and planning. The excellent relationship between Barclays and UNIFI shows this at its best.

But efficiency is also about harnessing new technologies using them to achieve savings or open up new channels of communication – like email and texting.

Some websites, such as IWEB sharedealing, offers customers advice through texting, email, live web assistance and on the telephone. All available as it suits the customer. Which suits the business as well, because it’s good for business.

It’s not just use of technology but use of location as well. There is enormous scope for consolidation with the contact centre sector, opening up possibilities to achieve economies of scale.

In closing, let me end by highlighting the positive from this report.

It clearly shows that our contact sector industry has the potential for a thriving future in Britain. It gives us the partnership and focus to move on from here.

But we must respond. Nothing would betray British contact centre workers more than to pretend that there was no need for change in the industry. But with that change will come greater prosperity and greater security.