Prepare to Serve the US Hispanic Market
(Part 1 of 2)
Tony Malaghan, CEO, Arial
International,
tony@arialinternational.com
Latest population
estimates by the US Census Bureau at the time of writing
put the US Hispanic population at 42,687,224 or 14.4
percent of the US population. That equates to one person
out of every seven in the US being Hispanic. The
projection for 2050 is that this will increase to one in
four people or 25 percent of the total population. To
give you an idea of the breakdown between foreign born
and those Hispanics born in the US, in 2006 Pew Hispanic
Center reported that the Hispanic population in the US
was comprised of 40 percent foreign born and 60 percent
native born .
To put the current Hispanic population into perspective,
when looked at in terms of the population of countries
in the world, it would rank 29th out of 232 countries.
In terms of pure numbers, it ranks higher than Sudan,
Spain, Argentina, Kenya, Canada, Australia and
Afghanistan to name a few.
Let's not look at population numbers in isolation. What
is the spending power of this segment? According to Jeff
Humphreys, Director of the Selig Center for Economic
Growth at the University of Georgia, the economic clout
of Hispanics has risen from $212 billion in 1990 to $862
billion in 2007. That's 307 percent growth from 1990 to
2007. They are forecasting that by 2012 the figure will
be slightly over $1.2 trillion, a growth rate of 495
percent from 1990 to 2012. Non-Hispanic buying power is
growing closer to a rate of 189 percent over the same
period.
According to the Selig Center, in 2012 Hispanics will
account for 9.7 percent of all buying power, up from
only 5 percent in 1990. Due to brisk growth, Hispanic
buying power essentially pulled even with African
American buying power in 2006, and will exceed it in
2007.
Based on the above data, I think we can conclude it's a
pretty substantial market and one well worth pursuing.
Unlike the general market, the US Hispanic market
presents businesses with some unique challenges to
marketers and customer service managers. Firstly, there
are many misconceptions about the US Hispanic
population, for example that the market is homogenous.
The term US Hispanic refers to all people of
Spanish-speaking descent, regardless if they are from
Cuba, Mexico, Spain, etc. Secondly, while US Hispanics
share a common language, there are distinct regional
differences in the vocabulary and accents of the Spanish
language, food eaten, music preferred, and other
cultural traits, just as there is between an American
and an Australian even though they both speak English.
Finally, length of time in the US and level of
acculturation has an impact on consumer behavior and
language preference.
So, why are more companies in the US not doing more to
establish a presence in this market and better preparing
their Call Center operations to service this segment?
Many companies are acquiring new Hispanic customers, and
call center managers need their operations to be
adequately prepared to service this segment and their
unique needs, regardless of whether the company is
proactively or reactively acquiring Hispanic customers.
In our experience of consulting and training to
companies targeting and servicing the US Hispanic
market, the hesitation and resistance from businesses to
proactively target this segment of the US market can be
attributed to one or more of the following reasons:
• Lack of corporate commitment to the strategic decision
to target the US Hispanic market.
• Lack of adequate budget to undertake the marketing and
build the necessary bilingual customer service
infrastructure.
• Resistance due to the sheer magnitude of the
undertaking. There are a multitude of components that
comprise your Hispanic marketing and servicing platform,
e.g. culturally relevant products/services; Spanish
language marketing collateral, customer communication;
Spanish language website; bilingual call center and
customer service personnel; bilingual IVR, etc.
• Fear of the unknown.
So what can a call center manager in a company facing
these and similar issues do to help the organization
overcome the challenges to become better prepared to
service the ever growing and unique needs of the US
Hispanic consumer? This question will be discussed in
Part 2 of this article.
A New Approach to Cost Structures for Today's Contact
Centers (Part 1 of 3)
Lori Bocklund, President and Brian Hinton, Sr.
Consultant - Strategic Contact, Inc.,
lori@strategiccontact.com and
brian@strategiccontact.com
This essay is the first in a series of three that
discuss a new approach to modeling cost structures and
distribution in the contact center. Following essays
will discuss the results of the analysis, including cost
per contact numbers, and how to apply those results to
your environment.
For years, contact center professionals – including us –
have been quoting wide-ranging and sometimes
unsubstantiated or out of date statistics about the
relative costs of contact centers. We began to wonder
how costs really are distributed in a contact center
today, and how relevant and reliable past studies and
surveys really were for today's contact centers.
Why is it critical to understand the structure of the
cost of a contact center? It should influence strategic
investment decisions, organizational, process, or
technology changes, and tactical adjustments.
So we set out to provide clarity and drive out
consistent, usable cost breakdown numbers that represent
best practices and show the impact of key changes. We
used a process-based modeling approach that uses
operating costs representative of contact centers in
2008.
We modeled three scenarios, producing a three-year
operating budget projection for each. Obviously we
couldn't cover all variables (industry, geography, etc.)
so instead tried to set the inputs at a "likely" level
based on a variety of data sources – surveys,
benchmarking studies, and our own years of experience
with numerous contact centers. Then we selected the
variables with the highest likelihood and greatest
potential to differ, and looked at the impact of changes
in those variables.
We modeled a typical small, medium and large center to
assess the cost differences based on size. We used the
following variables to define a typical center in each
size category.

Additionally, we viewed
technology (including VoIP PBX, ACD, CTI, IVR, ASR IVR,
PCs, QM, WFM) as one of the key differences among
centers of different sizes and varied features based on
the center's size. Many overlook how technology
investments can change based on functionality
differences for each technology and center size.
We also believe that technology should remain current
with maintenance contracts and periodic upgrades – a
factor not always included in cost analyses. We included
depreciation, maintenance, and upgrade costs for each
technology across the three-year projection period - a
true best practices approach. The same concept applies
to many of the other inputs to the models. For example,
we included fully loaded labor costs because we think it
is important to include all costs when considering the
operational costs of a center.
We also wanted to assess the sensitivity, within a
center of a given size, to variables that drive the
major cost differences among centers. We used a medium
size center and changed key variables to show how the
cost structure and overall costs change for three
options: high self service, low cost labor, and complex
contacts.
Now that we've identified what we modeled and why, we'll
discuss the key results in Part 2.
The Human
Resources Conundrum
By Paul Stockford, NACC
Advisory Board Member
In the survey we recently conducted with readers of this
newsletter we asked how many respondents planned to hire
additional agents in 2008. A whopping 63.7 percent of
the 125 respondents indicated that they did intend to
hire additional agents in 2008. After thinking about the
response, I began to wonder if these new hires would be
in addition to current headcount or would be hired to
replace agents who leave during the course of normal
turnover.
Agent turnover is the bane of the contact center
industry, yet is seems to be a problem that the industry
is unwilling to address. Efforts to bring established,
proven recruitment and hiring strategies to the contact
center industry have mostly been met with indifference
and, ultimately, failure. Although there are a few
hiring strategy solutions out there the majority of the
industry still seems to focus on ways to keep a steady
stream of replacement agents coming through the door
rather than focusing on ways of bringing in the right
people in the first place, then keeping them in. Sound
familiar? Click on the link below for more thoughts.
http://nationalcallcenters.typepad.com/nacc_blog/
Reader's Response: Making the Case for Coaching
Andy Elkind, Vice President, Operations, The Elkind Group,
andy@elkindgroup.com.
I'm writing in response to
Dennis Adsit's article No Hope For Coaching, which
appeared in Volume 3, Issue 8 on April 25. Dennis argued
that "coaching in even modest turnover environments
cannot improve overall call center output measures."
With all due respect, I have to disagree. I'd suggest
that Dennis has overlooked three key points.
First, it's wrong to look at coaching in isolation.
Dennis is absolutely correct when he talks about the
need to "lift the performance of the system."
Performance in a call center – or in any environment –
does depend on an effective system. This system
includes:
• Business strategy
• Processes
• Tools and resources
• Performance standards and expectations
• Hiring practices
• Training
• Monitoring and assessment
• Appropriate coaching
• Rewards and consequences
If these elements are aligned, an organization can
achieve significant results. If these elements are not
aligned – or if some elements are missing – it becomes
extraordinarily difficult to achieve any kind of
improvement. Even the best coaching can't make up for a
flawed performance system. But in the context of a
well-aligned system, coaching plays a critical role in
improving performance and boosting the ROI on hiring and
training.
Second, Dennis is also right to consider the negative
impact of turnover on the performance results of any
call center. But here he overlooks the role that
coaching plays in reducing turnover. The old adage is:
"people join organizations but they leave supervisors."
It turns out to be absolutely true. Of course, coaching
can't compensate for poor hiring decisions. But there's
overwhelming evidence that a positive coaching
relationship can play a substantial role in reducing
turnover.
Recently I heard an address by Keith Dawson, a Senior
Analyst with the research firm Frost & Sullivan. Keith
was formerly an editor for Call Center Magazine, and has
been covering the call center industry for nearly 20
years. Keith shared 10 best practices that top
performing call centers are utilizing to reduce
turnover, improve performance, and increase
profitability. Focused coaching was number 3, right
behind hiring the right people and providing good
training.
Finally, Dennis notes with despair that "billions of
dollars are being spent across the industry on call
recording technology and call monitoring personnel."
Again he's correct, but he's missing the critical point.
Upon close examination, most of the activities that pass
for "coaching" turn out to be just "evaluating." Here's
a quick summary of the differences:

If you ask any group of call center supervisors or
quality monitoring people if they are coaching, you'll
undoubtedly hear an enthusiastic "yes." But if you ask
the call center representatives you'll hear a different
story. And if you observe the "coaching" in action, more
often than not what you'll see is really just
evaluation.
So if you want your CFO to calculate the ROI for
coaching, make sure your coaching is happening in the
context of a complete and well-aligned performance
system. And make sure your supervisors and quality
monitoring people are really coaching rather than
evaluating. You'll reduce turnover in your call center –
and you'll improve other key results, too.
Call Center Comics

If you like this comic
and would like to see more write Ozzie at
callcentercomics@yahoo.com and visit his website at
http://callcentercomics.com/cartoon_categories.htm
or just click on the comic to take you to his page. The
NACC appreciates Ozzie letting us use some of his comics
in our newsletter.
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In Queue, please
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Copyright 2008 National Association of Call Centers
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