For fast-growing technology companies, BPO is the key to long-term value23. 5. 2022 | Kateřina Kopecká
For fast-growing technology companies, outsourcing customer management can be the key to fulfilling their potential. Find out why.
Whatever happens to the global economy this year, one thing is certain: many more unicorns will be born, as well as a few more "decacorns". The former you are probably familiar with - it is a start-up with a value of over $1 billion; the latter is its larger equivalent with a value of over $10 billion.
'Decacorn' is a label worth adopting because you'll be seeing a lot more of them. In January to March this year alone, 7 companies were awarded decacorn status for the first time. One of these 7 companies was Getir, an Istanbul-based fast food delivery company and a client of Comdata in Turkey.
Getir's success got us thinking about the many decacorns, unicorns and other fast-growing tech companies we work with and the secret to their success.
Based on our experience working with fast-growing technology companies such as Getir (in Turkey), Glovo (in Portugal/Brazil), Didi (Latam), Leocare (France), Doctolib (France) and Holaluz (Spain), here are some important points to keep in mind if you have ambitions to become a unicorn or support its growth.
A lot in common, or nothing at all?
On the one hand, each fast-growing tech company is unique (after all, it just noticed a gap or did things differently). For example, the new unicorns in 2022 are in gaming, semiconductor manufacturing, internal communications, fintech, and blockchain. And don't assume unicorns are limited to the US, Europe or Asia, because you can now find them on every continent, including LatAm and Africa.
So these companies are diverse, but they all share rapid growth (plus investors seeking high returns on capital) and are likely looking to increase their global footprint to sustain that growth.
This raises customer management issues:
- How to meet local customer expectations while ensuring brand consistency on a global scale.
- How to achieve a good understanding of and compliance with the local regulatory framework, including local regulations on data security, privacy, etc.
- how to meet local workforce expectations in order to attract talent.
To do this they need the help of partners who are:
- large enough to help high-growth companies expand across geographies
- locally embedded enough to guide them through the complexities and specificities of different markets and cultures, and ensure linguistic and cultural proximity with their target customers, whether BtoC or BtoB
- flexible enough to accommodate client preferences, e.g. account management style or level of autonomy and contact.
Old problems but on a different scale
Businesses have been grappling with the challenges associated with geographic expansion for centuries, but fast-growing technology companies are having to address them at an unprecedented pace. They need to be able to expand their operations quickly - perhaps in multiple locations simultaneously - while being mindful of cost, resilience and risk.
In customer management, this can mean, for example:
- The ability to rapidly increase FTEs to expand outbound sales activity, respond to increased inbound customer demand or manage seasonal fluctuations.
- The ability to quickly reduce FTEs to reduce costs during slower periods.
- An understanding of how to use automation to scale, but without sacrificing the human touch where customers want it.
- Handling the unexpected - ensuring high-quality business continuity and problem-solving in the event of adverse circumstances, such as the need to quickly transition employees to off-site work, as was the case during a pandemic.
In today's corporate environment, fast-paced companies need to get these things right the first time. Because they have few chances to open up a new market, they need expert local/regional partners. By offering support on these issues, Comdata is helping fast-growing technology companies across multiple industries achieve unicorn status.
Think camel and unicorn
The trials of the pandemic got a lot of people talking about "camels". The idea is that start-ups will learn from the ability of camels to endure months without food and water and adapt their metabolism to survive adversity and achieve long-term growth.
For companies, one of the key elements of camel behaviour is managing costs throughout their life cycle, maintaining reserves instead of burning cash. Although most debates about unicorns and camels are polarized - as if startups can only be one or the other - it is possible for startups and large enterprises to learn from both: how they manage costs, including outsourcing, can make the difference between becoming a multi-million dollar company or not.
Smart outsourcing can help with cost optimization
In our experience, "smart-shoring" (also called "best-shoring") can change the game and help fast-growing businesses achieve both efficiency and growth goals. We often say that delivering excellence in customer management is about the best combination of people, processes and technology; in fact, it's worth adding "seats" to that mix.
One well-known unicorn that benefits from Comdata's smart-shoring capabilities is Glovo, a food delivery provider founded in Barcelona in 2015. When it wanted to improve its customer service levels in Portugal, it turned to Comdata. Within 4 months, we had built a team of 140 people in Brazil on the work@home model to provide services in the Portuguese market. Without the infrastructure of a conventional contact centre, this model is highly costly.
Quality and cost savings are not mutually exclusive.
A key point of our work with Glovo in the Portuguese market is that cost efficiency is combined with quality improvement, as Germán Puentes, regional manager of live SWE operations at Glovo, explains:
"With the previous provider, none of the key performance indicators (especially customer satisfaction, quality and service levels) were reaching the targets set by Glovo. The intention was to move to a reputable provider that would stabilise these indicators and provide us with quality and excellent customer service."
After switching to Comdata, Glovo's performance in these areas improved sharply: service levels (80%+), customer satisfaction (more than 4 out of 5) and quality (+85%) were all at target levels after just 6 months - and all this at the height of a pandemic!
3 out of 5 customer relationships may be at risk
Quality matters so much because nine in ten (90%) people say customer service is critical to them when making a purchase decision, choosing a brand or maintaining brand loyalty.
The same study (Microsoft's Global State of Customer Service report) also found that nearly three in five (58%) people will sever their relationship with a company because of poor customer service. These findings are particularly important for fast-growing technology companies, as they tend to put CX as one of the key differentiators in their value proposition.
However, many fast-growing companies do not have the in-house resources to provide the level of customer service that consumers or customers want.
There can be a variety of issues, such as:
- Lack of time or capital to focus on building back-office or seamless customer management systems at start-up or lightning expansion.
- the need to integrate different systems as they grow through acquisitions and organically
- allocation of resources (including talent, investment and focus) to innovation instead of "business as usual". This helps companies maintain a spark of innovators and disruptors, but can impact the quality of
- reputations built on media hype or the profile of a charismatic founder. It can work wonders in raising brand awareness, but it may not translate into brand loyalty. A brand's reputation will ultimately depend on a quality and consistent CX.
In all these (and other) scenarios, the solution is to team up with the right partners. In customer management, this means choosing BPO partners who can support the company in innovation while ensuring consistent operational excellence and continuous improvement; who themselves have an entrepreneurial and innovative culture (so they have affinity); and who have the reach, infrastructure capabilities, resilience to deliver quality and growth at scale.
All of this will allow a growth company to focus on its ambitions and what it does best.