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Kids have been tweating and creating Facebook pages for years. But over the last 12 months, social media has become a new tool of the business world. For the first time outsourcing buyers are asking their suppliers "for social media solutions to help them out, specifically in customer care," reports Mike Wooden, Senior Vice President, Market Development, Business Process Solutions for ACS.

However, while he does believe social media can "drastically change the customer care environment," even more so than e-mail and the Web did, he doesn't see the likes of Facebook, blogs, and Twitter "completely overtaking the world."

Currently, the ACS executive says up to 10 percent of customer care interactions happen through social media, which is why Wooden predicts social media "will become a key component" in customer care over the next five years. Companies "can't ignore them" because today there are 65 million active Facebook users and over 200 million bloggers.

That's why ignoring social media in customer care processes can be a corporate death knell. Companies that wait may experience a backlash from missing the trend. "As I see it, the risk of ignoring social media is a risk companies cannot afford," insists Sue Marks, CEO of Pinstripe. She suggests companies "should focus on innovation and opportunity instead of narrowly defining their actions by their return on investment" when determining when they want to enter the social media world.

Within five years Wooden predicts any company with a customer-facing product "will have embraced social media to improve their customer service. If they don't, I doubt they will be around much longer," he says.

Customer care and HR recruiting processes will embrace social media

Wooden says companies have to consider social media as another channel of service, like e-mail and chat. He explains this creates a business advantage in reducing the volume of calls to the call center. This reduction saves outsourcing buyers money, giving them a better return on investment, he adds.

In addition to saving costs, mastering the art of social media improves customer satisfaction. Wooden points out there is a plethora of Web sites where disgruntled consumers share horror stories about companies. "People have now taken that to Facebook," he reports. The immediate way for companies to combat this negative impression "is to get real information out there to fight the perception early before it steamrolls."

For that reason, Wooden believes social medial is now "a critical element of any company's customer-care platform. They've got to figure out how to do it."

Marks agrees with Wooden, adding that employers "can acquire better talent if they are engaged in social media." Why? Because she says social media sites can reveal invaluable information about how employees, prospects, and consumers perceive a company's brand. "Gathering this information proactively is the critical first step for companies to address and reformulate their brand perception in the marketplace," she explains. RPO suppliers help employers leverage the social media dialogue so they can promote their organizations and attract the best talent, she continues.

Pace of adoption

Marks says that recruitment process outsourcing (RPO) buyers that are concerned about social media are the early adopters. "Today there is no clear ROI on social media, so the early adopters in the RPO space are taking a leap of faith," she says.

Wooden predicts, "The typical adoption phase is going to be much more accelerated in social media" than other trends.

He explains that the level of adoption depends on the vertical. "Different industries are aware of social media in different ways. There are different parts of the acceptance curve," Wooden says. For example, wireless companies in the communications vertical ask his staff for help in figuring out their initial strategy while buyers in retail/e-tail tell him, "Our marketing folks are already using this, so we have to determine our own strategy," he explains.

Marks says recruitment process outsourcers are using special applications built around social networking. New applicant tracking systems are an example. Instead of having job applicants fill out dozens of applications at each employer's Web site, they will be able to create a portable profile using an application like Facebook's Connect API. "Social networks take a step toward agility. This will be a huge and positive shift for HR and talent acquisition," she says.

Employers seeking talent will start doing online reputation assessments, she continues. She says employers "have to start listening to what's out there before they decide how to play in the social media space." The big question is how to leverage social media as part of their recruitment programs. This can be tricky for all outsourcers because "we have to navigate these discussions with the employer's legal, marketing, and HR departments as well as their IT security."

What social media means for suppliers

Today Wooden says "there's a big opportunity" for suppliers who embrace social media at this early stage. Suppliers that come up with strong solutions and a powerful ROI can enjoy "good growth with their existing customers." It also shows the supplier "is a thought leader." He says the outsourcing world "has to mine it early by coming up with a great solution."

To be a full-service customer-care provider in the future, "outsourcers will have to have strong social media services that help companies monitor the networks and make sure they get the right messages out." They will have to have the right tools to "mine the information and provide good solutions to their buyers."

What this means for buyers

Buyers have to make sure the suppliers have the right tools and strategy for their needs. Two people monitoring a Facebook page doesn't cut it. Suppliers "need technology that aggregates social media comments that are bad," suggests Wooden. And, as always, buyers need to treat their providers like partners if they want to get the best solution.

Buyers with an existing outsourcing relationship can discuss the social media options with their current supplier with social media monitoring as an add-on service.

Social media and the hand-held Internet -- most cell phones are Web-enabled, Marks points out -- have created "an opportunity for us to design a 'new normal' that will be better for our buyers, our customers, and our employees," she predicts.

Lessons from the Outsourcing Journal:

• Social media is becoming a game-changer. Companies, especially those with consumer products, ignore its use at their own peril and need to determine if their outsourcing suppliers have the capabilities to manage social media as a communications, marketing, and branding channel.
• Customer care and HR recruiting processes are early adopters of social media functions in outsourced services. Customers with consumer products can use social media to improve customer satisfaction and cut costs by having fewer calls to their call centers. Employers can attract better candidates using social media.
• Whether a buyer wants to add social media services to the scope in an existing outsourcing relationship or plans to establish a new relationship, buyers need to assess the supplier's technology and as well as the talent in the offering.

Publish Date: January 2010

Copyright © 2010 - Everest Partners, L.P.

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