February 19, 2020

Pros and Cons of In-House vs. Outsourced Call Centers

In-House Call Centers

In a world of business engagements, the call center is an integral part of every company. From handling client calls to promoting sales and generating business leads, the call center has many uses. Whether in-house or outsourced, its role is unmatched in the present-day business world.

The majority of customers globally prefer live calls. According to Smart Insights, 88% prefer call center engagements. With such high relevance, the call center remains a critical part of every business.

If your business is service or product-oriented, you need a call center to handle your sales or customer support. But should you be using an in-house or outsourced call center?

While both have advantages and disadvantages, determining the right choice for your business can be daunting. Outsourcing your call centers can save you on cost; however, customer service often suffers as a result of this. Comparing the pros and cons of both options is essential before selecting the right solution for your business.

Outsourced Call Centers

Also referred to as BPO, outsourced call centers involve hiring a third-party company to employ and manage your call services. Contracting happens in such a way that someone outside your company handles all your call center activities.

Benefits of Outsourced Call Centers

Outsourcing is highly sought after because of time and cost savings. They offer affordable business alternatives and have been ideal options for industry giants such as Time Warner Inc and The Wall Street Journal.

Here are some advantages of call center outsourcing;

Cost Reduction

Outsourcing call agents are cheaper compared to starting an in-house call center. Brick and motor in-house call center reduces infrastructure, labor, and overhead costs. With call center outsourcing, you can create a simple engagement as per your company’s needs. A contract is all that you need to cover your company’s needs. With an outsourced call center, your company can save up to 50%.

The call center provider takes care of the staff without wasting much time.

Ready, Trained Staff

Outsourced call agents typically have comprehensive customer service training. Also, call agents gain experience from working with numerous brands throughout their careers. Rather than starting an in-house call center with amateur agents, outsourcing providers can bring along a pool of experienced staff.

Besides, managers in outsourced call centers train their staff, both new and existing. They offer business–tailored training sessions for the benefit of their clients. If you are contemplating outsourcing staff, you might largely benefit from a pool of trained experts.

Management of Staff and Productivity

Hiring and managing staff can be a tedious task. A call center is relatively different from other departments- it requires close monitoring and maintenance, and your company might lack the capacity to run one. It requires a lot of time, experience, and resources to assemble a team of reliable call center agents. Outsourcing managers hire and manage staff on your behalf. This reduces the management task and allows your business to focus on productivity.

Risk Mitigation

Outsourcing call center agents implies that a business is engaging in a mutual risk agreement. This provides some sense of security to the outsourcer.

By outsourcing your call center services, you mitigate some costs such as a change of technology; the call center does that on your behalf! It shares the risks with your partner, thus reducing your burden. Additionally, outsourcing adds you some layer of defense should something go wrong.


Upgrading or downgrading can prove problematic with an in-house call center. Increasing or downgrading your number of seats is however, seamless with an outsourcer. Change in business volume is relatively flexible with an outsourced provider. Your provider makes the process more effective and you might not feel any change of guard. Whether it means adding infrastructure or staff, outsourcing makes it possible to scale up customer service during peak time.

The Disadvantages of Call Center Outsourcing

Outsourcing your call agents might have many benefits, but it also has its downside. Here are the disadvantages of call center outsourcing;

Language Differences

Language and cultural differences are rampant in most outsourced call center services. Without any significant control from your side, your call agents might fail to align their language with your audience. Miscommunication is inevitable if call agents lack appropriate training.

The majority of customers feel disrespected especially when there is a communication barrier with the agents. Call center agents may lack the cultural knowledge, communication skills and fluency needed in your brand, and this might ruin your business reputation.

Inadequate Brand Awareness

It’s normal to have outsourced call agents who are unfamiliar with your products. Regardless of the extent to which they are trained, having full knowledge or your brand is a dream. While in-house agents understand the dynamics and business environment under which you operate, outsourced agents tend to be misinformed in many instances.

Compromise on Data Sensitivity

Outsourcing your call center services compromises your data. You have to disclose some critical information while equipping your agents with relevant information. This compromise on data might hugely affect your business, especially when leaked to competitors. Call center outsourcing is never the best approach is you operate in a sensitive business environment.

Less Focus on Customer Care

In many instances, outsourced call centers don’t have your business interest at heart. All there is for them to do lowering queue time, and this might be at the expense of your business. Call agents tend to give quick, pre-defined responses to customers thus hurting your business. Outsourcing can be a bad mistake that can cause customer dissatisfaction.

Lack of Control

As a business manager, the extent of control that you can exercise on outsourced call agents is limited. While an in-house call center gives you autonomy, the case is different when it comes to outsourced services. Everything goes as per drafted in the contract, denying you the chance to manipulate your call services. Supervision is as well next to impossible, and your business might suffer from inadequate supervision.

In-house Call Centers

Having your call center within your business environment is imperative to better customer service. While it comes with numerous benefits, its costs and management requirements tend to be on the higher end.

Pros of In-House Call Centers

In-house call centers offer what outsources centers cannot deliver. Below are the perks of in-house call centers;

Increased Brand Awareness

In an in-house call center, agents are more informed about your business undertakings. Call agents are part of your team and understand business processes and changes as they happen. Also, they are well versed in your products. Unlike third-party agents, your in-house agents have a general interest in your products which promotes the ultimate customer experience.

Information Security

With in-house call center agents, information revolves within your business. Call agents can uphold business secrecy and prevent leakage of critical knowledge. There is less risk of data exposure when housing call agents within your premises. As a business manager, you are more confident when dealing with direct representatives than outsourced ones. Industries such as banking and finance ought to have their in-house call centers for maximum information security.

Personal Touch and Control

You can exercise complete control over the call center activities. Also, you can dictate on call handling procedures to achieve the ideal call support. The call center manager can decide on who to handle what type of calls and schedule shifts according to agents’ strengths. As a call center manager, you can choose the best inbound and outbound call center software that can revolutionize your workplace.

In-house call center agents deal exclusively with your brand, and this maximizes attention. You can also train your call center agents to become the ultimate brand ambassadors.

Quick Implementation of Policy Changes

Company policies are subject to change. In-house call centers are swift when it comes to relaying information on changes compared to third parties. While third-party agents might drag the process of communicating changes, in-house agents make everything fast.

Insights from Customer Engagement

In-house call center agents can gather essential insights for the benefit of the business. They can identify some critical areas of improvement, customer reactions to business changes, and identify market gaps. This is virtually impossible with third-party agents whose sole aim is to get the work done. If your business depends largely on customer insights, an in-house call center is by far better than an outsourced one.

Personalization of Services

In-house agents can often provide a higher level of personalized service to customers. Having access to management and high-level support can help resolve issues quicker and more suited for customers. While outsourced agents have to go through a long process to reach management, it’s easier for in-house agents. They can schedule calls, give accurate information, and attend to specific customer queries. With the right call center tools and software, you can personalize services to offer better customer service.

Integration of Call Center with Organization’s Resources

In-house agents benefit significantly from the organization’s resources. From infrastructure to premises, call agents feel integral to a company’s operation. With the ease of access to resources and data, they make customer engagement meaningful and productive.

Disadvantages of In-house Call Centers

Just like the outsourcing, in-house call centers have their demerits. They include;

Costly Infrastructure

Setting up an in-house call center infrastructure can be very expensive. There are many things that you have to start with including computers, PBX systems, phone lines, and general call center software. These tools can be costly especially those that use advanced technology. Many businesses struggle a lot while setting up in-house call centers. Besides infrastructure, other costs, such as restructuring, might occur in the processes.

It Requires Management and Training

Managing in-house call centers is not an easy task. It requires excellent managerial skills and some previous experience. Lack of good management might prove catastrophic and render the call center ineffective.

Besides management, call center agents require a proper training program to prepare them for the task. Without adequate training, customer engagements on the phone might be too overwhelming for in-house call agents. This can be magnified if your call center experiences higher turnover rates in staff.

Support Unavailability

In a business environment that does not operate on a 24-hour basis, the coverage gap is inevitable. In many organizations, call center agents work on local standard business hours. Customers seeking support services beyond this time might end up getting disappointed, which in turn, ruins your company’s reputation. While outsourced call centers offer 24-hour support, many in-house counterparts struggle with it.

HR Support

Using in-house agents requires additional elements of Human Resources, time, and budgeting. HR staff will need to be paid and handle payroll, tax information, recruiting, and managing benefits. While Human Resources is an integral part of a company, businesses with higher turnover rates will require better HR departments.

Making the Right Decision:

Choosing which way to go is never a walk in the park. While there are many factors involved in setting up a call center, finding the right solution to fit your business needs is an essential step in the process.

Many things fall in play, from the nature of the business to your goals. Do you receive high volume inbound calls that need to be addressed 24 hours? Are you catering to providing higher-level customer support for your customer experience? Asking the right questions to determine your ultimate call center goals should be factored in your decision to house a call center.

If you want more control, privacy, and high levels of coordination, in-house call centers are the best. However, this comes at a cost that might be avoided through outsourcing. As long as you provide 24-hour availability, offer the right training, and uphold brilliant management, in-house call centers will never be a problem. Call Tools provides a complete call center suite to help streamline your processes if you decide to use an in-house call center.

See how Call Tools can support your enterprise today!

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