E-Commerce Unit-3

E-Commerce Notes

Unit-3

Lecture-1

Value Chain

·        The value chain is a concept from business management that was first described and popularized by Michael Porter in his 1985 best seller, Competitive Advantage: Creating and Sustaining Superior Performance.

·        A Value Chain is a chain of activities for a firm operating in a specific industry.

·        Products pass through all activities of the chain in order and at each activity the product gains some value. The chain of activities gives the products more added value than the sum of the independent activities value.
     Here we have shown just a basic value chain flow of an Automobile Industry.

·        A diamond cutter, as a profession, can be used to illustrate the difference of cost and the value chain. The cutting activity may have a low cost, but the activity adds much of the value to the end product, since a rough diamond is significantly less valuable than a cut diamond.

·        The value chain framework quickly made its way to the forefront of management thought as a powerful analysis tool for strategic planning. Value chain analysis has also been successfully used in large Petrochemical Plant Maintenance Organizations to show how Work Selection, Work Planning, Work Scheduling and finally Work Execution can (when considered as elements of chains) help drive Lean approaches to Maintenance.

Porter’s Value Chain Model

The idea of the value chain is based on the process of organization, the idea of seeing a manufacturing (or service) organization as a system, made up of subsystems each with inputs, transformation processes and outputs. Inputs, transformation processes, and outputs involve the acquisition & consumption of resources- money, labour, materials, equipment, buildings, land, administration and management. How value chain activities are carried out determines costs and affects profits.

Most organizations engage in hundreds, even thousands of activities in the process of converting inputs to outputs. These activities can be classified generally as either primary or support activities that all businesses must undertake in some form.

According to Porter (1985), the primary activities are:-

Ø Inbound Logistics: involve relationships with suppliers and include all the activities required to receive, store & disseminate inputs.

Ø Operations: are all the activities required to transform inputs into outputs (products & services).

Ø Outbound Logistics: include all activities required to collect, store & distribute the output.

Ø Marketing & Sales: activities inform buyers about products & services, induce buyer to purchase them and facilitate their purchase.

Ø Service: includes all the activities required to keep the product or service working effectively for the buyer after it is sold and delivered.

Support Activities are:-

Ø Procurement: is the acquisition of inputs, or resources, for the firm.

Ø Human Resource Management: consists of all activities involved in recruiting, hiring, training, developing, compensating and dismissing or laying off personnel.

Ø Technological Development: pertains to the equipment, hardware, software, procedures and technical knowledge brought to bear in the firm’s transformation of inputs into outputs.

Ø Infrastructure: Serves the company’s needs & ties its various parts together, it consists of functions or departments such as accounting, legal, finance, planning, public affairs, government relations, quality assurance & general management.

Fig PORTER’S GENERIC VALUE CHAIN

Linked Value Chains

Value chain activities are not isolated from one another. Rather, one value chain activity often affects the cost or performance of other ones. Linkages may exist between primary & support activities. Interrelationships among business units form the basis for a horizontal strategy. Such business unit interrelationships can be identified by a value chain analysis.

                                                   Inbound Logistic- From Suppliers

                                                   Outbound Logistic- From Customers

E-Commerce enhances value chain by providing:-

Ø Electronic Value Chain: through electronic value chain, e-commerce enhances business by supporting:

·        Reduced time frame

·        Changed Cost Structures

Ø Re-engineered value: Re-engineered value chain, e-commerce enhances business by supporting:

·        Just-in-time Manufacturing

·        Quick response supply

·        Efficient document processing

Ø Competitive Advantage: E-Commerce supports a company for gaining competitive advantage.

                                       MANUFACTURING VALUE CHAIN

E-Commerce Notes

Unit-3

Lecture-2

Competitive Advantage

·        A firm is said to possess a competitive advantage over its rivals, if it sustains profit that exceed the average for its industry.

·        The goal of much of business strategy is to achieve a sustainable competitive advantage.

·        Michael Porter identified two basic types of Competitive advantage:

Ø Cost Advantage

Ø Differentiation Advantage

Cost Advantage: Cost advantage exists when the firm is able to deliver the same benefits as competitors but at a lower cost.

Differentiation Advantage: Differentiation advantage exists when the firm is able to deliver benefits that exceed those of competing products.

Cost and differentiation advantages are known as potential advantages since they describe the firm’s position in the industry as a leader in either cost or differentiation.

A resource based view emphasizes that a firm utilizes its resources  and capabilities to create a competitive advantage that ultimately results in superior value creation.

Resources & Capabilities:

According to the resource based view, in order to develop a competitive advantage the firm must have resources and capabilities that are superior to those of its competitors.

Resources: are the firm-specific assets useful for creating a cost or differentiation advantage and that few competitors can acquire easily.

Capabilities: refer to the firm’s ability to utilize its resources effectively. An example of a capability is the ability to bring a product to market faster than competitors. The firm’s resources & capabilities together form its distinctive competencies.

Model of Competitive Advantage

Value Creation: The firm creates value by performing a series of activities that Porter identified as the value chain. Superior value is created through lower costs or superior benefits to the customers.

The Principle of Competitive Advantage --

Success is based on inventing an offering that addresses a real scarcity in the world, charging a price for it, and inventing a way of making it available that is cheap enough to leave a high margin.

Elements of Competitive Advantage –

Uniqueness - finding unique opportunities and solutions is about imagination, insight, foresight, and the courage to pursue it. Unique is new, different, but most important of all, untested and unproven. By the time a unique solution is validated as profitable, it is no longer unique for the next company. Also, if it is a unique business model or business capability, it is likely unapproachable, in the short-term, by competitors.

Strategic Focus - Strategic focus comes  from marrying distinctive competency and purpose to form a superior value proposition. Strategic focus is about developing a longer view of competitive advantage with a combination of purpose, competency, and value proposition. This creates an internal environment that has the confidence and implicit support to continue to perfect and develop that focus through creating stronger competencies and further perfecting the value proposition.

Strategic Intent/Vision/BHAGs - Strategic intent challenges and guides the organization to achieve the unachievable by having a clear focus on outlandish objectives which require the development of new capabilities to achieve.

Innovation - Innovation is inventiveness put into profitable practice. In an evolving economy, the business organization must innovate at a rate that meets or exceeds its environment in order to sustain a competitive advantage.

Continual Innovation - Making innovation as an ongoing process on all fronts.

Democratic Principles - Democratic principles are needed to fully engage the active participation of diverse thinkers from across the organization. Broad and diverse participation improves innovation.

Strategic Management as a self-improving learning process - Strategic management must become, amongst other things, a learning and self-improvement process for the organization.

Dynamic Capabilities - Sustainable competitive advantage is ultimately based on dynamic capabilities, the capability to produce and utilize new capabilities on a continuous basis.

E-Commerce Notes

Unit-3

Lecture-3

Porter’s Five Forces Model:

Michael Porter described a concept that has become known as the “five forces model”. This concept involves a relationship between competitors within an industry, potential competitors, suppliers, buyers & alternative solutions to the problem being addressed.

·        Threat of Potential Entrants: The threat of new entrants relates to the ease with which a new company or a company in a different product area can enter a given trade sector. Barrier to entry into a particular market include the need for capital, knowledge and skills.  The barriers to entry for e.g. to the vehicle assembly sector are massive; to start building cars there is the need to develop a new model range, build a car assembly plant, contract a large number of component suppliers and sign up a dealer network. Getting into business in building personal computers is, in contrast, much easier; the components are readily available and there is not the same need for investment in product development or large scale production facilities before the company makes a start.

·        Threat of Substitution: Substitution is a threat to existing players where a new product becomes available that supplies the same function as the existing product or service. The classic examples are the (partial) substitution of natural fibres such as cotton and wool by synthetic fibres or the replacement of glass bottles by a plastic alternative in some sectors of the packaging industry. Existing players can protect themselves by keeping their product up-to-date.

·        Bargaining power of Buyers: For a business to be profitable the cost of producing and distributing its product  has to be less than the price it can fetch in the market place. Where there are a number of competitors in the market or a surplus of supply the buyer is in a strong position to bargain for a low price and for other favorable conditions of trade.

·        Bargaining power of Suppliers: The organization, while trying to get an adequate price from its buyers, will be looking to get favorable terms from its own suppliers at the next stage along the value chain. The organization’s ability to get a good deal is the mirror image of its position with its buyers. If the supply is plentiful and/or there are several suppliers it should get a good price. If the product is scarce or the number of suppliers that are able to meet its need is limited then the supplier is in a more favorable position.

·        Competition between existing players: The final force is the completion between existing players in the market. The competition is to get the buyers and to trade at a price that produces an acceptable profit. That competition is won on the basis of the generic competitive advantage of cost or differentiation. The competitive position of each organization is determined by the deal it is able to make with the suppliers.

Important Points of Value Chain:

1.     The Organization need to establish which of its inter organizational relationships add to its competitive advantage & which fail to achieve appropriate levels of quality & price.

2.     The Linkages in the value system have to be managed.

3.     The Physical Linkage involves good handling, transport & warehousing

4.     Value chain must be clear & understandable.

5.     The essential stages of a value chain are: Pre-sale, Execution, settlement & after-sales.

E-Commerce Notes

Unit-3

Lecture-4

Business Process Reengineering (BPR)

v Business Process Re-engineering is the fundamental rethinking and radical re-design of business processes to achieve dramatic improvements in critical contemporary measures of performance such as cost, quality, service and speed.

v BPR means not only change but dramatic change & dramatic improvements.

v BPR involves the overhaul of organizational structures, management systems, job descriptions, performance measurements, skill development, training and most importantly the use of information technology.BPR impacts every aspect of how the organization runs its business.

v Change on this scale can cause results ranging from enviable success to complete breakdown & failure.

v A successful BPR can result in dramatic performance improvements, increase in profits, better business practices, enormous cost reductions, dramatic improvements in productivity & so on.

Different Phases of BPR

·        Begin Organizational Change

·        Building the reengineering organization

·        Identifying BPR opportunities

·        Understanding the existing process

·        Re-engineering the process

·        Blueprint the new business system

·        Perform the transformation

1.        Begin Organizational Change:

Ø Assess the current state of organization.

Ø Explain the need for change.

Ø Illustrate the desired state.

Ø Create a communication campaign for change.

2.        Building the reengineering organization:

Ø Establish a BPR organizational structure.

Ø Establish the roles for performing BPR.

Ø Choose the personnel who will reengineer.

3.        Identifying BPR opportunities:

Ø Identifying the high level process.

Ø Gather performance metrics within & outside industry.

Ø Prioritize selected process.

Ø Consult with customers for their desires.

4.        Understanding the existing process:

Ø Model the current process.

Ø Understand how technology is currently used.

Ø Understand how information is currently used.

5.        Reengineer the process:

Ø Question current operating assumptions.

Ø Evaluate the impact of new technologies.

Ø Consider the perspective of stakeholders.

6.        Blueprint the new business system:

Ø  Define the new flow of work.

Ø  Model the new process steps.

Ø  Model the new information requirements.

Ø  Describe the new technology specifications.

7.        Perform the transformation:

Ø  Develop a migration strategy.

Ø  Reallocate workforce.

Ø  Educate staff about the new process.

Ø  Implement in an iterative fashion.

Challenges in BPR

§ Unfortunately, all BPR projects are not as successful as those described.

§ Most of the BPR projects will fall short of expectations.

§ Companies that begin BPR projects face many of the following challenges:-

« Resistance from employees.

« Changing the traditional ways of doing things.

« Time Requirements (BPR is a lengthy process, almost always taking two or more years to complete).

« High cost of BPR.

« Manpower reduction (BPR often results in employees being laid off).

Maximizing Chances for BPR Success

The guidelines that will help in maximizing chances for success in a BPR effort are:-

® Realize that not every company needs to re-invent.

® Expect strenuous resistance & manage it properly.

® Get top management support.

® Communicate with employees to prevent rumors & misunderstandings.

® Create an atmosphere of trust & co-operation.

® Change the way employees are evaluated & rewarded to motivate them to support the system.

® Staff the project with the best people & provide them with resources they need.

®  Make sure the employees are adequately trained on how to use the new system.

® Go for small success at first. Go for more dramatic projects once you have gained some experience in BPR.

E-Commerce Notes

Unit-3

Lecture-5

Business Process Management (BPM)

v Business Process Management has been referred to as a “holistic management” approach to aligning an organization’s business processes with the wants and needs of clients.

v BPM uses a systematic approach in an attempt to continuously improve business effectiveness and efficiency while striving for innovation, flexibility and integration with technology

v As a managerial approach BPM sees processes as strategic assets of an organization that must be understood, managed & improved to deliver value added products & services to clients.

v BPM is the discipline of modeling, automating, managing, monitoring and optimizing business processes to increase profitability.

Business Process

A business process is a set activities required to accomplish a common goal. The activities may be performed by people or systems and are completed either sequentially or simultaneously. It is best to think of a business process as the way that work should be performed.

BPM Life Cycle

BPM is a discipline consisting of 5 phases:-

« Model

« Automate

« Execute

« Monitor

« Optimize

1.     Model: The first phase of BPM is to create a model. e.g. a globe is a model of the planet earth. During model phase, we begin by creating a high level diagram of the process. Initially, the goal to gather just enough detail to understand conceptually how the process works and the main steps involved without being distracted by the fine detail of how it will be implemented.

2.     Automate: During the Automate phase, the model is expanded to create the specific set of instructions, form details and rules needed to run the process. It is at this point where discussion about how to specifically implement the processes is made. e.g. while a globe is a model of the earth, a map provides the detailed directions between two cities & helps you decide which route to travel.

3.     Execute: The Execute phase of BPM consists of interpreting the instructions created during the Automate phase to manage the flow of work from the beginning of the phase until its completion. Within BPM software, the workflow engine is responsible for creating tasks and automatically directing them to the right people or systems based on the process rules much like the way a GPS system provides you with step-by-step driving instructions to your destination.

4.     Monitor: The monitor phase is where process performance is measured, tracked & reviewed for potential improvements. e.g. identifying that travel time has increased by 30% might cause you to test an alternative route to avoid the new traffic signals.

5.     Optimize: During the optimize phase, managers use data and lessons learned from manage phase as a foundation to change the process. Optimization may include such things as enhancing the data collection forms, adding or removing tasks, automating steps that were previously completed manually or modifying the reports generated. The goal of the optimize phase is to identify changes that will improve the process.

E-Commerce Notes

Unit-3

Lecture-6

Customer Relationship Management (CRM)

v CRM is a widely implemented strategy for managing a company’s interactions with customers, clients & sales prospects. It involves using technology to organize, automate & synchronize business processes.

v The overall goal is to find, attract and win new clients, nurture & retain those the company already has & reduce the costs of marketing and client service.

v CRM is an iterative process that turns customer information into positive customer relationship.

v Some of the leading vendors of CRM systems are Siebel Systems, Oracle, and People Soft.

Process of CRM

Goals of CRM

·        Provide better customer service.

·        Make call centers more efficient.

·        Increase sales.

·        Simplify marketing & Sales processes.

·        Discovering new customers

·        Increase the quality of Information.

·        Improve customer retention.

Three Fundamental Components of CRM

·        Operational: Automation of basic business processes (marketing, sales, service).

·        Analytical: Analysis of customer data & behavior using business intelligence.

·        Collaborative: Communicating with clients.

Functions of CRM

« Identify factors important to clients.

« Promote a customer oriented philosophy.

« Adopt customer based measures.

« Provide successful customer support.

« Handle customer complaints.

« Track all aspects of Sales.

Uses of CRM

® Providing on-line access to product information & technical assistance around the clock.

® Identifying what customer’s value & devising appropriate service strategies for each customer.

® Providing mechanisms for managing & scheduling follow-up sales calls.

® Tracking all contacts with a customer.

® Identifying potential problems before they occur.

® Providing a user-friendly mechanism for registering customer complaints.

® Providing a mechanism for handling problems & complaints.

® Providing a mechanism for correcting service deficiencies.

® Storing customer interests in order to target customers selectively.

® Providing mechanics for managing & scheduling maintenance, repair & ongoing support.

 

                                     Application Components in CRM systems

CRM supports critical Marketing processes including the following:-

Ø Technology enabled selling

Ø Marketing Resource Management

Ø Segment and List Management

Ø Call Center Management

Ø Campaign Management

Ø Field Service Management

Ø Trade Promotion Management

Ø Lead Management

Ø Marketing Analysis

E-Commerce Notes

Unit-3

Lecture-7

Supply Chain

·        A supply chain is a system of organizations, people, technology, activities, information and resources involved in moving a product or service from supplier to customer.

·        Supply chain activities transform natural resources, raw materials and components into a finished product that is delivered to the end customer.

·        In sophisticated supply chain systems, used products may re-enter the supply chain at any point where residual value is recyclable.

Supply Chain Management(SCM)

·        Supply Chain Management is the oversight of materials, information & finances as they move in a process from supplier to manufacturer to wholesaler to retailer to consumer.

·        SCM involves coordinating & integrating these flows both within & among companies.

·        SCM enables collaboration, planning, execution & coordination of the entire supply chain, empowering companies to adopt their supply chain processes to an ever changing competitive environment.

·        With better synchronization across the entire supply chain, the business partners achieve the following major benefits:-

Ø Lower Inventories & therefore lower financing costs

Ø Shorter receivable cycles

Ø Optimal use of production resources & costly workforces

Ø Faster response to market changes

Ø Greater satisfaction & loyalty among customers

Ø Greater profitability

·        The military was one of the first organizations to recognize supply chains & to manage them during World War II.

·        The SCM systems have become more efficient & intelligent with the use of computers, artificial intelligence & other advancements in the field of information technology.

·        SCM solution transform traditional supply chains from linear, sequential steps into an adaptive supply chain network in which communities of customer-centric, demand driven companies share knowledge, intelligently adapt to changing market conditions & proactively respond to shorter, less predictable life cycles.

·        Today almost all organizations-military, manufacturing, service industries, retailers & so on use SCM systems to improve their efficiency & effectiveness.

Advantages of Supply Chain Management

« Supply Chain Planning & Collaboration: Supply chain planning functionality enables you to maximize return on assets & ensures a profitable match of supply & demand.

« Supply Chain Execution: SCM enables you to carry out supply chain planning & generate high efficiency at the lowest possible cost.

« Supply Chain Visibility Design & Analytics: SCM gives you network-wide visibility across your extended supply chain to perform strategic as well as day-to-day planning.

« Business Benefits: SCM can help you transform linear supply chain into an adaptive network with the following benefits:-

§  Faster response to changes in supply & demand.

§  Increased customer satisfaction.

§  Compliance with regulatory requirements

§  Improved Cash flow

§  High margins

§  Greater synchronization with business priorities

Just In Time (JIT)

·        JIT means to produce goods and services when needed, not too early and not too late. It is time based and often has quality and efficiency targets.

·        It is a Japanese production management philosophy since 1970s, which allows having the right items of the right quantity & quality, in the right place and at right time. This is hand to mouth approach to production. The primary goal of JIT is to achieve zero inventories within the organization as well as throughout the entire supply chain. 

·        The JIT system uses the PULL method of scheduling material flow.

·        A JIT system aims to make goods available just-in-time, and these cab be parts, products or sub-assemblies and achieve some of the following benefits:-

§  Increased Flexibility

§  Parts Reduction

§  Increased Quality

§  Simplicity of System

To achieve the aims of JIT a disciplined approach is needed which incorporates three principles applied to the organization:-

Ø Elimination of Waste

Ø Total Quality Management

Ø Total Employee Involvement

Elimination of Waste: Waste elimination is basically removal of any activity that is not value-added, but first it has to be identified. These activities don’t increase product value and are costly to the company. Examples of non-value added activities include traditional production methods, i.e, inspection of parts, holding stock inventories, time etc.

Waste can be eliminated from these activities by removal of defects and by not over producing hence, make-to-order.

Total Quality Management: TQM eliminates waste by eliminating defects. In a JIT environment, the aim is to prevent defects from occurring and this is achieved by detecting problems at their source. The whole organization is involved in the process, right from the stages of manufacturing, product development and purchasing. Manufacturing uses statistical process control (SPC) and in-process testing (to allow detection at source), while product development ensures that new products can be manufactured to specification. Purchasing makes sure that the parts that are bought are of required quality.

Total Employee Involvement: Total employee involvement has management providing the leadership which result in employees wanting to be involved in the processes. Opportunity is provided through education & training & work teams.

Benefits of JIT

®  Increased Flexibility: A flexible workforce means that the operators must be multi-skilled which is done through training. The worker should be free to move from low demand to high demand areas.

®  Parts reduction: JIT continuously seeks to reduce inventory levels of raw materials, work in progress and finished goods. Lower inventory means less space & less chance of the product being obsolete, damaged or spoiled.

®  Increased Quality: When operating a JIT system, disruption has a major impact, so quality problems need to be eliminated. Benchmarking Quality Function Deployment and service design can be used for service operations. Since employees need to learn the value of providing defect free services.

®  Simplicity of System: Product mix or volume changes as planned by the Master Production Schedule (MPS) can be accomplished by adjusting the no. of cards in the system. Production orders are prioritized by the cards on a post. Production orders for parts that are running low are moved in front of parts that have more supply.

Potential Pitfalls of JIT

®  Many companies fail to understand what JIT is and what it can mean to them because they fail to implement it properly. Most importantly, they need to be aware of the tasks, resources, time scale and costs. For this, the system will need the full backing of the top management.

®  The JIT will also fail, if an adequate education programme is not provided. If careful planning of process & control improvements are not strictly followed, they will result in JIT not been realized. The planning stage will require dedication & time and may also require the assistance of an external consultant(s).

PUSH & PULL System of Production

The term PUSH and PULL are used to describe two different systems for moving work through a production process.

In traditional environments, a PUSH system is used. When work is finished at a work station, the output is pushed to the next station or in the case of final production it is pushed on to the final inventory.

Conversely, in a PULL system-each work station pulls the output from the preceding station as it is needed; the output of final operation is pulled by the customer demand or the master schedule. Thus in a PULL system, work moves on in response to demand from the next stage in the process, whereas  in a PUSH system, work moves on as it is completed without regard to the next station’s readiness for the work. Consequently work may pile up at workstations that fall behind schedule because failure or the detection of a problem of quality.

Built-To-Order (BTO)

·        Built-to-order and sometimes referred to as make-to-order (MTO), is a production approach where products are not built until a confirmed order for products is received.

·        This approach is considered good for highly configured products e.g. bicycles, computer servers, or for products where holding inventories is very expensive e.g. aircraft

E-Commerce Notes

Unit-3

Lecture-8

Call Centre

A call centre or call center is a centralized office used for the purpose of receiving or transmitting a large volume of requests by telephone.

Inbound call centre is operated by a company to administer incoming product support or information inquiries from consumers.

Outbound call centers are operated for telemarketing, solicitation of charitable or political donations, debt collection and market research.

In addition to a call centre, collective handling of letter, fax, live support software, and e-mail at one location is known as a contact centre.

Premise-based Call Centre Technology historically, call centers have been built on PBX (Private Branch Exchange) equipment that is owned and hosted by the call centre operator. The PBX might provide functions such as Automatic Call Distribution, Interactive Voice Response, and skills-based routing. The call centre operator would be responsible for the maintenance of the equipment and necessary software upgrades as released by the vendor.

Virtual Call Centre Technology With the advent of the Software as a service technology delivery model, the virtual call centre has emerged. In a virtual call centre model, the call centers operator does not own, operate or host the equipment that the call centre runs on. Instead, they subscribe to a service for a monthly or annual fee with a service provider that hosts the call centre telephony equipment in their own data centre. Such a vendor may host many call centers on their equipment.

Call Centre Operations

Call Centre Functions

·        Workforce management (forecasting, call center scheduling)

·        Real-time operational management

·        Quality management

·        Call center training

·        Process review and optimization

·        Performance reporting and call center analytics

·        Call center technology tools and workflows

·        Human resources (recruiting and general support)

·        Information technology

Contact Center Components

There are four main components that make up a contact center. These components are:

• Telecommunication Network
• Hardware
• Software
• Infrastructure

Telecommunication Network

A telecommunication network is essential to connect a caller with a contact center employee. Generally, the following elements are needed to establish a telecommunication network:

• Public Switched Telephone Network (PSTN)
• Router
• Long Distance Carrier (LDC)
• Ethernet Switch
• Modem
• Server

Contact Center Hardware

The hardware needed for a contact center includes a local area network (LAN), an automatic call distributor (ACD), agent desktops, computer technology integration (CTI), web integration, and a predictive dialer. A predictive dialer enables contact centers to handle hundreds of calls simultaneously.

Contact Center Software

Important software components include customer relationship management (CRM) solutions, technical support solutions, and telemarketing solutions. These solutions help contact center employees manage customers, resolve and manage technical issues, and provide a means for marketing. Software is essential to interact with the hardware and telecommunication network.

Contact Center Infrastructure

All contact centers have different infrastructures. Implementing a contact center that provides a return-on-investment (ROI) is a task that is not always easy to achieve without the right infrastructure. Businesses that need help building or creating a contact center may want to consider seeking professional consulting services.

Criticism and performance

Criticisms of call centers generally follow a number of common themes, from both callers and call centre staff.

From callers, common criticisms include:

• Operators working from a script
• Non-expert operators (call screening)
• Incompetent or untrained operators incapable of processing customers' requests effectively[18]
• Obsequious behavior by operators (e.g., relentless use of "sir," "ma'am" and "I'd be more than happy to assist you")
• Overseas location, with language and accent problems
• Touch tone menu systems and automated queuing systems
• Excessive waiting times to be connected to an operator
• Complaints that departments of companies do not engage in communication with one another
• Deceit over location of call centre
• Requiring the caller to repeat the same information multiple times

Common criticisms from staff include:

• Close scrutiny by management (e.g. frequent random call monitoring)
• Low compensation (pay and bonuses)
• Restrictive working practices (some operators are required to follow a pre-written script)
• High stress: a common problem associated with front-end jobs where employees deal directly with customers
• Repetitive job task
• Poor working conditions (e.g. poor facilities, poor maintenance and cleaning, cramped working conditions, management interference, lack of privacy and noisy)
• Impaired vision and hearing problems
• Rude and abusive customers