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The Ethics of Outsourcing Customer Service

By Bruce Weinstein, Ph.D.
Ask the Ethics Guy!

It's a familiar scenario: a product you purchased recently has developed a problem, so you call the company's toll-free number and are connected to a "customer service associate" in India or the Philippines. You describe your problem but have a hard time understanding what the company representative is saying. You try several more times to communicate why you are calling but cannot get information that you can comprehend. You ask to be transferred to someone in the United States and are then put on hold what seems like an eternity. You hang up in frustration and vow never to purchase anything from this company again.

What in the world is going on?

More and more businesses are outsourcing not just manufacturing jobs but services ones too. Outsourcing customer service, however, is not only unethical. It's bad for business.

Here's why.

Good Word of Mouth and How Not to Get It

The problem with outsourcing customer service is that this practice creates nothing but negative word of mouth. Time is precious, and what customer wants to spend an inordinate amount of time in an often-vain attempt to communicate with a company employee who is halfway around the world and cannot speak English effectively? It is easy to measure the savings a business gets by farming out customer service jobs to countries whose median income is an eighth of what it is in the U.S. What too many businesses either fail to see or refuse to take seriously, however, is that companies that value short-term profit at the expense of meaningful customer service risk sacrificing long-term profits and the company's own reputation down the road.

Smart businesses recognize that the surest way to hold onto their current customers and create new ones is to place customer satisfaction front and center, not only in their mission statements but in their day-to-day operations. This means that customer service representatives must be able to communicate clearly. This also means that these employees should be fluent not only in the primary language of the customer base but in their culture, customs, and idiosyncrasies as well. The root of "customer" is "custom," and customs are largely a mystery to those who live and work outside of the culture.

A Racist Proposal?

I realize that a call for a ban on outsourcing customer service may seem racist. After all, the folks with these outsourced jobs are largely people of color whose first language is not English. Isn't this proposal thinly veiled discrimination against non-U.S. cultures?

Absolutely not. The reason it is wrong for U.S. businesses to give customer service jobs to non-native speakers of English who live overseas has nothing to do with race per se. Performing the job of communicating with the public simply requires being able to communicate well. Working on the front lines of customer service means, first and foremost, being able to understand what the customer needs and then meeting those needs efficiently. Outsourcing customer service subverts both of these crucial objectives. Showing a profound disrespect for customer satisfaction is why outsourcing customer service is unethical, and the damage that this practice does to a company's reputation and long-term financial prospects is why it is an unwise business move.

What Should Business Be About?

The goal of a business, unlike a charity, is to make a profit. Not only is there nothing wrong with this; it is hard to imagine what the world would be like without a profit motive. Where too many businesses falter, though, is leaping from the premise, "Money is good," to the conclusion, "We ought to do anything legal that will maximize profits." This leap of logic is ethically troublesome, since much wrongful behavior is legally permissible. Furthermore, the obsession with making the most money sooner than later blinds one to the very thing that promotes a flourishing business in the first place: satisfied customers who keep coming back for more. Not only won't a business succeed if it puts greater emphasis on short-term gain than on customer satisfaction; it can't succeed.

The smart business is one that values meeting the needs of customers above all else. Only by having its priorities straight can a company expect to prosper in the long run. The goals of making a profit and satisfying customers are not only not mutually exclusive; they are inextricably bound.

By doing right by their customers, businesses can indeed do well.

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Ask the Ethics Guy! Bruce Weinstein, Ph.D.

About the Author

Bruce Weinstein, Ph.D. is the corporate consultant and public speaker known as The Ethics Guy®. He has appeared as an ethics analyst on The Today Show, Good Morning America, Anderson Cooper 360, Lou Dobbs Tonight, The O'Reilly Factor, MSNBC Live, Bloomberg Television's Personal Finance, and many other national television programs. Visit The Ethics Guy.

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