Editor's note: Michael Mitrano is a principal at Transition Strategies Corporation, a management consulting firm serving the research industry. The author would like to thank Todd Myers of Opinion Research Corporation for his helpful review of this article.

In last month's column, I outlined four factors that a full-service company should consider in deciding whether to add a telephone interviewing capability, increase or decrease existing capacity, or exit that business all together. Those factors are cost, quality, schedule control, and technology. I addressed cost and quality last month. This column looks at schedule control and technology.

Scheduling control

One of the strongest arguments for keeping some or all interviewing in-house is that you have better control over priorities and scheduling. If you have constantly changing schedules and last-minute projects, this becomes an important issue. If you run a phone center, you can swing large percentages of your interviewing force from one project to another in mid-shift if need be. Effective subcontractors will try to accommodate shifting priorities as much as possible, but they can't fairly push aside other clients' work to favor yours. They may also grow impatient with last-minute schedule changes more quickly than in-house managers, who can put practices in place to retain flexibility if your work constantly calls for it.

Give special thought to unusually difficult studies. When production is far below budget but the study has to get done, you can martial your own workforce by putting the best interviewers on the project, giving it extra leadership on the call center floor, and using teams, prizes, and incentives to boost morale. When a subcontractor has that same study, they are probably losing money on it (since you will have negotiated a fixed price per interview) and it is causing projects for their other clients to fall behind. While a loyal subcontractor will do its best to help, the subcontractor may have a financial incentive to put as few hours on your job as they can get away with to contain their losses and keep other studies from being dragged down by yours. The bigger a customer you are of that subcontractor, the more leverage you have to keep this from happening.

Ownership works in your favor for controlling schedules only if you have a ready workforce to control! If you are in a town or neighborhood with a poor labor market for phone work, you may be chronically short of people. If your workload varies too widely and too frequently, you may not have enough experienced, productive people available when volume surges following a valley.

Technology

Long gone are the days when a tough-as-nails supervisor with a clipboard was enough to make an effective phone center. Information technology has transformed survey research phone interviewing. Sample management and call scheduling, dialing, question presentation, response capture, completed case management, client reporting, productivity and quality measurement, and payroll are all now controlled by computer systems in most phone centers. One facility may have systems from many software suppliers to accomplish all these functions, and often those systems are poorly integrated. The research software industry is changing itself, as suppliers consolidate and new modes like Web interviewing draw development resources away from old modes like CATI.

These days, if you don't have bench strength in IT hardware and network systems, very solid knowledge of a strong CATI package that has good future prospects, and the ability to integrate different systems (including telephony), you're going to find it hard to keep up in the phone center business.

Some companies have these skills in-house because of other company needs such as client database management, Web interviewing, or software product development. Some meet them by hiring experienced research technology professionals, while others pick up bright talent from local schools. I recently met one research company owner who actually went out and acquired a small IT consulting business so that he would have access to the people he needs without having to integrate them into his research business! However you face this need, though, it has to be faced.

Large CATI subcontractors will have the volume base to support a strong staff and the required regular upgrades of hardware and software. Some full-service companies do as well, while others may fall behind due to underinvestment.

If you have the resources and commitment to interviewing technology, owning your own interviewing facility has two advantages:


  • Programming your own questionnaires will give you better control over the resulting data and can shorten turnaround time. Programmers working interactively with project directors to finalize and test the questionnaire can assure higher quality in a shorter time than when the same questionnaire is passed back and forth between two organizations (or worse, tested only by a programmer who does not understand the research objectives). The more complex your questionnaires, the more true this will be.
  • You can split the project more easily between multiple facilities if you developed and control the questionnaire and sample. When one subcontractor has that control and you want to bring in a second subcontractor to speed the project up, you may find the process more difficult.

What should I do?

While every company's situation is different, here are some guidelines from my experience and observations.

1) If you have to own your own facility because of client requirements or the specialized nature of your work, then commit the necessary resources to meet your quality and schedule needs.

2) If you don't have to, assess your inclinations and resources. If you are ready to take on the management commitment of a call center and have the right operations and technology management expertise at many levels in your business, you've passed the first test. If you can set up and oversee the call center in a suitable location - where effective interviewers are available at reasonable cost - you've passed the second.

3) If you have enough work to keep at least a medium-sized (let's say 50-station) facility reasonably busy 75 percent of the time or more, you've passed the final test.

4) If you've passed these tests, be sure you adopt or switch to a CATI package that's widely used by American or Canadian subcontractors, so that you have a good-sized pool of potential subcontractors to chose from when your workload peaks. Build or retain a center that's no bigger than you can keep fully utilized much or all of the time. Develop strong relationships with one or two data collection subcontractors to whom you send large amounts of regular work. Become a valued customer to get the best service. With a broader base of business than most full-service firms, they will be able to handle the peaks and valleys better. If you have a typical amount of workload variation, plan on sending 30-50 percent of your work out. This will give you volume flexibility, let you avoid carrying idle capacity costs, and raise the efficiency and quality of the work you do keep in-house.

5) If you have a lot of regular work but are in a high-cost or poor-quality location, consider a joint venture with one of the multi-location phone interviewing companies. You may be able to obtain lower cost and more control than if you did the work yourself or subcontracted it out.

A phone center location may be good for only five to seven years. If you build close to growing metro area, your window of opportunity may be even shorter than that. Demographics and local labor markets change over time, and require that you look a few years ahead when considering current or future locations. Once labor costs drive you out of a competitive total cost range, there is little you can do to reduce cost in a location without compromising quality.

6) If you decide to open an additional center, consider a location within two hours of an existing center so that you can share management and technical expertise. While two such facilities will draw from separate labor local pools for interviewers and supervisors, their proximity makes it easier to relocate full-time staff or cover open positions on a temporary basis.

7) Avoid small phone centers. Unless you have a very even workload (that will give you continuous 80 percent+ utilization) or very special quality requirements, a phone center of 30 stations or smaller won't be economical. The technology and supervisory fixed costs of any interviewing operation make it very hard to be competitive with a small facility these days.

Tough work

Running a profitable, high-quality telephone interviewing facility is tough work for the most experienced operations professionals. Many research companies with a consultative, value-added orientation do not have the management resources or work flow to run an effective facility on their own. On the other hand, if your workload, needs, and resources support it, your own facilities can be the best bet by far. Careful and honest assessment of all the factors will help you decide.