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The announcement that AT&T is to pay $25 million in fines due to data protection violations by outsourced contact centers in Latin America and the Philippines is certain to place fraud prevention and risk mitigation at the top of enterprises’ checklists when choosing a CRM services vendor. Both nearshore and offshore operations can expect more scrutiny on security matters, and outsourcers with strong fraud prevention programs have an opportunity to win business.

Offshore contact centers in the spotlight for fraud prevention

The AT&T data violation comes at a time when enterprises are increasingly sensitive to fraud prevention and security. While data breaches are possible in any part of the world, given the sensitivity among in-house contact center managers around the impact of loss of control over operations, offshore third-party operations are certain to face increased scrutiny. Ovum’s 2015 CRM Outsourcing Business Trends Survey showed that respondents have a preference for local or regional contact center vendors; while delivering large-scale contact center services locally onshore may be somewhat idealistic, the perception of being able to better manage the relationship domestically is growing in importance for prospective clients.

Data protection concerns are clearly on the minds of enterprise contact center decision-makers when considering different offshore locations. Ovum’s CRM Outsourcing Business Trends Survey showed that across emerging and mature offshore delivery locations, data protection concerns are pronounced (most notably in Central & Eastern Europe, Philippines, Egypt, and Morocco, where it was rated the main drawback). It will therefore be essential in the wake of the AT&T occurrence for outsourcers to promote their ability to contain fraudulent activities but also ensure as many preventative measures are in place as possible.

Security needs to be highlighted as part of vendor offerings

The AT&T developments potentially provide an opportunity for contact center outsourcers to promote their own fraud prevention capabilities as part of their value proposition. In fact, in Ovum’s most recently published 2015 CRM Outsourcing Business Trends Survey, respondents indicated that an outsourcer’s fraud prevention/security capabilities are crucial determinants in selecting a vendor partner (second only to agent language capabilities in a list of almost 20 choices). With many vendors having made large investments in developing improved technologies and processes to reduce data theft, now is definitely the time to place these capabilities at the forefront of promotional efforts when seeking new clients. At least for the foreseeable future, augmented compliance around risk mitigation across verticals will be a reality that outsourcers will need to face head on.



Peter Ryan, Principal Analyst, IT Services

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