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CIO/CTO Update: Article

CCT CEO Jonathan Rosenberg Drives Revenue Through CRM in the Philippines

Cost Reduction is Not the Key to Global Sourcing. Creating Revenue Is.

Cyber City Teleservices (www.cctll.com) is the most venerable of the CRM call-center firms in the Philippines. Dating back to 1999, it was co-founded by longtime industry executive Jonathan Rosenberg, who spent two decades in the US in the direct response industry.

"The first thing I want to be clear about is that we don't view ourselves as a solution for companies to reduce costs," he told me in a recent interview at CCT's headquarters in the Clark Special Economic Zone, a couple hours north of Manila in the state of Pampanga. "The most important issue for business executives is driving topline revenue, and we help our clients do that."

I met Jonathan during an event called Convergence 2009, part of a convention at Clark that was sponsored by the Philippine government. The event attracted local business leaders and foreign executives, as well as students eager to learn more about global sourcing in the Philippines. It was one of a series of events being held throughout the country in selected technology-savvy cities.

Global Sourcing Extends to Services
Notice my use of the term "global sourcing." To me, it's not a euphemism for "outsourcing," but rather, a term that truly defines what's going on in our globalized business world.

Global supply chains have driven manufacturing for more than a quarter-century. Now, a fast-growing global services industry provides a complement. The middle classes emerging throughout Asia from this phenomenon-including in the Philippines-are now able to buy products and services themselves from global suppliers-including the USA.

CCT is emblematic of this phenomenon. The company employs approximately 3,000 people in the Philippines, with a substantial sales marketing and customer activation services center in the USA, and an emerging businesses in South America. It provides in-bound CRM services, processing orders and handling customer service issues for a client base concentrated, but not exclusively located, in North America.

CCT's traditional inbound call-center services are augmented by live help-desk support, email support, and live chat and browsing assistance. It operates 24 hours a day.

Its original and largest campus is at Clark, the former sprawling United States Air Force base that today is peppered with modern office parks, housing, resorts, and an international airport that also contains a Philippine Air Force base.

The Interview at Clark
I met Jonathan in the boardroom of the company's original office building, a converted military administrative headquarters that sits in a quiet corner of Clark, shielded from the sun by the rich, tropical flora found throughout the Philippines.

"This is where we started," he noted. "Today, our executives and agents work in those beautiful new buildings (at Clark) and in our other locations. But I like to work and meet people here because it reminds me of our very first days building this business."

Then picking up on his remark about driving client revenue, Jonathan refutes "the idea that call centers are somehow passive operators" just following a script. "When someone's customer is talking to one of our agents," he says, "they are talking to our client."

He trains his agents thoroughly in the specific details and culture of the clients they serve, so that CCT becomes an extension of its clients. "Along the way, we collect enormous amounts of marketing data that our clients can use. We can often tell them things they don't know, because we are the ones who are talking directly to their customers."

Well, I would hope so, I told him. "Yes, but maybe you don't realize the extreme financial efficiency we deliver. We operate in real-time, and when I say that, I mean real-time. We can tell our clients how much new business they acquired in the last 60 minutes, or the last 30 minutes, for example. How else can they get this information?"

CCT uses its own, in-house, proprietary software to deliver much of its service. "We are in some respects really a software company under the hood," he muses. The technology is also put to use in connecting CCT with dozens of warehouses throughout the world, a further fusion of CCT and the clients it serves.

Jonathan has also instituted a hiring practice that turns traditional thinking on its head. "If you have experience with another CRM service provider, then we will not hire you," he says. "We hire only people with no experience in the industry."

His belief is that the company thus builds a workforce "with no bad habits from somewhere else," he says, "and we have an attrition rate between 0.6 and 2.7 percent," compared to an industry average of 8 to 12 percent, he says.

Driven by Education and Process
To ensure that CCT's employees acquire only good habits, Jonathan also founded together with Mr. George Sorio another CCT founding member , a non-profit school, which has already certified over 8,000 students to date. Jonathan says that when he first considered starting a CRM business in the Philippines, "there was no (call-center or CRM) industry, no activity to give people experience."

So he started the school, which provides 15 modules of CRM-specific education. "some students join our company while others join our competitors. We feel comfortable with that, as we are building an industry, and we want to ensure quality all around. That's our way of contributing."

Upon first meeting a client, Jonathan says CCT presents "a book consisting of processes and a checklist with data gathering, to ensure that all things that may go wrong are prevented," as a way to demonstrate to its clients that the folks at CCT know their stuff, and that they'll always be very open with their clients. "There is no information that we have that we don't share with clients," he says.

Even bad news? "Especially bad news. We hire client advocates internally who, from day one, have this built-in friction with our agents and management." The client advocates work on behalf of CCT's clients on a day-to-day basis, on-site at CCT. "So we, in essence, have our clients present at all times. Through this process, what our clients see and hear is also what I see and hear."

Describing CCT as "an incredibly process-driven company," Jonathan notes that everything is ticketed, there is electronic escalation of tickets, and reports are generated "the way clients want them," rather than in some pre-templated form created by CCT.

Cooperation with India, Integration with the World
I related my recent experiences talking to call-center agents from the Philippines, contrasting what seemed like a helpful approach to the notorious script-driven folks named "Mike" and "Sam" that one encounters with Indian call centers.

"Well, the Philippines is very oriented toward customer service, as you know. And we do train our agents to solve problems and not just read from a script," he said.

But he wouldn't take the bait I offered; he had nothing critical to say about call centers elsewhere. "Each of our countries has specific strengths," he noted. "So we are very strong in the Philippines with the call centers. In India, there is strength with more of the BPO (business process outsourcing) services. Working together, the countries can present a compelling, integrated story."

Both Jonathan and others I interviewed in the Philippines say there are numerous contacts among executives and government officials in the two countries. And it's true, India's BPO government trade agency, NASCOMM, has made joint presentations with high-level members of the Philippine government.

The Philippines government has designated 10 "Next Wave Cities" as locations that should attract global services business in the coming years. The idea is for these cities to complement the business that has already developed in the very crowded capital city, Manila, and in the central Philippine city of Cebu.

The Clark area is one of them, and is considered to have the most highly developed infrastructure among them at this point. Five of the other targeted areas are in the general vicinity of Manila. Two are in the central, Visayan region (which also includes Cebu), and two are on the southern island of Mindanao.

Salaries in the Clark region are higher than those in the lesser developed Next Wave Cities, but still a fraction of that in developed countries. The cost of living, with the exception of automobiles and electricity, is also quite low. Readers of my generation will remember the US in the 1960s; think of salaries and costs then (again excepting cars and electricity) and you get the idea.

But as Jonathan says, this business is not about saving money. "Our company is about providing service and business solutions to its clients, in the best possible way, thus driving revenue," he told me.

My View
CCT is part of a global phenomenon, controversial to many, but essential in my view. Global sourcing is here to stay, and it brings hope to people who may have had little hope before. It brings employment options to nations that desperately needs them. In the Philippines, it puts on display a national character that is predisposed to polite efficiency.

And, in addition to driving revenue for clients located primarily in the US, companies such as CCT create wealth for a middle class that, for example, is now buying iPods-which are designed in America, assembled in China, and centered around Japanese-designed hard drives that are mostly made in...the Philippines.

More Stories By Roger Strukhoff

Roger Strukhoff (@IoT2040) is Executive Director of the Tau Institute for Global ICT Research, with offices in Illinois and Manila. He is Conference Chair of @CloudExpo & @ThingsExpo, and Editor of SYS-CON Media's CloudComputing BigData & IoT Journals. He holds a BA from Knox College & conducted MBA studies at CSU-East Bay.