Credit Card Issuer Case Study

Bottom Line: NAVICENT architected and implemented an offshore sourcing strategy for a credit card service center that reduced transaction costs by more than 70% while improving service levels.

Business Problem: Our client, a credit card issuer within an oil & gas conglomerate, faced increasing competitive pressure and operational challenges from increasing consolidation among competitive card issuers. The business suffered from a drop in card transaction volumes due to increased substitution of multi-purpose cards coupled with a need to offer value-added services to maintain its subscriber base with limited retail margins to fund card features. Furthermore the unit faced significant operational challenges stemming from the high-cost structure of its internal service center including limited operating hours, high employee turn-over, escalating hiring, training, and retention costs, inconsistent service levels, and staffing inefficiencies driven by seasonality in contact volume.

Solution: After screening the baseline for "offshorability," NAVICENT recommended that customer service operations be outsourced to an offshore contact center provider to quickly secure a step change reduction in operating expense. The agreement included a Build-Operate-Transfer option to accommodate shifts in offshoring strategy at the enterprise level. The onshore center was redesigned according to industry best practices allowing both centers to increase service levels and improve efficiency.

In addition to the regional and country shared service centers, certain HR functions remained embedded in the business units to meet unique and critical HR requirements of a BU or cluster of BU's. Also, a streamlined corporate HR function was implemented which was focused on corporate-wide strategic HR issues.

NAVICENT's Role: NAVICENT consultants supported this effort from analysis through execution. After building a business, the team formulated sourcing and deployment strategies. NAVICENT supported the supplier selection process and developed an implementation plan. NAVICENT managed process reengineering, process screening, a training program overhaul, and managed the design and implementation and operational stabilization of both the offshore contact center and the onshore residual center.

Results: Ultimately, 2.2M contacts per annum and more than 140 customer-facing processes were transitioned to a 150-seat offshore center with key functions retained in a redesigned, onshore escalation center. The offshore contact center addressed incoming inquiries by phone, e-mail and paper correspondence. The project resulted in an annual reduction in OPEX of more than $5M while increasing service levels, operational hours and organizational flexibility.

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