Running head: JOURNAL ARTICLE REVIEW TWO 1
Journal Article Review Two
Liberty University
BUSI - 613
JOURNAL ARTICLE REVIEW TWO 2
Journal Article Review Two
The perceived impact of successful outsourcing on customer service management written by Kok
Wei Khong.
The author’s purpose for this article is to describe in detail the various impacts
outsourcing otherwise known as subcontracting has on both the company’s perspective as well as
the customers. It goes without saying the more customers a company can reach, the more profit
there is to make. In the article the author addresses the ideals of outsourcing, both monetarily
and non-monetarily. Monetarily as discussed previously enhances the business performance,
which are gained by partnering with another company and the satisfaction of customer service.
Although, outsourcing appears to be the most effective means of supplying demands across the
world, it can be detrimental to a company if it is not addressed within properly first.
The relevance of outsourcing is crucial for the expansion of a company. Kalaignanam &
Varadarajan (2012), explain outsourcing as an activity once performed internally is a company
contracting externally. However, when implementing outsourcing a thorough examination
should be considered. First, the employees may not always be as flexible as they may have once
appeared and may become resistant to such changes. Therefore, communication of expectations
and objectives should accompany “support, commitment, and involvement from the top
management” (Khong, 2005, p. 402). Outsourcing as well, has to be planned to ensure
whomever is trustworthy, can meet the expectations and can clearly meet the needs of the
company. Those companies that poorly plan usually fail to succeed. However, when done
properly can offer competitive advantage, bigger clientele, financial gains, increase productivity,
and cut costs (Khong, 2005).
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Customers are the driving force behind the success of any business. According to
Kalaignanam & Varadarajan, (2012) the relationship between the activities are directly related to
the relationship in which the customer has with the company. Poor customer service can lead to
dissatisfied customers which ultimately leads to closures. As technology has advanced
customers have various options for shopping, therefore it makes perfect sense for a company to
want to keep the customers they have and preferably enhance the customer base. A customer
who is satisfied with the customer service they receive will inevitably come back or continue to
purchase from the company. The relationship between the customer and the customer service
received should be ongoing, which will enhance profitability of the company (Kalaignanam &
Varadarajan, 2012). Therefore, adequate recording keeping such as “consumer behavior,
complaints, product or service improvements and efficient customer handling” should be
maintained (Khong, 2005, p. 403). According to Young (2015) understanding the customers’
needs is the driving force for matching production and services. In regards the customer service
manager (CSM) should be abreast in market research and expectations of the customer.
The author chose to survey 1,000 companies across Malaysia based on random sampling.
The authors examined the impact outsourcing has on customer service management. The
companies which responded to the questionnaire consisted of industrial, product, insurance, retail
and agricultural. According to the research findings, outsourcing needs to be well planned to
include employees, outsourced companies and customers. First and foremost the employees are
essential to the success, therefore having the right work force is imperative to get the job done
correctly. Establishing was is expected for performance and encouraging feedback is beneficial.
Implementing and controlling outsourcing through strategic planning ensures a successful
transition. The author also concluded strategic planning of outsourcing is only one asset to
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customer service management, but communication, management involvement, adequate
infrastructure and thorough contract negotiations are of grave importance (Khong, 2005). There
were three key requirements associated with effective outsourcing such as strategic planning,
implementing and controlling. Strategic planning is described as adequate and comprehensive
planning, which are the opposite of tactical. The second is that of implementing which is
referred to as hiring the correct people to do the job right, while maintaining a high sense of
morale and performance standards. The third discussed by the author is controlling, which is the
effective communication and feedback of outsourcing and for improvements. Controlling is also
referred to as setting objectives, maintaining adequacy towards those objectives and consistently
doing performance checks. According to Khong (2005) to address all issues and concerns with
outsourcing there should be a specific facilitations to support and implement these efforts. When
a strategic plan has been formed, implementing can begin and controlling ensures all aspects are
carried and subsequent changes can be addressed. These three concepts are necessary for the
success of outsourcing and subsequently will lend itself to “short and long term benefits”
(Khong, 2005, p. 409). The benefit of strategically planning outsourcing along with establishing
the appropriate team of workers highly ensures the satisfaction of the customers experience and
the consumer purchases will reflect the success. According to Young (2015) organizations must
carefully assess the market to ensure the requirements of the customer are being met and when
considering all factors associated with outsourcing the determination of what companies to
outsource to must be ensured to satisfy the customer.
The data also provided additional evidence to support the satisfaction of customer service
management is maintained when there is success in outsourcing. Therefore, “customers are more
likely to be satisfied with their products and services” (Khong, 2005, p. 409). Customers who
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are satisfied with products and services will be just as likely to be satisfied with the customer
care received by the company. Customers who are satisfied are less likely to complain, and shop
elsewhere, which provides the company with a sense of loyalty to its customers. Successful
outsourcing also ensures better management of customer contacts and satisfaction. It can be
concluded increased customer service increases customer relationships.
In summary, companies who desire to grow must be willing to utilize all of its resources
effectively in order to do so. One such way is through outsourcing. However, a company must
strategically plan in advance all of the many factors in order to be successful. Effective
communication from the top down and throughout the transition will facilitate growth. First the
company must begin by having a well thought out plan. The second is to ensure the employees
are on board with the changes and are right for the job. Nearly simultaneously it is of the upmost
importance to have trust established with those whom the company is outsourcing with. Last,
but not least is the satisfaction of the customer. Ultimately, when everything goes as planned,
everyone benefits.
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References
Kalaignanam, K., & Varadarajan, R. (2012). Offshore outsourcing of customer relationship
management: conceptual model and propositions. Journal of the Academy of Marketing
Science, 40(2), 347-363.
Khong, K. W. (2005). The perceived impact of successful outsourcing on customer service
management. Supply Chain Management, 10(5), 402–411.
Young, G. (2015). Supply chain management (Custom.). New York, NY:
McGraw-Hill Create. ISBN: 9781308091969.
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