Call Center Outsourcing: Coordinating Staffing Level and Service Quality

Overview

This paper studies the contracting issues in an outsourcing supply chain consisting of a user company and a call center that does outsourcing work for the user company. The authors model the call center as a G/G/s queue with customer abandonment. Each call has a revenue potential, and the author model the call center's service quality by the percentage of calls resolved (revenue realized). The call center makes two strategic decisions: how many agents to have and how much effort to exert to achieve service quality. The authors are interested in the contracts the user company can use to induce the call center to both staff and exert effort at levels that are optimal for the outsourcing supply chain (i.e., chain coordination).