Last week, media writer Jim Romenesko reported about a Michigan newspaper that ended what its editor termed a "horrible experiment" with overseas outsourcing of its call center, and credited parent company CEO John Paton with pulling the plug. Days later, the Denver Post, the largest daily in Paton's stable, has shipped 29 call-center jobs to Honduras. Why? It's a long story.
According to a source close to labor talks between the Post and the Denver Newspaper Guild, Post management asked to move the jobs offshore three years ago. The Guild countered with a proposal to set monetary benchmarks in an effort to prove that cost savings could be achieved without shipping the jobs to another country, as plenty of newspapers and companies in other fields have done over the years.
We're told these benchmarks were met -- but when it came time for the contract to be renewed, members of the Post team insisted that the majority of the local positions had to move elsewhere -- and after negotiations, the paper offered what the Guild considered to be a fair severance package for workers who'd be losing their jobs. In addition, a handful of positions involving e-mail were allowed to remain in Denver.
The tally? The call center had employed ten full-time and 26 part-time workers. Now, two full-time and five part-time workers will punch the clock here, while the remainder have been moved to Honduras. The switch-over was finalized on Saturday.
When asked about this move, the Guild's Tony Mulligan sent the following statement via e-mail:
In order to reach agreement on the full contract, The Post insisted that any agreement must include the amount of savings from the circulation call centers that the paper could achieve by sending that work to Honduras. Post management argued that several other papers had off-shored that work, achieving huge savings without diminishing the quality of service. After months of trying to negotiate an agreement that would keep the call center work at The Post, but reduce costs enough to be competitive with a Central American call center, it became clear that the math just wouldn't work. So the union agreed to the outsourcing of live calls and negotiated additional compensation and benefits for those displaced. Outsourcing was completed by November 24, 2012. Customer service requests submitted by e-mail are still handled by Post employees here in Denver.
Mulligan adds that "a few papers around the county have brought their customer service work back in-house. Hopefully, The Post will do the same."
Continue to read more about the Post's decision to outsource its call center to Honduras. The most prominent recent example of a course change regarding an overseas call center involves the Mount Pleasant Morning Sun, a Michigan publication owned by the Journal Register Company, which has combined forces with MediaNews Group, the Post's owner, as part of a Paton-led venture dubbed Digital First Media. The JRC recently declared bankruptcy, but in statements afterward, Paton insisted that other Digital First Media properties, including the Post, were "thriving."
In regard to the Morning Sun, complaints about delivery problems were handled by a call center in the Dominican Republic for about two years before the positions came back to America. In an e-mail to Romenesko, editor Rick Mills explained the issues.
"Language barrier was a huge problem," Mills wrote. "From walk-in customers to phone calls, to calls to our Sound Off line, including letters and personal contacts with staffers talking to community members outside of the office, we heard complaints. They did not speak good English and it was obvious they were not in this country. Readers hated that."
Mills added that the locally based call center had "provided excellent customer service here, with a crew that would go so far as baking cookies for a disgruntled customer -- one of them really truly did that once -- just to keep them and talk them into giving our carrier another chance. That personal drive to keep our customers happy was gone with outsourcing."
Furthermore, Mills went on, "as readers found out they couldn't get a human being in circulation, they discovered that if they pushed enough buttons, they'd get the newsroom. Being a full-service newsroom, or at least we try to be, we refused to send them back to the Dominican Republic. So my news staff was frequently listening to angry customers who'd been bounced around, let down and were now angry. We had to hear them out, take their information, and go find a person in the building who could help them. It was not only a drain on staff productivity, but it was a morale-killer."
That's over now, and in his communication with Romenesko, Mills credited Paton "for trying the outsourcing, seeing that it didn't work, and then going back to the old way."
In Denver, the situation is very different.
Continue for more about the Post's decision to outsource its call center to Honduras. Bill Reynolds, the Post's senior vice president of circulation and operations, was unfamiliar with the Morning Sun's experiences with call center outsourcing -- but he stresses that the importance of providing a positive customer experience will remain as high as ever despite the call center's move from Denver to Honduras.
"We're in contact with the folks we've contracted with on a daily basis. and there's monitoring going on all the time," he says. "The quality will be checked on a daily basis."
As for the rationale behind the decision, Reynold points out that "as we continue to look at our business and try to find options and the most efficient ways to run our business, we made an economic decision to outsource our customer service calls to Honduras.
"Many newspapers around the country have been doing this over the past few years," he continues. "There are likely hundreds of them that have done it over the past ten years."
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Are there plans to outsource more of the Post's operation?
"Not that I'm aware of at this point," Reynolds replies. "But we continue to look at what options we may have for the most efficient and effective ways to run the business. And this is part of that."
More from our Media archive: "Denver Post thriving despite Journal Register Company bankruptcy, says John Paton."