How Convergys and Sitel figure in HP support

Q What do you get when you outsource support to the lowest cost provider?
A Unhappy customers.

Get it? Neither does HP management, but the outsourcing trend continues unabated. History does not seem to be a major teacher at the New HP either, they have been through this all before. If anyone remembers the workstation maker Apollo, competitor to Sun, in the late 80's, this is probably a familiar tale. I was at a summer job up the street with Alliant Computer, so I heard some of the rumblings, and it seems eerily familiar.

In 1989, HP bought Apollo, and the layoffs started. Teams of people walked up the street in lockstep, and Sun acquired a fully functional, coherent team of people with little fuss. I'll bet they were more motivated than the usual Sun employees to put the stake in HP.

Fast forward over a decade to the latest debacle that is HP outsourcing. The largest axing of jobs is going on right now in Canada, where in just over a months time, all HP jobs will be gone, some to India, some still in Canada. Either way, the outlook for HP staff is not good. There are two names that keep being whispered in my ear, Convergys and Sitel, neither of which have a good name among HP rank and file about now. Lets start with Sitel, it is a bit less complex.

As of September 30th, Sitel gets a good chunk of HPs support business, basically most of what is not moving to India. From all accounts, the HP support group was a decent bunch, with good wages, a steady job, and a friendly work environment. My personal experience backs up what I have been told, they did a good job, and supported the customers correctly, doing what it took to get a problem resolved. Hold times were low, and people were happy with the services rendered.

Sitel may be a different story entirely, if it's a cost rather a customer satisfaction model. While there are most probably SLAs that are in place in the Sitel-HP contract, the reputation that gets ruined by lousy service, if people get lousy service, is HP's, not Sitel's. How many HP customers have heard, or will hear the Sitel name? Our extensive INQUIRER poll, conducted at dinnertime over the last two weeks shows four people, although one kept calling us 'Grandma', so we suspect insanity.

Sitel has generously offered all of the ex-, and soon to be ex-HP employees jobs, but the uptake rate is rather low, sadly low in fact. Two things conspire to keep the number of experienced HP employees low. That's money and working conditions. HP employees at the call centers earned a decent wage, around $10-15/hour, but they got a lot of satisfaction from the work. They made a difference, and got things done, clients were happy. The Sitel jobs on the other hand pay about $5-8 less than the old HP ones, and a bit of quick math tells us that is not a decent living, in fact it would be hard to call it a living at all.

Some people might love what they do and bite the bullet and hook up with Sitel. After all, there may be room to advance, and you are getting in at the ground floor. Sadly, the people who know about work at Sitel tell us the work environment is different enough from HP so as not to have the job satisfaction that the old place had. The new job is more focused on the number of calls you can field, not the number of happy clients. Some sources describe it as a McJob.

The other company playing in this HP saga is Convergys, a company that does HP support in Canada now, but in a weird twist, is outsourcing itself to themselves in India. Yes, I worded it that way to make your brain hurt. I want to get even for what this whole affair is doing to me. The short story is that about three years ago, September 28th, 2000 to be exact, Convergys took the first HP support call in Canada, outsourced from HP USA. The transition went rather smoothly. I say this because no one has related any horror stories to me yet, and for three years, all was happy.

This happy home was turned upside down on June 30th when it was announced that the jobs were all going to India, not for a vacation, but a more permanent outsourcing of the outsourcing. It was suspected at Convergys Canada for a while because of the number of employees there were being flown back and forth to India on a regular basis. Some things just don't have a subtle explanation.

The reason this was possible was through a combination of factors only Convergys could have pulled off. It seems that Convergys went to HP management with a cost savings package, one that would presumably widen the margins of both companies a bit. Convergys told HP it would save them lots of money, and keep service at acceptable levels. They offered SLAs, and pointed to the track record they had during the US to Canada move. So far so very good, and HP signed up.

There are two things that conspire against this plan working however, neither of which was probably known to the higher-ups at either company, and that is the quality of workers in both areas. The Convergys call center in Canada is in Edmonton, a nexus of tech schools, with a much higher per capita tech school graduate rate than other large Canadian cities. The call center there appears to have quickly got a bad reputation among the local tech community, with many blaming poor management for the high turnover. It even got to the point when the Northern Alberta Institute of Technology (NAIT) supposedly took Convergys off the employee search boards. In a down economy, with tech jobs scarce, that is rather telling.

Even so, with a flood of new graduates from a lot of schools, the center was staffed with intelligent, knowledgeable workers, and they got the job done well. Curiously, this seems not to be the case with the Indian operations. India is known as a high quality, low wage technology area, which is why so many IT jobs are ending up there. If there are any problems, they tend not to be over the quality of the work, which is why this is so odd.

People returning from the Convergys operations on the sub-continent have reported a shocking lack of skills in the staff they were sent there to train. We are not sure if this is the same place as the HP operations outsourced from Australia, but it sounds like the same things are happening there as well. Why Convergys is not able or willing to hire above average staff is still unknown, but it seems like they have their work cut out for them to meet the SLAs they promised HP. I guess we will know after September 30th.

The ironic thing here is that an outsourcer not performing, cost HP dearly in lost contracts in Australia. DHL logistics didn't get the parts where they were wanted, when they were wanted, and nine figure contracts got flushed. Now, HP is betting on an organization that is offering the same type of promises, presumably with similar penalties for non-delivery. If this is the same phone center that has been doing such a curious job with the Australian traffic, those SLAs will be put to the test. In that old twist of fate, HP may be in the same boat that Coles Myer and Accenture found themselves in. SLAs don't cover the cost of things going wrong, they only provide incentive to make things run well.

Don't even start us on the Aussie Galileo debacle. µ