Risks of outsourcing: poaching

In our discussion on the hidden costs and risks of outsourcing, we discussed «poaching» (a term coined by Eric Clemons of the Wharton School) as a potential problem for firms. Poaching occurs when the outsourcer takes advantaged of privileged information for its own gain, at the detriment of the firm.

The example that I discussed in some length was of my consulting client (major Greek bank) suspecting that 3rd party call centers routinely poach sensitive customer information from financial institutions (banks, insurers, etc.) and sell it to competitors (or worse!). The suspicion is that customer info poaching is done by rogue employees, without knowledge by the outsourcer. My client used to take extreme measures to protect itself from such problems, such as insisting on using its own personnel on the floor and control room of the call center, for outbound calls.

Another good example of poaching accusations concerns the actions of iYogi, a customer support company that was managing live customer support for Avast, the anti-virus maker. According to Brian Krebs’ blog, Avast asserts that iYogi was using the live customer support calls to push for expensive support packages, by convincing Avast users that they had problems that they did not have.

In any case, poaching is a real problem that is expensive to monitor and even more expensive when the threat materializes…

Pic by barracuadz, Flickr (cc license)

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