The contact center outsourcing industry has always been subject to greater provider churn than other areas of IT and business process services. Historically around a quarter to a third of call center deals up for renewal are terminated every year compared to just fifteen percent of non-voice contracts.\n[ Related: 8 tips for choosing the right contact center for your business ]\nBut that termination rate has risen dramatically in recent years. Over the last two years, more than half of customers with end-of-term call center contracts decided not to renew their vendor relationships, according to recent research by outsourcing consultancy Everest Group, funded in part by business process and IT outsourcing provider TELUS International.\nMeanwhile, those customers that decided to retain their providers often increased the scope of their deals\u2014adding geographies, lines of business, or higher-value processes.\nWhat\u2019s going on, say Everest\u2019s analysts, is that buyers have greater expectations from their call center providers today. No longer content with simply lower costs, they are looking for vendors that can partner will them to deliver improved business outcomes. They are seeking engagements that incorporate emerging technologies, automation, and big data analytics. And they\u2019re showing the vendors who can\u2019t meet these increased demands the door.\nCIO.com talked to TELUS International president Jeffrey Puritt about the shifting dynamics in the call center outsourcing market.\nCIO.com: Why are more than half of contact center deals being terminated? \nJeffrey Puritt, president, TELUS International: The global BPO industry, which has grown to $150 billion, has evolved significantly over the years. For most buyers, it\u2019s no longer just a cost optimization play. Instead, buyers and their service providers are moving towards more engaged outsourcing models that foster strategic value creation. But getting there is not easy.\nWhen the focus was more on cost reduction and risk mitigation, multi-vendor strategies worked well. But now [that] the focus has shifted towards business outcomes, buyers are expecting their outsourcing partners to address the entire business process value chain. This means adding more judgment-intensive, value-added services involving new technology, automation, or analytics, as examples. Call center outsourcing (CCO) buyers now expect their incumbent providers to go \u2018beyond the obvious\u2019 of the service-level agreement (SLA), especially after the first few years of the relationship. Contracts are not renewed because these relationships have failed to deliver meaningful, long-term, value.\nCIO.com: How does this current state of provider churn impact customers in the short term?\nPuritt: Having too many relationships can be counter-productive, because they each require time and effort to manage. As a result, buyers are looking to focus on fewer but more meaningful relationships. And while the end goal is more engaged partnerships, there are often pains along the way in the form of lost business for service providers and increased transition costs for CCO buyers.\nThat said, from an operational perspective, buyers already expect some level of transition stress at the beginning of any relationship. But if both parties are committed to a more engaged, meaningful partnership from the beginning, they can work together to proactively nurture the relationship to avoid value leakage. With the shift towards consolidation, there\u2019s an opportunity to focus on building better, more comprehensive, outsourcing relationships from the start. The current industry trend towards consolidation is actually a good thing for both buyers and providers of CCO services.\nCIO.com: There has been an evolution in the larger IT and business process outsourcing market from cost-focused, transactional relationships to those focused on long-term improvements and business outcomes. Is that taking hold in the CCO industry as well?\nPuritt: The move away from a cost-focused relationship to a more business-outcome oriented one is already well underway in the CCO industry. And while it\u2019s an exciting shift towards greater engagement, collaboration, and mutual business success, let\u2019s not forget, outsourcing is still often about cost-savings.\nThe biggest hurdle is to stop focusing solely on costs-savings or cost avoidance. The evolved outsourcing relationship involves a lot more give and take. Service providers must deliver on the day-to-day operations while making time to understand the client\u2019s overall strategic direction. And buyers must invite their service providers to the table, educating them on where the business is headed\u2014even sharing more data and system access.\n\n\t\n\nAgain, this is easier said than done: the study found that a lack of communication is one of the biggest complaints among buyers. [However], enabling a service provider to truly collaborate with buyers requires a heightened level of two-way communication, which goes far beyond simple reporting on metrics.\nCIO.com: What are the biggest factors impacting the value that CCO deals deliver?\nPuritt: Our research with Everest Group identified six key factors impacting outsourcing relationship value including communication, executive relationship building, customer experience innovation, employee engagement, service quality and aligning business objectives. I\u2019ve already discussed the critical importance of communication. The next biggest factor, in my view, is frontline engagement. According to human capital consulting firm Aon Hewitt, the financial implications of an engaged workforce are significant. Their studies have found that a five percent increase in employee engagement is linked to a three percent increase in revenue growth in the subsequent year. In the CCO industry\u2014which is plagued by high attrition\u2014this correlation is eye-opening.\nCIO.com: What steps can buyer and service provider take to foster increased engagement?\nPuritt: The first step is to ensure that both parties have a shared set of values that underpin their business philosophy. For example, is the buyer interested in avoiding costs and nothing more? Similarly, is the service provider\u2019s value proposition \u201cyour mess for less?\u201d If so, then they may have something in common. But if the buyer is looking for a brand ambassador and long-term value, they need to find a service provider that is willing and able to think, act and invest for the long term as well.\nNext, they need to establish a relationship framework that targets mutually beneficial outcomes. That framework starts with the basics: defining a governance model that supports the working partnership and ensures accountability from the operational level to the executive level. And while the governance model lays the foundation of a healthy relationship, that relationship needs to be nurtured on an ongoing basis. That means building trust via regular \u2018health checks\u2019 to discuss current program status, identify issues and evaluate the potential for innovation. Innovation projects are often considered beyond the scope of the existing engagement and are not planned for at the time of contracting. Making innovation an agenda item ensures that it remains a priority in the partnership.\nOf course, any engaged buyer\/service provider relationship has employee engagement at its core. Engaged, tenured agents mean more happy and satisfied customers, which in turn, means more value to the buyer. Employee engagement programs, along with the ability to capture agent feedback, are essential so that outsourced agents feel and act like they are part of the buyer\u2019s organization and best represent the buyer\u2019s brand.\u00a0\u00a0\nCIO: How can customers measure the engagement level of their CCO relationship?\nPuritt: There are clear signs that the relationship is on solid ground. With increased comfort and understanding comes a [greater] focus on business outcomes rather than just the operational ones. When this happens, traditional SLAs are either supplemented or changed to include more business-outcome oriented objectives.\nFor example, while efficiency and effectiveness metrics (like agent utilization, average handle time, or first contact resolution) continue to be most prevalent, engaged outsourcing partnerships are likely to use of business-outcome related metrics such as sales conversions, customer satisfaction, likelihood to recommend, or net promoter scores.\nCIO.com: What kind of benefits have you seen these more evolved relationships deliver to CCO customers?\nPuritt: In more mature and engaged relationships, service providers have been able to deliver radical innovation improving business outcomes. When we focused on innovative ways to improve one of our client\u2019s employee engagement programs within our centers, agent engagement increased by 12 percent, attrition fell by 7 percent, customer satisfaction increased by 14 percent, and revenue increased by 7 percent\u2014all in the span of one year.\nIn another example, when we examined our client\u2019s quality assurance program [for] frontline agents, we found that their check-the-box auditing approach did little to motivate and strengthen the customer service attributes of the frontline. We proposed more one-on-one, real-time coaching. Not only did agent engagement scores increase because agents felt that the client cared and was investing in their success, but customer satisfaction also increased by more than 20 percent\u2014all in less than five months. This also worked because the buyer was willing to invest in a new, more innovative, QA model.