Outsourcing: Horizontal Vs Vertical Hour

An important concept to understand when deciding to outsource to a call center is the horizontal hour vs the vertical hour. When you hire a dedicated employee you pay them "horizontally." The employee is paid for eight hours so they are only available to you during that time. If the employee is working on one task, another task will wait or may go unfinished. When the employee takes a break or goes to lunch, there isn't any work being done. Therefore, you would need more than one employee to cover breaks, lunches, and after hours.

When you outsource you are paying for a vertical hour. You are only paying for the time that the outsourcer is working for you. This means that several calls can be answered at once and when there are no calls, you aren’t affected because that is the risk the call center takes on, not you. If you stack up the amount of time your outsourcer is working for you it is going to be a far more efficient time line.

When you are comparing the cost of an outsourcer to the hourly cost of hiring a dedicated employee you have to understand the significant differences. Instead of comparing a dedicated employee to a outsourced call center you need to consider comparing the overall cost of the outsourced call center with the overall cost of the total number of employee's you would need to hire in-house to handle the same work. Don't forget to include soft costs for employee's such as benefits, vacation time, and managerial staff.