Delta Airlines

In: Business and Management

Submitted By veroka15
Words 5864
Pages 24
A03-04-0011

Delta Air Lines: The Latin America
Contact Center Decision

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In early September 2000, Mary Smith, Delta Air Lines’ Regional Director of Reservations for Latin
America and the Caribbean, glanced over her notes one more time. Delta had decided to consolidate all of its reservations offices in Latin America into a single Latin America Contact Center. Now it was up to her to recommend a country location for this $3–4 million investment. Gail Childs, her immediate supervisor and General Manager for International Reservations, would want her report soon in order to get the final go-ahead from Delta’s CEO. Although a number of countries were possible options, Mary reviewed again the pros and cons for Mexico, Chile, and Argentina.

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The Internationalization of Customer Service

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By 2000, telephone customer service was growing rapidly throughout the world. Many companies chose to outsource their telephone customer service operations to outside call centers; others kept such operations in-house. Other than locating call centers, also known as contact centers, within a region to be closer to customers, the principal reason for U.S. companies to move telephone customer service outside of the United States was to reduce costs. Because labor costs constituted between 60–80% of a call center’s operating expenses,1 airlines, computer firms, credit card companies, and others that used telephone customer service extensively were moving these operations overseas at a rapid pace. In Latin
America, the rate of growth for such services was over 25% a year.2 While India was a popular low-cost destination for U.S. companies needing English-speaking call center staff, establishing a call center in
Latin America made sense for companies seeking to establish contact centers for customers in that region, or for companies wanting to serve…...

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