Call Center Outsourcing Under Information Asymmetry

32 Pages Posted: 14 May 2007

See all articles by Sameer Hasija

Sameer Hasija

INSEAD - Technology and Operations Management

Edieal J. Pinker

Yale University School of Management

Robert A. Shumsky

Tuck School of Business at Dartmouth

Date Written: July 30, 2007

Abstract

In this paper we examine contracts to coordinate the capacity decision of a vendor who has been hired by a client to provide call center support. We consider a variety of contracts, all based on our observations of contracts used by one large vendor. We examine the role of different contract features such as pay-per-time, pay-per-call, service level agreements, and constraints on service rates and abandonment. We show how different combinations of these contract features enable firms to better manage vendors when there is information asymmetry about worker productivity. In particular we focus on how different contracts can coordinate by yielding the system-optimal capacity decision by the vendor and consider how profits are allocated between the client and the vendor.

Keywords: Call Center, Staffing, Outsourcing, Contracts

JEL Classification: M12, M55, L14

Suggested Citation

Hasija, Sameer and Pinker, Edieal J. and Shumsky, Robert A., Call Center Outsourcing Under Information Asymmetry (July 30, 2007). Simon School Working Paper No. FR 09-07. Available at SSRN: https://ssrn.com/abstract=985558 or http://dx.doi.org/10.2139/ssrn.985558

Sameer Hasija

INSEAD - Technology and Operations Management ( email )

Boulevard de Constance
77 305 Fontainebleau Cedex
France

Edieal J. Pinker (Contact Author)

Yale University School of Management ( email )

New Haven, CT 06520
United States
203-436-8867 (Phone)

Robert A. Shumsky

Tuck School of Business at Dartmouth ( email )

Hanover, NH 03755
United States

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