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Satisfaction with outsourcing: Educational vs. STM publisher

March 10, 2010, 1:18 pm

One would expect customer satisfaction levels with outsourcing providers to be proportional to the years spent in outsourcing. However, our findings from a recent survey of publishing industry segments – STM/Academic and Educational publishing threw some of these assumptions off the mark. It is surprising to note that publishers from the STM/Academic segment indicate such low levels of satisfaction with outsourcing despite being pioneers in outsourcing and offshoring.

Source: ValueNotes Research

Dissatisfied buyers reflect badly on providers (including captives) servicing the segment. The growth in production-related outsourcing (and offshoring) by STM publishers has over the years spawned several small, fly-by-night operators, incapable of providing sustained and consistent delivery of services. Also, several mid-sized providers have not innovated sufficiently to match the growing expectations of STM publishers. In general, complacency, lack of consistent quality and delivery amongst providers has contributed to this dismal rating.

The education segment, on the other hand, has close to 80% of respondents being moderately satisfied – of which 20% have indicated high levels of satisfaction. Educational publishing requires somewhat niche capabilities. The large providers that cater to educational publishers have taken the effort to develop these capabilities. Even the mid-small vendors in this space have built their businesses around differentiated offerings with a clear focus on content and design capabilities and not merely production services.

While providers catering to both segments have a long way to go, those servicing STM publishers need to go all out to enhance customer satisfaction, else some of these risk losing business. On the other hand, providers servicing the educational publishing segment face an uphill task of pushing satisfaction levels from moderate to high. This will entail higher levels of servicing, quality in output and consistency of delivery.

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  • Jim Hill

    I find this study very fascinating and highly ironic on many levels. If STM and educational publishers are this dissatisfied with outsourcing premedia work offshore, then why do they continue to outsource? If I were 69% dissatisfied with my wife, a woman that I am dating, my automobile, my insurance agent, especially after a long relationship, then I would have to conclude that I need a new wife, a different girlfriend, a different car, or a new insurance agent. Most of us, especially in the USA, would not tolerate a 69% low satisfaction level on anything, ever. I suspect that the low cost out ways the dissatisfaction level, but not at all sure of that. If the level is this low, then I would propose that the cost savings can not be as low as many think since the study infers that a lot of work, time, and money is spent fixing problems like taking your car back to the repair shop 5 times to repair the same problem again and again with not much improvement. Not many will do that over and over again. On a fundamental level, I think this study is a clear indicator that most offshore publishing vendors do a horrible job of knowing what customers want and how to market their services in a highly differentiated way. On the publishing side, I also suspect that most publishers do not have a clue why one vendor is better than another vendor since they often use pricing as the first and only hurdle to get a fit. I find that they spend far too little time analyzing the key service areas with any degree of intelligence. In particular, one service area, copyediting, is often cited as one of the worst with offshore vendors, and I have personally seen horrible examples of this. I think what is needed is a study that examines the service areas more specifically with some recommendations from publishers and vendors on how to improve the quality of service.

  • Jim Hill

    I find this study very fascinating and highly ironic on many levels. If STM and educational publishers are this dissatisfied with outsourcing premedia work offshore, then why do they continue to outsource? If I were 69% dissatisfied with my wife, a woman that I am dating, my automobile, my insurance agent, especially after a long relationship, then I would have to conclude that I need a new wife, a different girlfriend, a different car, or a new insurance agent. Most of us, especially in the USA, would not tolerate a 69% low satisfaction level on anything, ever. I suspect that the low cost out ways the dissatisfaction level, but not at all sure of that. If the level is this low, then I would propose that the cost savings can not be as low as many think since the study infers that a lot of work, time, and money is spent fixing problems like taking your car back to the repair shop 5 times to repair the same problem again and again with not much improvement. Not many will do that over and over again. On a fundamental level, I think this study is a clear indicator that most offshore publishing vendors do a horrible job of knowing what customers want and how to market their services in a highly differentiated way. On the publishing side, I also suspect that most publishers do not have a clue why one vendor is better than another vendor since they often use pricing as the first and only hurdle to get a fit. I find that they spend far too little time analyzing the key service areas with any degree of intelligence. In particular, one service area, copyediting, is often cited as one of the worst with offshore vendors, and I have personally seen horrible examples of this. I think what is needed is a study that examines the service areas more specifically with some recommendations from publishers on how to improve the quality of service.