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ABC News has an article today about consumers' frustration with customer service. In general, I agree with this article: there are a handful of companies that get it right, and hundreds that seem to be clueless.

However, there's one part of the article that, in my opinion, glosses over reality. The article points to the increase in touch-tone phone menu systems (Interactive Voice Response or IVR in industry-lingo) as a contributor to consumers' frustration. I don't entirely disagree here, but the assertion that companies do this "to save money" makes it sound like the entire purpose of phone menus is to make executives rich while telephone agents get laid off.

Reality is far more complicated. There's a reason that phone menus and self-service systems have become so commonplace: they can handle tremendous volume with very good efficiency. In many industries, the majority of customer service calls are very simple inquiries - account balance, bill payment, store locations and hours, etc. If 70% of calls are simple enough for a computer to provide the answer, the 30% of calls that are truly complex can be more efficiently handled by live agents.

Assuming that ratio (70/30), imagine that customers complain about being put through phone menus in order to get anything done. (Not that hard to imagine, huh...) The company has three options:

1. Continue to put all calls through the phone menu
2. Route all calls directly to your existing pool of live agents, as a result of which everybody who calls will be subjected to 10-30 minutes of waiting on hold for an exasperatedly busy agent
3. Hire enough live agents to handle all calls immediately, as a result of which the company must raise prices of their products by 10% in order to cover the increased servicing costs

The results of options 2 and 3 are very real. One large company discovered that the cost of implementing a "zero-out" (press zero at any time to reach an agent) was approximately $40 Million annually, as a result of the additional agents they'd be forced to hire in order to handle those calls. And to be honest, it's not an efficient use of those agents -- they will probably get thousands of mis-directed calls, since the customer will have skipped the menu that normally directs calls to the right group of agents.

Okay, I left off option #4 above. The fourth option is to invest a moderate sum of money in a phone menu system that is extremely easy and intuitive to use. These systems are constantly improving - and in fact, many of them are now capable of "learning" based on customer inputs and behaviors so they become more efficient over time. This investment would be much smaller than adding additional agents, and would have a better payout.

Problem is, consumers have become trained to hit zero as soon as they hear a menu, and would need to give the new system a chance to work.