Finding a Scalable Product is Easy: How About Scalable Customer Service?

By: Brett Chandrasekhar

This morning, it was announced that Vocalocity is being acquired by Vonage for $130 million. This is the latest development in the VoIP industry since RingCentral went public late last month.

Vonage CEO Mark Lefar commented “Vocalocity accelerates our entry with a comprehensive, high-quality product suite and scalable platform. In addition, Vocalocity’s software orientation, customer focus and innovative approach are a natural fit with our culture.” [emphasis mine]

While the focus of any startup is to find a scalable product, a dilemma occurs when scale begins to be acquired. Bigger is better for a business, all else equal, but can customer focus really stay equal as a business expands?

A number of small businesses pride themselves on the quality customer service they offer (Telonium itself being an example). This can be contrasted with larger companies, especially in the telecommunications sector, who are sometimes even infamous for their poor customer service. Customers can be on hold for hours and hours and still get a poor response.

This is a trend that we see repeatedly and it occurs for a number of reasons. It is most evident when businesses ramp up and scale abruptly. In order to keep customer service at pace with their rapidly expanding customer base, what can a business do? One option is to hire just as rapidly to keep high quality customer service. But even this is a difficult-to-implement solution because there will be a tendency to hire sub-par employees and reduce customer service quality in this way instead.

However, there is some hope. Companies like Zappos show us that it’s not impossible to find a scalable customer service model. For example, check out this Business Insider article where Zappos is interviewed about their customer service and this piece about how a Zappos employee set a record for a 10 hour customer service call.

Will Vocalocity fall prey to its own growth as it is acquired by Vonage or will it manage to scale efficiently? Only time will tell, but clearly this is a dilemma for any growing startup to deal with at some point. How can we scale customer service as we scale our product? The solution may not be easy, but it’s definitely possible.