
The Costs of Running a Support Team in the Bay Area - fapi1974
http://www.peopledelight.com/costs-customer-support-bay-area/
======
dahdum
People Delight sells outsourced (mostly) offshore customer support, so the
source is only a _little_ biased.

Though having direct experience with this, these numbers are pretty good. Few
places will need a dedicated VP/Director level for a 6 person team though, and
if they did, that would apply to outsourced teams as well.

~~~
Sanddancer
In other words, part of the problem. The coders get all the perks, the free
sodas, stock options, the high salaries, etc. The front line employees get a
commute from Stockton and an opportunity for an extra dollar an hour wage next
year, unless there's a wage freeze.

~~~
gwbas1c
Supply and demand! Software engineers are much harder to find than support
staff.

They also bear a lot more of the burden than a front-line support person, as
the problems they solve are much more complicated, and need to fit in with
competing interests beyond one customer's single support request.

~~~
sgift
> They also bear a lot more of the burden than a front-line support person

I'm not sure about that part. The amount of abuse those people have to
withstand without being allowed to defend themselves (because "it's a
customer, be nice!") can break even the calmest person.

~~~
lsc
Yes, it is a rare kind of person who can be good at being front-line support
for very long. Especially for one of those outsourced-support outfits that
isn't actually allowed to help the customer.

I kinda kid about the last part, but even when it's internal, being front-line
support is brutal, especially for low-value products. The customer knows they
can usually get free stuff by being mean, and it's the front line support rep
who has to deal with that, almost always without the power to fire the
customer. Half the time, they have to deal with corporate policies that are
set in place really to get rid of customers who actually use support, but that
don't want to admit this obvious fact. This requires an ungodly amount of
patience.

That was one of the reasons why I think doing support for your own company is
so much easier; you can actually say "Hey, uh, I don't think we can help you,
how about I give you your money back and you go talk to a competitor?" you
don't have to pretend to be ineffective until they leave on their own, which
is essentially what the corporate policies are setup to do. It's soul
crushing.

(I mean, developers get paid more because businesses notice when their
developers can't develop; businesses seem to be largely okay with ineffective
customer support. I suspect you would have to come within 70-80% of a
developer salary if you actually wanted to keep effective customer support
people. If you look at very high dollar products where support people are
expected to actually help customers solve problems? they pay in that range;
sometimes better. )

~~~
ethbro
Amen. The sheer stupidity of running a low value unempowered astroturfing
support org to isolate your developers from listening to customers is matched
only by the frequency with which it seems to be done.

------
vacri
It's weird that $15-18/hour is considered pricey, when you could get 3-4
support staff per run-of-the-mill SF developer salary.

"All I want is someone who has the social skills to talk to clients, technical
skills to be familiar with the stack, and the nous to troubleshoot issues
based on the partial info that clients provide!"

Support sucks. You get the short end of the stick from _everyone_ \- clients,
management, developers - and there's little in the way of benefits for doing
so. No wonder there's a high turnover in the field.

~~~
jtmcmc
If they're expecting actual technical support staff (people who have a
technical ability as well as client facing abilities) to work for 15-18/hr
they're insane. Again outsourcing that sort of support is equally difficult
for the same reasons outsourcing engineering is difficult with the added bonus
they need to be effective communicators, generally in english.

~~~
erader
You're right, I've seen the type of Orgs in SF where 15-18/hr is the base wage
and it's not healthy (for the organization or the people who are working
there).

For the most part, I've seen that the type of Orgs with those support wages
are likely just trying to throw bodies at support volume. $16/hr for another
human to answer X amount of tickets with a Y% satisfaction over Z amount of
time. Their customer base is probably B2C or B2B with a large SMB base.

The model is bound to fail, particularly for communication reasons. The type
of Org that employs this position is also likely to not have the product
feedback loops that connect Support (reactive) with the Product/Eng teams
(proactive...hopeuflly). This means product is not addressing bugs quickly or
fixing usability issues that support agents frequently work around and explain
to frustrated users. It also means they likely don't have adequate internal
tooling to solve problems in real-time.

It's a form of technical debt that is REALLY hard to measure - I believe this
is because there's too much focus on "standard" support metrics like NPS, FRT,
# of touches... Yes these are important, but they are surface level stats for
maintaining a basic, "good" support experience. Great support experiences
require tighter integration with other teams with better data.

There's no one right answer, but likely a spectrum of options that need to be
analyzed for which works best for you. \- Have an international customer base?
Maybe outsourcing could be a great option to keep costs low and cover more
timezones \- Not interested in outsourcing? Stay in the US and build a new
office with talent outside the Bay Area (check out Lyft's Nashville office) \-
Do you absolutely need Support to be in HQ? Make the commitment to higher
wages and staying lean and effective, not just as a Support team but as 1
company together.

~~~
fapi1974
I would also draw a distinction between B2B businesses with Customer Success
needs and B2C businesses. Perhaps I should modify the blog post to reflect the
assumption that this is basic question-answering support, rather than
technical support.

------
mrweasel
I don't think that teams with only six people are that interesting. In terms
of cost, it really does start to matter when your employing 100+ support
teams, where the skills required may be somewhat limited.

One of my previous employers is a large telco, with two locations, one in
Copenhagen and one in the other end of the country. When I left, the plan was
to close down the entire support team in Copenhagen and move those tasks to
the other office. The benefit was/is that you can pay people a little less,
while still leaving them with a better work-life balance, due to lower rent
and shorter commutes. As a bonus the "office" space is much cheaper.

There's a huge benefit to place things like support teams in more rural areas
of a country. You'll have an easier time hiring and retaining and the cost
goes down. Companies, especially in the English speaking countries, just take
it one step to fare and move the job out of the country. Sure it's cheaper,
but you'll lack the cultural understanding that your customers will expect.
Also you do need developers, sales staff and so on to actually be on site with
the support teams once in a while. Having to travel abroad or even more than a
few hours really hinder that interaction.

~~~
ethbro
The other thing that comes with moving jobs into more rural / less competitive
markets is lower turnover.

Preface: I know some support rock stars and have nothing but respect for the
amount of crap they have to put up with above and beyond software engineers,
but from a salary perspective there are better things they could be doing. A
lot of which, doing support for long will train them for. Yet those those are
the exact people you want to keep in your support org.

------
lunaru
Customer support for every company is going to be different; there just isn't
a formula. Some companies can utilize more automation because the types of
questions fielded are going to be very similar (e.g. "where's my package?" or
"how come there's a flashing red light?"). A team of 8 just about anywhere can
scale to fairly high volumes.

But since we're talking about the Bay Area, and it sounds like specifically
for a technically focused company (I'm thinking startup) the good news is that
the core team is likely already fielding support because talking to customers
is so important to the growth and direction of the product. Yes Bay Area
salaries are high, but hopefully you're hiring high quality team members that
are more than just front-line support -- they should be an invaluable part of
your product and customer development process. You can't really put an
outsourcing price tag on that.

Lots of companies have a process where the developers are insulated from day-
to-day support roles -- and if that's working, great. But, the best companies
have developers who want to talk directly to (or at least have support access
to) customers and understand their problems first hand. This is where the high
salaries more than pay for themselves.

~~~
fapi1974
I definitely don't think it makes sense for early stage startups to work with
a vendor - there is too much iteration happening during the search for PMF.
Where we see it start to make sense is when the company is hitting
acceleration. At that point it doesn't scale to do side-by-sides for training.
It becomes necessary to manage large number of high-turnover employees and
become really good at hiring and training them. It's really specialized. Most
tech companies that have scaled - Uber, Amazon, Google etc etc use outside
providers. Which isn't to say that even when we get brought in (usually at
around the 6 person mark in the blog post) that we don't spend a TON of time
making sure that the communication between the front line agents and
product/engineering isn't really good.

------
calitalieh
I run PartnerHero, and we only work with startups (many are name-brands, some
are tiny). There is NO WAY you would need a VP or Director level person for a
team of 6, or even a team of 60 (our teams start at 2 and go up 80.) Startups
are not the same as "small companies", so traditional outsourcing doesn't
work. I would strongly recommend hiring outside of the Bay Area (there are
state nexus issues you will have to address) and put aside all the local bias.
It's not just about saving money, it's about hiring people who will be excited
to work with you and represent your voice to the stakeholders who matter the
most: your users. Support (operations in general) is really hard and most
folks don't get the love and acknowledgment they need. If you can't afford to
hire full-time, experiment with interns (paid) and part-time hires. I would
look at the Southeast, Mid-West and even Idaho/Oregon/Utah as great options.
As for us, we have folks in Honduras, Brazil, U.S., Japan, Spain and Serbia.
Great talent (for ops) can be found in many areas, with exceptional English
skills and great empathy/problem solving skills too.

------
jakozaur
A lot of things cost a small fortune in Bay Area. On the other most of
startups should provide exceptional support.

I believe it's hard to have exceptional support by outsourcing it remotely
(unless the whole company is remote). Especially in young company, when every
week a lot of things is changing. Also developers can apply changes based on
support insights.

Though this might make sense for established companies, I believe initially at
startup you should almost never outsource support.

~~~
blencdr
In France some companies "outsource" their support out from Paris near other
french cities.

The business offices price and cost of living is lower, you can have a
proficient team for 1/3 of the price.

~~~
fapi1974
This is the model a lot of startups follow here as well - "outsourcing" is a
loaded term.

------
ffjffsfr
Interesting read, thanks for sharing! Slightly off-topic, have you thought
about making your blog more readable? There is grey text on grey background.
I'm short sighted and when reading this on my computer monitor while eating
lunch I had to actually print it to pdf to be able to read it conveniently.
Your blog also breaks in "read mode" chrome extension that I usually use to
alleviate problems with bad designs like this one.

~~~
fapi1974
Just got up to head out to surf - this is great advice. It's a new blog - I
will take your advice!

------
sologoub
$15k per year (or $208/person/month) for CRM/Chat/Phone seems high, unless
they mean unlimited Salesforce.com license for each user and some add-one...
(which for 6-person team seems an excessive choice.)

------
coin
-1 for disabling zoom on mobile devices

~~~
fapi1974
Noted! Will fix.

------
kbhappyface
Actually (sorry late to the party) our company allows folks a great work/life
balance. Not a small thing. Appreciated. Well compensated. No commute. For a
person in SF that is a minimum savings of 2 hrs a day. Next enjoy team
relationships. We do that through slack chat which keeps them close to
engineers and other company team members, and keep those departments close to
customers concerns. As for costs -- having a The entire US or global footprint
to choose the most qualified talent also helps us ensure we are able to ensure
the best person for our client, their customer and wage for the location of
our team member - win, win, win.

