Joel (from Joel on Software) had another great post today (Seven steps to remarkable customer service). In today's post he talks about how to provide great customer service and how great service with highly qualified and compensated employees can actually save a company money in the long term.
As a consumer, I know that I would rather pay more for something (within reason of course) if the company is one I trust. The company's I trust are the ones that provide great service. I define great service as a company that returns phone calls, is on time, honest, listens to my issues, and attempts to address my issues in a reasonable fashion. It seems like most service companies (at least in my area) seem to fail the first test (I can't get any landscapers to return my calls, grrr).
The company I work for has off-shored some of the development work to India, but they kept the technical support in the United States (where the majority of our customers are). This seems to make a lot of sense to me. I know I grow frustrated when I get a technical support person with a heavy accent. I always feel bad when I have to ask them to repeat something because I don't understand what they said.
I've contacted Microsoft developer support a few times in the last couple of years. I've been happy with the level of service that they have provided. They seem very committed to resolving whatever issue I may be having and will go to great lengths to resolve it. However, the support call usually starts off in India (I assume the support person is in India due to their heavy accent). The person is usually very helpful, but I often times have trouble understanding them. Of course, overall I'm satisfied with the level of support, but I would be happier if I didn't have to deal with the accent as well.
My prediction for the next big movement in customer service will be home-based customer service representatives providing support for their local region (I have heard of some companies doing this already, but it isn't wide-spread yet and the infrastructure to support it doesn't seem to be quite there yet). With telephony services the next big thing in the Internet, it's only a matter of time before some large organization has figured out how to provide this type of customer service in a cost-effective way that maximizes customer satisfaction.
Of course, based on Joel's article, this approach may not be very practical when taking a long-term approach to customer service (at least for the software industry). Having a strong feedback loop from customer service to product development is very important in improving the quality of the product which reduces the amount of customer service that is required to support the product.