August 2000

BY STEVE MIHAYLO

When would a national corporation want to give the impression that it's a small neighborhood business? When its success depends on it, as Roto-Rooter Services Company's does.

Roto-Rooter  -- with 540 franchises, 63 company-operated branches, and 64 contractor-operated branches -- is the largest sewer repair and plumbing company in the U.S. The entire network serves 90 percent of the country, with company operated branches reporting revenues of $245 million last year. The name is synonymous with excellent plumbing service. Ask anyone on the street to sing the Roto-Rooter jingle, and they will easily recall the familiar "away go troubles down the drain" tune.

A LOCAL FEEL
Yet, most people think of Roto-Rooter as a local company. Customers, no matter where they are located, dial a local phone number, and they get immediate or near-immediate response from a local plumber. In fact, one of the roles of Roto-Rooter's customer service representatives (CSRs), who staff regional call centers, is to maintain that "in-the-neighborhood" feel when speaking with customers.

One of Roto-Rooter's busiest areas is made up of a call center in Philadelphia that serves five regional branch offices: Two in Philadelphia; and single offices in Wilmington, DE; Camden, NJ; and Middlesex, NJ. Customers dial "local numbers" that ring into the local office and are routed to the regional call center, which creates a service request for the branch office to dispatch the plumbers (or service technicians, as Roto-Rooter calls them). The branch office used to staff five to six customer service representatives. The regional call center now handles all calls for the five branches with better trained and more efficient CSRs.

"Telecommunications equipment carries our lifeblood," says Robb Thomas, communications manager for Roto-Rooter. Thomas is responsible for equipping each Roto-Rooter location with the necessary telephony and data/voice networks. "When people are facing a plumbing emergency, they need to be able to pick up the phone and reach us quickly."

In 1998, Roto-Rooter's Philadelphia region had a typical telecommunications setup: Its telecom and data networks were separate. Each branch office was equipped with an Inter-Tel Axxent telephone system, while the regional call center had an Inter-Tel AXXESS PBX system. All calls between the regional call center and the branch offices were placed over long-distance lines.

This standard setup created a number of problems for Roto-Rooter as its business in the area increased: Telecommunications costs were going up because each call placed between the branch offices and the regional center was a long-distance one. Likewise for all incoming calls from customers that were picked up by the regional center. In addition, Roto-Rooter's CSR turnover rate was double the national average. With the constant stream of new CSRs, the staff was on a continuous learning curve and productivity was an issue. The call close rate (calls resulting in full-pay jobs) wasn't growing, which translated into unhappy Roto-Rooter service technicians with time on their hands.

The cost of staffing turnover is high. Roto-Rooter loses between $75,000 and $150,000 in revenue for every master plumber that leaves. And in Roto-Rooter's Philadelphia area branches, turnover rate was expanding. Thomas identified these problems and took them to Inter-Tel's Rob Curtis, IP telephony product manager. Then they discussed what Thomas wanted to implement: A new telecom solution that would make the call center and branch offices more efficient, reduce Roto-Rooter's telecom costs and staffing expenses, reduce the CSR and plumber turnover rates, and increase the CSR call close rate -- but still allow Roto-Rooter to maintain its customers' perception of a local presence.

CLEARING THE PIPES FOR IP
After custom designing a solution that Inter-Tel had never proposed to a customer before, Roto-Rooter's regional call center and branch offices each had a newly installed Inter-Tel InterPrise 3200N voice and data router and AXXESS PBX. Inter-Tel's InterPrise products allow companies to cost effectively route their voice, fax, and data communications across a WAN. These gateways convert communications into data packets that travel over the same networks as e-mail and Internet traffic -- allowing a company to bypass traditional telephone lines and reduce communications costs.

By replacing Roto-Rooter's existing data routers with the InterPrise 3200Ns, all calls between the branch offices and regional call center are now converted to data, and a long-distance carrier is no longer required. Plus, by integrating the Inter-Tel InterPrise 3200N with the AXXESS PBX, the four AXXESS systems were transparently connected over the company's data network to operate as one system. The regional call center and branch offices are now only an extension away from each other, providing employees with complete telecom transparency and allowing them to function as if they were all in the same location.

The installations in all four locations took only four days, and Curtis and Thomas spent approximately one month fine-tuning the system (they initially experienced a slight problem with echo cancellation during calls). The results were immediately measurable: Telecommunications savings was estimated at $8,200 per month (or  just under $100,000 for the year). CSR efficiency improved, allowing Roto-Rooter to reduce redundant staff at the branch offices. The CSR call close rate doubled, resulting in twice as many jobs for the service technicians. The turnover rate among CSRs dropped as responsiveness to customers increased. The AXXESS call center management reports package also allowed supervisors to reward the most productive CSRs, motivating the entire staff and increasing job satisfaction. But most important for Roto-Rooter was the savings from service technician retention: Priceless.

Roto-Rooter now plans to install the InterPrise/AXXESS solution in nine more of its busiest locations. Thomas also expects the company to eventually move all of its locations over to IP telephony solutions. "Our product is our service," he says. "We don't sell anything that we manufacture; we sell knowledgeable guaranteed labor -- and we aren't making money if there's not a service technician in the house. Our telecom solution has to be as reliable as our service technicians -- or else our quality of customer service will decline." 

Steve Mihaylo is chairman and CEO of Inter-Tel, Inc. Inter-Tel is a single point of contact, full service provider of digital business telephone systems, call processing software, call accounting software, Internet Protocol (IP) telephony software, computer telephone integration applications, and long-distance calling services. For more information, visit the company's Web site at www.inter-tel.com.me.

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