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Sprint President Emphasizes Improving Wireless Division's Customer Service

Posted on: Thursday, 2 October 2003, 06:00 CDT

Oct. 2--FORT WORTH, Texas--On Tuesday afternoon, a Sprint PCS customer called the Fort Worth customer care center to pay his wireless phone bill.

What the customer didn't know was that Len Lauer, Sprint's new chief operating officer and president, was listening to the call -- one of thousands that the center receives each day.

Customer service has become increasingly important to the Kansas City, Mo.-based company as it attempts to remain competitive in the telecommunications industry. Sprint is the third-largest long-distance provider and has the fourth-largest number of wireless subscribers.

The company's long-distance business enjoys a strong reputation among customers. But Sprint does not have the same reputation for its wireless division, Sprint PCS, which has had problems with dropped and missed calls.

"We have not focused enough on providing outstanding customer service to our 19 million PCS customers," Lauer said in an interview during a visit to the company's 2,000-person call center in north Fort Worth.

Service quality in the wireless business will become even more important in November, when a federal law called "number portability" goes into effect that will allow consumers to change wireless phone providers and take their phone numbers with them. Industry analysts say customer service is crucial.

Lauer said the company has spent billions of dollars upgrading its existing wireless network and has lowered the number of dropped and missed calls on its network. The number of complaints federal regulators receive about Sprint has also been cut in half, and Sprint PCS' customer turnover rate was 2.4 percent in the second quarter, down from 3.8 percent less than a year ago, Lauer said.

The company has also tied the monthly bonuses of its call center employees, like those in Fort Worth, to customer surveys that are conducted by a third party.

Lauer oversaw several of these improvements while serving as the head of the PCS group. He was promoted to his new job in September, taking over for Ron LeMay. LeMay and former Chief Executive William Esrey left the company this year after the U.S. Internal Revenue Service questioned their use of personal tax shelters.

Last month, Sprint also announced that it will reorganize its various business groups into only two: business and consumer, which would save the company more than $1 billion annually. The company has not said how many layoffs will result from the restructuring, although Sprint has already announced 17,000 job cuts since 2001.

Industry analysts say that Sprint has improved its customers' experience, but that it is too early to tell if that will make a significant difference when number portability is available.

"The customer service issues are more difficult to gauge, although it is something they have been focused on in the past 18 months," said Will Power, a Dallas telecommunications analyst at the Robert W. Baird investment banking firm. "With that said, as you look at most of the market research studies, they still rank towards the bottom end of the industry with regards to customer service."

Where Sprint's wireless division has an advantage over its competitors is in its selection of wireless handsets and data services, like sending pictures via the wireless phone, analysts say.

"Some of the specific reasons that people are switching carriers are for data services," said Tom Watts, telecom analyst at SG Cowen Securities in New York."Sprint has done an outstanding job promoting their camera phones and other wireless Internet products."

The company has also started aggressively marketing its local and long-distance products to its existing wireless customers, Lauer said. When a new customer purchases a Sprint PCS phone, promotional material with information about Sprint's other phone services is present at the retail store.

By reorganizing the company into a division that deals with business customers and another that focuses on consumers, Lauer said the company should be able to sell more bundled telecommunication packages and make it easier for customers to get answers to questions and solve problems.

"My focus has been on increasing profitability for the company, and you do that by having customers that value your services so they stay with you and they want to buy more from you," Lauer said.

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To see more of the Fort Worth Star-Telegram, or to subscribe to the newspaper, go to http://www.dfw.com

(c) 2003, Fort Worth Star-Telegram, Texas. Distributed by Knight Ridder/Tribune Business News.

PCS, FON,

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