NT: I’d like to start out by having you tell us a little bit about your company and your type of business.

HS: NICE is the leading provider of solutions that generate insight for multimedia interactions. We are in the business of voice, VPO, radio communication and voice over IP in a variety of industries. Our biggest market is the contact center business. However, about 20 percent of our business is also in the security area where we provide public safety and security personnel with solutions to capture voice to manage those interactions in a very effective manner. The position we hold in the contact center industry today is probably the widest and most comprehensive in the areas in which we operate.

We have recently launched the NICE Smart Center Solution, which incorporates, under one umbrella, the different solutions that we offer to the contact center industry — from compliance, quality management, workforce management, adaptive interaction analytics, coaching, customer feedback and performance management.

We believe these best-in-class technologies combined under the NICE SmartCenter umbrella and integrated within a unique, service-oriented architecture (SOA) gives us a compelling solution for addressing the different challenges of the contact center industry.

NT: What would you say is the greatest challenge for your company going forward?

HS: If I look at the challenges of the company, they are aligned with the challenges of the contact center industry. I believe that today, we bring to market leading-edge technologies. The challenge with every new technology is how to make sure it is adapted in the most profitable way to help customers improve their business.

Managing a contact center in today’s environment is not an easy task. Contact center executives need to strike a balance between optimizing people (who are very expensive resources), training costs, service-level agreements and the quality they need to provide to clients. On the other end, executives are challenged with ever-changing demands and ever-changing products in a competitive environment. Many contact center companies now manage multichannel contacts and employ multiskilled employees around the world who must upsell, cross-sell and answer both incoming and outbound calls.

This is a complex environment to manage, and new technologies can bring a lot of benefits. However, implementing technologies in a clever manner that will allow organizations to derive benefits from them is not an easy task. Our challenge, which is also our opportunity, is how to make sure that we offer solutions to accomplish this, and to capture the interactions.

We predict the volume of these interactions, and via our advanced adaptive analytics, we help our clients intuitively know how to make sales out of these interactions. We help organizations build key performance indicators (KPIs) that will allow them to optimize their resources within the different aspects of the operation. This is the challenge and also the biggest opportunity that lies ahead for our company and, we believe, the industry.

For example, we recently made an announcement of a deal with a very large GSM operator. The major reason this company purchased our technology was to manage customer churn. Companies are starting to realize that in order to manage churn, they must more efficiently and effectively manage interactions with the customer via the contact center.

This is a big revolution. Businesses are now looking at the contact center as a strategic place that can affect revenue in a significant manner. This GSM operator has implemented NICE Perform, our flagship technology, with advanced analytics. Now, implementing it is a very sophisticated task, but the provider absolutely requires these services. They need to analyze and understand specific work flows. They need to take the contact center to a different level of complexity within the organization. As I said, this is a challenge, but obviously this is also an opportunity. That is where we are focusing as we speak.

NT: I think that is a great area to focus on. If you have been reading my recent editorials, I have always said companies live or die from repeat business and repeat business comes from customer satisfaction. If you don’t watch what is going on and you don’t take care of every need of the customer, they are not likely to come back.

HS: When you have 100,000 customers calling you every day, you need to understand what issues you have with them — what opportunities exist, which customers are at risk and why. Without our technologies, this is very, very difficult to understand and know what type of proactive action you need to take, how to forecast your demand, understand your customer’s requirements and make sure that you put the right people in the right place in the contact center. That’s a big step forward. We believe that with our technology, we can make a significant impact on the industry. That’s where we are heading. Of course, this is challenging, but we love challenges.

NT: What do you perceive to be the greatest need of our industry? What can we do, as the leading publication of the industry for 25 years, to make things better?

HS: I would say that if you look at the industry in terms of greatest challenges, it's probably how to move back-office types of operations into the forefront of the customer-focused operation on the business side of the enterprise. That is still a challenge. Some companies have gone a long way, but there is still a long way to go for the rest of the industry.

NT: What would you say are the greatest developments in your company?

HS: I would split these developments into three areas. There is the technology side, the service side and the customer reach side. I will start with the last one. Over the last few years, we have built a global approach and a global footprint that, in our industry, we believe is quite unique. We now have global customers. We have operations in basically every important part of the world. For companies that would like a standard approach, standard SLA and a standard focus, we provide it. This is very important. So, customers that have their business partially outsourced to India or the Philippines, that want to do business in a similar way with us, both in Japan, in Asia in general, in the UK and in the U.S., we have built a global footprint that is probably unmatched by any of our competitors. So, these developments are on the operational side, which is important because though technology is important, it is not just about technology.

The second important area is the service part. We understand that in order for customers to effectively use the technology, it is no longer enough to just physically install the system, do a one- or two-day training session and go home. Customers expect much more than that. They expect us to understand their needs and their requirements for the system before they even make a decision on any technology. They expect us to understand their needs and to assist them in the extra implementation and to follow up in the later stages. As a result, we have significantly upgraded the capability of our service organization, adding people and disciplines that are more from the CRM side. We have added people from IBM with experience in how to take IP solutions into the enterprise. We are now focusing them in the contact center industry because of the reasons that I have described. So, I would say that this is another important development, and we continue to do this as we speak. We are adding people with domain expertise, people who understand the contact center industry and develop around that ability to help our customers better implement the technology.

The first part, of course, is the technology side. As I mentioned, we have recently launched the NICE SmartCenter offering. NICE SmartCenter is an innovative solution that brings an unprecedented level of openness to the contact center industry. To the best of our knowledge, NICE is the first company to bring a solution based on service-oriented architecture (SOA) principles to the contact center market. Basing our solution on SOA principles allows us to maintain the best-in-class status of individual components while helping our customers focus on ‘smart’ integrations. That means customers can protect and maximize their technology investments. In other words, customers get back the right to choose what they want and need. With SOA, we are not creating a closed suite. Instead, we are creating a web of services that are integration points between the NICE SmartCenter applications. With this approach, each of the NICE SmartCenter components can develop at their own pace.

NT: You acquired IEX and Performix in 2006. How are these doing? Are these blending well with the rest of your organization? Are you happy with the progress?

HS: Yes, we are extremely happy with the progress. If you look at our financial advancement in 2006 and you see the outstanding performance of the company, obviously this is a combination of organic growth, but also a very, very successful integration of the acquired companies.

From a strategic perspective, I would say that the combination of IEX, Performix and NICE technology puts us in a situation where we have best of breed in every category of our business. This is a good situation to be in. I can refer to some of our competitors. At least one of them has just decided to give up and basically leave the market. And, the other one had to pay an unbelievable amount of money just to be able to try and compete with us. So, from a strategic prospective, the breadth of our technology solutions is best of breed, which is a good situation. This is the result of the acquisitions that we have made and of course our own internal development.

NT: You mentioned you are involved in video. How do you think or what do you think is the future of video in the contact center and/or in enterprise in general?

HS: With people having more and more bandwidth in the home, we believe that video communication is another means of communication that the contact center will eventually embrace. It has been tested and people have talked about it for quite some time. For the more lucrative type of transactions, we will see it more and more. But it is not there yet. For transactions about a specific statement, for example, I am not sure that video will be used. But for consenting types of activity, whether it’s medical, pleasure or financial, where the interaction is much longer than 30 seconds, there is a potential benefit of video. It’s going to take a few more years, but I believe that contact centers will be able to provide video communication for a high-end type of transactions.

NT: Next question, what is your vision of the future of contact centers? What are the trends in your opinion and also where do you think we are going to be in the next five years? Also, are you happy with the industry growth at this moment?

HS: The world today is becoming competitive to a point which is unbelievable and was unheard of a few years ago. In this microenvironment, organizations hardly ever physically see customers anymore. Customers communicate with the business via the Web or telephone. Very little communication is done in-person. Therefore, the strategic importance of the contact center is probably going to grow more and more.

Over the next five years, I believe that the importance of the customer interactions is going to grow. On one hand, there will be more and more spending on automating the interaction. On the other hand, an opposite direction on everything that creates a venue, where there is an ability to spend time with the customer and to spend what he wants, sell him more, get more of his time and, of course, budget. So, we will see kind of two different trends, almost going in the opposite direction. Automating the simple interactions and making much more of those communications that can place value.

NT: Are you involved in home agents or developing technology for home agents or host it solution deliveries?

HS: Yes, we are involved in both areas. Our technology is a critical element in the home agent operation. With voice over IP, I would say from a strategic point of view, if you are looking at agents that work from home, understanding the context of what they are doing is much more complex than if they are sitting on the same floor as you are, and you can look over their shoulders.

So, managing and optimizing the scheduling of agents that work from home is probably more complex than all the agents that are just around you. This is one element. The other part is how to coach home agents, record their interactions and improve the service quality. So, home agents is a very important trend that we can help implement much more effectively with our technology.

NT: What would you say NICE’s core competency?

HS: Our core competency is a combination of technological expertise in a variety of fields. If you look at the different disciplines that are active today within NICE, we have very advanced applications (compliance, QM, WFM, adaptive interaction analytics, coaching, customer feedback and PM). We have developers and architects that are expert in networking, telecommunications and IP. We have experts in storage management. We have experts in algorithm and artificial intelligence using speech processing and speech recognition, and even in some cases advanced hardware design. If you look within NICE, you will find many of the same core competencies that you find within companies like Oracle and SAP. We have expertise in developing networking tools that you could find in companies like Cisco. And within the company, people with expertise in algorithms and artificial intelligence like the type you would find in labs in IBM or other companies. We have the experience to understand the needs of the contact center industry, and combine all these expertise into one working system.

NT: And what would you say then is the positioning statement of your company?

HS: We are the clear leader in several markets in generating insight from customer interactions or other business owned security related interactions. That’s where we are today.

NT: How would you differentiate your company from the competition or others?

HS: We are probably the only supplier of best-of-breed solutions that have a clear direction without any doubt about the company’s financial, strategic or technology direction. It is clear and I, of course, refer to some of our competitors that now need to make tough decisions about which platform will be there, which will not be there, how to integrate and so on. We are beyond all that. We have already moved to the next step, which is best of breed technology, an open architecture backed by a wealth of services and a holistic solution under the NICE SmartCenter umbrella. That’s a big difference. If I am a customer who needs to make a decision today on what to buy, I would say that we are the only one with a clear direction, a clear team that has been working together for many years now, who knows its direction and knows the industry, so that’s a big differentiation.

NT: Thank you very, very much sir. I really appreciated your time.