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Thinking about replacing your legacy call center system but not sure whether to go the software-as-a-service or on-premises route?

As many organizations are discovering, today’s software-as-a-service or “cloud”-based call center systems hold numerous advantages over on-premises systems –  as well as the traditional hosted or ASP model of the not-too-distant past.

With these “all-in-one” call center systems, essential software applications such as IP-PBX (News - Alert), ACD, IVR, call recording/monitoring, workforce management, performance management, customer surveys and reporting can be tightly integrated on a shared platform in a data center and delivered to agents via dedicated IP network or the public Internet.

For companies still using legacy TDM equipment, upgrading to a new SaaS (News - Alert)-based call center system typically means gaining a whole new slew of features and capabilities – only at a much lower cost than if they had purchased and installed separate, best-of-breed solutions.

Unlike the hosted “client-side” solutions, these SaaS-based systems offer improved scalability and flexibility -- including the ability to add/remove agent seats, as well as the ability to turn specific applications (or even specific features) “on” and “off” with just a click of the mouse. In addition these solutions can be more quickly and easily (and affordably) integrated with existing systems, including CRM and other back-office systems.

Despite the current recession (in fact because of the recession), companies in a wide range of industries are adopting SaaS-based call center solutions at a rapid rate. A recent report from market research firm DMG Consulting predicts that the SaaS-based call center software market will grow 30 percent in 2009, 35 percent in 2010 and 20 percent in 2011. According to the report, 2008 was actually a good year for vendors offering hosted or Web-based call center solutions, despite the down economy, and 2009 is shaping up to be a strong year for growth as well.

 

In this multi-part series, we’ll look at the many advantages SaaS-based call center solutions have over traditional on-premises systems.

Lower Upfront Cost

One of the main factors driving adoption of SaaS call center solutions is lower up-front cost. Companies that adopt the SaaS model save initially by avoiding the need to shell out capital for premises-based hardware and network infrastructure, as well as installation and integration services. With today’s SaaS-based solutions, all a company needs to launch a new IP call center are the PCs and a high speed (typically T1/E1) connection.

In addition, companies that go with a SaaS solution avoid having to pay for the licensing of new software -- instead, they simply "lease" the software on a "pay-as-you-go" basis, typically a flat subscription model based on the number of seats. Not only is this pricing model more economical, it's easier to predict and manage, and affords simplified financial reporting: Rather than paying out chunks of capital for upgrades or replacements of on-premise systems, call centers now have the ability to include the cost of their SaaS service in monthly expense reports as a recurring line item.

 

Another huge advantage of SaaS call center systems is that they deliver lower ongoing operational costs. For one thing, the vendor takes on all responsibility for the performance of the system -- including all software upgrades as well as maintenance and troubleshooting of hardware and infrastructure. This reduces the strain on the IT department and also lets companies avoid having to hire third party support. In addition, new applications or capabilities can be added or customized quickly via a single, Web-based interface, without adding significantly to the overall cost of the service.

In addition, these systems lower companies’ electric bills, because all of the servers and equipment used to deliver the software is housed in a data center operated by the vendor or a third party provider. That means a company can quickly and easily reduce its carbon footprint and become “greener” by migrating to the SaaS-based model of delivery.

Next week we’ll look at three more advantages SaaS-based call center systems have over on-premises systems, including Faster Time to Market, Faster Access to New Technologies and Enabling the Virtual Call Center.