First, welcome to the launch of the Cloud-Based Contact Center Solutions channel sponsored by Interactive Intelligence. Given the dynamism of this market, as forward looking enterprises seek to transform the efficiency and effectiveness of their contact center operations as they become ever more integral to success, we invite you to not only bookmark this space but return often.
In this inaugural week it only seemed appropriate that we turn to Jason Alley, Solutions Marketing at Interactive Intelligence (News - Alert) to share some thoughts about the importance of the cloud as it relates to the present and future of contact centers. As always, he had more than just a little food for thought.
Defining the cloud
We started out discussion with the basics since there is so much buzz/confusion about the cloud. In fact, Alley’s blog on the subject, “Clarity in the Clouds,” is highly recommended. Interestingly, both in his blog and our conversation he dusted off the Wikipedia definition of cloud as a level set:
“Cloud computing is a marketing term for technologies that provide computation, software, data access, and storage services that do not require end-user knowledge of the physical location and configuration of the system that delivers the services...”
Yes, blame the marketing folks. However, as Alley explains, this is about virtualization and other things driving what I call “infostructure” (utility-like computing and communications capabilities needed by organizations to optimize their businesses) being, “Moved into data centers. In fact, to a centralized single data center to ease stress on IT organizations to realize at a high level the benefits of more cost-effective, easier to manage and extensible solutions.” That said, Alley believes, despite Interactive Intelligence being a leading-edge supplier of communications as a service (CaaS, e.g., cloud-based solutions for enterprises) since 2005, contact centers have been a laggard compared to other parts of enterprises in moving to the cloud.
Alley points to three things that have been top of mind of IT asset managers that have caused them to be circumspect about the cloud: security, reliability/predictability and control. He also said that compliance and regulatory concerns, big issues in the U.S. and globally, have constrained the market. However, all of that has changed. It has done so in a big way in the past several months.
For instance, Interactive Intelligence’s cloud business is growing rapidly. It has become a significant portion of its overall business. Their FY2011 results are telling:
- Cloud-based revenues increased 96 percent year-over-year
- Cloud-based orders up 179 percent year-over-year
- Cloud-based orders were 23 percent of total orders in 2011, up from 11 percent in 2010
- The company signed its largest deal in its history 3Q 2011, a $10 million five-year cloud contract with a peak of 4,200 agent seats and additional opportunities for expansion.
Alley was quick to point out that definitions are important and not just semantics and that all clouds are not equal in terms of whether they are the best solution for any customer’s unique circumstances. Indeed, understanding the differences is critical. A little primer he produced is useful. You are invited to cut and paste:
Private Cloud – technology infrastructure is owned and operated by a single company and deployed as a service for users within its organization.
Public Cloud – technology infrastructure is owned and operated by a third party service provider who offers like services to multiple clients.
Hybrid Cloud – the combining of private and public cloud infrastructures to take advantage of unique benefits offered with each model.
Digging deeper
As we all know, the numbers say cloud-based solutions are growing at rapid pace. However, premises-based ones will not disappear quickly. Alley amplified this saying, “The cloud must be leveraged in places where it makes business sense… It needs to be done in a smart way, and cloud vendors must become part of customer strategic planning teams.”
We next returned to why contact centers have been slow to the party. A big reason has been the initial captivation, much of it marketing generated, that stressed IT managers could just flip a switch and not only solve their headcount and other CapEx and OpEx challenges, but that implementation would be easy. While possible true in some areas, this has not been the case for contact centers. They are high-touch parts of organizations. This is true regarding interactions not only with customers and channel partners, but increasingly with multiple parts of most enterprises to assist in business process optimization, planning and even competitive intelligence. The knowledge generated is, to use an old term, “mission critical.” This means it needs to be guarded judiciously and control who, what, where, why and when it is accessed and how it is used under which set of policies and rules is crucial.
Where this is taking enterprise interest in cloud-based contact center solutions is not necessarily where one might think. This is particularly true as contact center transformation is increasingly seen as strategic and not just economics-based or tactical.
Alley says, “A trend we’re seeing in the contact center is that companies moving to the cloud are looking for full-suite solutions versus deploying a smaller subset of contact center applications in the cloud (something occurring in the on-premise world for some time now).” He notes that when companies are doing their consideration and evaluation, many are looking for ways to leverage voice and other infrastructure components located on their premises as part of the overall solution.
Interestingly, what is increasingly seen in the market is that a hybrid deployment (the hybrid “Local Control VoIP” model (read details) or via a centralized deployment leveraging existing PBX (News - Alert) infrastructure (the centralized “Remote Control TDM” model) is preferred. As discussed on the web pages he explained that, “We expect customers to continue to deploy contact center applications both in the cloud and on-premises. The cloud is where the growth is but the on-premises business isn’t going away anytime soon – the key is having a choice in how to deploy and being able to protect one’s investment over the long-term should requirements, preferences or strategies change,” he said.
In fact, one of the trends to watch closely is the one where for time to deploy reasons companies start with a multi-tenant public cloud deployment, move to a hosted private deployment for control, security, geo redundancy, compliance and other concerns, and then move critical assets back onto the premises. Alley says that in fact, “hybrid solutions based on the flexibility enterprises need to satisfy business optimization as well as strategic issues are emerging as popular solutions as the market evolves.”
Why Interactive Intelligence
As our Contact Center Solutions channel matures, this space will explore all of these issues and look at what customers, channel partners, other ecosystem members, and industry experts are saying and doing in regards to challenges and opportunities as they arise. However, as leaders in the space it seemed fair game to let Alley explain what makes the Interactive Intelligence approach to cloud-based solutions compelling. He cited four key reasons:
- Interactive Intelligence is an experienced and proven contact center and unified communications (UC) solutions provider and the features in the cloud are built on the same code as those on-premises and are supported by people with years of experience.
- The company’s solution set provides a single-customer, multi-instance virtualized environment in the data center that gives the customers increased security, isolation and flexibility.
- Deployment options enable customers to keep all of their voice traffic within the customer’s network which increases quality, control and security while reducing expensive WAN bandwidth requirements. This means critical functions can remain under local control while certain if not all applications reside in the cloud.
- The ability to migrate from cloud-based functionality to on-premise gives customers long-term investment protection that is customized to their specific needs.
Flexibility cannot be under-stated. The contact center does not function in isolation any longer. Integration with things like UC and business process automation is only going to grow over time. This is the differentiated value of Interactive which Gartner (News - Alert) Group has highlighted as the company being the only solutions on the market fulfilling a comprehensive cloud-based approach.
Finally, Alley wanted to be sure it was mentioned that the ubiquitous access to the cloud is very important to a growing set of customers. It enables them to ride the trend toward more teleworking, i.e., that work is associated with people and not reliant on close physical proximity. The cloud lets remote agents have access to all of the enterprise tools they need as if they were not remote. It does so under strict control by IT for the enforcement of the enterprise’s policies and rules. It does so without sacrificing contact center supervisors’ responsibilities in any way. It fits nicely into the hybrid schema.
At the end of the day, going to the cloud is both exciting and can be extremely beneficial. If you are involved in contact center for your enterprise, if you have not considered some type of cloud-based solution already, there is an extraordinarily high likelihood that you will and that this will be the year.
As the old axiom goes, “knowledge is power.” This channel is designed to give you the knowledge you require to make great decisions about what is best for you and your company’s success no matter what part of the contact center solutions value-chain and ecosystem you occupy. Once again welcome. We look forward to hearing from you.
Edited by Peter Bernstein