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January 2009 | Volume 27 / Number 8
CALL CENTER Technology

Industry Leaders Share Their Views Regarding The Growth and Trends in the Contact Center/CRM Industries

Once a year, the editorial staff of Customer Interaction Solutions conducts a roundtable interview of industry leaders as a way of assessing the growth and prospects of the call/contact, CRM and teleservices industries. This year, we asked Avaya, Convergys, CosmoCom, Interactive Intelligence, InfoCision Management Corp, NICE, OpenSpan, SugarCRM, and Verint Witness Actionable Solutions to provide us with their valuable opinions on the direction of the industry. We’re happy to share with you, our valued readers, with the highlights of these companies’ expert opinions. You can view the complete answers on our highly ranked web site TMCnet.com

First, companies were asked “In your judgment, by what percentage is the contact center industry expected to grow, and what is the reason for that growth?”

Avaya (News - Alert)
Until recent months, we saw industry growth at 12-15 percent. Recent economic activity leads us to believe the industry may remain flat for the year (No Growth) or more likely experience a slight decline.

Convergys (News - Alert)
We estimate at less than 10 percent. The current economic climate makes it more difficult to predict longer term growth in the industry, but we think we’ll see moderate growth over the next several years. Companies are struggling to contain costs while their revenues decline, but customer demands will continue to evolve and become more complex. To compete, companies will need to provide higher levels of service through a range of online and offline channels and invoke some personalization into the experience through the use of business intelligence, analytics and technologies that integrate customer channels.

CosmoCom (News - Alert)
The industry as a whole is not going to grow much in 2009. But although the overall industry is flat, there are sharp growth curves hidden within it in two segments – the all-in-one IP platform, which enables TCO reduction and creates an ROI through consolidation, and the SaaS (News - Alert) model, which will increase in popularity as companies seek to convert capital expenses (CapEx) to operating expenses (OpEx) in view of the economic climate. Since these trends are gaining market share against traditional strategies, the overall market does not grow, but there is a lot of growth for those who respond to these major trends.

InfoCision Management Corp.

For the overall industry, we are predicting minimal growth, if any, for most of 2009. With the uncertain economy many organizations will cutback on their marketing budgets. Clearly only the fittest call centers will thrive and marginal result providers will face significant challenges. Expect more consolidation and for organizations to decrease their pool of preferred vendors.

Interactive Intelligence (News - Alert)
It is very difficult to make any predictions for 2009 given the economic climate. Clearly, things have slowed down from the 25 percent+ growth we saw for the last couple of years, but how much will it slow?

In the current economic environment – it is very difficult to provide a specific demand projection for the market. We find that demand for contact center solutions continues to be strong, particularly in this uncertain time, as they help organizations nurture and protect their most valuable asset, their customer base.

The turmoil in financial services and other markets is translating to greater reliance on our systems. When everyone is worried about their personal finances – the first call they’re making is to find out what’s going on with their savings and investments. Some of our customers have told us they are seeing an increase of twenty percent to even 200 percent in calls coming into their call centers, branches and back offices. In many cases, their call center systems are running at full capacity.

We are finding the demand for value-added offerings such as interaction analytics to be as strong as ever, as this high-value technology helps organizations better understand their customers and maintain a clear edge over competition. For example, one customer has been using our Interaction Analytics solution to categorize customer calls by topic to gain insight into why customers are calling. This level of analysis enables them to anticipate issues and respond more effectively and often leads to fewer calls overall.

OpenSpan (News - Alert)
We expect the industry to experience little or no growth in 2009 simply due to the global economical challenges. More than ever, the contact center industry will need to “do more with less” as customers will continue to demand high quality of service. Organizations will look to optimize or modernize their existing technology in order to improve the productivity of existing agents and improve customer satisfaction.

SugarCRM (News - Alert)
We see potential for growth by about 20 percent in the contact center market for three distinct reasons. First, the trend away from call center outsourcing back towards on-site call centers bodes well for the industry in general. Second, VoIP technology has made the cost of running a call center less, and also opened up the doors for home-based agents using VoIP softphones. Finally, open source applications, such as SugarCRM, are lowering the barrier to entry for businesses to create their own call centers. So, we are seeing actual organic growth as smaller businesses that previously could not afford to operate a call center able to create their own contact centers thanks to the convergence of these three trends.

Analyst estimates have generally been between eight and 10 percent, indicating that the contact center industry will indeed continue to grow in 2009. The contact center remains the bridge between a company and the marketplace. In general, companies still rely on the direct customer feedback that is shared in the contact center to influence marketing campaigns/promotions, updates to products and services, and more.

For the next question, companies were asked “in your opinion, what is the greatest technological need of the contact center industry at this moment?”

The technology most in demand is data integration and normalization focused on improving customer satisfaction and contact center efficiency.

Analytics and relationship management technologies that balance agent-assisted and self-service options for customers are critical in giving customers the service they want, when and how they want it—whether that is by speaking with an agent on the phone, using a self-service option via a voice portal or mobile device or leveraging both on a single transaction.

Companies must understand customer preferences and utilize the right technologies to make this transition to a value-add model. It requires understanding why a call was made or what the drivers are for initiating a query or complaint.

To provide a proactive and seamless customer experience, companies need to know their customers and their pattern of behavior over time. So, it’s important to have analysis of customer behaviors and intimate knowledge of call types and customer segments. How that information is deployed to agents at point of service is also very important.

The technology needs to catch up with the two major trends we highlighted earlier, the all-in-one IP platform and the SaaS/hosted contact center model. It will be a great year for the suppliers who do.

InfoCision Management Corp.
Currently, business intelligence is one of our priority projects. One-to-one marketing is here to stay and the ability to provide clients with such solutions as data overlays, best-time-to-call technology, predictive modeling, data enhancement and customer profiles is a clear differentiator.

Interactive Intelligence
We don’t know if we’d categorize it as so much as a need versus “the greatest technologic benefit.” And that focuses around the move to IP telephony. It provides overall cost savings, it better enables distributed environments and remote agents and it also facilitates the deployment of new, innovative applications.

The greatest technological need in the contact center right now is for solutions that will help transform the contact center into a value-added profit center, rather than a cost center. To achieve this critical goal, contact centers need comprehensive solutions that integrate quality management (QM) integrated with interaction analytics, agent coaching and a post-call customer feedback solution. This integrated approach enables call center supervisors to dramatically improve service levels, resulting in increased customer loyalty – one of the requirements for sustainable profitability.

An integrated contact center solution enables supervisors to dramatically improve service levels by performing precision QM. This enables them to target specific customer interactions, as opposed to random sampling, for a better understanding of which agent behaviors contribute — or are detrimental – to customer satisfaction.

Taking this one step further, integration with a performance management solution can provide supervisors with a customer satisfaction dashboard that displays information about declines or increases in customer satisfaction scores, where integration with the call center’s CTI (News - Alert) system enables them to correlate lower scores to longer queue times. Further integration with a workforce management solution enables supervisors to conduct coaching sessions at the optimal time, ensuring that the agent receives critical inputs without risking a conflict with peak-call hours, for example.

Desktop optimization solutions. Whereas in years past most contact centers were investing in new applications, today we find that they are looking to derive more value from their existing ones. The focus is shifting towards extending or modernizing existing applications instead of replacing or upgrading applications; automating processes across these applications and streamlining the way agents interact with applications so that they have immediate access to a 360° view of the customer. Improving agent effectiveness through desktop optimization is a hot area given today’s “do more with less” mantra.

For the “mature” contact center market, I see the greatest need being software and VoIP-based technologies to replace outdated PBX (News - Alert) and other expensive and unwieldy contact center components.

In today’s business environment, the greatest technological need is for organizations to leverage eLearning and software that supports the coaching process. This area continues to present a challenge for many organizations worldwide. The contact center industry, in general, has done a poor job of creating an environment rich with learning and training opportunities for agents. This is especially important because the complexity of transactions has increased dramatically. Even further, budgets are being affected, and employees are being asked to do more in return. By placing more emphasis on training agents to effectively handle calls, companies can experience a direct connection and increase in establishing stronger customer loyalty.

Next, companies were asked: “What was the most important technology they used in 2008?”

Increasingly throughout the year, the blending of unified communications with customer service capabilities has driven important developments. The merging of multiple media – video, data, voice – and multiple modes of communications – e-mail, phone, SMS -- took important steps forward in 2008. This sets the stage for ’09, in for helping customers reach the right expert (based in any location) faster, using any media channel, via inbound or outbound methods.

Customers are using all channels to access enterprises and demand more responsive service with shorter queue times, one and done resolution, and quick turn around on information. They are looking for proactive communications through notifications and mobile message alerts, and they want to choose how they interact.

Just this year, we’ve announced several clients using a new relationship management technology, Dynamic Decisioning Solution, to bolster customer satisfaction and control costs to serve through increased voice portal call containment, real-time personalization and segmentation. With the Dynamic Decisioning Solution and the recent launch of the Intervoice (News - Alert) Voice Portal 6.0, we’ve taken the customer experience to a new level. These relationship management solutions enable the design, development, and deployment of secure and personalized speech-enabled self-service applications that deliver a consistent experience to customers across any channel.

Interactive Intelligence
Interaction Client® from Interactive Intelligence: A desktop client that provides a great graphical interface to manage all communications.

We have found that the introduction of interaction analytics packaged business solutions is leading to a revolutionary approach for extracting important customer and business-related insights that help improve operational efficiency and overall customer experience. Packaged Interaction Analytics business solutions provide organizations an innovative approach and quick turnaround in tackling some of their most pressing business issues. These solutions offer highly valuable integration with the organization’s existing business processes where organizations can automatically analyze customer interactions and perform root cause analysis to identify potential problems and derive immediate insight into potential resolutions. These business packages constitute end-to-end, out-of-the-box solutions that include comprehensive reports, dashboards, and workflows that enable rapid deployment and provide an accelerated return on investment.

The first packaged solutions to be offered include: First Call Resolution Optimization, Average Handle Time Reduction, Decreasing Churn, and Improving Customer Satisfaction.

Virtualization and desktop integration technologies were two very important trends in 2008. Also, the game-changing technologies in business activity monitoring (BAM) mean you can reach out to all of the agents in the enterprise to monitor and report everything that happens on the desktop. Desktop BAM is here for 2009.

SugarCRM looks to use its own solution as much as possible internally to prove the value, and leveraging our own knowledgebase and self-service portal tools, we were able to continue to serve our thousands of customers in a consistent, multi-channel and cost effective manner. VerintWitness

The emergence of analytics – speech, data and customer feedback surveys – evolved in 2008. A unified, analytics-driven workforce optimization (WFO) solution that leverages critical information from customer interactions helps optimize workforce performance. It provides companies insight into customer experiences that might otherwise be difficult to obtain. Incorporating these types of analytics solutions helps transform raw data into actionable intelligence, enabling organizations to now only know what’s happening, but why it’s occurring.

Finally, roundtable participants were asked: “In your view will more contact centers that have left the US for nearshore and offshore come back or do you see them staying and grow offshore and nearshore, and why?

Yes. There are two reasons some work will return to home shore. Some will come back due to the need for improved customer satisfaction and others will come back because of reduced volume creating more stranded capacity. It will make more economical sense to keep capacity in more expensive regions highly utilized. Attrition, which is one of the largest cost drivers in high cost regions will also improve due to higher unemployment rates, making work here more feasible.

We’ll continue to see growth across the globe. Recent Convergys research indicates one of the top things customers want is to “speak with knowledgeable agents regardless of location.” Many variables impact choice of location for call center work and different geographies provide different strengths in the business. For example, technical support has really evolved over the past 10 years and India has a strong base of engineering graduates that are well suited to this work. We have also opened new contact centers recently in North America and hired a large pool of home agents. We announced a significant expansion in The Philippines. While the location of a contact center is always driven by the unique needs of each client and type of work, we’ve seen overall growth in our call centers globally.

The real key is "right-shoring," which is a trial-and-error process. For some, that will mean moving or remaining offshore. For others, it will mean coming back onshore and using virtual contact centers that increasingly include home and informal agents in tandem with formal resources on and offshore. The beauty of virtual contact center technology is that it doesn't matter where the agents are.

InfoCision Management Corp.
Some offshore contact center businesses are returning to the U.S., no question about it. There has and will continue to be a real shake-up of the Indian market. A call center is the voice of your company, so it's crucial to have mature, experienced professionals on the phones who can truly understand the regional and cultural nuances of your customers and donors. Companies that sacrifice call center quality for short-term savings in operations end up losing customers in the long run. Ultimately you want to look at the same things as you would on any outsource decision, paying special attention to important metrics such as talk times, wait time, reporting, security and lifetime value of the client interaction.

Interactive Intelligence
We don’t see a big change in this trend. Offshoring works for some and not for others, based on criteria such as language, time zones, complexity, costs, etc. We doubt we’ll see a big shift in either direction.

We expect that current off/near shore activity will stay as is but it seems as though in most cases companies will not initiate new offshore activity in 2009.

Outsourcing does have its challenges, especially when it’s overseas and centers are staffed by a workforce whose native language is other than that of the clients’ customers, requiring the implementation of very stringent quality assurance standards. The outsourcer needs to ensure control over processes and earn their clients’ confidence in the service levels that they provide to end customers.

An overseas outsourcer may also have special training requirements such as accent reduction, cultural differences, and the nuances of the callers’ language. These challenges can easily be overcome with the right contact center solution. A solution that enables remote monitoring, for example, can provide clients with a comprehensive view of what is going on with the agents handling in- or out-going customer calls, in near real-time. Clients can save a lot of time and money by not having to physically be on the outsourcer’s premises to conduct training, as it can be done from their home base – without compromising quality or reliability.

On the one hand, the trend was to move contact centers back on-shore, but it’s likely to stall as the prices to outsource (personnel) are falling dramatically, given that the tough economic climate is global. Only time will tell if the trend to return on-shore continues but whether off-shore, near-shore, or on-shore it always comes back to optimizing desktops regardless of where agents reside.

We see a resurgence of U.S.-based contact centers however they are of a different makeup than what we have seen previously. Home-based agents, SaaS-driven call center operations, and more virtual call centers make creating, staffing and budgeting for a contact center initiative a lot easier for businesses of all sizes. The advancements in technology are creating a lot of opportunity for the contact center market, if it markets itself correctly.

There is now parity in cost for offshore, providing less reason to explore offshore territories. However, there are opportunities in the near shore with Latin America, which is becoming the new India. Some areas excel in the English language, and naturally also can cater to the growing Spanish-speaking population in the United States.

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