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Arthur M. Rosenberg

[March 22, 2004]


By Art Rosenberg

Enterprise Migration Was Moving At VoiceCon 2004

2004 may well be the turnaround year for the enterprise voice communications industry, if the standing room only audiences at Business Communications Review’s 14th Annual Conference early this month in Orlando are an indicator. With a 50 percent increase in attendance over past years, more than 1,200 people filled every main session, and hundreds participated in the concurrent sessions that covered key issues in the migration of traditional telephone communications to a converged, IP-based infrastructure (VoIP). It was estimated that almost half of the attendees were enterprise technology managers seriously thinking about migrating to VoIP and IP telephony applications.

Of course, BCR’s reputation for objectivity and their well-organized program played a key role in the success of this landmark conference. In particular, all conference speakers were challenged to deal with “hard” issues and questions, rather than dish out “hype” about technology offerings.

There was an awful lot of excitement and a lot of issues discussed in a few days and we couldn’t sit in on all the sessions. So, we can only give you some highlights affecting practical enterprise migration toward unified/converged communications.

In the last few years of economic belt-tightening, most organizations would not consider any technology expenditures unless there was a significant cost-saving benefit. The experience of users presented at the conference confirmed that such cost savings are real and significant, particularly for distributed organizations. This applies not only to remote branch locations, but also to home workers (teleworkers) and to mobile workers.

Hard dollar, cost-reducing benefits of VoIP infrastructure cited by conference speakers included:

·        Consolidation of network infrastructure, hardware platforms, and server software;

·        Centralization and reduction in technology management support and administration* for remote sites;

·        Easier and less expensive integration of telephony and data functions (CTI) for communication applications;

·        Reduction of office workspace costs for teleworkers;

·        Reduction of travel costs for meetings; and

·        Reduction of long-distance services (toll bypass) between sites and through IP-based connections and Virtual Private Networks (VPNs).

* It was noted by one speaker that a traditional cost savings cited for office telephones because of Moves, Adds, and Changes (MAC) is not necessarily a useful metric for an organization that doesn’t move many people between offices. 

Aside from cost savings that can be realized by converged communications infrastructures and reduced technology support, there has been a shift of focus towards “productivity.” It was acknowledged by many speakers that it is now time to recognize that “soft dollar” benefits are equally important to include as ROI. Most of the discussions centered on individual user productivity (“micro-productivity”), where personal time-savings resulted from easier and faster procedures for communicating with other people. There was also consideration given to correlating better “contact center” customer communications with revenue generation.

What we didn’t hear anyone talk about is the ROI that accrues from faster task completion of enterprise groups because of more effective collaborative person-to-person communications (what we have termed “macro-productivity”). This kind of communication includes ad hoc conferencing, call/message notification and delivery, and exploiting wireless accessibility. “Macro-productivity” is a new metric that may now be possible to apply because of new communication standards like session initiation protocol (SIP), presence/availability/modality management servers, and will be more directly applicable to enterprise-level payoff.  

Finally, another justification for migration is to be found in the “insurance” value of business continuity. As Andy Brown, a VP at Merrill Lynch, pointed out, their experience after 9/11 made VoIP infrastructure a key requirement for ensuring rapid business resumption after a catastrophic disruption.   

However, up to now, such potential cost savings and benefits have not been enough to drive the enterprise market to buy into simply replacing TDM telephone systems with VoIP networks, IP telephony servers, and desktop IP phones. Unless end users get noticeable benefits too, there will be no demand for change. The technology providers have long promised that the real ROI benefits for VoIP will come from increased “productivity” from communication “applications” and the BCR conference leaders pushed hard on that question. Most of the speakers and panelists acknowledged that such productivity ROI from “communication applications” would really come from the benefits that individual end users and groups will realize from specific communication features and functions.

We see such enterprise “communication applications” traditionally falling into two general areas; individual user (person-to-person) directed contacts and contacts between a customer and an enterprise group, better known as “contact center” activities. Communication modalities, such as real-time voice calls, instant messaging, and asynchronous messaging, etc., then become functional options for the applications. As communication devices become multi-modal at the desktop and for mobile, handheld use, the traditional differences between modalities will blur even more. Enterprise call and message management functions will blend together under multi-modal contact management (“unified communications”) for both person-to-person and customer contacts.

However, even these two “application” domains will be overlapping as IP-based convergence enables the traditional “formal” call center functions to be extended to the “informal,” enterprise-wide, virtual contact center. Indeed, speakers cited the contact center application as a primary source of revenue-generating ROI productivity through customer satisfaction and retention. This is where strategic call/message routing, mobile accessibility, customer context “screen-pops,” and consolidating all customer activity data will all help maximize available enterprise staff resources to selectively accommodate new multi-modal, customer-facing contact demands.

Within each of these two primary “communication applications” are a variety of features and functions, some through the “basic” call server switching functions, others provided through ancillary software servers. Unfortunately, the industry still calls many functions an “application!” With the flexibility of SIP for real-time contacts, presence for availability management and cross-modal access to people (and their multi-modal devices), the basic “communication applications” will simply become improved with more effective functionality and greater interoperability between communication modalities. However, we also see the customization of user interface needs, for both contact initiators and recipients, for vertical markets as becoming the true “applications” that the industry will start to produce in the future. But, we didn’t hear too much about that!

When it comes to communication applications, every speaker enthusiastically acknowledged the arrival of flexible end-to-end real-time connections through the still-evolving SIP standard. Because stateless SIP can exploit presence, availability and modality information to establish contacts with a variety of communication devices regardless of content, it is being hailed as the real enabler of effective communication between end users. Leading industry providers like Siemens, Microsoft, and even newcomers like Interactive Intelligence were quick to tout their early exploitation of SIP, but all the others like Nortel Networks, Avaya, and Mitel have been quickly following suit. We noticed that most vendors are now starting to call their “hard phone” devices “SIP phones,” rather than just “IP phones.”

Although well-known consultant Allan Sulkin pointed out that many of the “new” functional capabilities have been available in the past, the real benefit of VoIP and SIP are that such features can now be provided much more easily and at much less cost. The “CTI” of the past was way too difficult and expensive to get implemented by the enterprise market. Now the way is clear to implement our visions in the past, as well as new capabilities that we never even considered.

The current “fly” in the SIP ointment is that technology providers are implementing non-standard extensions to “basic” SIP functions, which may delay universal interoperability between end user devices and communication services. The industry hope is that “SIP federation” will help extend the power of SIP across systems and networks.      

Part 2

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