Jason Alley
Jason Alley, founder and president of SmartContact Consulting, is a consultant and industry analyst focused on customer interaction.Jason has both...
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Jason Alley | December 17, 2010 |


Cloudy in the Contact Center...Why Now?

Cloudy in the Contact Center...Why Now? CaaS has finally hit the mainstream and there's no longer a reason to hesitate when it is the right answer for your company.

CaaS has finally hit the mainstream and there's no longer a reason to hesitate when it is the right answer for your company.

My company's Communications as a Service (CaaS) solution (think all-in-one contact center in the cloud--PBX, ACD, IVR, outbound, multi-media, workforce optimization...) is the fastest growing segment of our offering today. Many signing up for the service operate mainstream, mission critical contact centers, and they cross multiple verticals. To be honest, I've been surprised by the traction in this area of the business. I remember all of the renewed hype around the "on-demand contact center" back in the mid-2000 timeframe, and that it appeared to amount to mostly just that...hype. I was convinced it would be a long time before mainstream contact centers would trust a service provider with the lifeline of their business--customer communications. Well, I've been woken up and proven wrong. Clouds appear to be rapidly moving into the contact center and are likely here to stay.

Most of us in the contact center world have understood the value of the software as a service model for some time. It allows organizations to:

* Focus resources on core business initiatives
* Spend less up-front
* Pay for licensing as-needed
* Take advantage of OpEx accounting benefits
* Rapid deploy solutions
* Quickly proliferate new capabilities
* Simplify IT infrastructure, and
* Swiftly respond to corporate change (e.g., acquisitions, globalization, virtualization, etc.)

In addition to realizing the value proposition, we've seen the model prove out in other areas of the business, including: sales force automation, customer relationship management, human resources, marketing management, corporate messaging, and customer interaction via e-mail. Companies such as Salesforce.com and RightNow have generated much success and excitement with cloud services in the very same contact centers companies like ours have served for years. As Sheila McGee-Smith of McGee-Smith Analytics explains in a recent No Jitter posting, "If Siebel was the go-to partner in the last decade, salesforce.com is the bright and shiny CRM vendor of this one."

Why the delay?
So why did it take so long for CaaS to gain traction and hit mainstream? While there are many considerations, customers tell us there are five primary reasons:

1. Fear of voice quality problems
2. The heavy bandwidth requirements of voice
3. Security questions
4. Uneasiness with the multi-tenant approach: sharing applications and "lock-in"
5. Concerns about the size and financial stability of those offering cloud based solutions

Most of these are pretty self-explanatory. The fourth inhibitor listed makes for an interesting discussion. Many believed multi-tenant architectures were the Holy Grail of cloud based services--the only way to provide an economical solution that yields a compelling enough ROI. Ironically, it is that very model that contributed significantly to the delay in adoption. Customers proved to be averse to sharing applications with others and didn’t want to invest in a solution that could not later be moved on premise should the business demand or prefer it.

So, what's changed?
Many would point out poor economic conditions and a reality that more must be done with less across the business--something we all feel. Others would point to an increasing trend in management mandating cloud services unless there is good reason not to go that route. While these are certainly critical factors, we believe proximate cause has to do with HOW service providers are delivering CaaS solutions to market.

First, the maturity of VoIP and virtualization software has enabled service providers to deliver cost effective alternatives to the multi-tenant approach. By having their own dedicated virtual machines, customers can enjoy added security, control and flexibility. They can also avoid lock-in by migrating between CaaS and premise environments as business priorities and policies change. That helps answer:

--Security questions
--Uneasiness with multi-tenant approach: sharing applications and "lock-in"

Secondly, customers are being offered greater choice in how CaaS solutions are deployed. For example, service providers are enabling components of the voice infrastructure to be implemented on premise (gateways, media servers, proxy servers, databases, etc.) for companies that are hesitant to have voice traffic traverse the WAN (for quality, security or bandwidth concerns) or do not want customer data or recordings stored off premise. That takes care of:

--Fear of voice quality problems
--Security questions
--The heavy bandwidth requirements of voice

Finally, suppliers that are proven in the market and have publicly revealed strong financial track records are in the game with formalized CaaS offerings. That solves:

--Concerns about the size and financial stability of those offering cloud based solutions

One size does not fit all
The following are themes that continue to surface in conversations with customers and market experts:

* Choice
* Flexibility
* Security
* Predictability

CaaS offerings now reflect these characteristics. So, is it CaaS or bust? Absolutely not. Every business is different. What's cool is that CaaS has finally hit the mainstream and there's no longer a reason to hesitate when it is the right answer for your company.


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