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Does a UC-to-UCC Transition Mean a Managed UC Transition?

Unified communications these days seems to be creating more conceptual disunion than it is convergence on a consensus model, and that could threaten UC investment in tough economic times. In downturns, it's traditional that projects get suppressed by having higher ROI targets set for them, and this effect typically lasts a couple of years beyond even the technical end of a recession. It's that ROI requirement boost that creates the current challenge, because you can obtain higher ROI by either cutting costs or boosting benefits. Maybe, just maybe, both.On the benefit side, there is increasing interest (at least among the vendors) in promoting an expansion of UC to UCC, for Unified Communications and Collaboration. In many ways, the UCC development is natural and even essential, because collaborative relationships are certainly a part of what UC is supposed to be unifying. To the extent that collaboration is separate from simple communication, the separation is created by a focus around which the communications relationship develops. Two such areas of focus are proposed: video and "whiteboards" or shared data views.

There's a lot of research going back over 20 years that shows that video-based "virtual meetings" are not useful for groups of less than four or five people, and rarely is useful for groups larger than about 50 (it becomes a "broadcast" for large groups). In the range where video works, though, it's sometimes critical, which means that some form of group meeting support via videoconference or telepresence is essential to a broad UCC strategy. The market is still trying to figure out how to make that work financially, though. Because sight is the strongest of all human senses, it's the one we're most critical in exercising. A little video problem is a big problem, and unfortunately high-quality video is a significant cost.

Shared data collaboration is a lot easier, and that's proven out by the success of companies like GoToMeeting and WebEx (owned by Cisco). The challenge that this kind of collaboration poses for UC is that it's almost always easier to have it hosted as a service than to build an in-house capability. Instead of making collaboration a part of a true UCC, this means that plain old UC may have to be somehow harmonized with Web-based collaboration.

That introduces the cost-cutting part of the story. If you think about what "ROI" means, it means capital investment and the benefits that offset that investment. Something that's not capital investment-an expense-has a completely different cost justification picture. In fact, many companies will treat any "managed" or "outsourced" service as a simple expense as long as the contract term is relatively short (a year or less). Service providers of all types have caught on to this and have started to promote managed UCC services, and I'm hearing a lot of positive interest among users. But not all users will find managed UC/UCC helpful. The "average" multi-site business has about 30 subsidiary locations, and the best approach for UCC varies below and above this midpoint.

My own research and experience suggests that where there are less than about a dozen sites, it's rare that any UC or UCC approach will generate much of a benefit. Users in this range are best-served by simply making the best deal for any specific communications services they need without worrying much about unifying the result. Some call this "client-side" UC because it relies on the desktop systems and handsets for whatever unified features it offers.

Where there are somewhere between a dozen and perhaps 50 remote locations, most companies I've surveyed find that hosted UC/UCC supported by the IT organization is the approach that generates the best ROI. Open source platforms, including wikis and email/IM servers, seem to provide good value for most users in this range, and companies here also seem to like using hosted collaboration services like GoToMeeting and WebEx even for internal applications.

Where managed UC/UCC seems to fit best is in the range from about 30 to perhaps 1,000 remote offices. At the low end, it's most likely to be valuable where the company doesn't have a lot of IT resources in house, and at the higher end, the presence of a lot of international locations is likely to make a managed service a smart choice. In fact, my research suggests that even the spreading of remote offices across multiple time zones is likely to increase the value of managed UC/UCC services.

If you have more than 1,000 offices, you're much less likely to be happy with the cost/benefit analysis of managed UC/UCC. The reason is that large organizations begin to achieve the same economies of support scale that service providers do, and that means the savings that managed services could generate is smaller. But even here, my surveys of enterprises show that 2009 and 2010 might bring some changes. Some companies have put tight constraints on any capital projects, making it very difficult to buy anything like computer equipment or software.

These numbers are just guidelines, of course. A factor that makes managed UC/UCC more generally attractive no matter how many branches you have is the need to communicate outside the company. Collaboration with partners or even customers increases the benefit of a managed approach tremendously. I don't have really broad statistics here, but of 277 enterprises I've got data on, it appears that the chances of using a managed UC or UCC approach doubles for firms who have even 10% of their collaborative relationships with people outside the company. Another factor that makes managed services generally more attractive is a company with a high average value of labor; the top 10% of firms by unit value of labor were three times as likely to consume managed services of any sort than were the bottom 10%.

It would be nice to think that the UC/UCC evolution would be driven by optimum technology choices, but it is very likely that won't be the case in the near term. The best approach overall might be to plan a transition to UC/UCC by starting with a hosted/managed approach on a limited scale (one of the benefits of managed UC is that you can start small pretty easily), and as overall economic conditions improve, consider bringing elements of the solution in house. That will mean having a very well-integrated set of tools and a UC client approach that supports both managed and hosted UC. If you take this approach, you can satisfy management project requirements in the near term, and have the best strategy in the long term.