CRM - June 2008 - (Page 36)

HOSTED CONTACT CENTERS runs into issues and is unable to continue to advance the technology, pay their people, and maintain the relationships they have on the front end, it can cause major disruptions for the customer and organization,” he explains. “Customers must continue to monitor the financial health of the company from multiple angles to make sure they’re continuing to grow and be successful and be viable in the long term.” As for security, there is always a risk in that any data used by a third party— in this case, the vendor providing the hosted contact center model—could leak. However, analysts say vendors have created robust applications that should be able to assuage fears of data loss. “When you are essentially outsourcing a major business function like that, there is always going to be some question,” Kakodkar says. “But feature sets now are basically on par with anything you can get on-premise [in terms of security].” While the software capabilities are there, overarching concern makes it hard for vendors to plead their case. “[Vendors] can prove that the security is legit with the data,” Kraus assures. “The issue is getting the chance to tell the story because they get discounted and taken out of the competition in many cases before they’re ever invited to play. So it’s not that they can’t provide a strong security story; they rarely get the chance to.” solution to buying all this infrastructure and investing that heavily in a particular technology platform,” he adds. Intervoice’s Manghillis concurs, stating that working hosted contact center solutions into the conversation with customers will take “an educational process.” Markle contends that it doesn’t have to be an educational initiative solely on the vendor’s end, though. Companies also have to take initiative in determining the best technologies out there to help their particular business needs. “[Education] is one of the things we’re strongly advising our clients [to undertake],” he says. “They need to understand the opportunity around the hosted contact center, and have somebody who is reading the literature and talking to the different vendors in the industry.” pothesis is that eventually most, if not all, of even the largest-scale contact centers will look at [the hosted model] in a very serious way,” Markle says. “I think it’s absolutely one of the top things a contact center manager and contact center strategists will be tracking and assessing for their organizations. But the horizon is out beyond five years.” Kraus agrees: “I think that you will see marquee customers come along in the next one to two years,” he says. “To actually see that translate into market traction, it’s more in the three-to-five-year time frame.” Kraus also advises vendors not to expect to see revenues quickly. “It’s going to take time,” he says. Vendors expecting to see rapid adoption of these services may “drop out as soon as they hit the 12to-18-month point when they were expecting to move into the black…and are not even close to it yet,” he says. “Vendors that take a more long-term view I think have a chance to make it.” Companies using the hosted model, however, may be better off: According to figures from DMG Consulting, the average payback for hosted contact center solutions is between two and six months, and the quantifiable benefits, when compared to costs, can return double or triple the original investment. Time will tell if the hosted contact center is really a fit for the entire enterprise. (Nabbing some large companies will deliver some cachet.) But Dawson McAllister’s Thompson makes a compelling argument in favor of hosted contact center solutions: The hosted model has helped his nonprofit company reduce costs by 80 percent over an on-premise solution. If that’s any indication of the market’s future, the hype may turn out to be true after all. “I really believe in the hosted contact center solution,” he says. “It proved to be so much more efficient than I even pictured it to be In the end it makes my job a lot easier. It also helps our donors and funders know that we’re bringing the right people to do the right job.” Contact Editorial Assistant Christopher Musico at cmusico@destinationCRM.com. www.destinationCRM.com EDUCATION The key to handling these concerns may be simply to correct preconceived notions of the hosted model. Vendors have to beef up communication efforts in order to make their case. “End-user education is huge,” Kakodkar believes. “A lot of people still don’t know about hosted at all. In fact, we had one of the main vendors that we spoke to say that approximately 40 percent of current customers did not know what a hosted solution was.” He says sales and marketing teams have to constantly knock down the door and drive home key message points. “It has to be a sales-and-marketing effort, just letting them know what it is and how it works, and that there is an alternate 36 LOOKING AHEAD The hosted contact center market definitely has a future—and how quickly it can realize its potential depends on who you speak with. Manghillis says he is very optimistic about Intervoice’s hosted offering gaining traction due to the current economic situation facing America. “In the past, any time you have the kind of economic situation that we have here in this country today, there has been a significant rise in the amount of outsourcing,” he says. “I see a trend that customers are absolutely going to start outsourcing, especially start-up companies and new companies adding feature functionality to their existing infrastructure and may not have the cash to spend Day One to purchase solutions You’re going to see a litany of even larger-scale enterprise businesses go to a hosted model for their contact center.” Others are more hesitant. “Our hy- the hosts with the most THE TOP FIVE VENDORS IN HOSTED CONTACT CENTER INFRASTRUCTURE (in alphabetical order). • Aspect Software • Cisco Systems • Oracle • United Carrier Network • West Interactive SOURCE: DMG CONSULTING CUSTOMER RELATIONSHIP MANAGEMENT | JUNE 2008 http://www.destinationCRM.com

Table of Contents Feed for the Digital Edition of CRM - June 2008

CRM - June 2008 Contents Front Office Reality Check Customer Centricity The Tipping Point Making Mashup Masterpieces Trouble in the Air CRM on Twitter Is SaaS Ready for Its Contact Center Close-up? CRM: In the Public Interest Required Reading Lollipop Loyalty Best Practices Series: CRM & eCommerce eGain NetSuite Infor Longwood Software Vovici The Second Coming of 2.0 Believe the Hype About Hosted Contact Centers All Talk So Hot It’s Cool Linksys Gets Shaken, a Community Is Stirred The Risky Risk Business Awana Hears a SaaS Sermon Secret of My Success Re:Tooling Scouting Report Pint of View

CRM - June 2008

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