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Cloud-based contact centres: Pros, cons and practical advice

30th Sep 2013
Managing editor MyCustomer.com
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Just as the transition to Cloud infrastructure has reached a tipping point for enterprise software, so it is having a similarly transformative effect on contact centre architecture.

According to DMG Consulting, Cloud-based infrastructure is the fastest growing area in the call centre sector, predicted to almost double between 2013 and 2015. This will see the proportion of call centre seats in the Cloud reach 18%, up from just 2.2% in 2008.

And even those that are undecided on the migration are investigating the Cloud to weigh up the pros and cons – a survey of 500 contact centre directors and senior managers by Interactive Intelligence found that while 41% have either already chose their Cloud provider or are currently exploring options and deploying pilots, a further 36% are taking steps to learn more about the Cloud.

So why is there so much interest in Cloud-based infrastructure?

According to the II research, a reduction in capital expenditure was the most commonly cited reason for a move to the Cloud (45%), followed by the belief that a Cloud-based system would aid their company’s growth (37%) and Cloud computing’s ability to bring faster deployment in their contact centres (28%).

“Traditionally, a call centre would be based on a CAPEX model – investing in all the infrastructure, technology and solutions. However, with the Cloud, organisations can deploy these solutions using a more agile OPEX budget and avoid the costly infrastructure expenses. In addition, many providers offer a pay-as-you-go model which can be beneficial in some instances,” says Dave Paulding, regional sales director UK, Middle East & Africa, at Interactive Intelligence.

Art Schoeller, principal analyst at Forrester, notes that the analyst’s own research found that 37% of respondents said they wanted to have their contact centre technology managed in the Cloud in the future. So what does he think is driving this?

“When we first started talking about Cloud, the discussions was about it being cheaper,” he says. “But I think we’ve matured to a much more subtle view of what Cloud means. Now no-one wants to spend a lot more money, but folks might be willing to pay a little more to have someone else manage this for them, because they might do it better. Contact centres are important to your business, but the actual expertise and the tech is not necessarily something that you want to do. So there is a rise in agility as you can free up some of your people to do more of the important things in the contact centre – you can focus on ensuring that your contact centre’s configuration is more aligned with the ongoing change in your strategy for customer experience rather than standing around the servers making sure they all talk to each other.”

Flexibility and scalability

Klaas van der Leest, UK managing director of Intelecom, adds that the flexibility and ability to customise and react quickly, as well as the independence of Cloud infrastructure, are also all appealing features to businesses.

“Modern contact centres need to scale and seamlessly grow (and contract) to cost-effectively react to market changes.  Cloud-based contact centres offer a building block approach, which means additional functionality can be turned on as and when required,” he explains. “The flexibility of Cloud technology also means that organisations can work as they want and not as technology dictates.  Traditional contact centre architecture tends to be divided into centralised or distributed.  With a Cloud-based solution, organisations can work as their business dictates.  The ability to add agents across centralised or distributed locations can make the difference between success and failure when responding to customer demand.  Likewise in terms of management inherent flexibility means that satellite offices can manage and control their own locations, while sharing the technology and platform across the whole organisation and still benefit from centralised management.”

He continues: “Cloud-based contact centres are independent of location, hardware, software and agent location. The benefits of this absolute independence include callers never receiving a dreaded engaged tone. Traditional premised based telephone systems are limited by the number of lines into the building and the number of agents available to answer those calls. Hosted contact centres have a huge capacity, meaning that customers will never hear a busy tone. Callers are held in queues in the cloud and presented to the first available agent.   

“Location independence gives agents and administrators the freedom to log-in from any location. All that is required is a phone line (PSTN, SIP or mobile) and an Internet connection to easily access all the functionality previously tied to a premised based contact centre. This is particularly helpful when the weather is bad and people cannot travel to the office or in the event of a break in business continuity for another reason. Cloud comes to the rescue.”

Integration in the Cloud is another important appeal to businesses today, particularly the ability to simply integrate with collaboration tools, social media tools and CRM systems, all of which empower agents with customer data at their fingertips and features that support their job.

“Time to deployment has been cut dramatically now, both for organisations setting up a call centre from scratch, but also those looking to add new features to their existing set-up,” adds David Ford, managing director of Magnetic North. “For example, call blending can easily be added to an inbound contact centre, enabling CSRs to make outbound calls, with minimum use of IT time or resource and dramatically improving agent efficiency.

“Using a hosted system, the kind of inbound blended functionality that contact centres need to increase the value of their customer service representatives is readily available, without any need to find scarce capital investment. Similarly Cloud-based software solutions integrate with a CRM systems right out of the box. And there is another important benefit for those who take the cloud-based call centre route: there is no waiting time for new features - when they are rolled out, they are rolled out for everyone straight away, with no additional integration or professional services costs.”

Cloud concerns

However, despite these apparent benefits, the majority of call centres still do not fully operate in the Cloud – and some harbour reservations about Cloud Computing that is discouraging them to migrate. In Interactive Intelligence’s study, for instance, respondents cited data security (43%), concerns about lack of on-site support (23%) and the belief that customers have negative perceptions of ‘outsourced’ call centres (24%) as reasons for not embracing Cloud infrastructure.

Paulding acknowledges that a move to the Cloud may not be the right solution for all contact centres and that in some case it may – incorrectly – be seen as a cure for all ills.

“The important thing is to ensure that a move to the Cloud meets the organisation’s objectives and requirements, and that the cloud solution matches the business processes,” he says. “Other challenges include reliability, accessibility and security. In terms of reliability and accessibility, an important aspect to consider is that agents need full-time and real-time access to customer data and if, for example, all of the IT infrastructure has been moved to the Cloud, including telephony, and the VoIP connection is lost, so too is contact with customers.

“Security is usually the main concern and organisations should be asking questions about whether they will be using dedicated or shared hosting, who is hosting the servers, what type of security is in place, where are the servers hosted, etc. More importantly the Cloud provider should be established, trusted and has security policies in place to assure against data loss and theft, and strategies in place to deal with business continuity and data recovery.”

He adds:  “It is crucial that decision-makers understand the full implications of moving to the Cloud. It may not be the best possible solution, so it is critical to understand the reasons for moving, the benefits and the challenges. Having a trusted Cloud provider, a company that understands your business and its needs, is also important and can assist CIOs and other IT decision-makers in making the move seamless and more efficient.”

Cloud advice

So how can businesses ensure that they make the right decision about the Cloud, and find a reliable Cloud provider and one that is appropriate for their particular needs?

“One take away that people need to consider is that they really should do both a total cost of ownership (TCO) and a return on investment (ROI) analysis over a three to five year period when they are considering a Cloud-based solution,” advises Donna Fluss, principal of DMG Consulting.

“Another word of advice is that when you’re selecting an application – whether it be an ACD, WFM, recording, whatever - select the solution that you want, select the partner that you want, the vendor you want, and then decide on the acquisition model. You still need to make sure that you have got the right solution and right vendor.

“And my last word of caution with new Cloud-based infrastructure vendors, is that every single one of these vendors that I know has at some point realised that they can’t keep up with the demand and their infrastructure starts to have issues. So you need to make sure that the vendor you’re working with has a sturdy infrastructure and platform. If you have a commitment to your customers – for instance, you’re committed to be up the five nines, 99.999% - and the vendor can only give you support for four nines… well you’re going to end up in trouble.”

In line with this, Van der Leest advises that businesses should choose a Cloud-based provider with a proven history and client base, and echoes some of Fluss’ advice concerning costs. “Take a close look at the cost of ownership of on-premise versus cloud options. Remember to include savings from reduced internal IT resources and the potential benefits for seasonal businesses.”

He also recommends that organisations should factor the growing influence of social media into their equations: “Plan for the future as the concept of the customer engagement centre is already here. Analysts predict that by 2016 as many as 50% of enterprises will utilise social media as a customer channel. Social media will be the new servicing norm in just a few years. Therefore, ensure to select a solution which incorporates social media and not just as a bolt-on.  Success in the social world lies in the Cloud.”   

Tim Pickard, chief strategist at NewVoiceMedia, provides the following recommendations to weed out the most appropriate supplier for your firm.

“I’d advise businesses to look at whether their shortlisted providers meet their critical requirements today, as well as where they are going to be in five years’ time. Find out what their vision is, how they see the market evolving and whether they are leading the market or following what others are doing,” he says. “If your vision is aligned with that of your supplier, then as long as they have the ability to execute, you should be in good stead. If your vision conflicts with that of your supplier – or worse still, they aren’t able to accurately convey what that vision is to you – then alarm bells should be ringing!”

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