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Opinion: The tipping point for hosted contact centres

6th Apr 2009
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The notion of outsourcing mission-critical functions in the contact centre is not as controversial as it was a few years ago when there was a consumer backlash against offshoring. Nancy Jamison looks at the tipping point for hosted contact centres and the benefits it can bring.

By Nancy Jamison

The concept of a tipping point is when a confluence of factors come together to make something explode, turn into a fad, an epidemic or trend. In the case of contact centre hosting, several recent events have converged to tip hosting from being a strategy used by companies for business continuity or overflow into a preference.

The idea of outsourcing mission critical functions is not as foreign as it was even a few years backm with many services now being provided both offshore and domestically. In fact, the vast press coverage on offshore outsourcing has educated businesses and the public as to what outsourcing is, thereby helping hosted service providers in the US to state their case.

As awareness has evolved, so has the technology to make hosting a safer choice to begin with. For example, VoIP is now a stable and prolific technology, making calls to a hosting facility entirely affordable and taking slow speed of remote application access off the table. Similarly, the movement towards standards-based, open software solutions has made the integration of traditional contact centre and third-party applications a reality.

"The beauty of hosting is that companies can pull back if they need to, not pay out capital money up front or spend critical resources on hiring, retaining and training personnel."

Hosted contact centre providers have also benefited from the accelerated acceptance and usage of software as a service (SaaS) offerings elsewhere in the enterprise. Notable examples include SaaS offerings from fields intertwined with the contact center, including on demand CRM and ERP solutions from companies including, Microsoft, IBM and numerous others. As companies become more accustomed to 'renting' applications in one part of their enterprise, they are more likely to consider related hosted functionality.

The elephant in the room

The big elephant in the room today is the economy. In reality, this elephant has been lingering in the room for a long time but if people aren't pulling back entirely on spending, then they are being the most cautious they have been in decades. Two issues are feeding that elephant: the increasing requirement to cut costs and the ongoing replacement cycle for legacy call centre equipment, much of it purchased in advance nearly 10 years ago. So how does a business handle this? They investigate options such as leasing versus buying, so as not to get locked in.

The beauty of hosting is that companies can pull back if they need to, not pay out capital money up front or spend critical resources on hiring, retaining and training personnel. They can also scale their operation up or down without purchasing any equipment. This also helps management, who may have their backs to the walls with investors on spending issues, and thus the woes of the economy are highlighting the attractiveness of leasing over buying and hosted over premise.

Finally, three decades into the existence of contact centres, we also have a large veteran pool of contact centre managers who have 'been there and done that' with managing their own centres. These managers have grappled with understanding the ever-changing products and services that their centres support, handling the hiring, training and supervising of pools of agents, and keeping up with the churn of technology to run their centres. Additionally, they have dealt with two critical issues that have been a thorn in their side: getting IT to make changes in a timely and on demand fashion when there is a need to add agents, desktops or software, and being able to get a consolidated statistical reporting view of what is going on in their centre.

The experience of these seasoned managers has changed the thought processes of many. They have seen that technology advances can provide them with consolidated reporting across all centres as well as centralised software downloads. They are more comfortable with outsourcing those pieces of their operation that others do really well and focusing on mission critical things they need within their control. At the same time, their support staff and the follow-on generation of contact centre managers are growing up with Web 2.0 applications and are comfortable with downloadable software and tools, and renting versus owning applications and technology.

"The tipping point for the rapid movement in hosted contact centres is a sociological meeting point between experience, awareness and situation."

Equally important is the change in status as to how the contact centre and associated managers are viewed within a business. Seasoned managers position themselves as business strategists, focusing on the customer experience and finding ways to incorporate their centres within business plans to transform the business - not just finding ways to cut costs and improve day-to-day operations. These managers understand process transformation and customer relationship management, not strictly operational nuts and bolts and contact centre metrics.

The tipping point for the rapid movement in hosted contact centres is a sociological meeting point between experience, awareness and situation. Although we can't control situational factors such as the economy, we can mitigate some of the negative business impact that occurs when it takes a downward tumble.

Awareness of our options for handling these occurrences, combined with the experience of handling business, operations allows us to understand the value of outsourcing even mission critical operations to experts so that we can focus our resources on transforming other parts of the business to get ahead and remain competitive.

Nancy Jamison provides in-depth research, analysis and insight to clients in the areas of unified communications, speech technologies and contact centres.

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By mhelpdesk
07th Apr 2009 14:41


Great write-up. I just wanted to add that "hosted" mission-critical applications have reached a tipping point because of improvements in efficiency. Internet connections are not only more affordable today, they are also more reliable and faster. In the past, it just wasn't practical to access your mission-critical functions over the Internet.

Another area of increased efficiency is the way software is being developed today. In the past, desktop applications were touted as being faster and instantaneous than web-apps. Well, today's web-applications render just as fast. With smaller footprints and AJAX technologies, the Web-browser can finally keep up with desktop-only applications.

I could go on about how much more efficient we are today with regard to development, security, and design...but that's beyond the scope of what you are writing about.

Thanks for the post.

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