frost & sullivan 2017 north american contact routing ... · best practices recognition: 10...

2017 North American Contact Routing Customer Value Leadership Award

BEST PRACTICES RESEARCH

© Frost & Sullivan 2017 2 “We Accelerate Growth”

Contents Background and Company Performance ........................................................................ 3

Industry Challenges .............................................................................................. 3

Customer Impact and Business Impact ................................................................... 3

Conclusion........................................................................................................... 8

Significance of Customer Value Leadership .................................................................... 9

Understanding Customer Value Leadership .................................................................... 9

Key Benchmarking Criteria .................................................................................. 10

Customer Impact ............................................................................................... 10

Business Impact ................................................................................................. 10

Best Practices Recognition: 10 Steps to Researching, Identifying, and Recognizing Best Practices ................................................................................................................. 11

The Intersection between 360-Degree Research and Best Practices Awards ..................... 12

Research Methodology ........................................................................................ 12

About Frost & Sullivan .............................................................................................. 12



Background and Company Performance

Industry Challenges

Customers seek high value from their engagements with companies. They want to be offered products and services with features, quality, convenience, and pricing that ideally exceed their expectations. And, equally critically, they expect to be treated as valued customers, with personalized service.

But meeting and exceeding customers’ value expectations are easier said than done. Customers are buying complex products and services, such as the Internet of Things-connected appliances that require involved sales and support. Customers also are using growing array of channels that companies must support, including training contact center agents to use.

In today’s hectic world, customers are multitasking to handle day to day chores and to meet personal and professional goals. Understandably, customers have scant patience for long queues and for repeating the same information when being transferred from automated to live agent channels and when being transferred from agents to supervisors.

Customers expect excellent service regardless of where the agents are working, whether inside contact centers, from home (work at home agents or WAHAs), and while mobile. Sometimes, though, the best available resources to help customers are not agents. They may be subject matter experts (SMEs) or other qualified staff who work in other departments, in branch offices and stores, and in the field, i.e. “informal agents”. Yet companies must be able to tightly connect customers with these employees.

In turn, companies seek high value from contact center routing solutions. The applications must work flawlessly, be flexible and scalable, and be easily integrated with companies’ existing technologies. The solutions must be feature-rich and a half-step-ahead innovation-wise of where companies are going with their customer engagement strategies. Finally, the routing solution vendors (contact center systems providers or CCSPs) must have the financial resources and a deep understanding of companies’ needs and direction, based on their market experience.

Customer Impact and Business Impact

Price/Performance Value

Avaya’s contact routing solutions enable productive omnichannel customer contacts for companies of all sizes and verticals. The products cover and integrate inbound and outbound automated and live agent interactions.

• Avaya Oceana customer engagement solution. Avaya Oceana supports voice (for both PSTN and WebRTC), email, chat, co-browse, SMS, and social, (Facebook and Twitter). Avaya Oceana uses attribute-based routing to connect customers with



agents. Attribute-based routing taps agent expertise and location, contact context, and customer intent to effectively direct contacts to the right agents. Agents access Avaya Oceana through intuitive unified desktops. Avaya Oceana natively provides IVR and chatbots and integrates them with live agent assistance. Avaya Oceana tightly integrates with the Avaya Workforce Optimization solution. Avaya Oceanalytics, included with Oceana, supplies real-time and historical omnichannel Customer Experience (CX), customer journey, and operations analytics.

• Avaya Contact Center Select for small to mid-sized contact centers supports up to 400 multichannel agents. The solution provides generally the same functionality as Avaya Oceana, but scaled appropriately. Avaya Contact Center Select is offered as a module of the Avaya IP Office unified communications (UC) solution. Avaya IP Office provides control, presence, and collaboration. It can also connect customers directly with informal agents.

Avaya’s enterprise contact routing and UC solutions are built on the Avaya Breeze platform, which uses Avaya’s proven Aura architecture. Avaya Oceana supports agents inside formal contact centers and WAHAs and connects with informal agents. The software provides connectivity between automated applications and agents, between agents and SMEs, and provides collaboration between agents, SMEs, and customers. Both conversations and context are automatically transferred between channels and staff.

Avaya has gradually been moving its contact center solutions to the cloud to tap the growing demand by companies for this affordable, flexible, and scalable deployment model. The company offers Oceana in partner-hosted clouds and direct from vendors in private clouds. Avaya’s OnAvaya-Google Cloud Platform enables the company’s partners to sell Avaya Contact Center Select and IP Office as hosted solutions.

Avaya’s products are inherently designed to maximize value from solution investments. The software’s modular or “snap-in” architecture permits companies to add features and integrations as the need arises. For example, a company may purchase an Avaya chatbot application as a point solution to deflect calls, but later connect it into live agent chat or voice support.

The Avaya Breeze development platform also enables companies to create new applications. For example, a developer could create customized call treatments to give a bank’s value customers direct access to account managers, based on incoming line ID. The Breeze-built application would allow administrators to easily modify the customers lists based on changing customer needs and customer value.

Finally, Avaya provides and supports a wide range of communications endpoints. The company’s software is device-agnostic, enabling it to connect to agents’ and supervisors’ headsets, IP or TDM desktop phones, and wireless devices. Avaya also supplies desktop phones (Avaya 9600/1600 IP series and 1400/9500 digital phones) and IP desktop softphone and UC clients (Avaya Communicator).



Customer Ownership Experience

Avaya’s customer routing solutions have enabled its customers to cost-effectively provide an excellent customer experiences. Here are a couple of many examples:

• HGS, a global BPO with U.S. and Canadian contact centers, deployed Avaya’s solutions for its agents and reduced costs by more than 30%

• Liberty Sport saved $100,000 from reporting, increased contact center flexibility and resiliency, optimized agent shifts, and improved voice quality. As a result, Liberty Sport is projecting revenue increases.

• Plantronics saves over $400,000 annually via lowered attrition by enabling WAHAs and by having them and formal in-center agents to “own calls”. The company’s customer satisfaction and first contact resolution rates have climbed.

Financial Performance

Avaya has long been a leader in the inbound contact routing market, and ahead of its leading competitors by nine or more points, according to Frost & Sullivan research. The growing strength of Avaya’s customer contact product line contributed to the company’s FY 2016 (ended September 30, 2016) annual revenues of $3.7 billion. Avaya reports that contact center product revenue increased from 5% in FY 2015 to 6% in FY2016.

Debt restructuring led Avaya to voluntarily file for Chapter 11 bankruptcy in January, 2017. The company filed a reorganization plan in April, 2017 that would reduce its debt and improve its balance sheet while meeting its pension obligations. It sold its networking business to Extreme Networks for approximately $100 million in March, 2017. The sale bolstered Avaya’s finances, but also critically it enables the company to focus its attention and resources on its contact center, UC, cloud, and other product lines.

The market is showing faith in Avaya. The company signed more than 1,100 customer contracts since the Chapter 11 filing as of March 31, 2017 and at its ENGAGE 2017 conference, held in February, attracted approximately 2,600 attendees. ENGAGE Mexico 2017, held in June, attracted over 3,500 attendees.

“This [the Chapter 11 filing] is a critical step in our ongoing transformation to a successful software and services business. [Our] current capital structure is over 10 years old and was put in place to support our business model as a hardware-focused company, which has evolved significantly since that time,” said Avaya CEO Kevin Kennedy.

“Our business is performing well, and we are confident that we can emerge from this process stronger than ever, as this path is a reflection of our debt structure, not the strength of our operations or business model. Pursuing restructuring through Chapter 11 will enable us to reduce Avaya’s debt and interest expense, while providing increased financial flexibility to further invest in innovation and growth to enhance our market-



leading competitive position.”

Customer Acquisition

Avaya continues to attract customers on the basis of its evolving, innovative, feature-rich and market-relevant solutions. The company, in keeping with market trends, has shifted its product portfolio from primarily hardware to software and services, which accounted for 79% of total revenue in Q2 FY 2017, ending March 31, 2017.

Here are several examples of new and enhanced products that Avaya has released since early 2016:

• Avaya Breeze platform, and its Avaya Snapp Store, marketplace for marketing, selling, and acquiring reusable code modules and applications

• Avaya Oceana, next-generation omnichannel solution, is context-driven, fully integrated and customizable through the open, easy to use Avaya Breeze platform and leverages the extensive expertise and intelligence Avaya has developed from throughout their portfolio

• Zang cloud communications and collaboration platform and solution

• A full stack, turnkey contact center solution in Avaya Pod Fx, including applications, computing, storage, networking, and management

• Connected visual self-service mobile applications with agents or SMEs and the conversation contexts in the Avaya Aura Experience Portal 7.1

• Avaya Workforce Optimization Select for mid-market contact centers and now integrated with Avaya Oceana omnichannel solution.

• Avaya Equinox browser-based user-defined mobile-first UC platform

• Enhanced security and reliability in Avaya IP Office through built-in signaling and media encryption for endpoints and UC clients at no extra chargeAugmented reality (AR) demo at GITEX Technology Week 2016. Visitors to Avaya’s booth were greeted by avatar representing a banking agent, and interactive AR brochures

Avaya enables successful installations through its extensive Professional Services practice. The company uses an “as is” and “to be” methodology to show the customer current solutions, versus what is possible, and roadmaps that include a one-page value proposition with cost and ROI. This is a consultative approach, focused on solving companies’ business challenges. It is based on understanding exactly what companies want/need, what is driving them, and when the products are needed. Avaya uses a combination of presales and professional services expertise as part of the methodology to ensure the right focus on both the business and technical requirements. This allows for greater project management at every stage and folds in directly with Avaya’s strategy of



product simplification, and working with customers as a trusted advisor.

Growth Potential Avaya has strengthened its longstanding commitment to the customer contact and adjacent enterprise communications markets by restructuring its business to focus on them and on other growth markets.

Avaya has on its contact center solutions roadmap:

• Advanced analytics for improved agent and self-service anticipatory responses

• Drag and drop artificial intelligence, machine learning, and IoT integration

• Customer journey mapping and customer experiences with AR

• Vertical market optimized solutions

The Avaya Oceana products are coming on stream at the right time, as the economy continues to grow. There are many legacy applications that companies have been waiting for the optimal time to replace with omnichannel solutions. This is particularly true in Canada, which has lagged behind the U.S. in moving to omnichannel, and where Avaya has a strong base through its inheritance of Nortel applications and installed base. To underscore the company’s commitment to the Canadian market it appointed Rejean Bourgault as Managing Director and President of Sales. Mr. Bourgault, who had served as a Leader in Sales and Operations for Canadian Federal Government accounts, is responsible for driving revenue growth and increasing market share in Canada.

Human Capital

Avaya acutely recognizes that product quality is key to attracting and retaining customers in today’s highly competitive market. The company has successfully overhauled its quality processes over the past five years.

Here are the steps taken:

• Launched a Cost of Poor Quality initiative, which monetized the cost of repairing or redoing products as compared with creating high quality products

• Created a corporate “culture of prevention”. It focuses on understanding why problems occur and corrects them early in the product design process. To promote this culture, Avaya established the CEO Quality Award for excellent team performance in the pursuit of quality.

• Created the Avaya Quality Index (AQI) “report card” that defines what a good customer experience is, including customers receiving features sought, defect rate, ease of use, and customer service, and set a benchmark score of 80% for each line



item. Each business unit is focused on driving improvements in their core metrics.

• Created the Implementation Quality Index (IQI) to score implementations against best practices expectations

• Implemented an agile methodology, according to an October25, 2016 Harvard Business Review article by Uri Neren CEO of Innovators International. With this method, which entails building multiple versions of prototypes to create the best solution, Avaya dramatically lowered the lead times for customized products from six months to three weeks.

As a result, Avaya saw its Net Promoter Score (NPS) rise from the low 20s five years ago to over 50 today. As the AQI began to climb so did its NPS. Avaya also raised the bar for its standards, which led to further product and service quality improvements. Avaya is not resting on its laurels, though. It is aiming for NPS scores in the 70s. Avaya’s customers have rewarded the company in kind. Avaya’s gross margins have increased from 50% in 2010 to over 60% in late 2016.

Avaya’s staff is committed to the company as it plans to emerge from Chapter 11, and come out stronger to meet the challenges of today’s competitive marketplace. They have seen, and been directly involved, with the new products and the quality initiatives.

Conclusion

Today’s customers justifiably expect excellence from the companies engage with. With competition based on customer service it is imperative for companies (and CCSPs) to enable productive omnichannel customer interactions.

Avaya has long been the leader in developing innovative, reliable, and scalable contact routing solutions. Staying one-half step of the market, Avaya has been moving its products from predominantly voice, hardware, and on-premises delivered to automated and live agent omnichannel, software-based, and available in the cloud. Recognizing that customer service does not always mean contact centers, Avaya enables customers to connect with WAHAs, SMEs and with other employees. Finally, Avaya has been taking on the necessary financial steps to provide the resources with which to build on its product lines, thereby greater value for its customers.

Avaya’s customers have, in turn, experienced strong value from its products, and have rewarded the company with their business. For these reasons, Avaya is recognized with Frost & Sullivan’s 2017 Customer Value Leadership Award.



Significance of Customer Value Leadership Ultimately, growth in any organization depends upon customers purchasing from a company and then making the decision to return time and again. Delighting customers is, therefore, the cornerstone of any successful growth strategy. To achieve these dual goals (growth and customer delight), an organization must be best-in-class in three key areas: understanding demand, nurturing the brand, and differentiating from the competition.

Understanding Customer Value Leadership Customer Value Leadership is defined and measured by two macro-level categories: Customer Impact and Business Impact. These two sides work together to make customers feel valued and confident in their products’ quality and long shelf life. This dual satisfaction translates into repeat purchases and a high lifetime of customer value.



Key Benchmarking Criteria For the Customer Value Leadership Award, Frost & Sullivan analysts independently evaluated two key factors—Customer Impact and Business Impact—according to the criteria identified below.

Customer Impact Criterion 1: Price/Performance Value Requirement: Products or services offer the best value for the price, compared to similar offerings in the market.

Criterion 2: Customer Purchase Experience Requirement: Customers feel they are buying the most optimal solution that addresses both their unique needs and their unique constraints.

Criterion 3: Customer Ownership Experience Requirement: Customers are proud to own the company’s product or service and have a positive experience throughout the life of the product or service.

Criterion 4: Customer Service Experience Requirement: Customer service is accessible, fast, stress-free, and of high quality.

Criterion 5: Brand Equity Requirement: Customers have a positive view of the brand and exhibit high brand loyalty.

Business Impact Criterion 1: Financial Performance Requirement: Overall financial performance is strong in terms of revenues, revenue growth, operating margin, and other key financial metrics.

Criterion 2: Customer Acquisition Requirement: Customer-facing processes support the efficient and consistent acquisition of new customers, even as it enhances retention of current customers.

Criterion 3: Operational Efficiency Requirement: Staff is able to perform assigned tasks productively, quickly, and to a high quality standard.

Criterion 4: Growth Potential Requirements: Customer focus strengthens brand, reinforces customer loyalty, and enhances growth potential.

Criterion 5: Human Capital Requirement: Company culture is characterized by a strong commitment to quality and customers, which in turn enhances employee morale and retention.



Best Practices Recognition: 10 Steps to Researching, Identifying, and Recognizing Best Practices Frost & Sullivan analysts follow a 10-step process to evaluate Award candidates and assess their fit with select best practice criteria. The reputation and integrity of the Awards are based on close adherence to this process.

STEP OBJECTIVE KEY ACTIVITIES OUTPUT

1 Monitor, target, and screen

Identify Award recipient candidates from around the globe

• Conduct in-depth industry research

• Identify emerging sectors • Scan multiple geographies

Pipeline of candidates who potentially meet all best-practice criteria

2 Perform 360-degree research

Perform comprehensive, 360-degree research on all candidates in the pipeline

• Interview thought leaders and industry practitioners

• Assess candidates’ fit with best-practice criteria

• Rank all candidates

Matrix positioning of all candidates’ performance relative to one another

3

Invite thought leadership in best practices

Perform in-depth examination of all candidates

• Confirm best-practice criteria • Examine eligibility of all

candidates • Identify any information gaps

Detailed profiles of all ranked candidates

4 Initiate research director review

Conduct an unbiased evaluation of all candidate profiles

• Brainstorm ranking options • Invite multiple perspectives

on candidates’ performance • Update candidate profiles

Final prioritization of all eligible candidates and companion best-practice positioning paper

5 Assemble panel of industry experts

Present findings to an expert panel of industry thought leaders

• Share findings • Strengthen cases for

candidate eligibility • Prioritize candidates

Refined list of prioritized Award candidates

6 Conduct global industry review

Build consensus on Award candidates’ eligibility

• Hold global team meeting to review all candidates

• Pressure-test fit with criteria • Confirm inclusion of all

eligible candidates

Final list of eligible Award candidates, representing success stories worldwide

7 Perform quality check

Develop official Award consideration materials

• Perform final performance benchmarking activities

• Write nominations • Perform quality review

High-quality, accurate, and creative presentation of nominees’ successes

8 Reconnect with panel of industry experts

Finalize the selection of the best-practice Award recipient

• Review analysis with panel • Build consensus • Select recipient

Decision on which company performs best against all best-practice criteria

9 Communicate recognition

Inform Award recipient of Award recognition

• Present Award to the CEO • Inspire the organization for

continued success • Celebrate the recipient’s

performance

Announcement of Award and plan for how recipient can use the Award to enhance the brand

10 Take strategic action

Upon licensing, company is able to share Award news with stakeholders and customers

• Coordinate media outreach • Design a marketing plan • Assess Award’s role in future

strategic planning

Widespread awareness of recipient’s Award status among investors, media personnel, and employees



The Intersection between 360-Degree Research and Best Practices Awards Research Methodology Frost & Sullivan’s 360-degree research methodology represents the analytical rigor of our research process. It offers a 360-degree-view of industry challenges, trends, and issues by integrating all 7 of Frost & Sullivan's research methodologies. Too often companies make important growth decisions based on a narrow understanding of their environment, leading to errors of both omission and commission. Successful growth strategies are founded on a thorough understanding of market, technical, economic, financial, customer, best practices, and demographic analyses. The integration of these research disciplines into the 360-degree research methodology provides an evaluation platform for benchmarking industry participants and for identifying those performing at best-in-class levels.

About Frost & Sullivan Frost & Sullivan, the Growth Partnership Company, enables clients to accelerate growth and achieve best-in-class positions in growth, innovation and leadership. The company's Growth Partnership Service provides the CEO and the CEO's Growth Team with disciplined research and best practice models to drive the generation, evaluation and implementation of powerful growth strategies. Frost & Sullivan leverages more than 50 years of experience in partnering with Global 1000 companies, emerging businesses, and the investment community from 45 offices on six continents. To join our Growth Partnership, please visit http://www.frost.com.

360-DEGREE RESEARCH: SEEING ORDER IN THE CHAOS

http://www.frost.com/

frost & sullivan 2017 north american contact routing ... · best practices recognition: 10...

Documents