More 2009 Contact Centre Predictions - Datamonitor

My last post ("My Contact Centre Top 5 Predictions for 2009") seems to have had a lot of interest, so thank you to all the readers who liked it.

I was sent today Datamonitor's latest contact centre reports ("2009 Trends to Watch: Contact Center Markets and Technologies", published 22nd Dec) and can recommend it. We have a corporate subscription to Datamonitor and and I've tended to like Datamonitor's research as it's focused more on the market trends and the buyers needs than on the vendors and their products. I also must admit to using them extensively in the past when I was working in consulting and needed insight into sectors of the retail financial services markets.

The report has some very good points to make about potential growth in the contact centre mid-market and around SaaS offerings. It also highlights that the super-large contact centre (so common in financial services) will probably not be driving forward technology spend in the current market conditions in the way that this segment has driven functionality in the past. I'm not sure about Datamonitor's view on the 'rehabilitation of outbound', at least for Europe and the UK. It is true that companies do want to use the outbound phone channel more proactively and better, but most to date have managed to damage their reputation with outbound (See my blog posts: "Barclays, silent calling & we've been here before..." and "Banks criticised by BBC for automated calls "). I fully agree with Datamonitor's view on the importance of business process (see my blog: "My Contact Centre Top 5 Predictions for 2009", though Datamonitor have an interesting and slightly different view) and the potential growth in contact centre analytics. I think they've got some very good insight on those subjects and I've got some interesting things to think about.

In short, I've found this Datamonitor report one of the better analyst assessments of the contact centre market in 2009 and it's well worth buying.

My Contact Centre Top 5 Predictions for 2009

This year I thought I'd do something different to welcome the new year and stick my neck out by making some predictions. I'm often asked what I think the contact centre trends will be in 2009, and so I'll put forward what I think is going to happen.


Making predictions is always a risky business and 2009 looks so turbulent that the risks will increase. I'll have a go, but I am fully prepared that I begin 2010 with a blog post on how I got it wrong!


1. IP Contact Centres will continue to grow rapidly.
I'll start off with a relatively uncontroversial prediction. This is backed by most of the market analysts I've seen, but if 2009 proved anything, then it was that uncontroversial, analyst backed predictions could be totally wrong! The most up to date research I've seen was yesterday on Network World (see: "IP call centers will do well despite VoIP slowdown") where Infonetics' newest report had some interesting statistics. Infonetics predict the market for IP Contact Centre as growing 38% in 2008 and continued growth in 2009. The growth in 2009 could be as low as 5%, but that's still pretty rapid for a relatively mature market segment in recession. Forrester and Gartner have higher figures for growth, but I suspect they will revise them downwards as they reassess them in light of the global economic situation. Still, there is steady momentum towards Voice over IP (VoIP) in all aspects of telephony and I expect contact centre to follow the trend.


2. Fixing customer processes will be a major focus in 2009.
To a certain extent all contact centres (whether using TDM or VoIP for the voice traffic) can now do all the basic things needed, namely answer the phone and provide the agent with some information on the caller. These historically have been what technology spend has been focused on, answering the call (which is all the spend on telephony) and getting usable information to the agent (all the spend on CRM).

The problem is that telephony plus CRM has not not fixed most of the issues customers experience. What matters to customers when they call is (1) did I get my problem fixed? and (2) was it a pleasant experience. I've been interested in 2008 to see the big system integrators start to focus on process (see posts like: "System Integrators write interesting things about contact centre for the downturn!" or "Contact Centres, Process and Six Sigma") and much more focus on the customer experience (see posts like: "HSBC creates 250 UK call centre jobs & offshore in decline").


3. A major contact centre technology provider to fail/ be bought from administrators.
I'm not confident enough to predict who, but the press and blogs are providing quite a selection of possibilities. Nortel has had some rough press (see: "Nortel Drops After WSJ Says It’s Exploring Bankruptcy" and "Juniper: the big winner if Nortel goes under?") to pick just two recent articles and their financial situation is not good. There are still Nortel supporters, and I admire the optimism of the article "Don’t write off Nortel yet", but I can't say I share it. I do agree with the point the article makes that Nortel is underestimated and is still a very technically capable company and is likely to have fewer self-generated problems going forward.

Aspect may also have trouble, despite their alliance with Microsoft (see: "VoiceCon 2008 - IBM, Microsoft & Aspect"), but they haven't had the focus that Nortel has. They have a strong (and lucrative) product in Aspect Workforce Management but their core call centre offerings have seemed to struggle in recent years.

There is always the chance that Microsoft will buy one of these vendors (or perhaps private equity as with Siemens) but I'm not sure I see other obvious candidates. It's possible that SAP or Oracle might move in, as both have bought small IP contact centre companies in the past (SAP bought Wicom and Oracle bought Telephony@work) but that seems less likely.

4. Offshoring to decline further for front line customer service.I think it's hard to see further offshoring as going to be well received by consumers. Offshoring of call centres was perhaps already in decline for reasons of brand reputation and cost (see posts like: "HSBC creates 250 UK call centre jobs & offshore in decline ") and I think consumers will be very hostile to brands that are seen to be destroying jobs. In the banking industry this will be a particular issue, as with the banks potentially dependent on government, the views of politicians may suddenly be very important.

I think offshore for non-customer facing activities, like IT, may well go offshore more rapidly. The signs are there (see "Lloyds TSB offshores IT, not call centre ") and Barclays has been doing this for a while and I think this is an area where offshore may prosper.

5. Predictions will be wrong!
OK, this is a bit of a cheap one, but there is a serious point. In very turbulent times, the range of possible outcomes for a given set of events increases substantially.

The predictions I've made look the most probable, but I'm prepared to apologise profoundly if against my expectation, 2009 turns out to be the year of TDM offshore contact centres!

Latest Gartner Magic Quadrant on IVR & Speech Self-Service

A good article on the Speech Technology Magasine Website setting out the details of the latest Gartner Magic Quadrant for IVR and Self-Service ( titled the "Magic Quadrant for Interactive Voice Response Systems and Enterprise Voice Portals, 2008." and available from Gartner here).

I was quite please to see that the Microsoft Speech Server was dropped from the Magic Quadrant as I've never found it a relevant offering for the European Contact Centre. I've gone into the details of this previously (in "Technology firms, Europe and speech recognition" and "Speech Market Share"), but the main reason is that if you don't offer speech in European languages, you will struggle to sell in the European market.

It was also good to see Holly Connect getting onto the magic quadrant. I've seen a bit of them in the European market and their network based IVR/ self-service solution looks interesting for those who would like their self-service hosted by a network carrier. They're an Australian company in origin, so I wouldn't be surprised to see them push further into Europe and Asia-Pacific.

Otherwise, the Magic Quadrant has the usual firms in the leader's segment, Genesys, Avaya, Cisco, Intervoice and Nortel. For the full details (I won't duplicate them here) best to look at
the Speech Technology Magasine Website or buy the report Gartner .

Call Centre to Contact Centre... or why worry about e-mail when the phone's ringing?

In terms of hype, the move from call centre (deals with telephony) to contact centre (deals with all remote contacts, telephony, e-mail, etc...) is probably one of the most hyped things in the industry.

Gartner's hype cycle research paper ("Hype Cycle for CRM Customer Service and Field Service, 2007") is one place where the tends are dissected, but I'm not sure I agree with all their conclusions. My main objection is that Gartner are looking at technologies like e-service suites and IP-based contact centres and pronouncing them 'in the trough of disillusionment and stating that it will be 2 -5 years before they mature. I think they are underestimating the pressure from consumers that will come onto organisations to adopt these technologies.

The two big factors I see driving this are the increasing sophistication and pervasiveness of mobile devices and the increasing speed of broadband into the home. Both of these things mean that consumers will find it increasingly easy to contact organisations by e-mail, SMS, instant messaging, etc... and will expect to be able to do so. You only need look at the demographics for things like Facebook and IM users to see that these are what today's youth and tomorrow's consumers are adopting rapidly.

That said, at the moment many of the organisations I work with want to improve their telephony service, and they view multi-media capability as something they need to build into their telephony improvement plan. The view I've often encountered is that while they only need to enable 10% of agents for e-mail now, they need to be able to change that fast and have built an environment that can support any change.

In this context the choice is to look at an IP based contact centre that integrates multi-media or to look at a hybrid integration option. There is a third possibility, but I'm not convinced anyone worried about multi-media would look at TDM for their telephony.

Obviously, as someone who works at Cisco, I believe that IP is the way forward. Putting as much of the intelligence at the network level as possible seems highly desirable in the call centre. The alternative architectural approaches (putting the intelligence at the application layer or splitting it between application and network layer) seem to me to add an unnecessarily level of complexity. Of course, complexity equals cost and when I worked on a couple of Genesys and Kana integrations, and it was the cost of doing all this at the application layer (especially the cost of professional services) that could cause problems. I don't pretend that the IP based approach removes the need for services, but it does reduce the complexity of some aspects of the project, and it can make future functionality extensions easier. As an illustration, it is worth looking at the capabilities of the Cisco ICM (Intelligent Contact Management) product to see just how much enterprise-wide routing can be done at the network level.

In this context, I think Gartner are underestimating how quickly organisations might move to IP and how much this is driven by a need to be ready for multi-media in the contact centre, even if all that functionality is not being implemented today.