October 2008 Archives

I came across a fine in-depth report from Forrester Research, The Forrester Wave™:
Customer Service Software Solutions, Q4 2008

The study has an excellent premise: how the technology can help companies provide better customer experiences. Its author, Dr. Natalie L. Petouhoff, Forrester Senior Analyst, says "before a company even thinks about a software vendor they need to define their customer strategy, what they want their customer experience to be and how they want to provide service to their customers."

Then I saw the writeup on Entellium, which has been having its fair share of troubles lately, and I began to wonder: should such reports look at the vendors' financial and legal history and stability? That has a big impact on whether their technologies will deliver the goods; if the suppliers have gone belly-up who will be there to support the solutions and keep them updated? New owners of the firms or the patents may, or may not, decide to buy and continue to support all product lines and their customers.

With the economy still going south at the same time as contact centers mature as a market, expect more mergers, and shutdowns, and such issues to arise. Tough times have a not unfortunately foolproof way of weeding out the useless and the incompetent, leaving the strong, well-managed, financed, and the lucky.

The acquisition of Envox by Syntellect for $14 million is the latest in a series of smart and timely consolidations in the maturing contact center/CRM solutions space, others being Verint and Witness and Aspect and Concerto (this juror is still out on the Convergys/Intervoice deal announced earlier this year).

The Syntellect/Envox deal appears to be an excellent and complementary match of two fine companies. Envox brings to Syntellect's table a global reach and technology heft, not to mention a $16 million per annum revenue stream: very handy in an uncertain marketplace. The menu of Envox's powerful communications platform, IVR, CTI, and Voice XML tools may well enhance Syntellect's flagship Customer Interaction Management suite. That will help Syntellect to fend off competitors in a slow-growth market, and position it to take advantage of opportunities when the economy turns around.

When I saw the press release from the American Teleservices Association and DialAmerica reporting that most major teleservices clients would leave their outsourcer vendors because they were dissatisfied with them i.e. the service they were getting, I didn't know whether to laugh, cry, or curse or all three at the same time. Naturally I turned this into an article that I put on our site.

After all, what are teleservices firms in the business for, except to deliver services? If they can't deliver them to their clients' satisfaction then why should they exist?

The underlying issue is quality. Teleservices companies have historically been the 'teleprofessionals': the experts with the expertise to deliver high quality customer care and acquisition at low costs.

Yet too many teleservices outfits have dropped the ball for reasons both preventable i.e. greed, incompetence, lack of attention to detail, underpricing, and understandable: limited resources, overly demanding clients, costly new technologies with long-burn ROIs, and offshore and onshore competition.

In fairness, and to the last set of points, clients too must share part of the blame, including for the low service quality their customers get. Stressing cost over price, which too many outfits still do results in poor results for cheap: you get what you pay for. Lousy metrics and lists generate lousy returns: garbage in/garbage out.

This leads to another key question: is the teleservices industry sustainable? The hard reality is that outsourcing is a more expensive solution than in-house centers because the outsourcers' profits have to calculated into the total costs. The only savings--and rationale--for outsourcing, is avoiding staffing and facilities costs for short-term programs. That is why organizations typically have a core in-house group to handle the steady calls and outsource the rest.

Yet advancements in speech rec, and increasing comfort levels with employee home agents are making these options viable to handle outsourced calls. Outsourcers like Working Solutions are wisely also marketing their platforms to serve in-house operations.

The only choices available for teleservices firms seem to be:

* Get back to the quality roots. Make the people and processes outperform the best in-house centers. Clear out the management and supervisory deadwood. Lead, follow or get the (H) out of the way. Do whatever it takes. Teleservices can be better than 'DIY'

* Go innovative techwise. There are a wide range of hosted solutions on the marketplace for everything from CRM to routing to WFO. Go SIP ASAP

* Board up traditional contact centers--they are a waste of money and those jobs tend too often attract low-performing 'gumsmacker' young slackers--and instead go home where one can recruit higher quality, mature, and responsible adults

* Focus on the clients. Treat them like gold, because they are.

The firms that do the above will survive this economy and prosper, and may find themselves at the top of our Top 50 Teleservices Agencies, where they belong.