RAD: The Telecommunications/UC space is changing. It is a lot different than when we both got in during the heyday of the 90s. How will these changes affect channel partners?
CEO: The evolution of Cloud offerings in the UC space is changing the fundamental structure of the type of partners that are required for a successful channel. The classic VAR's face the challenge of a major change in becoming solution focused, not product focused. This also entails a change in the type of technical talent required within the VAR's to execute on their new solution offerings. A market that for more than a decade had only 5 to 10 top providers, now as the shift to cloud continues, has 30 or more providers with UCaaS offerings. With this, VAR's that navigate the change will have to focus on providing solutions that incorporate integrations to other work flows, CRM's and related solutions. On the positive side, it does allow VAR's to truly become solution providers by having the ability to easily offer multiple Cloud solutions, finding the best fit for each prospect."
Tracey continues, "As a result of these changes, many of the providers turned to alternative channels like Master Agents and Value Added Distributors (like CDW and Jenne). This opened a larger market reach than the classic VAR channel, but has compounded the problem of finding resources to deploy and support these solutions as they grow in numbers and scope."
"As we sit today there is a lot of uncertainty in the channel and lots of scrambling for solutions. Channel partners that can adapt and overcome will have plenty of opportunity and the re-occurring revenue streams should provide many opportunities for growth beyond that of the traditional VAR."
"What is really needed to succeed is the technical talent and execution of a top VAR, with the exponential sales growth opportunity of a channel like the Master Agents built for carrier services."
RAD: What have you seen that is a positive indicator?
CEO: "We see growing demand from the providers for an answer to their execution and support issues. The demand for organizations that specialize in UCaaS/CCaaS and have the required skilled engineers to successfully design, deploy and support these solutions will see tremendous opportunity. We also see growing demand for technology in the business space that can improve companies' ability to compete in their markets. We see increase value put on UCaaS and CCaaS solutions as a key for organizations to succeed. It opens lots of opportunities for those organizations that are ready to take on the challenge of these changes."
RAD: How do you see the Contact-Center-as-a-Service space evolving?
CEO: "I see the CCaaS space evolving ahead of the UCaaS space. Contact Centers are often the heartbeat of an organization and its key factors - revenue and service. The more organizations realize that Contact Center productivity is a driver for their business, the more demand we see for the business applications/features to be built in to the Contact Center solution. The line between CRM and CCaaS is blurring as more companies demand integrated access to multiple communication channels and data sources. And today it's true not only for bigger business players but also for SMBs."
"There's a very limited number of competitive premise-based Contact Center offerings in the small-to-medium market. Cloud solutions are stepping forward bringing top-level Contact Center functionality to this market along with the reliability, scalability, continuous software advancement and next to zero hardware requirements. Smaller contact centers now can afford to operate on the same level as business monsters with less risk and more opportunities to grow."
Tracey adds, "We see some big SaaS CRM platforms presenting themselves as Contact Centers to play as CCaaS solutions but they are still lacking lots of expected Contact Center functions and they lack the ability to route interactions from multiple channels effectively. They face a step climb to catch up to the rapidly expanding feature/application sets of specific CCaaS solutions. At this point in time with some many of the CCaaS players offering integrations into these big SaaS platforms and having open API's for continued advanced integrations. It just makes more sense for CCaaS to be integrated into complete CRM than the opposite."
Tracey remarks, "When it comes to the channel, CCaaS business is a great source of MRR revenue. The average CCaaS deal will have a Top Line of 4x to 5x in comparison with UCaaS, and it is still a field with fewer players. MSPs, VARs and Agents who see the writing on the wall about declining top line revenue in their carrier business should really start considering CCaaS as an alternative."
]]>The one thing missing from this cloud strategy: business model.
For all the talk about monthly recurring revenue, the commissions off cloud services are tiny compared with the time it takes to sell and support.
Even with the drop in uptime for carriers, the amount of support for network services is small. The sale is easy. The commissions are fair. High ROI.
Microsoft Office365 is starts at $60 per seat per year. That is a commission of fifty cents! If the client calls with just one support call, all of your profit is gone.
In network, almost all carriers deliver services as advertised. There isn't really a big trust issue with the customers. It's plugged in and usually works. Stays up most of the time.
The same can be said of PRI. But SIP trunks? That gets tricky with inter-operability, with porting numbers, with quality of service. There are so many providers that it isn't even possible to do an apples to apples comparison. Easier to sell POTS lines, in my opinion.
UCaaS has been notorious for porting problems; QoS issues; lack of user training; and deployment mishaps. Also, too many features, not enough pain for the buyer to move to what looks like a complex system. At ARPU of about $350, that is a lot to overcome to make a little bit of money. The SPIFF War that pays out up to 6X MRC is getting attention, especially if the partner can just throw a lead over the fence, let the ITSP close it and collect his $200 after passing GO!
The big impact from cloud is the integration. But who is going to do that integration? Who is going to come in and add the Zaps or the IFTTT? Who is going to script together the various pieces of software to get data to flow without swivel chair?
On a client call recently, they mentioned that many IBM A/S-400s are still in service. Those applications don't easily port to the cloud for a number of reasons. There are a number of software applications that won't easily port to the cloud. That's why we have the Hybrid Cloud strategy, right? Which just means that some stuff stays as is, some stuff goes to AWS/MS/IBM/Rackspace, some stuff moves to a private data center. (SD-WAN plays the part of making that network optimized for a hybrid environment, or as I like to call it the usual system.)
I'm not saying cloud isn't here to stay (see here). I am saying that the Business Model for Partners to be Cloud First has not become mainstream yet.
A good Cloud Engineer/Cloud Architect or a knowledgeable Sales Engineer are expensive full time positions. It would take a lot of large deals to begin to offset that investment in talent. There is a new skill set needed for cloud services that wasn't needed for managed IT services. New sales skill set too as the sale transitions from transactional replacement of services (cable for T1 or Ethernet for T1) to consultative selling involving business needs and impact.
"What we've found working with clients who want to begin taking advantage of the cloud's cost and accessibility advantages is that they will start new projects in the cloud, but will leave their legacy systems intact." To find these deals, you would need to be proactive in marketing your firm as a cloud expert (and actually have the chops to pull it off without burning the client and your reputation, which is a real problem that vendors don't want to address.)
Personally, I wonder about the economics of cloud. VDI, UCaaS, CRM and Office 365 are going to cost you ($40+$30+$100+$5) roughly $175 per month per employee. At 99 employees that is $200K per year. Seems like a lot, but if you are the partner and you get most of that share that is $20K per year in commission.
]]>Usually the only KPI we look at is Quota.
Yet we know that daily activity is the most important factor for success. That includes number of contacts per day via email, social media, phone calls.
The speed at which we follow up from an inbound lead is directly related to success. "Since Harvard's study on response outcomes showed that sales reps that contacted leads within 1 hour were seven times more likely to have a meaningful conversation with a decision maker, other studies have affirmed the findings." [source: salesforce]
Are you tracking new logos (new accounts) that are opened? Yes, we need to retain and grow current accounts (and that is another KPI to measure). In some sales organizations, different reps have different responsibilities: like retention and account growth would be different than a hunter looking for new business (new logos, new accounts).
Sales math helps to break down the daily activity needed. If it takes 1000 dials to contact 30 people, you need to make 1000 dials a month. If it takes 30 contacts to get 3 sales, you understand what the numbers mean.
"A new study from AG Salesworks & BridgeGroup estimates that reps should be generating roughly 32 opportunities per 1,000 outbound calls. Keep in mind that those numbers were for outbound prospecting, a term that tends to include many calls that are relatively cold. So keep an eye on those call logs." [source: salesforce]
"Persistence pays off. A National Sales Executive Association survey found that 48% of sales agents never follow up with leads a second time. This is significant since 10% of sales are closed on the fourth contact, and 80% are made on the fifth to 12th contact." Can you track follow up?
How about Contacts added to a drop campaign or monthly newsletter?
Of course, we have Sales Target, Closing ratios, quota, average sales size, and sales cycle to measure as well. We can also measure by product. What are they selling and to who, which will provide data for follow up contacts. For example, a follow up email can say that we have sold to 310 banks and most of them have bought not just bandwidth but also our managed security product. This is food for thought for prospects plus productive follow up email content.
What you measure you can manage is what Peter Drucker said. If you are spending the money on Salesforce CRM, you might as well get the most of it.
]]>When asked if this wasn't just a wrapper around Broadsoft's UC-One or other packages, Nextiva replied, "NextOS was completely imagined and developed in-house."
This follows Broadsoft's own announcements about Hub, Team-One and CC-One. This is BSFT's response to Slack, a real-time messaging and collaboration app now at 4 million users.
"BroadSoft Business includes three core applications: UC-One, Team-One, CC-One, with BroadSoft Hub providing contextual intelligence across the entire platform so users can access the information and apps they need in one place," press release states. "Built into BroadSoft Business are bOpen, bMobile and bSecure capabilities that can enable service providers to deliver carrier-class security and reliability; the openness for businesses to be able to integrate their favorite business apps (CRM, email, calendars, Twitter, etc.); and full mobility to connect advanced unified communication and collaboration (UCC) capabilities to a user`s mobile devices." I'm not certain if this is BroadWorks add-ons or if you can only get this via BroadCloud. The difference being that BroadWorks is run by the VoIP Provider and BroadCloud is the white-label service that Broadsoft operates for the provider.
Frost & Sullivan analyst Elka Popova wrote, ""BroadSoft's share of the global hosted IP telephony and UCC services market is 41 percent, which confirms BroadSoft's market leadership." With 15 million cloud lines, "BroadSoft cloud PBX/UCaaS installed base 3x greater than closest competitor Cisco and 10x greater than RingCentral." The "cloud line" is defined by Popova as "The BroadSoft installed base is hosted IP telephony seats, fully-loaded UCaaS seats and business VoIP lines." Still don't know if they include SIP trunks in that number because 3 million of those would be WIND and XO trunks then. And that woould skew UCaaS/HPBX penetration. It does look impressive in a graph:
Microsoft previewed Teams, which is its answer to Slack. It is currently only available to subscribers of Office 365 Enterprise or Business plans.
Meanwhile Cisco introduced a "flex plan" for Spark that lets businesses choose cloud, on-premises or hybrid services in a single contract. That includes Spark Meetings, which is also a Slack competitor.
Slack is attracting its own ecosystem that allows companies to integrate other functions to Slack beyond comms. Slingr turns Slack into a task manager. Other scripts can turn Slack into a CRM with Slack's user interface. IDEA2 and other companies like the user interface and the open API on which they can add functionality to an app people already like and use on desks and on phones.
Interesting that these folks are rolling out more complex platforms at a time when Verizon is rolling out One Talk which simplifies the whole UCaaS thing for small business. It's my experience that most businesses don't want complicated (hence, Slack!) and most users want simple (think Facetime). Without user adoption, this is wasted expense.
Want another example? Salesforce CRM at $99 per user per month but only a couple of people on the sales team use it actively. There will be managers who don't utilize the dashboard or coach to the activity in the system. Despite how integrated the SF ecosystem can be, it isn't worthwhile unless the users -- your employees -- are using it and benefiting from it! Same goes for any software, especially UCaaS (which is morphing again from Hosted PBX to UCaaS to UC&C and WC&C).
]]>I have run into quite a few companies that have never hired a consultant before. I figure that they are used to hiring bodies and managing bodies. They manage the hours you work; not the outcome of the work.
They do hire vendors, for example, a PR firm or a softswitch. On the one hand, with the softswitch they know exactly what they are buying. With the PR firm, it is more intangible. Both are managed differently.
Salespeople ideally are managed by outcome, but not really. Many salespeople do not hit quota nor do the perform the necessary daily activities. So no, they are not managed by results. The managers are managing bodies and hours.
If you rent a car, you don't want to own it or maintain it. You want it to get you around safely, while you have it. If you want, you can rent a better, faster, more luxurious car, but all you are doing is contracting for transportation during the prescribed hours.
That is how some consulting works. The consultant comes in for a set number of days or hours, bangs out the presentation, does some Q&A, sets a strategy, crafts a killer message, plans a product launch, then the company takes over from there. They hired for a specific function, a bunch of knowledge or guidance. This is not unlike hiring a lawyer or going to the doctor.
Consultants bill by the project or by the hour. Billing by the project is fine if there aren't any snags. In web design, there is usually scope creep and changes, which sink many a web design project - both for the designer and the customer.
When hourly billing, buyers may look for the cheapest supplier. That is when you know that they are buying hours, not outcomes. It might also be that they don't know what to look for when hiring that talent or skill.
We are moving to a freelancer economy - 40% of the population is now part of the connection economy. Managers are going to have to adjust to hiring tasks, projects, output, activity - as opposed to hiring bodies.
In a management webinar I am presenting, I am working towards re-adjusting managers' thinking towards salespeople. CRM was supposed to make sales activities more transparent - or at least trackable. It has been 16 years since Salesforce took off - and sales departments are still fighting CRM! And managers are not using the functionality to manage the funnel and the team.
Jim Rohn, a business philosopher, said, "You don't get paid for the hour. You get paid for the value you bring to the hour." True, but you get managed by the hour, not the output. In a world of big data and analytics, we still manage like there is still a wall phone.
]]>Sendhub,a business SMS provider that raised $10M, was acquired by Cameo Global, a global managed IT shop that does some contact center work.
Salesforce's leadership position in CRM now gets e-commerce with Demandware $2.8B acquisition
Broadsoft acquired Intellinote. [see here]
QTS buys DuPont Fabros Tech's New Jersey data center. This transaction comes after QTS transformed the Sun Times building in Chicago into a Tier 3 data center with 317K SF of capacity and 24MW of power.
Nest has unlimited budget, large workforce, and nothing. Oops!
The strike is over for Verizon and the lesson for the C-Suite: we can't get rid of wireline and unions fast enough.
ADTRAN launched hardware-as-a-service, a subscription service for MSPs to offer hardware to clients without leasing -- or another way to say that the leasing is built into a subscription service.
The Allied Fiber assets in the Southeast are up for auction under bankruptcy court approval. [source]
Rest assured, another prediction says the same thing that the other predictions said: VoIP Market Set for Steady Growth.
Want an example of Innovation? Zappos re-designs the shoe box!
CNBC list of Top 50 Disruptors
Mid-year channel trends HERE (site is hard to read with banners, pops, etc., but aren't they all getting that way?!)
Dean Bubley asks, "So uncomfortable Q for 5G designers & stds bodies: can critical-comms 5G really yield enough rev/profit to justify much expenditure/effort?" Follow up with this piece on 5G Vision. In short, is there enough revenue to build out yet another network (voice, 2G, 2.5G, 3G, 4G)?
Now softswitch vendors are service providers, competing with their customers and making it easier for new entrants into the already bloody ocean of Hosted VoIP. Broadsoft BroadCloud; GenBand Nuvia; Alianza Cloud Voice Platform; and Metaswitch MetaSphere Cloud Services [see here and here]
RETAIL: Sears, J C Penney - 30 Companies That Might Disappear In 2017 Based On Altman Z ]]>
I recently explored how one client company used Slack. Everyone liked it; however, it didn't really work. It lacks real presence; notification if message seen/read; a way to escalate the message to a phone call, etc. It really was just a messenger replacement. That isn't workflow or collaboration.
I think stand alone apps like Snapchat just aren't going to do it. Office365 with Lync/Skype and Google with Hangouts have full capabilities for collab, comms and integration. With the add-ons to Gmail, that platform gets richer and more useful (if you have enough memory to run the darn thing; it is such a memory hog.)
The buzz about Office365 is growing because all the work is being down to integrate voice and Skype/Lync with the other apps (like here). That is the first step in what has to happen. And it doesn't have to be Google or MS, but who wants to build another ecosystem? Well, someone will build one because we build instead of buy in this industry.
Enterprises aren't happy with the current out-of-the-box UC&C solutions. There are pitfalls with each software deployment - UC or CRM or other - because of functionality, poor planning, lack of user training, simplistic guides, bungled execution and other pitfalls.
I think it has to be about what you are trying to do, not just what tool can I use. You have to step up to see the desired outcome, how can I get there, and is the solution complex or simple.
Best example I can give comes from CRM. The execs and techies want CRM to touch every single department. That is the wrong reason to get CRM. If the salespeople won't use it or it is too cumbersome, then why bother? It has to be user friendly first, tech friendly second.
When you look at consumerization of IT -- why is that happening? Because people have iPhones and they like the simplicity and functionality of it. They want that at work. They like how easy Mailchimp, Dropbox and Slack/WhatsApp are to use. Simple interfaces, clean UX. Do you get that from the ERP system or the in-house built software project? Unlikely. The UX and GUI took hours of specialists' time to get right. (If you haven't seen what goes into UX, you should.) They want that look and feel at the office.
Unfortunately for your office, you have millions sunk in legacy systems, proprietary systems, and cobbled together integration. Not only does that make for a mess for IT; it isn't user friendly or mobile ready or portable. What now? When workplace evolution to hot desking and remote workers is speeding up.
There are people in organizations that just want a replacement for what they have now - only cheaper. Our industry taught them that. You have to find the business leader who wants to transform the business. That person will have a discussion about business goals and expected outcomes. (Remember to talk about the internal employee resistance to change -- and mention how the training, online learning and guides should smooth some of that out.)
It is changing pretty fast. That means opportunity abounds.
Vonage says there's still 85% of the SMB market left to penetrate with cloud services.
]]>Windstream is in battle at the FCC to get IP equivalent wholesale products from AT&T as TDM retires. It is not going well. (You would think all CLECs and Comptel would be roaring along with them.
A little more WIND news as residents of Alabama are taking Windstream to court over slow broadband speeds. Not shocking.
9-1-1 is falling apart in this country. No one notices until a huge outage. T-Mobile hit with $17.5 million FCC fine for 911 outages . Fines are great, but the FCC has to address the underlying problems with the 9-1-1 system, especially as we transition from TDM POTS calls to cellular, texts and VoIP. But, heck, the FCC hasn't fixed Rural Call Completion problems yet either.
So DISH bid on spectrum in the last FCC auction using a bunch of shell companies setup as "small biz" for credits and discounts. Well, the FCC caught on. FCC Poised to Reject Dish Partners' Spectrum Discounts Affiliates requested $3.3 billion in small-business discounts on $13.3 billion in winning bids.
So the FCC is approving the AT&T-DirecTV deal with some conditions. Will they actually follow up on these conditions? History says No. "12.5 million customer locations will have access to a competitive high-speed fiber connection. This additional build-out is about 10 times the size of AT&T's current fiber-to-the-premise deployment, increases the entire nation's residential fiber build by more than 40 percent, and more than triples the number of metropolitan areas AT&T has announced plans to serve." [forbes]
"The customer relationship management (CRM) market is mature, bloated and consolidation is going to continue for the foreseeable future. The upshot: Technology buyers need specialized CRM vendors, but they could wind up absorbed by a giant." So companies build their own systems. Why build from scratch when you can use stuff like tray.io, Idea2, IFTTT and the like?
74% of business buyers told Forrester they conduct more than half of their research online before making an offline purchase. [source]
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