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Cloud-based systems have arrived as an option for how organizations source their IT systems, now and in the future. Proponents of the cloud – of which I am one – will tell you they have several major advantages over conventional on-premises systems. They require little upfront capital expenditure; the major costs come as a monthly “rental” charge for using the service rather than an annual license; they are less demanding on in-house resources; they are quicker, easier and less risky to implement; there is no annual maintenance fee as updates are built into the service charge; and organizations have disaster recovery taken care of by the vendor. With this background I recently carried out benchmark research to discover organizations’ current and likely adoption of cloud-based systems to support their contact center operations.

I broke the analysis into three areas: communication technologies, business applications and analytics. The results confirmed what I expected: CRM is the application most often currently used in the cloud, by just over one-quarter of participating companies. Somewhat surprisingly about as many have adopted text analytics in the cloud, which I suspect many are using to analyze the content of social media. In addition to these two, the results showed significant adoption of video, CTI, text messaging, feedback management, e-learning and social media analytics (a specific form of text analytics) in the cloud.

For the future, the research indicates that the adoption of cloud-based systems is likely to increase. Of the three areas we researched, based on participants’ stated plans for adopting systems over the next two years, communication systems is likely to grow fastest; for call routing, social media and video adoption rates in the cloud are likely to equal or exceed on-premises. The next fastest growth area is business applications; quality monitoring, call recording, social media integration, feedback management and e-learning all will equal or exceed on-premises. Lagging in third place is analytics; here companies seem less confident of moving to the cloud with only operational intelligence and speech analytics likely to equal on-premises.

We found clear evidence of this trend in the responses to a question central to contact centers and their performance: “How are you planning to meet the requirements to improve interaction-handling in your company?” It is evident that handling interactions is still a people-based process, so the top option was to improve training and coaching for everyone who handles them. However a close second was the adoption of cloud-based systems, which 27 percent more companies chose than investing in on-premises systems. To me this shows that organizations are overcoming their concerns about moving to the cloud and simple economics is making it a more attractive alternative.

Is moving to the cloud on your agenda for 2012? If so, please tell us more by collaborating with me on this topic.

Regards

Richard Snow – VP & Research Director

The old proverb “When all you have is a hammer, everything looks like a nail” applies well to the management of customer relationships. If business technology vendors are to be believed, managing customer relationships involves – indeed, is driven by – software. 

We have a somewhat different take on it. In our view, truly mature management of customer relationships is at its core a set of business processes that enable companies to understand and make informed decisions about their lifetime relationships with customers. One aspect of this is knowing about customer moments of truth – the individual interactions between a customer and a company that can occur at any time through any channel. A moment of truth can happen when someone sees an advertisement, buys a product, tries to use that product, calls the contact center, visits the company’s website or receives a tweet from a friend. From these, and how each is handled, the relationship between a company and a customer is formed. So the challenge of optimizing the customer relationship is in truth one of managing moments of truth.

A number of methodologies as well as applications are available to help companies improve how they handle these moments. Innovative companies have begun to use customer personas to help understand customers’ likely reactions to different events. Customer personas are constructs, built by mapping the key attributes, behaviors, motivations and goals of a company’s target customer groups. They can be used to guide the design of products and services suitable for different market segments, identify the best channels of communication and shape key marketing, sales and customer service messages.

Personas also can become the basis for customer journey maps, which are documents that visually depict the interactions with a customer segment throughout those customers’ lifetimes with a company. They provide a reference for all anticipated interactions with a company, specify which business units are involved and cover the different communication channels customers might use. By using personas and journeys as a methodology, companies can identify which interactions are working and which are not delivering the expected outcomes – from not only the company’s but also the customers’ perspectives. This in turn allows companies to pinpoint where to focus improvements.

Then there is the voice of the customer (VOC) and associated programs and processes. As is often the case with three-letter acronyms, VOC has an array of meanings. Most commonly, though, it is associated with using speech analytics to produce reports and derive analysis from call recordings. But a full VOC implementation is more than just this; it is a closed loop that analyzes all relevant customer data, especially interactions from nonvoice channels to produce a complete (“360-degree”) picture of the customer. With this in hand, a company can understand how to optimize future interactions (using personas and journey maps where applicable) and use alerts, workflow and other tools to ensure that those responsible make the required improvements. Tools to enable this can include more focused training, process changes and better use of technologies such as a smart agent desktop, natural language self-service and automated agent applications. But the key input to any VOC program is an analysis of customer feedback, which should come from all sources, including formal surveys and analysis of free-form text such as text messages and social media content.

Looking ahead we see no one answer to managing customer relationships. It is clear, though, that the traditional software-driven approach will no longer meet the needs of most companies. It is an undertaking that is in the process of evolving, and the details will vary from industry to industry and from one customer to another. To understand these details and search out maturity patterns and best practices, Ventana Research is carrying out research, and I’d like to invite you to participate and see how you are doing compared to everyone else. If you do, I’ll be happy to share with you our findings and some insights on the most direct path to maturity in maintaining excellent customer relationships. 

Regards

Richard Snow – VP & Research Director

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