Four Signs That A Hosted Contact Center Is Right For You
by Robert Hill -
July 30, 2009
Four Signs that a Hosted Contact Center
is Right for You by Robert Hill
The number of Hosted Contact Centers is expanding exponentially. Analysts Frost & Sullivan predicted a compounded annual growth rate (CAGR) of 34.1% through 2013. The prediction for contact centers of less than 100 seats during the same period was even higher – 41.3%!1
A prime reason for this growth is that today’s advanced hosted contact centers bring all of the features and functions that were previously available only to large institutions through on-premise solutions. Justifications for implementation vary from one organization to the other. However, four factors driving the current adoption of hosted contact centers could indicate that your situation is right:
1. You have multiple sites and want to utilize remote agents
2. You want to minimize costs and capital investments
3. You need to minimize IT maintenance and management costs
4. You have an immediate need for enhanced technology and capabilities
Multiple Sites and Remote Agents
Because the hosted contact center is located off-premise it is naturally predisposed to operating across multiple sites and with remote agents. There are a number of reasons that this is attractive to businesses.
Multiple Sites
Multiple sites put additional pressure on any network. As companies grow or acquire other companies, it can be expensive and time-consuming to expand the network. Downtime, especially during these critical growth periods, can be devastating and expensive. A hosted solution can be integrated with these companies’ existing technology to expand the reach of their current capabilities. With a hosted solution, the software supplements the company’s existing infrastructure, but resides on a third-party network and can be accessed from workstations anywhere in the world via a web-based interface.
Remote Agents
There has been a tremendous movement to remote agents and virtual contact centers. And for good reasons. A virtual contact center gives organizations access to what is essentially an unlimited labor pool and unmatched employee flexibility. It enables organizations to offer service that follows the sun without physical contact centers located around the globe or employing workers at non-traditional hours.
Hosted contact centers enable agents to work from any location as long as it has a high-speed internet connection. They can employ the best qualified people for the job no matter where they reside and offer them the flexibility to work from home. This is especially critical for employers that require highly specialized or skilled agents where the potential talent pool might be extremely small in a single geographic area.
Minimal Costs and Capital Investment
Hosted solutions typically operate on a monthly subscription based on the number of users after a minimal upfront charge for implementation. This pay-as-you-go method enables organizations to enjoy the robust features and functionality of a sophisticated contact center solution without the prohibitive upfront investments. It also enables the organization to tailor the contact center solution to their exact needs, paying for only what they use and nothing more. Because the software is actually running at a remote location implementation and customization costs are dramatically lower in comparison to on-premise, the provider typically can complete the installation and necessary adjustments from their remote location without traveling to the client’s site, saving both cost and time.
The fact that the hosted contact is billed monthly is no small matter. This results in the cost appearing on the operational budget instead of the capital budget and its associated approval processes. As a fixed, all inclusive monthly expense, it simplifies the accounting and business planning process.
Lower Ownership Costs
Comparing the total costs of ownership (TCO) of hosted to on premise reveals the dramatic cost savings that hosted delivers. When making this comparison with all of the associated costs – software hardware, implementation, ongoing expenditures, subscription (for the hosted solution) IT Staff Costs – Frost & Sullivan estimated a 64% cost savings for the first year alone for a typical 100 seat contact center.1 Projecting out five years, the saving continued. After the three years the TCO was 36% less for the hosted solution; after five years, the TCO was 23%.
Minimize IT Costs and Management
The hosted model is ideally suited to smaller businesses that have a small or no IT department. Typically help desk support and physical technical support is available with the subscription fee. The service provider guarantees performance, reliability, and support through service-level agreements with the client. The service provider provides all customization, integration, upgrades, support, and maintenance. This simplifies implementation and ongoing support.
Because all of the software maintenance, support, and updates as well as infrastructure systems and network monitoring are centrally administered, existing technical resources are available for other projects. The service provider's expertise as well as their investments in security, networking, monitoring, and reliability are not easily replicated. Overall costs are lower because the costs are spread across numerous clients.
One study revealed that the savings in IT staff alone could easily exceed $75,000 per year for just an average sized contact center. The rapid implementation capability of hosted enables companies to accelerate their ROI by as much as six to nine months compared to a traditional, on-premise solution.
Immediate Need
In today’s rapidly changing marketplace, an organization’s needs can change quickly. These changes can range from additional capacity to enhanced capabilities to meet customer expectations. A hosted contact center solution offers the flexibility to meet quickly changing requirements, whatever they might be. A hosted solution can be up and running very quickly, in a matter of days in some situations. This enables the company to quickly adapt to whatever situation is at hand.
Outgrown existing application requirements
Hosted solutions provide organizations with an efficient and economical way to replace or upgrade existing solutions while minimizing disruptions to their day to day operations. With their customizable features, easy integration, and adaptability, a hosted contact center can provide the functionality and cost savings needed to upgrade from first-generation solutions that provide little beyond basic customer data tracking to the most advanced features available today.
Rapidly expanding
For companies undergoing rapid growth, the hosted contact center enables them to take on new business without worrying about infrastructure capacity. Hosted solutions are able to scale easily and quickly to maintain pace with growth. Additional agents can easily be added without the cost and headache of upgrading or replacing the infrastructure. Simply increase the number of seats in your monthly subscription. Because the application remains the same, established training and management processes can be used.
Seasonal needs
Hosted solutions offer organizations with seasonal spikes in demand the ability to meet these demands yet only pay for the services required. For instance, organizations that have traditional and anticipated increases in demand, such as retail and government, can have the ability to ramp up quickly during peak times, without having to make a "peak infrastructure investment” that would otherwise sit idle for most of the year.
Final Analysis
The hosted contact center offers a number of advantages that can benefit contact centers of any size. As the capabilities of hosted contact centers are now equal to those of on-premise in many instances, the decision between the two comes down to the individual organization and their needs.
1. The Hosted Model: Why It’s Revolutionizing the Contact Center, Frost & Sullivan
About the Author
Robert Hill is an industry sales consultant with over 20 years experience in information technology, customer relationship and supply chain management in corporate management and consulting roles. Specifically, Mr. Hill specializes in the development and operation of state-of-the-art customer care and technical support operations, and has provided expertise to international companies such as Xerox, GE, Allstate, Computer Sciences, DuPont, National City Bank, QWest and Cincom. You can reach him at rhill@cincom.com or 1.513.612.2300.
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