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“Flexible Contact Center”: Orange goes for growth in international markets



“Flexible Contact Center”: Orange goes for growth in international markets
Contact centers are a natural market for telcos looking to move up the services value chain. They are network oriented and the need to integrate a variety of channels to engage with customers plays well to the strengths of operators in Unified Communications.

Hosted contact centers, the segment that is showing by far the fastest growth, make particular sense for large operators with ambitions and investments in the cloud.

Orange is an established contact center player in France, with a portfolio ranging from simple solutions for call handling and routing to a premium "on premises" service for sophisticated, virtual contact centers.

"Flexible Contact Center", a cloud hosted solution, is the newest addtion to its portfolio.

THE FACTS

On October 18, 2012, Orange announced a cloud-based solution called “Flexible Contact Center”, available in 110 countries and territories around the world. This “turn-key contact center solution” is intended to provide what the company called “a best-class and personalized customer experience.”

According to Vivek Badrinath, CEO, Orange Business Services, “cloud-based contact center solutions provide a powerful business tool to accompany multinationals’ rapid expansion in new territories.”

The announcement was presented as a new step in the company’s international customer contact strategy, with the “ambition to double international contact center revenues over the next three years”.

At the same time, Orange announced that it will be providing a managed “on premises” contact center solution to 360buy.com, the leading Chinese online business-to-consumer (B2C) retailer.

ANALYSIS

The worldwide announcement of “Flexible Contact Center” suggests not only that the company is enlarging its solutions portfolio but also that it is leveraging its know-how in cloud services in an aggressive move into international markets.

As Orange continues to leverage its strategic partnerships with leading editors to provide the underlying software “motor”, the company has added significant value by integrating a flexible, web-based user "workspace", allowing easy customization to meet a wide variety of needs.

While a cloud-based solution is not necessarily the best response to every customer situation, hosted contact centers are achieving rapid market acceptance and Orange is clearly staking out a position in this fast growing market segment. More broadly, the announcement represents an interesting and entirely logical step for the company into network-intensive SaaS (Software as a Service) as part of its overall cloud strategy.

As always, success in international markets – especially in fast growing emerging economies - will depend not only on the quality of “the product” but also on the company’s ability to engage with these markets, to drive sales and to provide excellent delivery and support in the target geographies.

Cloud hosted solutions are attractive to many customers

While only a small part of the overall market, cloud hosted contact centers are the segment showing the fastest growth in seats and revenue.

Specialist market watcher DMG Consulting has predicted worldwide annual growth of 20% in 2012 and 18% in 2013 and 2014. The Asia-Pacific market has shown particularly strong growth. By 2018, Frost & Sullivan expects hosted contact centers to account for nearly 10 percent of the overall seats in the region.

Cloud-based hosted solutions are meeting with increased market acceptance for a number of reasons, including in particular financial and operational flexibility. Customers avoid important capital investments and operating costs are usage based, allowing them to scale up or scale down as needed. Web based, hosted solutions can typically be implemented quickly but also evolve rapidly, since upgrades are the responsibility of the hoster. Routine hardware and software support services can be delegated to the hoster, freeing up internal IT resources for work with higher value for the business.

Another major advantage, especially for mid-market customers, lies in the simplification of the customer’s business continuity requirements.”Flexible Contact Center”, for example, is hosted redundantly in Orange’s highly resilient, Tier 3+ data centers: two in France and two in Singapore for the Asia Pacific region. On a technical level, the redundancy architecture is "active-active" for the business critical components and "active-passive" for less critical components such as real-time statistics.

Hosting the contact center in the cloud, especially with this sort of high-availability architecture, effectively transfers an important part of the customer's continuity responsibilities to a hoster who is well equipped to deal with them. Since the contact center is virtual and web-based, agents can easily work from another location if necessary.

Depending on the customer’s situation, “on premises” solutions also have their advantages. Over a period of several years, a functionally stable “on premises” contact center, with predictable and stable usage patterns, may well have a lower total cost of ownership than a hosted solution. In addition, existing enterprise applications such as CRM may need to be integrated with the solution - in some situations this could be easier to do with an “on premises” infrastructure, although moving the CRM application to the cloud (together with the contact center) could also be an option.

It is interesting to note that the example provided by Orange in the announcement - 360buy,the Chinese B2C retailer – in fact involves a managed “on premises” solution.

Security is often cited as a concern with hosted solutions, but this is an issue which cuts both ways. On the one hand, users may - understandably - be reluctant to depend on a hoster to meet their security needs. On the other hand, large operators such as Orange and Verizon are well placed to ensure “end to end“ security, starting with the use of a secure VPN (Virtual Private Network) for data traffic rather than the public Internet. They also provide a variety of other important security functions such as malware filtering, intrusion detection and prevention, protection against DOS (Denial of Service) attacks and so forth. In many cases, the security provided by a large operator like Orange may well be stronger than the customer’s own internal security capabilities.

On balance, while cloud hosted solutions are not necessarily the best answer to every situation, it is clear that they are increasingly attractive to many customers.

The Flexible Contact Center workspace: a key Orange value-add

While the cloud delivery model is important, the most interesting aspect of this announcement is how Orange has managed to add value in a mature market in which well established software editors deliver (and regularly upgrade) similar, full function solutions.

Orange is entirely transparent in explaining that it leverages strategic partnerships with the leading editors to provide the underlying software “motors” for its contact center portfolio. Its “on premises” solutions, for example, are built on technology from Genesys, Cisco and Avaya.

The “motor” for Flexible Contact Center is provided by Enghouse, a well regarded Canadian, software engineering specialist. The software is a full function, all-IP contact center suite with multi-channel ACD (automated call distribution), IVVR (Voice and Video), CTI (computer telephone integration), predictive dialing, interaction history, recording, reporting, and administrative tools. It was designed from the beginning as a multi-tenant platform for cloud-based deployment, including in particular deployment as SaaS by telco operators. Orange’s solution, however, is significantly more than a rebranded Enghouse software suite delivered as a service.

The stand out, added value feature of Flexible Contact Center is a web based “workspace” that Orange has layered on top of the underlying software “motor”. The workspace is based on drag-and-drop widgets, enabling companies to easily personalize user desktops for the specific job of the agent or supervisor and to integrate company resources such as CRM applications. The workspace also permits the easy integration of Unified Communications tools onto the desktop, including a PC-based softphone and instant messaging.

Technically speaking, the architecture is cleanly designed - the link between the workspace and the “motor” uses Web Services with no impact on the underlying software. This also implies that editor upgrades, including new functions, are easy to integrate into Orange’s workspace solution and, via the widgets, onto contact center desktops.

On the business level, Flexible Contact Center addresses the needs of users to have workspaces that are personalized to their jobs and that can evolve as the business and the jobs change. Contact centers are used in different ways in a variety of industries to carry out various functions such as telesales / telemarketing, customer service, IT help desk, field service management, account collections and so forth. Even within the same center, different agents (and of course supervisors) have differing responsibilities and needs.

In this context, the differentiating business benefit of Orange’s web based workspace is the easy personalization of contact center desktops to meet these numerous and very specific requirements, with only limited need for specialized IT resources to do it.


Success at the international level will be challenging

While Orange does seem to have achieved a certain level of competitive advantage in building this solution, success at the international level will depend (as always) not only on the quality of “the product” but also on market “execution”.

We assume that the company will focus on geographies where it already has strengths, but even there we see at least three important “execution” challenges:

  • Market mind-share and messaging

Orange is an established contact center player in its French home market but much less so on the international scene. It needs to engage with international markets to the point where it is seen as a major player and a natural candidate for calls to tender.

The company has formidable resources for market communication, but it also needs to get “the pitch” exactly right for business decision makers. In our opinion, the real story in this announcement is not so much “the cloud” as such, but rather the business value of the solution and how Orange delivers it.

  • Sales force education and mobilization

Like other big services providers, Orange has a lot of things to sell. Outside of France in particular, even getting the attention and interest of the sales force is no small matter. In addition, selling contact center solutions will require that sales people access and fully engage with both business and IT decision makers at various levels within the potential customer’s organization.

On an upbeat note, however, selling a contact center solution may offer interesting potential for cross selling related offers. With a hosted contact center, for example, it may make sense for the customer to consider moving applications such as CRM into the Orange cloud.

  • Delivery and support

The implementation and support of a secure and well managed contact center, whether hosted or on premises, will necessarily involve different parts of Orange’s organization working seamlessly together. This is hard enough in the French home market and potentially even more challenging on an international scale.

The “customer experience of delivery” will be fundamental in achieving customer satisfaction, developing Orange’s international reputation in contact centers and achieving market success.

CONCLUSION

With Flexible Contact Center, Orange has a strong story to tell. In terms of “product”, the company can now reasonably claim that its cloud hosted service runs on a world class, state of the art software “motor” and that it has also added real value, in terms of the business and IT flexibility that its customers need to get the most out of their investments.

On the strategic level, Orange has announced the goal of doubling international contact center revenues over the next three years. This ambition appears to be achievable, but successful market execution will certainly be the biggest challenge.

Monday, November 26th 2012
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Duquesne Advisory

Duquesne Advisory Ltd is a European firm, headquartered in the UK, dedicated to researching, understanding and advising clients worldwide on opportunities and trends in Information and Communications technology.

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Duquesne Advisory delivers in-depth analyses of Information and Communications Technologies, their implementations and their markets. Research is based on critical observation of the market by the analysts and their on-going contacts with the vendor community, together with hands-on, practical experience in consulting engagements.

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The analysts of Duquesne Advisory leverage the Firm’s ongoing market and technology research to undertake high added value consulting engagements for both ICT users and ICT providers. Focused on client service, their approach is rigorous and methodical, and at the same time pragmatic and operational.