Speech analytics: Invest now or wait?
Speech analytics: Invest now or wait?
By Donna Fluss
The speech analytics market might be in its infancy, but it’s definitely developing at a rapid pace. In fact, at DMG Consulting, we expect the contact center speech analytics market to grow at a rate of at least 120% in 2006 and 100% in 2007. The reason is obvious: there is an abundance of rich but unstructured information that comes directly into the contact center — and speech analytics systems structure conversations and extract the invaluable data and insights hidden in customer interactions.
Today, most speech analytics applications analyze recorded conversations. But in the future, the analyses will take place in real time, while the customer is on the line. This will enable contact centers to be more proactive and provide customers with an outstanding customer experience that builds loyalty and drives revenue.
Contact center managers are constantly challenged by budget constraints and are asked to absorb increased volumes of transactions without additional resources. At the same time, they are looking for ways to enhance the customer experience, improve service quality and increase revenue. Speech analytics, when implemented properly, have the potential to accomplish all of these goals. Perhaps even more compelling, organizations can identify and document the impact of sales and marketing initiatives and operational issues (such as a billing problem) on the contact center and other functional organizations. Empowered with this new information, contact center managers will be able to rapidly identify and explain why transaction volumes are growing. They can then work with the appropriate organization(s) — marketing, sales or operations — to effectively address and manage the root cause. Speech analytics function as an early warning system, providing tools to rapidly and unambiguously identify trends and issues so that the enterprise and its respective managers can respond much sooner than was previously possible.
Like most new software applications, speech analytics have endured a rather rocky start. Some early adopters have not been pleased with their results. There are and will continue to be problems and glitches, but failed implementations occurred for all the typical reasons — poor planning, lack of best practices, inadequate management support and follow-through and under-trained users. Consequently, over the past nine months, an increasing number of success stories have emerged with positive and quantifiable benefits.
Speech Analytics ROI
The payback period from successfully implemented speech analytics applications is approximately nine to 12 months. Achieving real benefits takes significant investments of time and resources. Best practices are just emerging and are available only through expensive professional services offerings. But as speech analytics expertise becomes more widely available, we expect the payback period will be reduced to less than nine months. Once sales and marketing begin to use these applications and incremental revenue is included in the ROI calculations, the return will be realized even faster.
Invest or Wait?
The speech analytics market is still immature — though some of the underlying technology has been under development for more than 20 years. In spite of limitations in accuracy and ease of use, the current batch of speech analytics offerings can bring substantial value to enterprises and their contact centers. While the technology is certain to improve significantly during the next five years, the information these products are now capable of identifying — when implemented and managed properly — will have a substantial positive impact on how businesses operate.
Today’s speech analytics applications provide information that is directionally accurate. In other words, they are good enough to spot trends, identify the underlying reasons for customer calls (root cause analysis), improve the effectiveness of quality assurance programs, reduce fraud, determine if agents are adhering to their scripts and much more. But these applications can also be used for activities that extend beyond the boundaries of contact centers; they can help identify new product ideas, determine which marketing campaigns are most successful, provide competitive information and drive revenue.
For now, enterprises will get an enhanced “big picture” from these applications, which are already identifying data that contact centers historically didn’t know or couldn’t access. Over time, as companies demand better insight and more complex functionality, speech analytics applications will need to become more accurate. The great news is that many vendors are devoting a substantial amount of R&D dollars to speech analytics technology and the underlying speech engines and recognition capabilities are improving.
Despite issues with accuracy and ease of use speech analytics products are viable, have been proven in the field and already have a strong demonstrated ROI. DMG Consulting recommends that forward-thinking companies invest in this technology, but commit to allocating the resources necessary to implement and use the system properly.