The decision maker’s guide to contact center quality management
The decision maker’s guide to contact center quality management
By Donna Fluss
Quality management (QM) and liability recording suites have improved dramatically during the last two years, with more innovation expected during the next 12 months. QM and recording suites now include quality assurance, recording (random and 100%), speech analytics, surveying, performance management, coaching and e-learning. Currently, two of these suites also include workforce management. Increasingly, these suites are being designed to incorporate an enterprise portal framework with advanced reporting. They are also set up to work well in multi-site contact center environments. Software-based Voice over Internet Protocol recording is now a high-value reality, and it is easier than ever for end users to implement.
Product innovation drive ROI
Product innovation is driving end-user demand for quality management suites. The core platforms (QM and recording) yield a rapid return on investment. The expected payback period is six to 12 months from the time the system is fully implemented. Newer applications, such as speech analytics, can speed up the financial return.
The QM/liability recording market continues to be in a state of transition. Vendors are realizing revenue from newly released modules, even though recording (also known as logging) has become a commodity, significantly reducing the price for this functionality. Most recording products are migrating from hardware-based offerings to software. The market also continues to consolidate. In 2005, Witness Systems closed its acquisition of Blue Pumpkin Software (workforce management), Nice Systems acquired Dictaphone’s Communications Recording Systems division and U.K.-based Autonomy Corp. acquired Etalk. All these moves are expected to strengthen QM/recording products and the market. New entrants, like CallCopy and Telrex, have also energized the market in the last couple of years.
It’s challenging to select a new QM and recording vendor because there are so many good options. Most vendors have enhanced their offerings to include value-added functionality and services to meet the needs of this growing and increasingly demanding market. (See Figure 1 for a market assessment.) This chart addresses each vendor’s ability to sell, build products, innovate, implement, deliver service, and support and satisfy its customers.
Figure 1: QM/recording contact center market product/execution positioning reflects the market leadership as of August 2005.
According to DMG Consulting LLC, as of the end of 2004, the four largest vendors, Nice Systems, Witness Systems, Verint Systems and Etalk, owned 90% of the $463 million contact center recording/QM market. (See Figure 2.) The entire recording market, including contact center, public safety, financial trading and air traffic control, was $814 million as of the end of 2004. DMG Consulting expects the overall recording market to grow by 12.5% to $916 million and the contact center component to increase by 14% to $528 million by the end of 2005.
Figure 2: Contact center QM/recording 2004 market share
The following is a high-level review of 11 of the vendors in this marketplace.
Top three vendors
Nice Systems returned to first place in the market in 2005. The company has revamped its products and consulting services, enhanced its management team and expanded its marketing efforts. Its most significant development was the Q4 2004 release of Nice Perform. This new product suite captured end-user attention, garnering significant market adoption in 2005. Nice Perform is the company’s first software-based offering, designed around an enterprise portal concept. In 2006Nice is expected to deliver enhanced functionality for Nice Perform, as well as improve its speech and text analytics capabilities. Nice also acquired the call recording division of Dictaphone Corp. in 2005. Nice has retained a large percentage of Dictaphone’s service staff and is now cross-training those employees to do Nice Perform implementations.
Verint Systems continues to execute well in 2005, retaining its leadership position in the market. The company is getting into more deals and has been aggressively building partnerships, particularly in the small and medium segment of the market where it has not been very active in the past. Verint is in the process of making substantial changes to its products and is planning to roll out an enhanced, services-oriented architecture-based product in 2006, which will include an enterprise portal framework. Verint is also continuing to invest in its speech analytics offering and intends to enhance its product with text analytics. Verint receives high marks from its partners and its customers are some of the most loyal in the market. Customer satisfaction with ongoing service and support remains high.
Witness Systems acquired workforce management vendor Blue Pumpkin Software in January 2005, changing the dynamics of this market. Witness’ marketing initiatives have been consistently excellent and instrumental in building the quality management marketplace. Witness recently released package pricing bundles for its family of QM and workforce management products. The company has started to see interest in these bundles, as compelling pricing is motivating cross-selling to the two customer bases. Witness’ challenge is to deliver new products and an enhanced architecture. In 2004, Witness moved much of its development organization offshore, enabling it to substantially increase the size of its research and development organization. Witness is planning to begin delivery of its new product platform in September 2005, including its first software-based, standalone recorder that can capture 100% of calls. In March 2006, Witness plans to deliver an enhanced suite with an integrated software-based recorder that supports time-division multiplexing, Internet Protocol, screen and voice. ((Content component not found.))
Etalk is the leader among the next tier of vendors. U.K.-based Autonomy acquired Etalk in June 2005. Autonomy provides technology that structures “unstructured” customer communications for both speech and text interactions. Autonomy has a speech analytics application that Etalk has integrated into its solution set. The merger enables Autonomy to up-sell to Etalk’s U.S.-based customers while allowing Etalk to benefit from access to Autonomy’s U.K.-based customers. Etalk will enjoy an influx of R&D dollars from its new parent, while retaining its name and keeping its management team intact. During 2004, Etalk invested more money in R&D on a percentage basis, and the company’s focus on product enhancements is expected to continue.
Mercom Systems utilizes a vast network of domestic and international business partners to target the public safety, financial trading, air traffic control and contact center markets. Though Mercom has traditionally targeted the government and public safety sectors, its sales to contact centers have steadily increased during the past couple of years. This is a direct result of Mercom having enhanced its QM offerings and expanded its product suite to include speech analytics. Mercom’s sweet spot is the midmarket, specifically 20- to 200-seat contact centers. Mercom has a strong engineering orientation.
Envision is the considered the founder of the contact center e-learning/coaching market. Its Click-2-Coach product is still a market favorite, which other vendors have tried to replicate. Envision has recently begun to compete more aggressively, bringing on a new head of sales and marketing in 2004. Envision made headlines in 2003-2004, when it became the first vendor in the QM market to offer a workforce management product. The company is seeking to increase its market reach by building its network of partners outside of North America.
VoicePrint has been selling recording products since 1994. The company uses a direct sales model and sells its products primarily to contact centers, financial services firms and public safety institutions. Though the majority of its sales are in North America, the company is aggressively building partnerships in other regions. VoicePrint offers a complete suite of products for contact centers and sells predominantly to the midsized segment of the market. An interesting point about VoicePrint is that 90% of its business involves a competitive replacement product, often where maintenance is a key customer issue.
HigherGround has been in the telecommunications business since 1973 when it began to design and manage telecommunication systems. HigherGround has since moved into the recording market, providing a complete suite of products, including QM, speech analytics and professional services. The company sells to contact centers, public safety and financial trading floors, mainly in North America.
ASC, a German-based QM/recording vendor, targets public safety, financial trading and contact centers. ASC is trying to expand its North American footprint, but is impeded by its conservative marketing spending. ASC was the first to release a Linux-based recorder and has other innovative product capabilities.
Magnetic North Software, based in the U.K., provides software-based recording systems that include QM, recording, speech analytics, performance management, surveying, and e-learning products and services. Magnetic North also offers a multi-tenant hosted product that enables users to run multiple applications off the same server with separation and security. Magnetic North concentrates its sales efforts in Europe, but is expected to establish and solidify partnerships that will bring the company into North America. Magnetic North’s sales philosophy differentiates the company; it is committed to selling seats that include all its capabilities, instead of having customers purchase modules separately.
VoiceLog offers hosted QM/recording products, including speech analytics. Prior to releasing its hosted QM/recording product in 2004, VoiceLog sold third-party verification services to contact centers for almost 10 years. VoiceLog has leveraged its experience with recording and storage systems to build a suite of hosted recording and QM products.
It’s time to invest in QM/recording suites
Companies of all sizes and in all vertical markets can benefit from the new crop of QM/recording systems and associated value-added applications, such as speech analytics, performance management, surveying and coaching. As the tactical and strategic mission of a contact center evolves from that of a reactive cost center to a proactive, engaged profit center, companies will have little choice but to purchase new QM/recording suites or upgrade existing ones to remain competitive. Choosing the appropriate vendor in a crowded and rapidly changing market isn’t easy, but it’s worth taking the time to select the best strategic partner for your company.