Workforce Optimization (WFO) Product and Market Report Reprint. Reprinted for:
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1 Workforce Optimization (WFO) Product and Market Report Reprint Reprinted for:
2 Table of Contents 1. WFO Market Projections for 2014 through WFO Vendor Satisfaction Analysis Summary of Survey Findings and Analysis... 8 About Calabrio About DMG Consulting LLC i - DMG Consulting LLC
3 1. WFO Market Projections for 2014 through 2018 The contact center WFO market has experienced a wonderful run for the past 15-plus years. It has grown well, often outperforming other contact center and IT sectors when budgets have been tight, and selling very well when the economy and IT spending have been going strong. Growth has been fueled by essential nature of the 2 core WFO applications: recording and QA. Helping along the growth and expansion of these solutions has been the introduction of 8 complementary applications: workforce management, contact center performance management, speech analytics, text analytics, desktop analytics, surveying, coaching and elearning. The contact center WFO market is still attracting substantial investments, many of which are coming from organizations replacing their core infrastructure, typically purchasing a new recording system. This often drives an investment in a new QA solution, which in turn results in investments in at least a few or more (if it s a large enterprise) of the 8 non-core contact center suite applications. The challenge for vendors is that enterprises do not think they should pay as much for recording, or even QA, as they did in the past. Most companies view recording as a commodity, a concept that is supported by the availability of recording solutions from WFO, contact center infrastructure and many standalone providers. Additionally, the availability of SIPREC-based products from cloud-based contact center infrastructure vendors is promoting the view that recording functionality is a simple utility. With a couple of exceptions, such as NICE s greatly enhanced recording functionality, recording has become rather commoditized. DMG Consulting expects companies to continue to invest in contact center WFO solutions, but the rate of growth is expected to decrease. This is partially due to the high penetration rate of some of the WFO suite modules specifically, recording, QA, and even WFM in large contact centers in developed economies. The largest opportunities for increasing the sales of WFO are in emerging economies, particularly in Asia and in under-penetrated sectors like the back office. Although this Report concentrates on the contact center, DMG has other research that identifies the potential for back-office WFO, and it is substantial. Revenue from WFO applications is expected to grow as follows: 1. Recording: Companies are going to continue to purchase recording solutions, but there is going to be downward pressure on the price they are willing to pay. DMG expects recording revenue to grow by approximately 1% per year between 2014 and DMG Consulting LLC
4 2. Quality Assurance/Quality Management: DMG expects sales of QA/QM applications to grow by 4% in 2014, 2015 and 2016, and then for the rate to decrease to 3% in 2017 and A large percentage of contact centers with more than 300 seats already use these packaged applications and, if they make a purchase, it is to replace an existing solution. An increasing percentage of these replacements are for analytics-enabled QA solutions, and the revenue for these systems is typically allocated to the speech analytics bucket. 3. Workforce Management: The potential for sales of WFM solutions is greater than for recording and QA, as a significant number of companies have not replaced their installed solution for many years. DMG predicts that WFM revenue will increase by 10% in 2014, 11% in 2015 and 2016, 10% in 2017, and 9% in The reason why companies have not replaced their existing WFM solution for 8 12 years is that they have not found a new offering compelling enough to justify the cost and effort of replacement. For the past 15-plus years, leading contact center WFM vendors have not spent substantially on R&D for their solutions, as they were concerned that they would not be able to recoup their investments. (The vendors only made investments that were necessary to keep up with competitors.) This is starting to change due to the potential of selling WFM to back-office operating environments. However, contact centers will also benefit from some of these changes. 4. Contact Center Performance Management: The adoption rate of packaged CCPM solutions remains very low, which creates a relatively large potential upside for this solution. DMG predicts that revenue from sales of CCPM solutions will increase by 14% in 2014, 2015 and 2016, and by 12% in 2017 and All contact centers need CCPM, as it provides a quantifiable and repeatable process for measuring the performance of the contact center and its agents. Unfortunately, too many contact centers view CCPM as just advanced reporting and are not able to, or even interested in, building a business case to justify an investment in one of these solutions. 5. Speech Analytics: This product remains the sweetheart of the contact center market in terms of growing adoption. DMG predicts that revenue from sales of speech analytics solutions will increase by 20% in 2014, 18% in 2015, 16% in 2016 and 2017, and 14% in Post-call speech analytics solutions are finally mature enough to be used by most contact centers. The critical success factor is investing the resources and time to take full advantage of its capabilities. Real-time speech analytics is an emerging application that is still looking for ideal use cases. DMG believes that real-time speech analytics will become a critical input to the predictive analytics platforms that will power a future generation of contact center systems DMG Consulting LLC
5 6. Text Analytics: This application remains one of the toughest to sell to contact centers. It s surprising, because in many companies, the managers who are purchasing speech analytics are delaying investments in text analytics. The adoption rate of text analytics in contact centers remains very low, and this is expected to continue until social customer care becomes a cornerstone in contact centers. When this happens, text analytics will take off, but DMG expects it to be incorporated into thirdparty applications. Despite these challenges, more companies are buying these applications. DMG predicts that the growth rate of text analytics will be 25% in 2014 through 2017, and 22% in (Text analytics is currently at a low base.) 7. Desktop Analytics: Companies that want to improve their servicing applications and reduce the amount of copying, cutting and pasting, and screen switching performed by their agents, should consider using desktop analytics (DA). But first they have to find out about the uses of DA, which is not so easy to do, as there is very little marketing to support these solutions. The current adoption rate of DA is low, and DMG expects it to continue this way. DMG expects the revenue from DA-related activities to increase from its current small base by 25% in 2014 and 2015, 30% in 2016 and 2017, and 28% in Surveying: Surveying is an essential business activity that continues to be badly handled by too many organizations around the world. If there is any doubt about the lack of surveying best practices, consider the number of times you are asked to complete a survey, and the scarcity of follow-up from the companies whose surveys you ve completed. However, organizations continue to invest in these solutions in the hope that they ll provide a magic bullet to help improve their customer experience. DMG expects revenue from surveying applications to increase by 18% in 2014, 15% from 2015 through 2017, and 13% in There appear to be a large number of surveying applications available in the market, many on a stand-alone basis. However, once social media becomes a core servicing channel, it is likely that the volume of surveying will decrease. 9. Coaching: DMG does not expect the WFO vendors to earn much revenue from coaching applications, because few of them are charging for these solutions. End users expect coaching to be a core component of a QA or ACD application, and do not expect to pay separately for this functionality. 10. elearning: This remains an independent application that is associated with WFO suites. elearning has never experienced a period of major growth in contact centers (or enterprises, for that matter), but is viewed as a nice to have by many managers. DMG expects elearning to continue to limp along and experience a consistent growth rate of 5% for the period DMG Consulting LLC
6 from 2014 through elearning has many benefits for contact centers, but all too often other investments take priority. The majority of WFO suite and application sales in contact centers today are premise-based, but DMG expects this to change during the next 5 8 years as more contact center activity moves to the cloud. As this happens, short-term revenue from sales of these applications will decrease due to the cloud business model, where revenue is spread out over time rather than being highly concentrated in the purchase year DMG Consulting LLC
7 Figure 1: WFO Application Projections, Source: DMG Consulting LLC, December DMG Consulting LLC
8 2. WFO Vendor Satisfaction Analysis On an annual basis, DMG Consulting conducts independent customer satisfaction surveys to measure end-user satisfaction with vendors and their products, as well as their service, support, professional services, training and innovation. DMG conducts these studies because they provide great insights into general market trends and challenges, in addition to end-user satisfaction and concerns about vendors, as participants are open and candid in sharing their successes and challenges with us. This year s study evaluates the performance of the 13 vendors analyzed in detail in the Workforce Optimization Product and Market Report: Avaya, Calabrio, dvsanalytics, Envision, incontact/uptivity, Interactive Intelligence, KnoahSoft, NICE, OnviSource, TelStrat, Verint, VPI and ZOOM. Eleven of the 13 vendors in this year s satisfaction analysis were covered in the prior year s study; dvsanalytics and Envision, are new participants. To perform this analysis, each of the 13 vendors was asked to provide the names of 5 customers who had agreed in advance to participate in the satisfaction survey. These references could not be the same ones provided for the 2013 Report. Since confidentiality is important to the reference participants and respected throughout our process, the names of the references and the companies that they represent are not directly attributed to any of the comments or ratings included in the customer satisfaction analysis. The research for DMG Consulting s customer satisfaction survey was conducted as follows: 1. The WFO vendors were asked to provide contact information for the customers participating in the satisfaction study. 2. DMG Consulting sent the participating customers an with a link to a Web survey. The survey consisted of 12 questions, which fell into the following categories: 1. Customer background name of their WFO provider; the top 3 to 5 primary reasons for selecting the vendor/product; the top 3 to 5 benefits realized from using the solution; the modules implemented; and the channels supported. 2. Product satisfaction detailed product satisfaction ratings for the following 16 product categories: supervisor interface and features, agent interface and features, recording feature set, quality management feature set, analytics-enabled QA capabilities, multi-channel capabilities, coaching DMG Consulting LLC
9 capabilities, security features, historical reporting, real-time reporting, ad hoc reporting, dashboards. overall breadth of suite functionality, ease of administration/configuration/use, ease of integration with third-party applications and ability to share data between suite modules. 3. Rating of the WFO solution s effectiveness in providing business benefits across 9 categories, including the ability to: improve productivity, improve quality, improve agent performance, monitor and track adherence to regulatory requirements, share data across modules to improve the output of the solution, track and measure all aspects of the multi-channel/crosschannel customer journey, improve the customer experience, identify issues, trends and root causes, and help the contact center meet or exceed enterprise goals. 4. Rating of satisfaction levels across 10 vendor categories, including: implementation, training, professional services, ongoing service and support, current product, planned product innovation, responsiveness to product enhancement requests, vendor communication, pricing, and overall satisfaction with the vendor. 5. Open-ended questions product enhancements that the references would like to see; top 3-5 strengths and challenges of their WFO solution; and an open invitation for participants to express general thoughts about their experience with the vendor. A total of 39 customer survey responses (3 from each vendor) were received. The vendor satisfaction ratings reported below were calculated by averaging the scores provided by customers for each vendor and category, using the point scale in Figure 2. Figure 2: Customer Survey Satisfaction Rating Categories and Point Scale Satisfaction Rating Points Assigned Completely Satisfied 5 Highly Satisfied 4 Satisfied 3 Somewhat Satisfied 2 Not Satisfied 1 Source: DMG Consulting LLC, December DMG Consulting LLC
10 2.1 Summary of Survey Findings and Analysis The figures and analysis that follow represent the results of DMG Consulting s WFO customer satisfaction survey. This section of the analysis examines customer satisfaction ratings across the 10 major satisfaction categories in the survey. These include: implementation, training, professional services, ongoing service and support, current product, planned product innovation, responsiveness to product enhancement requests, vendor communication, pricing, and overall satisfaction with the vendor. Of the 13 vendors shown in Figure 3, ZOOM achieved the most notable results with a perfect score of 5.0 (completely satisfied) from all customer references in all 10 satisfaction categories. Calabrio followed closely, earning a perfect score in 9 of the 10 categories. NICE achieved a perfect score in 4 categories; professional services, current product planned innovation and overall vendor satisfaction. Professional services was the highest-ranked category, with an average score of Calabrio, NICE and ZOOM each earned a perfect score of 5.0, followed by a tie in second place with dvsanalytics and TelStrat, each with a score of 4.66 (highly satisfied). Current product and overall vendor satisfaction were tied for second place, each with an average score of Overall vendor satisfaction scores do not represent the average of the other categories; this is a separate category where customers were asked to rate their overall satisfaction with all aspects of their vendor relationship. Calabrio, NICE and ZOOM each achieved a perfect score, 5.0 (completely satisfied) for both categories. dvsanalytics and OnviSource were tied in second, each with a score of 4.66 for satisfaction with current product. dvsanalytics and TelStrat were tied in second for overall vendor satisfaction, with scores of Implementation was the third highest scoring category, achieving an average score of 4.15 (highly satisfied). Calabrio and ZOOM took top honors, achieving perfect scores of 5.0. dvsanalytics, TelStrat and VPI were tied in second place with scores of 4.66 (highly satisfied). The fourth-ranked category, vendor communication, earned an average score of Calabrio, dvsanalytics and ZOOM earned first place by earning perfect scores of 5.0 (completely satisfied). NICE followed in second place with a score of 4.66 (highly satisfied). Ongoing service and support ranked in fifth place in terms of customer satisfaction, with an average score of Calabrio and ZOOM achieved a perfect score of 5.0, followed by dvsanalytics, NICE and TelStrat with Three categories were tied for sixth place; training, planned product innovations and pricing each came in with an average score of ZOOM achieved a perfect score in training, followed by Calabrio, dvsanalytics, NICE and TelStrat, each with scores of The training category had the DMG Consulting LLC
11 highest range, 2.67, which suggests important differences in the training delivered by the 13 vendors in this analysis. Four vendors Calabrio, dvsanalytics, NICE and ZOOM all achieved a perfect score for planned product innovations. In second place with scores of 4.33 (highly satisfied) were incontact/uptivity, OnviSource and TelStrat. Calabrio and ZOOM were tied with perfect scores in the pricing category. Responsiveness to product enhancement requests was the lowest-ranked category, earning an average score of 3.94 (satisfied). Calabrio, dvsanalytics and ZOOM shared the top spot, each achieving a perfect score. NICE followed in second place with Figure 3 shows the average satisfaction ratings by category for each of the 13 vendors DMG Consulting LLC
12 Figure 3: Average Satisfaction Ratings, by Category Vendor Implementation Training Professional services Ongoing service and support Current product Planned product innovations Responsiveness to product enhancement requests Avaya Calabrio dvsanalytics Envision incontact/uptivity Interactive Intelligence KnoahSoft NICE OnviSource TelStrat Verint VPI ZOOM International Category Average Range Notes: 1. These scores do NOT represent the average of the other categories; this is a separate category where customers were asked to rate their overall satisfaction with all aspects of their vendor relationship. Source: DMG Consulting LLC, December 2014 Vendor communication Pricing Overall vendor satisfaction DMG Consulting LLC
13 About Calabrio Calabrio elevates the customer experience and drives strategic business growth through workforce optimization (WFO) and voice of the customer (VoC) analytics solutions. The integrated Calabrio ONE software suite including call recording, quality management, workforce management and analytics solutions empowers customers to connect their corporate strategy to their customer engagement strategy by liberating the data that provides true insight into the voice of the customer. A pioneer in its industry for more than two decades, Calabrio is also a member of the Cisco Solution Partner Program and the Avaya DevConnect program. Calabrio s latest Workforce Management innovation, Dynamic Scheduling, a take on modern shift-bidding, lets everyone on the team have a role in the process of staffing to levels never before possible while still guaranteeing the contact center s ability to meet staffing needs. Calabrio is also the only workforce optimization provider to integrate speech, desktop, and text analytics into a single, unified offering. Calabrio Analytics allows organizations to make better, faster, more consistent data-driven decisions to protect and grow their business by discovering the true nature of 100 percent of conversations. About DMG Consulting LLC DMG Consulting LLC is a leading independent research, advisory and consulting firm specializing in contact centers, back-office and real-time analytics. DMG provides insight and strategic guidance and tactical advice to end users, vendors and the financial community. Each year, DMG devotes more than 10,000 hours to producing primary research on IT sectors, including workforce optimization (quality management/liability recording), speech analytics, workforce management, performance management, desktop analytics, surveying/voice of the customer, text analytics, cloud-based contact center infrastructure, dialing, interactive voice response systems and proactive customer care. Our actionable solutions are proven to deliver a lasting competitive advantage, and often pay for themselves in as little as three months. This reprint is excerpted from the Workforce Optimization Product and Market Report, which was released in January 2015 with the permission of DMG Consulting LLC. More information about this Report and DMG Consulting is available at DMG Consulting LLC
14 2015 DMG Consulting LLC. All rights reserved. This Report is protected by United States copyright law. The reproduction, transmission or distribution of this Report in whole or in part in any form or medium without express written permission of DMG Consulting LLC is strictly prohibited. You may not alter or remove any copyright, trademark or other notice from this Report. This Report contains data, materials, information and analysis that is proprietary to and the confidential information of DMG Consulting LLC and is provided for solely to purchasers of this Report for their internal use. THIS REPORT AND ANY DATA, MATERIALS, INFORMATION AND ANALYSIS CONTAINED HEREIN MAY NOT BE DISCLOSED TO OR USED BY ANY OTHER PERSON OR ENTITY WITHOUT THE EXPRESS PRIOR WRITTEN CONSENT OF DMG CONSULTING LLC. Substantial effort went into verifying and validating the accuracy of the information contained within this Report, however, DMG Consulting LLC disclaims all warranties as to the accuracy or completeness of this information. DMG Consulting LLC shall not be liable for any errors or omissions in the information contained herein or for any losses or damages arising from use hereof DMG Consulting LLC
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