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by Jed Hewson, 1Stream

Gartner has said that by the end of 2013, 75% of global call centers will be making use of the hosted call center model – which leaves 25% of call centers likely relying on premise-based solutions that use their private branch exchange (PBX) to perform basic call center capabilities, along with several bolt-on solutions and platforms.

It’s not to say that on-premise solutions aren’t doing the job they were intended to do – but those jobs may very well have become redundant in a world that demands a multi-faceted, multi-channel call center, nor are they the most efficient, or cost effective way of working. Any enterprise with premise-based equipment that is at the end of its life cycle has to at least consider the benefits of moving to the cloud before investing in a replacement or upgrade of their current system.

It’s safe to say that most of the legacy on-premise call center equipment in use today has become obsolete – simply due to the very nature of the industry. On-premise equipment represents a significant Capex investment – depending on the size of your call centre, you may very well have invested several million into the equipment alone. This investment would have been “paid off” over several years of use. But sadly, not even the most top-notch futurist can predict customer behavior – or what technology is going to prove disruptive – over the next five years.

A contact center that was designed and deployed a mere five years ago would not even have made provision for social media or smart devices – which means that no provision would have been made for the technology or business processes that customers are demanding, leading to frustration…and a loss of business. We’re living in the era of the customer experience – with customers using search engines, social media, Wikis and forums rather than just phone and email. Moreover, customers are dictating how they want to communicate with businesses, not the other way around.

Conventional contact centers have tried to stay abreast of the changes by adding functionality, but too many add-on remedies can result in layers of complexity and solutions that are hard to manage or change…especially if the upgrades were left in the hands of a single IT employee, who may walk out and take the knowledge of how to work the system along with him.

This has lead to a crucial boiling point for businesses – either stop investing in the old technology, and turn to what’s new and flexible. In some instances, their vendors made the decision for them with end-of-life announcements and discontinued product lines.

Modern call centers must keep evolving to keep abreast with customer trends – and the cloud can not only accommodate that, but do so at a much lower cost. In addition, moving to a hosted model represents a much lower risk than investing in new on-premise technology, because it operates on a “pay-as-you-go” model. If the hosted service provider does not deliver what he promises in the service delivery contract, it is relatively easy to switch to a new provider who will.

The switch itself is quick and painless – an on-premise solution may take up to 3 months or more to install, modify and roll out, but graduating to the cloud takes two weeks or less. It may be oversimplifying the process, but essentially, it involves plugging into a system that has already been running successfully for years and making adjustments as required. The expertise needed to deploy, maintain, modify and fine-tune the various components of the technology is employed behind the scenes and without user concern.

My advice to anyone that’s debating whether to upgrade or ditch their on-premise system? Take a cold analytic look at all aspects of the current system. It might sting to consider the time, effort and expense that went into your current solution – but the only thing that truly matters is the future. If you are currently hosting your own contact center, you have to factor new hardware, operating, database, middleware, application and labor costs into the equation. Then consider the trends in the marketplace – such as remote agents – as well as the need that may arise to up- or downscale according to demand, as well as the cost of upgrading.  These considerations are automatically catered for by hosted providers in the cloud – and included in their fee.

25% of call center managers are still holding onto on-premise solutions – but the end is nigh. Their competition, in the meantime, will be spending their time and resources servicing the needs of customers, rather than focusing on making the technology work.

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