Call Center Era Report Full

AberdeenGroup
The Customer Contact Center

Technology, Trends, and Investment Plans for the Customer Contact Center: 20032004
April 2003
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Aberdeen Group, Inc. Aberdeen Group is a leading IT market analysis and positioning services firm that helps Information Technology vendors establish leadership in emerging markets. This research study is the result of research performed by Aberdeen Group in partnership with CNET Networks, Inc. CNET Networks, Inc. is a leading source of information and services for buyers, sellers, and suppliers of technology, including IS/IT professionals, enterprise decision makers, executives, and technology shoppers. As a top 10 Internet company with established Web sites throughout the United States, Europe and Asia, CNET Networks provides its content via the Web, wireless devices, broadband, radio and print. Aberdeen Group performs specific projects for a select group of domestic and international clients. Each project requires a combination of strategic advice and pragmatic, experience-based action plans. Assignments range from corporate and product positioning and organizational planning to in-depth market segment research. Aberdeen consults on mergers and acquisitions, corporate positioning and investor relations, and transaction-processing benchmarks; in addition, it offers special expertise in software and midrange computer markets. In carrying out assignments, Aberdeen uses a proprietary, comprehensive, analytical framework providing fresh insight into the complex future of computing and communications, both from technological and market-dynamics perspectives. Aberdeen also offers retainer-fee programs to a group of continuing clients. Aberdeen principals and staff are recognized industry figures with hundreds of years of combined high-tech industry, research, and financial community experience among them. They are quoted extensively in industry trade and business publications. Each staff member is a frequent conference and seminar speaker. In addition to client-related research and consulting, Aberdeen publishes several periodicals, Aberdeen Viewpoints, and Profiles, which summarize its analysis and research findings. To provide us with your feedback on this research, please go to www.aberdeen.com/feedback.
The information contained in this publication has been obtained from sources Aberdeen believes to be reliable, but is not guaranteed by Aberdeen. Aberdeen publications reflect the analysts judgment at the time and are subject to change without notice. The trademarks and registered trademarks of the corporations mentioned in this publication are the property of their respective holders. Warning: This publication is protected by United States copyright law and international treaties. Unless otherwise noted, the entire contents of this publication are copyrighted by Aberdeen Group, Inc. and may not be reproduced, stored in a retrieval system, or transmitted in any form or by any means without prior written consent. Unauthorized reproduction or distribution of this publication, or any portion of it, may result in severe civil and criminal penalties, and will be prosecuted to the maximum extent necessary to protect the rights of the publisher. 2003 Aberdeen Group, Inc., Boston, Massachusetts
Technology, Trends, and Investment Plans for the Customer Contact Center: 2003 2004
Table of Contents
Preface.................................................................................................................1 Chapter One: Methodology and Overview ..........................................................3 Chapter Two: Primary Research Environment and Participation........................6 Industry, Company, and Executive/Management Background ................ 6 Chapter Three: Key Top Level Findings ............................................................ 11 Chapter Four: The Customer Contact Center: Priorities and Perceptions in the Enterprise........................................................................................................... 14 What is the strategic importance of the contact center in the enterprise? How critical a role does the contact center play in the enterprise? ...................... 15 What is the biggest management challenge in regards to the organizations contact center?......................................................................................................... 16 Chapter Five: Outsourced Contact Centers ...................................................... 19 What do executives think about the possibility of outsourcing some or all of their companys contact center operations to a third-party outsourcer? What would their primary motivation be to turn to an outsourced contact center solution? What geographic regions would they be likely to consider? ........................................................................................ 19 Chapter Six: Investment and Spending Plans ................................................... 24 Key Findings: Spending and investment plans ............................................ 24 Key Findings: Spending and Investment on Technologies and Services ..... 26 Chapter Seven: Technology and Investment Plans by Region and Size ........... 33 Key Findings: Technology and investment plans................................... 33 Author Profile ..................................................................................................... 43 Appendix A: Lexicon of Acronyms and Abbreviations....................................... 45 Appendix B: Related Aberdeen Research ......................................................... 47
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Figures
Figure 1: Executive Roles in the Contact Center..................................................7 Figure 2: Job Title and Function in the Contact Center ........................................8 Figure 3: Vertical Industry Representation ...........................................................9 Figure 4: Geographic Distribution....................................................................... 10 Figure 5: Total Agent Seats by Contact Center Size........................................... 12 Figure 6: Customer Interactions by Type............................................................ 12 Figure 7: Contact Center Function ..................................................................... 13 Figure 8: Strategic Importance of the Contact Center in the Enterprise ............. 15 Figure 9: Maintaining/Improving Customer Satisfaction Levels.......................... 16 Figure 10: Maintaining or Improving Service Levels with Reduced Budgets ...... 17 Figure 11: Managing Confusion and Uncertainty Over the Introduction of New Technologies ...................................................................................................... 17 Figure 12: Managing Involvement from Senior Management............................. 18 Figure 13: Motivation for Using Outsourced Services ........................................ 20 Figure 14: Reduce Costs of Customer Service .................................................. 20 Figure 15: Deal with Growth in Volume of Customer Calls................................. 21 Figure 16: Focus Internal Resources on Core Competencies............................ 21 Figure 17: Inability to Find Qualified Agents Locally ........................................... 22 Figure 18: Country Selected As Likely Source for OCC Services....................... 23 Figure 19: Spending and Investment Changes: 20022003 .............................. 25 Figure 20: Plans to Deploy or Upgrade to Multichannel Contact Center ............ 27 Figure 21: Plans to Deploy IP Contact Center.................................................... 28 Figure 22: Plans to Invest in Enterprise Routing ................................................ 28
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Figures
Figure 23: Plans to Invest in Customer Experience Management or Multimedia Recording........................................................................................................... 29 Figure 24: Plans to Invest in Contact Center Analytic Tools ............................... 30 Figure 25: Plans to Invest in Outsourced Contact Center Services.................... 31 Figure 26: Plans to Invest in Workforce Management Tools............................... 32 Figure 27: Deployment Plans: Contact Centers > 5,000 Agents ........................ 34 Figure 28: Technology Deployment Plans: 2,500 to 5,000 Agents .................... 35 Figure 29: Technology Deployment Plans: 1,000 to 2,500 Agents ..................... 36 Figure 30: Technology Deployment Plans: U.S. ................................................. 37 Figure 31: Technology Deployment Plans: Europe............................................. 38 Figure 32: Technology Deployment Plans: Asia/Pacific Rim and Australia ........ 39 Figure 33: Outsourced Contact Center Plans by Size........................................ 40 Figure 34: Outsourced Contact Center Plans by Region.................................... 41 Figure 35: Technology and Investment Plans: All Regions................................. 42
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Preface
The current environment of economic malaise, uncertain global events, and the lingering technology recession makes for a challenging operating environment for companies in a variety of industries. Capital investments in general, and technology investments in particular, have been particularly hard hit over the past 18 months and indicators are, in general, far from reassuring. Commerce cannot and will not grind to a halt, however, and companies are continually challenging themselves and their suppliers to identify investment areas that will generate a positive return on investment. The customer contact center seems to be one of the few segments holding its own in an otherwise bleak technology investment environment. Buoyed by the ongoing challenge to reduce costs, improve customer satisfaction, and (ultimately) to grow revenues, small, mid-sized, and large enterprises are looking at their contact center operations to identify areas of potential opportunity. The contact center continues to be the largest single channel through which most organizations communicate with their customers and constituents. Buoyed by investments in ancillary customer-facing initiatives, such as customer relationship management (CRM) applications, Web-based customer initiatives, customer experience management (CEM) technologies, and others, the contact center continues to be one of the most cost-effective and profit-effective ways to maintain marketing, sales, and service-centric communications with the customer. Aberdeen Group and CNET are pleased to present this collaborative research initiative, The Customer Contact Center: Technology, Trends, and Investment Plans for the Customer Contact Center: 2003 2004. This report is Aberdeens most recent coverage of the wellestablished customer call and contact center segment of CRM. In addition to this current research, Aberdeen Groups ongoing coverage of CRM includes specialized research, consulting, and reports that cover areas including marketing automation, CRM for the smalland medium-sized business (SMB) market, CRM professional services, customer support, and service management.
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Additional Aberdeen Group research that covers CRM segments includes the following: What Works: Ten Significant Implementations in Customer Call and Contact Centers (November 2002) is a global best practices survey of call and contact center case studies for 2002. Worldwide CRM Spending: Forecast and Analysis 2001-2005 (July 2002) provides market share, growth projections, and rankings for the CRM industry. What Works in Europe: Success Stories in Customer Relationship Management (March 2002) highlights notable CRM implementations in the European marketplace.
A listing of Aberdeen Group publications, reports, and research in the areas of CRM and call and contact centers can be found in Appendix B at the end of this report. Readers are also encouraged to visit Aberdeen Groups Web sites, www.aberdeen.com and www.crmaccess.com, for comprehensive CRM and contact center research that is made available at no cost to qualified executives and users.
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Chapter One: Methodology and Overview

Aberdeen Group, a leading industry analysis and positioning services firm, and CNET, one of the largest technology media organizations in the world, with more than 4.5 million readers and viewers, collaborated on a unique research initiative that began in late 2002 and terminated in March 2003. The research was designed to gain an understanding of how executives in companies across a range of industries perceived the role of the contact center in their organization, and to understand how their perception of and experience with the contact center affected their investment and adoption plans for key contact center Aberdeen believes technologies, services, and outsourcing services. that the perceived Ultimately, the perceptions of these senior execuvalue of the contact tives are likely to signal technologies and trends that will and will not gain traction in the contact center by senior excenter industry over the next 18 months. ecutives would directly impact a comThe premise for the research was fairly straightforward. Aberdeen believes that the perceived panys overall spendvalue of the contact center by senior executives ing on technology for would directly impact a companys overall spendthe contact center, ing on technology for the contact center, and that a and would correquantitative understanding of these executives late directly to underopinions would correlate directly to understanding standing how investhow investments in technology would evolve. ments in contact cenThis research initiative focused on understanding ter technology would the values and perceptions that executives hold evolve. concerning their companys contact center operations and the role that these contact centers played in the companys strategic initiative to expand market share, grow revenues, and to attract, attain, and retain customers. Given the economic and political uncertainty that is impacting both buyers and vendors of technology, the research focused on the relatively immediate future 6, 12, and 18 months rather than trying to take a long-term-prognostication position based primarily on extrapolating the recent past. As Yogi Berra once said, The future isnt what it used to be. This Aberdeen/CNET research takes a markedly different approach from simple surveys that ask about buying intentions over the coming year. Specifically, the research was designed to ask the following questions:
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To top executives of these companies, how important is the contact center ? Are these executives simply looking to cut costs, or do they believe the contact center plays a pivotal role in their companys ability to grow revenues and market share? In which emerging technologies are these executives likely to invest over the next 6, 12, and 18 months? Which of these technologies are likely to represent investment priorities to them? What are their plans for outsourcing their contact center operations to third-party providers? What geographic areas or countries are they likely to consider if they do outsource? What are the biggest challenges these executives face in managing their contact center initiatives, and what are their operational, management, and customer priorities over the next year and a half?
The research instrument was designed by Aberdeen Group and then codified and administered by CNET. The survey itself was made available to a selected subsegment of CNETs readers that represented operational and executive managers with involvement in their companys contact center operations and decisions. Invitations to participate in the survey were made to this subsegment of individuals across a broad range of industries; sizes of companies and contact center operations; and critical to todays global economy across a broad range of geographic locations, including North America, Europe, and Asia/Pacific. In return for participating in this research, respondents will be given a copy of the final report at no cost. All information collected from these companies and individuals will be reported only in aggregate. No information about individuals or companies that were submitted as part of this research initiative will be released, sold, or provided to any outside organization. In conjunction with Aberdeen Groups unique business model of providing quality research at no cost to qualified users, executives, and organizations, this report is also being made available at no cost in electronic format via Aberdeens Web sites at www.aberdeen.com and www.crmaccess.com, as well as through CNETs Web site at www.cnet.com. Users that would like to download a copy of the report will be asked to complete a registration form and may be contacted by companies that provide relevant contact center technology or services. In addition, companies providing contact center technologies, consulting, integration services, or outsourced contact center services may opt to sponsor this report. These companies may receive logo placement, marketing and sponsorship exposure, access to registra-
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tion information from companies or individuals downloading the nocost research report (not to information collected from research participants), and/or access to the aggregate data collected as part of this research in exchange for their sponsorship.
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Chapter Two: Primary Research Environment and Participation

Industry, Company, and Executive/Management Background A broad range of companies of different sizes, from a variety of industries and global locations were represented in the Technology, Trends, and Investment Plans research initiative. Likewise, management and executive response to the survey crossed a range of titles and seniority, with a large majority of the respondents involved in either evaluating, recommending, or approving technology and service investments for their companys contact centers. The following key findings from the managers, directors, and executives that participated in this research are notable. 90% of the respondents evaluate, recommend, specify, or approve technology or service investments for the customer contact center. 56% of the respondents are C-level executives, vice presidents, or directors and have responsibility for or involvement in their companys contact center. Executives and companies participating in this research employ a combined total of approximately 161,000 agents, and are responsible for recommending, evaluating, or approving technology and services for their organizations contact center.
Executives and companies participating in this research employ a combined total of approximately 161,000 agents, and the contact centers they manage handle a total of 7.88 million transactions per month.
The contact centers surveyed manage a total of 7.88 million transactions per month, including interactions managed by contact center, Web, e-mail, and chat sessions. Geographic regions outside of the U.S. were broadly represented, with 51% of the contact center executives located outside of the U.S. Participants from Europe accounted for 18% of the total, 16% were from the Asia/Pacific/Australia/New Zealand area, 7% were from Canada, and 6% were from Latin America and Africa/Middle East.
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Vertical industries were very broadly represented: aerospace, business services, education, financial services/banking, health care, high-tech manufacturing, insurance, IT consulting, IT services, public sector, telecommunications/ISP, transportation/utilities, energy, and wholesale/distribution all account for at least 3% of the contact centers.
Figure 1: Executive Roles in the Contact Center
No role 10% Approves 21%
Evaluates 22%
Specifies 15%
Recommends 32%
Source: Aberdeen Group, March 2003
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Figure 2: Job Title and Function in the Contact Center
C-Level Executive 10% Other 34% VP/Director: Sales/ E-commerce/ Support 10%
Operations Manager 10%
VP/Director/ M anager: IT 36%
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Figure 3: Vertical Industry Representation Vertical Industry

Aerospace/military Automotive Business services (non-financial) Consumer packaged goods (CPG) Systems Education Energy Financial services/banking Hardware supplier Healthcare High-tech manufacturing Insurance IT consulting Media Other IT services Pharmaceuticals/chemicals Process manufacturing (plastics, rubber, etc.) Public Sector Retail Software supplier/developer Telecommunications/ISP Transportation/utilities Wholesale/distribution Other
Percent
3.43 % 1.06 % 2.90 % 0.79 % 8.71 % 3.96 % 7.39 % 1.85 % 4.75 % 3.17 % 3.43 % 8.18 % 1.06 % 5.80 % 1.85 % 2.37 % 7.12 % 2.64 % 2.90 % 6.86 % 3.17 % 3.43 % 13.19 %
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Figure 4: Geographic Distribution

Africa/M iddle East 4%
Asia/Pacific Rim and Australia/New Zealand 16% Canada 7%
U.S. 49%
Europe 18% Latin America/ Caribbean 6%

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Chapter Three: Key Top Level Findings

Executives of the largest contact center operations representing only 10.6% of the total number of centers make investment and technology decisions that impact the largest number of agent positions or seats. As shown in Figure 5, the top segments of contact centers employ the largest number of agents and account for the lions share of technology and service acquisitions. Companies whose contact center operations account for 5,000 or more agents employ more than half of the contact center agents (53%); 73% of the total numbers of call center positions exist in companies with contact center operations of 1,000 or more contact center agents. The highest volumes of customer interactions, including telephone, Web, e-mail, and chat sessions, were also managed by a relatively small number of companies 7% of the companies reported handling more than 100,000 interactions per month, whereas 15.6% of the respondents handled between 25,000 and 100,000 interactions per month. A majority of companies (82.0%) reported customer service and support (in-bound) as their primary operational function; 27.7% reported handling both support and sales (blended contact center); 21.1% reported collections, billing, and payment issues as their primary responsibility; and only 11.6% did outbound-only telesales or telemarketing. Traditional, voice-based interactions continue to dominate this segment. Voice-based interactions account for 61% of customer interactions; 11% of customer interactions take place over the Web; e-mail interactions accounted for 19.3% of the volume; and chat amounted to 3.1%.
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Figure 5: Total Agent Seats by Contact Center Size
8% 4% 5% 5% 53% 5% 11% 9%
Less than 100 100 - 250 251 - 500 501 - 750 751 - 1,000 1,001 - 2,500 2,501 - 5,000 Over 5,000
Figure 6: Customer Interactions by Type
Chat 3%
Other 5%
E-mail 19% Telephone/ Voice 62%

Web 11%
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Figure 7: Contact Center Function

Collections, Billing, & Payment Issues 14% Other 5%
Both Support & Sales (Blended) 19% Telesales Telemarketing 8%
Customer Service & Support 54%
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Chapter Four: The Customer Contact Center: Priorities and Perceptions in the Enterprise
One of the primary research objectives was to quantify and identify executive-level priorities and perceptions as they relate to their companys contact centers. Specifically, this research was intended to answer the following questions: What is the strategic importance of the contact center in these organizations, and how critical is the contact center to these senior executives? What do senior executives believe is their biggest challenge regarding their organizations contact center? What do these executives think about the possibility of outsourcing some or all of their companys contact center operations to a third-party outsourcer? What would be their primary motivation to turn to an outsourced contact center solution? What geographic regions would they likely consider? What emerging contact center technologies do senior executives believe are the most strategic for their companys contact centers over the next 6, 12, and 18 months? What are their investment plans for these technologies over this same 18-month period? How important to senior executives is a single, integrated customer contact center, and what are their plans for moving toward this strategic and technical objective? How are their investment priorities likely to change over the next 18 months? Will their spending on the contact center decrease, increase, or stay the same?
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What is the strategic importance of the contact center in the enterprise? How critical a role does the contact center play in the enterprise?
When company executives were asked the question, How would you rate the strategic importance of your companys customer contact center initiatives? the responses were relatively startling: Critical: The contact center is a key part of our company, product, and customer strategy (45%). Somewhat important: The contact center is viewed as important but is not a major strategic component of our business (38%). Only 11% of executives were neutral, stating that the contact center was viewed as overhead and as a necessary evil; and only 5% thought the contact center was somewhat important (viewed as financial overhead and as a drain on management resources or not important to our strategic direction).
Figure 8: Strategic Importance of the Contact Center in the Enterprise

Not important 3%
Somewhat unimportant 2% Neutral 11%
Critical 45%
Somewhat important 39%

It seems clear that the contact center is not, for most executives, a low-level, operational priority or a cost center to be controlled. For the large majority of executives involved in making contact cen-
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ter decisions, the customer contact center is a strategic priority and an important part of their companys product and service mix.
What is the biggest management challenge in regards to the organizations contact center?
Executives face numerous challenges regarding their organizations contact center challenges that range from the political to the operational. Challenges identified and ranked by executive include the following: Maintaining or improving customer satisfaction and service levels Maintaining or improving service levels with reduced budgets Managing confusion and uncertainty over the introduction of new technologies Integrating contact center initiatives with corporate strategic priorities Workforce hiring and retention issues Obtaining and managing involvement/understanding from senior management Day-to-day operations issues
Figure 9: Maintaining/Improving Customer Satisfaction Levels
Extremely Difficult Difficult Neutral Simple Extremely Simple 0 50 100 150 200
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Figure 10: Maintaining or Improving Service Levels with Reduced Budgets
Extremely Difficult Difficult Neutral Simple Extremely Simple 0 50 100 150 200
Figure 11: Managing Confusion and Uncertainty Over the Introduction of New Technologies
Extremely Difficult Difficult Neutral Simple Extremely Simple 0 50 100 150
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Figure 12: Managing Involvement from Senior Management
Extremely Difficult Difficult Neutral Simple Extremely Simple 0 50 100 150
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Chapter Five: Outsourced Contact Centers
What do executives think about the possibility of outsourcing some or all of their companys contact center operations to a third-party outsourcer? What would their primary motivation be to turn to an outsourced contact center solution? What geographic regions would they be likely to consider?
Outsourced contact centers (OCCs) are one of the fastest growing segments of the contact center industry. Third-party providers from countries and regions including Canada, the Caribbean, India, Ireland, the Philippines, and the U.K.are all vying for business from mostly North American- and European-based companies. Although many regions have been able to initially win business solely on the basis of labor arbitrage providing contact center services at highly competitive rates based on the low cost of labor in their region executives evaluating OCC services are increasingly focused on factors other than price. Key findings regarding the use of OCC services include the following: Improving the quality of customer service and reducing costs associated with customer service were both rated as Important or Critical by 71% and 68% of the executives, respectively. 54% of executive stated that dealing with the growth of customer interactions was Important or Critical in their decision to use third-party contact center services. 33% of executives stated that they were currently using OCC services to manage some portion of their customer interactions. 30.6% of them stating that between 1% and 50% of their total customer interactions were being managed by an outside servicing organization. 21% of the executives believed their use of OCC services were likely to increase over the next 18 months.
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Figure 13: Motivation for Using Outsourced Services
Critical Important Neutral Somewhat Important Not Important 0 50 100 150 200
Figure 14: Reduce Costs of Customer Service
Critical Important Neutral Somewhat Important Not Important 0 20 40 60 80 100 120 140 160 180
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Figure 15: Deal with Growth in Volume of Customer Calls
Figure 16: Focus Internal Resources on Core Competencies
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Figure 17: Inability to Find Qualified Agents Locally
Critical Important Neutral Somewhat Important Not Important 0 50 100 150
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Figure 18: Country Selected As Likely Source for OCC Services Country
USA UK & Northern Ireland India Canada Australia/New Zealand Mexico/Latin America Singapore China Netherlands Philippines Ireland Korea Caribbean Other (not specified):
%
45.65 % 12.40 % 11.61 % 9.50 % 8.71 % 5.80 % 5.54 % 5.01 % 3.96 % 3.96 % 3.17 % 1.85 % 1.32 % 24.80 %
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Chapter Six: Investment and Spending Plans

Few questions elicit more interest from the vendor, services, and government sectors than those concerning investment and spending intentions. Two questions are most frequently asked of decisionmaking executives: How will your company's spending for contact center solutions change in 2003 compared to 2002? In what technologies or services do you plan to invest over the coming months?
Key Findings: Spending and investment plans

The largest percentage of contact center executives almost 48% expect spending to increase in 2003 as compared to 2002 levels. 25% of all executives expect their spending in the contact center to increase between 6% and 25% over 2002. Only 12.1% expect their 2003 spending to decrease from 2002 levels, with the largest number of executives (4.75%) anticipating that their spending will decrease between 6% and 10%. 40.1% of contact center executives surveyed believed that 2003 spending would remain the same as 2002 levels.
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Figure 19: Spending and Investment Changes: 20022003 Increase by

1% - 5% 6% - 10% 11% - 25% 26% - 50% 51% - 75% 76% - 100% Total 11.61 % 13.72 % 12.40 % 4.49 % 2.37 % 2.90 % 47.49 %
Decrease by
1% - 5% 6% - 10% 11% - 25% 26% - 50% 51% - 75% 75% - 100% Total Remains the same 3.43 % 4.75 % 1.58 % 1.58 % 0% 0.79 % 12.14 % 40.37 %
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Key Findings: Spending and Investment on Technologies and Services

When asked if their company planned new deployments or significant upgrades of various contact center technologies and services, executives were both candid and practical about their plans. For example, 49% of the executives claimed that they have no plans to either deploy or upgrade a multichannel contact center technology within the next 18 months. The corollary to this finding is that 51% of the contact centers have already either deployed or plan to deploy multichannel technologies. Likewise, 57% do not plan deployments or upgrades of IP-based contact center technology within a 18-month timeframe, with 43% planning either initial implementations or upgrades of IP-CC technology. The top five technology investments cited by executives over the next 18 months included: 1. Analytic tools for the contact center (61%) 2. Multichannel contact center (51%) 3. Interactive self-service (50%) 4. Enterprise routing (49%) 5. Workforce management (49%)
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Figure 20: Plans to Deploy or Upgrade to Multichannel Contact Center
6 months 19% No plans to upgrade/deploy 49%
12 months 16%
18 months 16%
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Figure 21: Plans to Deploy IP Contact Center
6 months 12% 12 months 17%
No plans to upgrade/ deploy 57%
18 months 14%
Figure 22: Plans to Invest in Enterprise Routing
6 months 15%
No plans to upgrade/deploy 51%
12 months 18%
18 months 16%
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Figure 23: Plans to Invest in Customer Experience Management or Multimedia Recording
6 months 9% 12 months 12% 18 months 16%
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Figure 24: Plans to Invest in Contact Center Analytic Tools
No plans to upgrade / deploy 39%
6 months 22%

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Figure 25: Plans to Invest in Outsourced Contact Center Services
6 months 7%

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Figure 26: Plans to Invest in Workforce Management Tools
6 months 15%
No plans to upgrade/deploy 51%
12 months 16%
18 months 18%
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Chapter Seven: Technology and Investment Plans by Region and Size

Significant differences in technology investment and deployment plans exist between geographic regions, vertical industries, and contact center size. The following key findings relate to technology deployment and investment plans between global regions and among vertical industry groups. Key Findings: Technology and investment plans 41.1% of contact centers employing more than 5,000 agents and 50.0% of contact centers employing between 2,500 and 5,000 agents planned deployments or upgrades of multi-channel contact center technology over the next 18 months. In contrast, only 25% of contact centers in the 2,500 to 5,000 agent range planned IP-based contact center deployments, while more than 46% of the largest contact centers planned IP contact center deployments or upgrades over the next 18 months. Outsourced or offshore contact center deployments over the next 18 months were planned by 35% of the largest contact centers (>5,000 agents), by 25% of contact centers with between 2,500 and 5,000 agents, and by 40% of contact centers with 1,000 to 2,500 agents.
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Figure 27: Deployment Plans: Contact Centers > 5,000 Agents

Interactive self-service Voice portal or Voice XML Predictive dialing Automatic Call Distributor (ACD) or Computer Telephony Integration (CTI) or Interactive Voice Response (IVR) Integrated or universal queuing Workforce management and workforce optimization tools Outsourced or offshore contact center services Analytic tools for contact center analysis/reporting Customer experience management (CEM) or multimedia recording Automated customer routing capability IP-based call center (IP-CC) software switches or infrastructure Multi-channel customer contact center 0% 10% 20% 30% No plans 40% 50% 60% 70% 80% 90% 100% 18 Months
6 Months 12 Months
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Figure 28: Technology Deployment Plans: 2,500 to 5,000 Agents

Interactive self-service Voice portal or Voice XML Predictive dialing Automatic Call Distributor (ACD) or Computer Telephony Integration (CTI) or Interactive Voice Response (IVR) Integrated or universal queuing Workforce management and workforce optimization tools Outsourced or offshore contact center services Analytic tools for contact center analysis/reporting Customer experience management (CEM) or multimedia recording Automated customer routing capability IP-based call center (IP-CC) software switches or infrastructure Multi-channel customer contact center 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% No plans 6 Months 12 Months 18 Months
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Figure 29: Technology Deployment Plans: 1,000 to 2,500 Agents

Interactive self-service Voice portal or Voice XML Predictive dialing Automatic Call Distributor (ACD) or Computer Telephony Integration (CTI) or Interactive Voice Response (IVR) Integrated or universal queuing Workforce management and workforce optimization tools Outsourced or offshore contact center services Analytic tools for contact center analysis/reporting Customer experience management (CEM) or multimedia recording Automated customer routing capability IP-based call center (IP-CC) software switches or infrastructure Multi-channel customer contact center 0% 20% No plans 40% 60% 80% 100% 6 Months 12 Months 18 Months
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Figure 30: Technology Deployment Plans: U.S.

Analytic tools for contact center analysis/reporting Interactive self-service Workforce management and workforce optimization tools Multi-channel customer contact center Automated customer routing capability Automatic Call Distributor (ACD) or Computer Telephony Integration (CTI) or Interactive Voice Response (IVR) IP-based call center (IP-CC) software switches or infrastructure Integrated or universal queuing Customer experience management (CEM) or multimedia recording Voice portal or Voice XML Predictive dialing Outsourced or offshore contact center services 0% 20% 40% 60% 80% 100%
No plans
6 Months 12 Months
18 Months
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Figure 31: Technology Deployment Plans: Europe

Analytic tools for contact center analysis/reporting Multi-channel customer contact center Interactive self-service Workforce management and workforce optimization tools Automated customer routing capability IP-based call center (IP-CC) software switches or infrastructure Automatic Call Distributor (ACD) or Computer Telephony Integration (CTI) or Interactive Voice Response (IVR) Customer experience management (CEM) or multimedia recording Integrated or universal queuing Voice portal or Voice XML Predictive dialing Outsourced or offshore contact center services 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
No plans
6 Months 12 Months
18 Months
38 AberdeenGroup
Figure 32: Technology Deployment Plans: Asia/Pacific Rim and Australia

Analytic tools for contact center analysis/reporting Automated customer routing capability Multi-channel customer contact center Interactive self-service Workforce management and workforce optimization tools IP-based call center (IP-CC) software switches or infrastructure Customer experience management (CEM) or multimedia recording Automatic Call Distributor (ACD) or Computer Telephony Integration (CTI) or Interactive Voice Response (IVR) Integrated or universal queuing Voice portal or Voice XML Outsourced or offshore contact center services Predictive dialing 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
No plans
6 Months 12 Months
18 Months
AberdeenGroup 39
Figure 33: Outsourced Contact Center Plans by Size
LA
Asia/Pac/Aus
EAME
US/Canada 0% 20% No plans 40% 6 months 60% 12 months 80% 18 months 100%
40 AberdeenGroup
Figure 34: Outsourced Contact Center Plans by Region
U.S./Canada
EAME
Asia/Pac./Aus.
L.A.
0%
No plans
25%
50%
75%
100%
18 Months
6 Months 12 Months
AberdeenGroup 41
Figure 35: Technology and Investment Plans: All Regions
Outsourced services Predictive dialing Voice portal or Voice XML Universal queuing CEM or multimedia recording IP-CC ACD, CTI, IVR Workforce management Enterprise routing Interactive self-service Multichannel contact center 0 20 40 60 80 100 120 140 160 180 200
42 AberdeenGroup
Author Profile
Christopher Fletcher, Vice President and Research Director
Area of Focus Christopher Fletcher is a five-year member of Aberdeens Customer Relationship Management (CRM) practice, which provides research and consulting on market strategy, communication, product positioning, and branding for established and emerging CRM technology suppliers. Recently recognized as one of the 20 Most Influential Executives in CRM by CRM Magazine, Chris has provided analyst and consulting services on multiple facets of customer-facing CRM and e-business applications, including sales force automation; sales effectiveness systems; enterprise-focused hand-held devices and personal digital assistants; customer service and support; call centers and customer contact centers; marketing automation; field service; and help desk. Current Research Chris is currently working on a report entitled The Customer Contact Center: Technology, Trends, and Investment: Plans for the Customer Contact Center: 20032004, which examines the issues surrounding and impacting the adoption of and investment in key technologies for the customer contact center. Chris also published a best practices report (November 2002) entitled What Works: Ten Significant Implementations in CRM/Customer Call and Contact Centers, and coauthored a similar report entitled What Works: Ten Significant Implementations in Services Management, with research conducted in conjunction with the Association for Services Management International (AFSMI). Chris has also published groundbreaking research in the converging areas of CRM for the small- and medium-sized business (SMB) market. MS CRM: Threat or Opportunity? examined the convergence of Microsofts entry into CRM with its MS CRM product and .Net strategy and architecture. Microsoft: Nothing but .Net? discussed the relative failure of Microsoft to clearly articulate its .Net strategy to the enterprise. Other related research included Microsoft: Changing the Face of CRM, which examined Microsofts entry into the CRM market with its Passport and .Net technologies a report that presaged Microsofts announcement of its key MS CRM product line. Chris also played a leadership role in researching and writing Aberdeens recent Worldwide CRM Spending: Forecast and Analysis 2001-2005 report. He was responsible, together with members of
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Aberdeens CRM practice, for the research and development of several new CRM reports, including Customer Relationship Management: Europe 2001; What Works: Ten Significant CRM Implementations of 2000; and E-Mail Marketing: A Primary Touchpoint of Customer Relationship Management. Chris is also responsible for Aberdeens enterprise mobility research covering the application of mobile, wireless, and handheld devices in CRM and enterprise business applications, and has worked closely with several of the leading providers of handheld operating systems and applications. Experience Chris has more than 20 years of experience in the technology industry and has held positions in sales and marketing management, global marketing, and product planning and management with both established and emerging companies. Chris joined Aberdeen in 1997 as a Senior Analyst, was promoted to Research Director, then Managing Director, and finally Vice President and Research Director of Aberdeens CRM practice. In his current role as Vice President and Research Director, he continues to take a primary role in providing research, consulting, and thought leadership within the CRM, ebusiness, and mobility industries. Chris is a well-known author and speaker and has contributed to several industry publications. He has been quoted in numerous publications including The New York Times, The Wall Street Journal, Red Herring, and USA Today. Chris is also an active member of the National Ski Patrol, is certified as an Outdoor Emergency Care (OEC) provider and as an OEC instructor for the NSP, and has been published in Ski Patrol Magazine.
44 AberdeenGroup
Appendix A: Lexicon of Acronyms and Abbreviations

Acronyms and definitions used in this report and in other Aberdeen research include the following: ACD ASP CEO CFO CIO COO CRM CSR CTI CTO EBA IS IVR IT MA OCC OLAP OS PRM ROI ROR SES SFA SI SLA Automatic call distribution Application service provider Chief executive officer Chief financial officer Chief information officer Chief operating officer Customer Relationship Management Customer service representative Computer telephony integration Chief technology officer Enterprise Business Applications Information Systems Integrated Voice Response Information Technology Marketing automation Outsourced Contact Center Online analytical processing Operating system Partner Relationship Management Return on investment Return on relationship Sales (force) effectiveness systems Sales Force Automation Systems integrator Service level agreement
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SMB SSP TCO VAR VoIP WAP XML
Small and medium business Strategic solutions provider Total cost of ownership Value-added reseller Voice over IP Wireless Application Protocol Extensible Markup Language
46 AberdeenGroup
Appendix B: Related Aberdeen Research

Related Aberdeen research that form a companion or reference to this report include: Worldwide CRM Spending: Forecast and Analysis 20012005 (July 2002) What Works: Ten Significant CRM Implementations of 2001 (March 2002) What Works in Europe: Success Stories in Customer Relationship Management (March 2002) Microsoft: Changing the Face of CRM (November, 2001) IP Contact Centers: An Architectural Foundation for Multichannel CRM (February, 2002) Microsoft Enters CRM Market with MS CRM: Opportunity or Threat? (March 2002)
Information on these and any other Aberdeen publications can be found at www.aberdeebn.com or by e-mail at info@aberdeen.com.
AberdeenGroup 47

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The Customer Contact Center

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Terms and Conditions

Chapter One: Methodology and Overview

Chapter Two: Primary Research Environment and Participation

Figure 1: Executive Roles in the Contact Center

No role 10% Approves 21%

Figure 2: Job Title and Function in the Contact Center

Operations Manager 10%

VP/Director/ M anager: IT 36%

Source: Aberdeen Group, March 2003

Figure 3: Vertical Industry Representation Vertical Industry

Figure 4: Geographic Distribution

Asia/Pacific Rim and Australia/New Zealand 16% Canada 7%

Europe 18% Latin America/ Caribbean 6%

Chapter Three: Key Top Level Findings

Figure 5: Total Agent Seats by Contact Center Size

Source: Aberdeen Group, March 2003

Figure 6: Customer Interactions by Type

E-mail 19% Telephone/ Voice 62%

Figure 7: Contact Center Function

Both Support & Sales (Blended) 19% Telesales Telemarketing 8%

Customer Service & Support 54%

Source: Aberdeen Group, March 2003

Figure 8: Strategic Importance of the Contact Center in the Enterprise

Somewhat unimportant 2% Neutral 11%

Somewhat important 39%

Figure 9: Maintaining/Improving Customer Satisfaction Levels

Source: Aberdeen Group, March 2003

Figure 10: Maintaining or Improving Service Levels with Reduced Budgets

Source: Aberdeen Group, March 2003

Extremely Difficult Difficult Neutral Simple Extremely Simple 0 50 100 150

Source: Aberdeen Group, March 2003

Figure 12: Managing Involvement from Senior Management

Extremely Difficult Difficult Neutral Simple Extremely Simple 0 50 100 150

Source: Aberdeen Group, March 2003

Chapter Five: Outsourced Contact Centers

Figure 13: Motivation for Using Outsourced Services

Source: Aberdeen Group, March 2003

Figure 14: Reduce Costs of Customer Service

Source: Aberdeen Group, March 2003

Figure 15: Deal with Growth in Volume of Customer Calls

Source: Aberdeen Group, March 2003

Figure 16: Focus Internal Resources on Core Competencies

Source: Aberdeen Group, March 2003

Figure 17: Inability to Find Qualified Agents Locally

Critical Important Neutral Somewhat Important Not Important 0 50 100 150

Source: Aberdeen Group, March 2003

Chapter Six: Investment and Spending Plans

Key Findings: Spending and investment plans

Figure 19: Spending and Investment Changes: 20022003 Increase by

Source: Aberdeen Group, March 2003

Key Findings: Spending and Investment on Technologies and Services

Figure 20: Plans to Deploy or Upgrade to Multichannel Contact Center

6 months 19% No plans to upgrade/deploy 49%

Figure 21: Plans to Deploy IP Contact Center

6 months 12% 12 months 17%

No plans to upgrade/ deploy 57%

Figure 22: Plans to Invest in Enterprise Routing

No plans to upgrade/deploy 51%

Source: Aberdeen Group, March 2003

Figure 23: Plans to Invest in Customer Experience Management or Multimedia Recording

6 months 9% 12 months 12% 18 months 16%