Wednesday, November 21, 2007

On-Premise vs. Hosted Technologies for the Contact Center

Software as a Service (SaaS) is all the rage these days mostly because of the purported cost-savings and scalability aspects of contact center technologies. In my opinion, there are several SaaS contact center solutions that make perfect sense for any size call center: speech analytics (Nexidia is first on my list) , CRM (think salesforce.com, Siebel et al) are a few that come to mind.

But the core components of the contact centerthe predictive dialer (outbound) and the ACD (inbound)are critical tools that should remain on-premise because they are better suited for systems integrations and are less expensive than hosting options—with a few exceptions.

Existing centers that already have invested in facilities and infrastructure may be able to benefit from the hosted model when they need to add more seats in busy, seasonal peaks and dial-down after the rush. Brand new contact centers, on the other hand—those who are in start-up mode and don't yet have facilities and infrastructure—should be diligent in their consideration when comparing SaaS vs. on-premise call center technologies. Hosted solutions are positioned as cost-effective alternatives to premise solutions, but that's simply not always true.

Just ask CRM expert Steve Hayes,
President and Co-Founder of eVergance, who stated a similar belief in his SearchCRM.com post comparing SaaS vs. on-premise applications (Note: you have to be logged in to SearchCRM.com to read this article - but registration is free)

In case you decide against subscribing to SearchCRM.com, here's what Steve said:
"If you already have an established call center systems infrastructure, I don't believe there is anything unique about SaaS offerings that would make delivering self service any easier. In fact, you may be better off with more specialized on-premise applications... These enterprise-grade packages would better support your integration requirements and would provide more flexibility in working with disparate content sources."
Granted, Steve is talking about self-service applications with a focus on CRM, as he is a CRM expert and consultant, but the message is the same: some applications are better suited for SaaS delivery than others.

The real skinny is this: if your contact center needs to integrate with back-office systems or third party applications (think green screens, AS400s, or anything outside your four walls), then an on-premise contact center is the only way to go. And furthermore, it is a complete untruth that hosted options cost less than on-premise systems.

Don't believe me? I'll post more about this soon, and offer some pricing examples, that will debunk the myth about supposedly lower cost hosting options (other than those I mention above) as opposed the more expensive (not!) on-premise option.