Mitel Business Partner Conference - Highlights

This year's Mitel Business Partner Conference is a bit on the short side for the invited analysts, as Wednesday is the only full day here, and we leave today around noon. So far, it's been very good, with a strong turnout on all fronts - about 1,500 partners and customers, and about 60 exhibitors. The morning was a series of executive updates for all attendees, and the afternoon had special sessions for analysts, including a customer panel and personal executive interviews.

Overall, lots of positive messages, and it's clear that Mitel is on the right track. There was some timely news as well, but the general sessions were not analyst-friendly - no Internet access or power bars - and I wasn't able to tweet then. Too bad, but I'll share my takeaways here.

CEO Rich McBee set the tone with a clear, realistic vision of where Mitel fits in the comms market. He established that a strong foundation is in place on all fronts - the products, the people, the culture and the channels. They know they'll never be as big as Cisco or Avaya, but that's not their target. They're happy to be #3, and more important, they want to be the best. Good plan. He surrounded that with lots of examples, and the main thing is that they're paying down debt ahead of schedule, the financials are strong and they're growing in all the right places. There's money in the bank, and he says Mitel will be ready for whatever changes/consolidation comes next. I don't see the need to follow ShoreTel's steps to acquire a hosted provider - they have plenty of virtualization capability via VMware - so it's not clear if that means Mitel will be a buyer at some point, or will just react to what others do. After all, they've pretty much digested the InterTel acquisition, and am sure they're happy with what they have now.

Two other notables from Rich's remarks. He touched on the fact that the market still doesn't really know all that Mitel has to offer. If the customer wants hosted, they can do that via virtualization, and of course they can do premise-based all day long. After hearing him talk about things they want to do to strengthen Mitel's mindshare, a lot of these messages sounded spot on to what ShoreTel was saying at their last industry event. These two companies really are in a dogfight for the #3 spot, and each will take any angle they can to get a leg up. I've noted in the past that Mitel has bet pretty heavily on virtualization, and it sounds like that's starting to pay off nicely now. Each company is chasing a similar type of customer with similar channel partners, so at minimum, Mitel has to be telling a story that's just as good as ShoreTel to keep the partners onside. I'd say it is, and technically, it sounds like they're a bit stronger, especially after talking to various partners who sell both.

The second notable comment speaks to the culture Rich is trying to build. He stated that for the first time, all Mitel employees will be in on profit sharing. Well, that's one way to gain an edge on ShoreTel, given that they're not making money these days. Regardless, it's a great way for Mitel to build loyalty and motivate all employees to go the extra mile to make the company strong. That's a big change considering how poorly their IPO came off, when many doubted whether InterTel was a good move.

CFO Steve Spooner gave more detail on their financial performance, and it's a good story. I thought they'd be a billion dollar company by now, but $670 million is just fine, especially when gross margins are at 50%, and they've paid down $100 million of debt in the past 3 years. The other metric I liked was about how diversified their revenue base is. Mitel's top 10 customers only account for 4.7% of sales, and their top 10 partners only tally 12.8% of sales. That's a nice mix. In short, Steve made it clear that Mitel's financials are just fine, and that matters when you consider how challenged some of the other vendors are. That's a pretty important message for channels to hear, especially when weighing Mitel against other vendors they're selling.

Lots of other strong messages throughout the day, but the biggest item was from Jim Davies and the launch of their new device, the UC360 Collaboration Point. Tech companies aren't known for coming up with sexy names for their products, and this is no exception - it's pretty clunky. He did the big reveal, like on a reality TV show - see photo below - so it was new for all of us. Reminded me a bit of how Cisco unveiled the Cius, which really was the first of its kind - but also the first exit of its kind too. Video is really just making its way into Mitel's story, and with this, it becomes a central driver for UC and collaboration.

Jim did a very smooth demo showing how the device has the convenience of a touchscreen with intuitive features that allow any tech-challenged SMB end user to launch and manage a collaboration session from one device. The demo worked across all screens - PC, tablet and room-based system - so, it's ideal for ad hoc needs that anyone can run with. The list price is around $2,000, which seems high, given that Cius could not compete with the iPad's price point. Of course, it does a lot more, but we just don't know if it's solving problems that are pressing enough among SMBs to warrant the investment. Mitel is basically taking the approach they can disrupt the market with a new category device, and hats off if they're right. Apple sure had success this way, but I'm not so sure that this really is the "new way to collaborate", as Jim was telling us.

On the whole, my impression is that Mitel is in a good spot. They certainly have come a long way from their IPO, and Rich McBee seems to be the right man for the job. Got to give them credit for trying to shake things up with the new product launch, as well as continue pushing the virtualization option. They're certainly getting good validation, as they showed that virtualization deals are coming in bigger than premise-based sales. They seem to know their sweet spot - we didn't hear much talk about chasing the enterprise market, and so far, not much about social media - it's just not on the radar of their customers. There was a little talk about contact center, but they know that's not their forte. For now, there's better upside for them with virtualization, and as they grow internationally, this could really pay off since this is a global trend. As the first photo below shows, "it was a busy year", but the results seem to be there for Mitel. Let's see if they can keep it that way in the second half of 2012.

CEO Rich McBee

CFO Steve Spooner

Philip Keenan, EVP NA Theater

Steve Beamish, VP Corp Marketing/Bus. Dev., hosting a customer case study

CTO Jim Davies revealing the UC360 Collaboration Point

Jon Brinton, GM, Network Solutions

Next Stop - Mitel BPC, San Diego

One more trip in my plans for the next while, and it should be a good one. Tomorrow, I'm off to Mitel's Business Partner Conference 2012 in San Diego. Things have been a bit quiet on the Mitel front recently, but they're no stranger to innovation, and am sure we'll be hearing lots of interesting things to shake the market up. They've been on the leading edge of the virtualization curve with VMware, and I'm keen to hear where that's going now that cloud has become the "it" tech trend, and how quickly tablets have become the must-have business device.

I'll be blogging as time allows, and for more timely updates, follow the twitter feeds - mine: @arnoldjon and theirs: #mitelbpc.

UC's Role in the Contact Center - Podcast

Good topic for this week's UCStrategies podcast, especially following last week's Interactive Intelligence conference. The contact center has long lived in a parallel world with the enterprise, and it's not much of a stretch these days to see how UC is well suited to address the needs of both spaces.

That's the entry point for the themes we explored on the call , and we certainly didn't run out of ideas. I'm sure it's a topic we'll return to soon, but until then, this is a good way to get a broad reading of what UC can bring to the contact center. The session was moderated by Blair Pleasant, and you can access the podcast as well as the transcript on the portal now.

Customer Experience Management – Burger King or McDonalds?

This is my second post in the current series focusing on Customer Experience Management - CEM – for the CIO Collaboration Network. As you may know, I’m writing 3 posts for each series in this ongoing program, with 2 being posted here and 1 directly on the CIO portal. My last post examined the business value of collaboration to support CEM, and here I’m going to look at the business case for the same. The differences are subtle but important, and the business case is about the rationale for having collaborative tools – namely Unified Communications – to get the most from CEM.

So, why do enterprises need UC for CEM, and what does fast food have to do with customer service? In terms of the business case, UC is a fundamental building block for CEM, but this may not be evident yet to contact center decision makers. UC has been primarily an enterprise-focused solution, helping employees communicate more effectively within their organization. The business case there is typically tied to the phone system, especially end-of-life scenarios. This is a natural trigger event whereby IT must do something, and increasingly, UC is one of the more appealing options.

There really is no comparable trigger event or driver in the contact center for UC, and that largely explains why it hasn’t been a top priority. Instead, the impetus is coming from external forces – changing behaviors and expectations from customers. Aside from this being a new development, these changes are not well understood, impossible to control, and difficult to measure in the context of building a business case. A cardinal rule of business is that you can only improve what can be measured, so when customer satisfaction scores start to dip, IT will suddenly get religion about finding metrics to make the case for UC.

Of course they will only do this if they understand the broader strategic value of UC and the associated collaboration capabilities it brings to the contact center.  I don’t need to articulate those benefits here; the CIO Collaboration portal is very rich in such content, and I’ll leave that to you for further exploration. Building on this strategic value, the business case for UC becomes easier to define. The drivers are different here, and management is not thinking about lower telecom costs or network efficiencies. UC and the contact center is all about the customer, and as outlined in my last post, this is really about CEM.

While most of the CEM discourse is about managing the experience, you first need the tools to create that experience, and that’s where UC comes in. Conventional contact center tools provide a pretty uniform, predictable and reliable experience, but that just won’t do with today’s customers. As noted here and elsewhere on this portal, many customers want – and expect – an interactive, multichannel experience where the phone call is the starting point of the interaction, rather than the totality. A robust UC deployment will give agents the tools to roll with whatever comes their way, and when customers have a good – or great - experience with agents, you can be certain that all the metrics contact centers live and die by will trend upward. Case closed.

Have you figured out yet where burgers come into the discussion? Well, we all know Burger King’s USP – unique sales proposition – “have it your way”.  Like most businesses, burgers are pretty commoditized, and it’s hard to differentiate from the crowd. Burger King knows they’ll never be a big as McDonalds, but they deliver a better customer experience by allowing us to choose our toppings. It only takes a few seconds to hold the pickle or add extra mayo, but that makes all the difference for keeping the customer happy – and making sure they come back over and over again. Clearly, McDonalds customers value other things, but BK has been holding its own for a long time, and I’m sure their customer satisfaction metrics validate a loyal base of burger lovers.

Really, is your business any different? Burger King caters to customers who want a burger on their terms, and that’s why they don’t go to McDonalds. If your line of business is crowded with lots of similar offerings, any form of customization can be differentiator. For many companies, customer service is the best – or even only – way to do this, and if you’re in that camp, then I’m sure CEM is in your thoughts 24/7. The contact center can be a gold mine for customization, but only with the right tools, skill set and management vision. If you have the vision, then the business case for UC should be self-evident.

The choice to me is pretty simple – do you want CEM to be like Burger King or McDonalds?  Did you know there are 1,024 ways to have a Whopper? That’s a lot of choice, and wouldn’t you like your agents to have so many options? The way social media and mobility is evolving, it won’t be long until your customers think they have this many choices, and you probably don’t want to find this out after the fact. Bottom line - collaboration is a highly personal experience, and with UC, CEM can become a true business driver that goes well beyond what happens in the contact center. Remember, the customer is always right, and you don’t want to get on the wrong side of an Angry Whopper experience.

This post sponsored by the CIO Collaboration Network and Avaya

Interactive Intelligence - Takeaways from Interactions 2012

Last week's Interactions 2012 event was the biggest and best yet put on by Interactive Intelligence, and I briefly posted about it here. I often write a  more reflective recap just after the event, and this one sure gave us a lot to think about in terms of where the cloud is going, not just in the office, but in the contact center as well.

Well, I did just that for my June contribution to the UCStrategies portal. Several of us from UCS were at the event, and we did our best to keep UC in the discussion mix both on stage and in the hallways. ININ is one of the few vendors bridging the enterprise and contact center worlds with a mix of telephony, UC and CEBP applications - available either on-premise or in the cloud. That's a lot to digest, and I've taken my shot at what it all means from a UC point of view. You can read that now on the UCS portal, and while you're there, please spend some time reading what my colleagues have to say on all of these topics.

Interactions 2012, Day 1

Yesterday was the first full day of Interactions 2012 here in Indianapolis. I've been to a few of these before, and Interactive Intelligence keeps doing a great job as this event keeps getting bigger. It's now over 1,500 strong, so they've gone to a bigger venue, and there are a lot of people wandering around here with orange badges.

Anyhow, just wanted to pass on some quick thought and takeaways, along with a few photos. CMO Joe Staples set the tone early by talking about how the customer experience is this year's core theme and how it can become a "competitive weapon". That's certainly consistent with what I'm seeing these days and ININ seems to have a good handle on this. The company continues to grow on all fronts - revenues, profits, new customers, new countries, etc. They have cash in the bank and no debt, and are in great shape to make strategic acquisitions to fill out their portfolio.

I think most people would agree that the highlight so far was the keynote from Prof. Clayton Christensen, a noted Harvard professor and author, renowned for his views on disruption and innovation. In short, his view is that we buy products to do a specific job for us. For marketers to be successful, they need to focus not on the customer, but rather on ensuring their products do that job better than anyone else. Your odds of success are greater if you understand what that job is and build your product around that instead of trying to get into the heads of your customers. He used milkshakes as an example of how this works, and if you don't know how that one goes, drop me a line.

More specific to ININ, he outlined the trajectory of how markets evolve when new entrants come in at the bottom end and compete by finding ways to lower costs and drive out higher-priced rivals. We're certainly seeing that with cloud, and its potential to displace telephony altogether. He didn't explore that tangent, but was generally lukewarm about the virtues of the cloud - outsourcing - in the communications space. I think that made a few people nervous, but these comments came at the end of Q&A, and really needed more time to be parsed out for a more thoughtful conclusion.

Moving on, the rest of the day was filled with breakouts, all of which were pretty good. There's a rich agenda here, so there's something for everybody. You have to keep in mind that the program isn't built around analysts - we're just a drop in the bucket, and most of the content is geared to help partners sell ININ.

I particularly enjoyed the competitive landscape sesssions and hearing their thinking on how to position ININ against everyone else. No single vendor has all the answers for customers, and it's refreshing to hear a company be upfront about what they can and cannot do. I've commented before about the mid-West sensibilities that characterizes their culture, and I think it goes a long way in explaining their success. They won't blow you away here with flash and dazzle, but if you want to meet great people doing great things with IP technology, it doesn't get much better than this.

 Joe Staples - CMO/event MC

CEO Don Brown - now... and then

Clayton Christensen talking about innovation and disruption cycles

Lunchtime customer panel with analysts and consultants

A bit of fun after dinner - the 80's live - big hair, tight pants and all....

Customer Experience Management – the Business Value of Collaboration

It’s June already – a new month has begun, and that means it’s time for a new topic on the CIO Collaboration Network. Last month, the focus was on video and now we’re shifting to a functional area of growing importance to all businesses – the contact center. I say “all” for good reason, and Unified Communications is very much a driver here.

Prior to the advent of IP, contact centers were mostly facilities-based, centralized and costly to operate. This made them relatively easy to manage, but beyond the means of small businesses. This creates a natural paradox in the sense that smaller businesses have a harder time getting customers than large enterprises, and for them, the contact brings great value in terms of keeping those customers happy.

My readers should understand the economics of IP, and how that has opened up great opportunities for businesses of all sizes. One of the great benefits has been in the contact center, where affordable, scalable solutions are accessible to every business, even those who have no in-house infrastructure to support it. In short, there are no major barriers today to keep any business from having some semblance of a customer service operation.

Just as with UC, the call center has become a rather fluid concept, again, mainly due to the impact of IP. The call center has become the contact center to reflect that fact that agents now use more than just telephony to interact with customers. As SIP and UC have made real-time, multichannel communication more commonplace, the emphasis has shifted from agents in the contact center out to the marketplace where the impact of their actions has the most important impact.

Where a simple call to a toll-free number once constituted customer service, UC gives agents greater latitude for more engaging communication which ultimately should lead to faster, better problem solving and increased customer satisfaction. This milieu gives rise to a new area of focus – CEM – customer experience management. Instead of being evaluated on how quickly problems are resolved on the phone, agents are now gauged by how well they create and manage a customer experience.

This may seem like a tall order, but in the right hands, it can be fairly seamless and intuitive with UC. Not only can UC extend this to any agent willing and able to deliver this level of service, but for any business as well. That’s why the concept of customer experience management is exciting – it’s accessible for anyone ready to embrace the tools. UC provides the integrated environment for agents to interact – and collaborate – with customers as each situation requires. Some customers will just want one mode and others will want multiple modes. Similarly, some will be happy just dealing with one agent from start to finish, whereas others will want direct access to specialists, either brought in during the initial call, or on a subsequent call.

The scenarios here are endless, and that’s the point – as well as the business value of collaboration in the contact center. Ultimately, the value of collaboration is reflected in the results, many of which are directly measurable; transactional metrics such as AHT and FCR. There are also indirect metrics that should tick upward with effective uses of collaboration, such as customer satisfaction, repeat purchasing, referral business, etc.

Whatever the positive impact, the main idea is that collaboration adds value to the contact center by allowing agents to interact with customers on their terms. Customer expectations have come a long way from the time when all they could do was call a toll-free number, wait endlessly on hold and hope for the best. With UC, whatever works for the customer, works for the agent. Business has never been more competitive, and the timeless maxim “the customer is always right” has never been more true. By providing agents with the tools that let them respond to any situation on the fly, UC levels the playing field and meet today’s expectations, in whatever form collaboration may take. If that doesn't create value for a business, I don't know what does.

This post sponsored by the CIO Collaboration Network and Avaya

Next Stop - Indianapolis, Interactions 2012

Been traveling a lot less this year, but I have two vendor events this month. Next week, I'll be in Indianapolis for Interactions 2012, from June 4-7. This is Interactive Intelligence's annual customer/partner event, and includes a smattering of analysts and media. I've been to this a few times, and each year it gets bigger and better.

ININ continues to do well, especially with CaaS, their cloud-based contact center platform, and based on how they're engaging with analysts prior to the event, I can see they'll have some interesting story lines in store next week. So, if you follow the company, the cloud and contact centers, this should be a great event, and I'll be posting here and tweeting (@arnoldjon) as time allows.