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Is the Contact Center Going the Way of the PBX?

Staff Writer's picture

This article was originally published on NoJitter

Cloud and AI are clearly disrupting the contact center... but there's more.

A lot has been written about what came from last month's Enterprise Connect 2018, and I've got a takeaway you may not have yet considered. The contact center, one focus of this conference, is very much part of the broad communications landscape, especially when considering collaboration across the enterprise, including both the office and the contact center.

Disruption is the new normal these days, with cloud and artificial intelligence (AI) invariably being the main drivers. Based on all I heard and saw at Enterprise Connect, I would contend that the short answer to the question posed in the headline is "Yes."

VoIP gave us the IP PBX, which was the beginning of the end for the rule of telco vendors, and that seed of disruption has brought us to what is widely viewed now as the "post PBX" world. Compounding what VoIP started, of course, was the rise of mobility and the cloud, each of which has changed the enterprise telephony landscape. Strange as it may seem, IP telephony shipments are still going strong, but we've long moved on from the desk phone being the hub of workplace communication.

You Can't Get There from Here
I'm not alone is seeing similar parallels for the contact center, but this came into sharp focus for me at Enterprise Connect. There we heard how the majority of contact center seats remains premises-based, and, as with phones on office desks, how switching costs are high. Office and contact center premises solutions may continue to work well for their intended purposes, but they don't really meet the needs of today's market. While the virtues of premises-based systems are valid -- quality, reliability, durability, scale, own-and-operate, etc. -- they create inertia for change. This model has limited adaptability for new technology, and being CapEx investments, their utility is somewhat driven by CFO considerations.

As with enterprise telephony, many contact centers are now looking for ways to migrate their on-premises infrastructure to the cloud. While scalability concerns will hold back larger contact centers, the cloud model seems very much ready now for prime time.

The second disruptor, AI, is certainly the trend du jour, and for the contact center, AI can be a panacea for many ills.

Hype aside, AI has a legitimate role to play for improving self-service. This is a huge need for contact centers, not just because the bar is so low with IVR, but because automation is the only way forward. Contact centers simply can't afford to keep hiring agents to keep customers happy. Plus, with today's 24/7 service expectations, live agents can't possibly support the volume of inquiries. AI and chatbots are still evolving, but there is clearly a readiness now to use these technologies.

Not only is AI seen as a way to reduce costs and drive automation, but the hoped-for "intelligence" can help contact centers provide a better customer experience (CX). This is quickly becoming the raison d'etre for contact centers, as management views customer service as one of the best ways to create differentiation in the marketplace.

It's All About Cloud and AI -- not Telephony
All told, then, both cloud and AI are clearly disrupting the contact center... but there's more. Along with communications platform as a service (CPaaS) -- which is disruptive in its own right -- AI is a very developer-centric technology, and a key way to differentiate customer service is to create highly personal experiences that make customers feel valued. This takes us a long way from buying off-the-shelf solutions and the relatively closed systems that drive most of today's contact center market.

Virtually every contact center vendor is moving in this direction, and each is wondering what kind of traction Twilio and Amazon Web Services (AWS) will ultimately get. They're at the vanguard of these disruptive trends, and as enterprises validate the cloud-based models, developers will become key influencers in the buying process. Enterprises that continue relying solely on IT and customer care executives to make contact center investments are at risk of missing the most important value drivers in 2018.

Even if developers are helping drive those decisions, there's yet another form of disruption happening inside the enterprise. Again, with the cloud, there are plenty of options today to deploy technology outside the purview of IT. For customer care, lines of business have been charting their own courses for cases in which the existing contact center simply can't support specific end customer needs.

While this has been going on for some time, a more recent trend is emerging specifically within sales and marketing organizations. AI can have great value in the contact center to help agents address customer problems, but it may have even greater value for these other use cases. Sales is concerned with driving revenues, and marketing is focused on customer acquisition -- needs that aren't best handled by the contact center of today.

Aside from these being different forms of customer engagement, they produce top-line results, and no executive team will object to these initiatives. As such, the legacy model of large-scale, premises-based contact center operations is just too rigid to support what these customized, cloud-based, AI-driven platforms can provide.

It's important to note that Twilio and AWS are disrupting the market in two different ways. First, each has its own platform now -- Flex and Connect, respectively -- but collectively they provide the underlying cloud platform for most of the market, namely Genesys, Five9, NICE/inContact, Serenova, NewVoiceMedia, and Talkdesk. Not to be left behind, the majors have all made AI acquisitions, most recently with Genesys taking Altocloud and Avaya acquiring Spoken. Last May, Cisco acquired MindMeld, so there should be little doubt about how both cloud and AI are truly driving this market now.

There's more disruption to consider -- fragmentation, really -- in terms of moving further away from the center of gravity that has anchored this space for so long. First would be the blurring lines between CRM and customer service, which has been going on for years. These have long been separate spheres, mainly because the telephony pedigree of contact center vendors was something CRM vendors couldn't really address. Coming back to the start of this post, the cloud has taken that advantage away, and with AI, CRM vendors are on more equal footing now to provide an end-to-end CX. The likes of Salesforce, Zendesk, and Zoho are increasingly able to offer a complete solution independent of what conventional contact center offerings have.

On a similar but related tangent, another strong trend evident from Enterprise Connect -- and one I've been writing about for a while -- is the rationale for incorporating contact center with UC. The use case is strong for enterprises with a customer-centric culture where all employees must support that focus. Increasingly, it's starting to look like business success will require a seamless blend of CRM, contact center, APIs, and UC. These have long been separate worlds, and cloud is the only way to integrate them. Once you have that, AI becomes the engine for finding, managing, and using data from this tangled milieu to do what's ultimately important -- provide a better CX.

Conclusion
My main conclusion from all this is that it's getting much harder now to view the contact center in the way we've been doing for so long. What happened to the PBX is happening here now, and it may well be a short matter of time until the core functions of the contact center become incorporated or embedded into other platforms that are built from the ground up for cloud and AI.

Perhaps a sign of what's coming would be 8x8's X Series, announced at Enterprise Connect. 8x8 has broken from the conventional model of standalone offerings, with X Series being a continuum of offerings, starting with basic telephony, then moving into richer forms of UC and collaboration, and finally offering contact center variations, including analytics and workflow management, at the top end. The underlying idea is that for 8x8, contact center is now on the UC&C spectrum rather than being a standalone offering. Everything builds on everything else, and enterprises are free now to choose the mix that works best for them.

The contact center as we know it won't be disappearing any time soon, but I saw enough at Enterprise Connect to tell me that it will be PBX redux once the magic around AI starts becoming real.

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