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Is SaaS Ready for Its Contact Center Close-up?
Software-as-a-service continues to catch on, but observers differ on whether the not-so-new business model is right for contact centers
For the rest of the June 2008 issue of CRM magazine please click here
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As the CRM market warms to on-demand software, providers have begun pushing to make software-as-a-service (SaaS) more palatable for the contact center. Recently, LiveOps, a California-based virtual contact center company, launched a SaaS offering that made its telephony platform accessible atop Salesforce.com's on-demand contact center product.

But pundits aren't ready to crown SaaS as king of the contact center. Daniel Hong, lead analyst at Datamonitor, is among those who believe that SaaS still has a long way to go. "It will take time before SaaS penetrates or hits critical mass within the contact center environment," he says.

Research giant Gartner says that 75 percent of customer service centers will use a form of SaaS by 2013, but only 10 percent of organizations will leverage SaaS for "complex business process support." Michael Maoz, a Gartner distinguished vice president of research, says the results surprised him. "You'd think that, with the maturation of the on-demand business model and technologies, that more contact centers would be ready," he says.

Maoz blames contact centers' mindset for slow SaaS adoption. "[Contact centers] need to be risk-averse because they are so mission-critical," he explains. "A contact center agent has no other tool but that desktop." The hesitancy, he says, is here "until they see a major...[or] mission-critical contact center that is built and run using SaaS" -- and he suggests that it may not come to pass until the end of 2009.

But Clarence So, Salesforce.com's chief marketing officer, says SaaS is already well-established in the contact center. He cites office products and services provider Corporate Express (CE), where Salesforce Call Center manages 7.3 million transactions per year via phone and case management. "Thousands of companies have already adopted our [on-demand] call center offerings," So says. "It is not a 2009 thing."

Streamlining operations across 28 service centers, CE deployed Salesforce Call Center in under four months to 1,300 customer experience and operational support users in the field. "We've been very pleased with the offering that we've had, both from the robustness of what Salesforce has as an application and what we can develop on with their solution itself," explains David Costello, CE's director of customer operations.

And yet the on-demand deployment, Costello acknowledges, did raise some concerns for CE, where customer service had "almost always been [handled with] on-premise--based solutions." Costello notes issues integrating Salesforce.com's on-demand offering with CE's Cisco Systems Internet Protocol telephony platform, being able to leverage rich information, and a loss of control over software that was no longer located on-site.

Costello notes that the depreciation cycle for technology investments is "a legitimate concern for any company," but protecting investments may not be the right metric for gauging contact center success. "We were looking for the right solution that would bring the best experience to our customers and ease-of-use and flexibility to our organization," he says.

Costello believes more contact centers are moving toward using SaaS, but stories like his remain few and far between -- and that silence may be a factor. According to Salesforce.com's So, "A lot of people who use us are a little shy in PR, so we have to be a little hesitant about how we talk about them."

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