• September 1, 2015
  • By Donna Fluss, president, DMG Consulting

The Outlook for WFO: Optimal

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DMG research has found that, based on an analysis of U.S. government numbers, back-office personnel are 2.6 times more numerous than front-office personnel. Although DMG has not found a good source for branch employee numbers, adding these workers to the mix increases the addressable opportunity for sales of back-office and branch WFO solutions.

Front-office WFO vendors are actively pursuing back-office and branch opportunities, and after years of struggling to make any headway with these sectors, they're finally seeing progress. Sales of back-office and branch workforce management (WFM) solutions grew by 16.1 percent, from $33 million in fiscal 2013 to $38.3 million in 2014. While these numbers are small compared to the $281.7 million that WFO suite providers earned from selling WFM solutions to contact centers during 2014, it's still a notable improvement over previous years, and an indication that enterprise executives and operations managers are starting to adopt these essential and high-value applications. But if WFO and WFM vendors want to really open up the back-office and branch WFM markets, they need to significantly increase investment in these areas. DMG expects to see continued research and development investments in WFM and WFO solutions for back offices and branches during the next five years.


Leading WFO vendors continue to push sales of their new analytics capabilities, yet the revenue numbers for these WFO sectors remain small. During 2014, sales of speech analytics, the most talked-about analytics solution on the market, were $147.2 million, up only 7.8 percent from the year before. Sales of contact center performance management solutions continued to be slow, accounting for $73.8 million in revenue in 2014, an increase of only 4.4 percent from 2013. Desktop analytics, one of the newer high-value analytics capabilities, posted revenues of only $44.6 million. The market potential for these applications remains high, but vendors are struggling to convince companies to buy them.

The new push in the market is for customer journey analytics. It's a great concept—helping organizations capture and evaluate data points throughout a customer's life cycle. While there is a great deal of talk about such solutions, the products available thus far have limited capabilities—and usefulness. Most of the supposed customer journey analytics solutions can handle only one or two channels, which provides only a partial view into enterprise performance. But the vendors in this area are making substantial investments and are moving the market in the right direction. DMG expects to see ongoing investment and innovation in the area of customer journey analytics during the next few years, which should result in high-value, beneficial solutions that enterprises will want to use.


DMG expects the WFO market to continue to outperform most of the contact center sectors, just as it has for the past 15 years. The question is, how will this be accomplished? It remains to be seen whether NICE will respond to Verint's acquisition of KANA in kind or move in a totally different direction. (It's a given that NICE will respond to the KANA acquisition in some fashion by making one or more acquisitions, if only to realign its revenue with Verint's.) Vendors will continue to push sales of their new analytical capabilities, and DMG hopes that vendors improve the integration among their solutions' many modules to allow customers to realize the benefits of fully integrated suites. Sales of back-office and branch WFO and WFM, in particular, are going to pick up momentum, although the pace of adoption would be increased if the solutions were better targeted for their specific needs. And amid all this innovation, look for the WFO vendors to continue to make investments in their core recording capabilities, as this fundamental functionality is still the foundation of their suites.

Donna Fluss (donnafluss@dmgconsult.com) is founder and principal of DMG Consulting, a provider of contact center and analytics research, marketing analysis, and consulting.

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