Cost Considerations for Migrating your Contact Center to the Cloud (CCaaS/Contact Center as a Service)

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Three whooping cranes flying through a partly cloudy sky

Cloud Contact Center Solutions provide companies tremendous opportunity to realize return on investment.  First, let’s delineate between on-premise and Cloud/CCaaS. On-premise contact center solutions are equivalent to home ownership – they require the company to purchase or lease the hardware, license the agents and supervisors, administer or sub professional services for all maintenance, upgrades and remediation, and then provide the telephony/SIP connectivity and design, install and support any integrations with CRM or other platforms.  

Cloud, on the other hand, is the rental or lease market – allowing companies to subscribe to or lease a contact center platform software from a provider who will install, manage and support the solution without any (or minimal) investment in hardware.  I’ll hearken back to the housing reference: in the case of CCaaS solutions, companies are able to quickly migrate and onboard agents akin to moving into a fully furnished corporate condo. Bring your personal items, and off you go for a nominal monthly fee.  Should you require more advanced features for your agents, you can add-on ala carte Workforce Optimization (WFO/WFM/WEM), Quality Assurance (QA), Advanced IVR, outbound dialing campaigns and more.  Comparatively, if you chose to purchase your home/CC solution, you would need to then bring in third-party solutions and integrate them into your system for WFO, QA, AQM, IVR (the list goes on) and license them for all your agents vs. the ones that require it.

Let’s delve deeper into the financials of this decision. We discussed the ability to rent or lease contact center software in the CCaaS/Cloud model.  By consuming the technology in this manner, a company can minimize capital or upfront expenditures since no or limited equipment is needed. They can pay monthly based on their actual consumption (allowing for seasonality or scalability with service while costs stay true to actual usage vs. projected).  

By consuming it via the cloud, you’ve also eliminated the need for exorbitant professional services fees to design/build/implement the solution. Typically, a cloud-based provider charges a nominal installation and training fee far less than the cost to do it in-house.  So, we’ve eliminated the majority of capital costs, minimized our installation and training costs and we are paying for actual usage, which allows us to eliminate any waste or overages for agents/supervisors/channels/SIP trunks/telco, etc.  We are now operating in a truly optimal environment from a cost standpoint, and we have a very clear line of sight on our run rate for our Contact Center technology.  Outside of the human/resource costs, we’ve reined in our technology and operating costs, upgraded to the latest and greatest functionality and eliminated overage charges and financial waste.

So far, we’ve painted a stark contrast between home ownership and home rental, contact center on premises or in the cloud, but for our analogy and the sake of this discussion, we’re just leveraging the technology available in the market in the most optimal manner for the business. 

By consuming it this way, we also take advantage of the disaster recovery and survivability of cloud solutions.  Common practice is to have multiple geographic, redundant instances and data centers (commonly referred to as POP’s or points of presence) with multiple underlying telecom carriers coming in as well to prevent any single point of failure within the technology or the PSTN.  It would simply be fiscally irresponsible to try and replicate this type of disaster recovery and continuity in the on-premises model since you would single handedly need to procure, manage and pay for these economies of scale, whereas this comes along as an added benefit or differentiator with a CCaaS company that provide this natively to all their clients as table stakes these days.  

That leaves us to the data and analytics piece, which seems to become more important by the day as businesses realize the amount of intellectual property and customer insights they can learn from this data if it is digestible.  CCaaS companies continue to improve on providing real-time data and analytics about their clients and their clients’ consumers behaviors.

To summarize, the contact center market is volatile right now with new technologies and features being released monthly; to capitalize on these business and technological benefits it behooves companies to act, but to do so cautiously with limited downside, make sure you lease instead of buy and include a POV (Proof of Value or Concept) in the contract terms.  Also, insist on current client reference calls with similar business parameters and scale.  While this will not make you immune to risk, it should significantly reduce it, while also enabling your company access to the latest and greatest technology in a world where consumers demand a seamless customer experience – however they may choose to engage with you!

Erik Zecevich
Erik Zecevich
Erik is an experienced Enterprise Sales Executive and Contact Center Transformation expert, specializing in hosted & managed cloud-based solutions. He has over 15 years of successful enterprise sales and management assisting Fortune 50 to 1,000 with migrating legacy telephony and contact center technologies and leveraging AI to improve conversion.

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