Enterprise Communications

Interactive Intelligence Looks to its Contact Center Strengths for Growth, Not So Much UC Markets

by Rob Arnold 14 Oct 2010
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At the Interactive Intelligence Global Partner Conference 2010 in San Antonio, TX, spokespersons for the company provided updates on products and services direction, as well as branding, marketing and other corporate efforts. Interactive Intelligence remains very much focused on its core strength as a contact center solutions developer and the vast majority of its growth initiatives are founded upon this strength.

The most heavily covered topics included Interaction Process Automation (IPA), Communications-as-a-Service (CaaS) and the forthcoming latest release of the company’s flagship Customer Interaction Center (CIC) software suite.

The Communications-as-a-Service (CaaS) offering, essentially CIC hosted by Interactive Intelligence, was launched in North America several years ago and has since been introduced to Europe. The company reports that in North America in 2010, 25 percent of new customer orders were attributable to CaaS – compared to just five percent in 2009. There are plans to open additional Interactive Intelligence data centers to support the CaaS offering in additional international markets. The CaaS offering gives Interactive Intelligence partners new options to meet a variety of enterprise deployment needs and budgets. Customers can implement hosted CIC services with greater speed and at reduced upfront capital expense than CPE-based solutions. Customers can deploy CIC as a hosted solution then migrate to CPE, or vice versa. (Note that the vendor reports the vast majority of customers who migrate go from CaaS to premise-based).Customers can purchase the systems and have them managed as dedicated hosted solutions. CaaS margins may be lower, but sales cycles are shorter and revenues are recurring. While there have been some complaints by partners about the lack of feature parity between the CPE and hosted versions, Interactive Intelligence has articulated some development initiatives aimed to help alleviate the issues, such as by improving the richness of auto attendant for use in both environments. With its CaaS initiative, Interactive Intelligence has kept to its core expertise to create a differentiator from most of its competitors.

Built on top of CIC, Interaction Process Automation (IPA) is a business process automation and management application. IPA creates control and visibility into work flow processes by intelligently routing, tracking and reporting on work (i.e., a help ticket or insurance claim) as it progresses through the phases of completion and people responsible for it. IPA can be integrated with a range of data sources (CRM, SQL, sales force tools, web services, email, etc) to initiate processes or processes can be initiated by users manually. Users access IPA process work fromwithin their Interaction Client interface. Made available in 1H 2009, Partners are encouraged to market and resell IPA solutions, but at this early stage in IPA maturity Interactive Intelligence plays a lead role in customer qualification, consultation and integration services, which over time will increasingly be handed off to qualified partners. The company is targeting CIC accounts in regulated industries (i.e., financial services, healthcare, utilities, etc.) needing to ensure compliance as well as those looking to reduce human latency, reduce paper, and improve accountability within work processes. Some examples of work processes include insurance claims, contract management, collections, lead generation, loss mitigation, patient scheduling and financial aid renewal. IPA will require Interactive Intelligence resellers to take more of a business consulting approach when selling the solution, but the majority of them are already experienced in work flow coordination within the contact center. In general IPA can be a nice fit within many Interactive Intelligence partner portfolios which again leverage the company’s known strengths in contact center solutions.

Although many of the specific CIC 4.0 details are under non-disclosure, the information that was confidentially provided evidences that Interactive Intelligence is listening to the wants and needs of its customers and partners. New deployment options, and new integrations and enhancements to applications will generally improve CIC competitiveness. However the company is also working hard to address the long intervals between major product releases. For example, CIC 3.0 was released in 2H 2008 and 4.0 is scheduled for Q1 2011 release. The company is now targeting one major release per year. This will mean fewer intermediate bug fixes and maintenance releases for partners and customers to contend with, and will also allow them to remain competitive and to innovate.

As a UC Analyst, I have one major knock against the company. That is the lack of emphasis given to its strategy as a UC solutions vendor and its development efforts in UC markets adjacent to the contact center. It is quite notable that Interactive Intelligence spokespersons abstained from using the term “unified communications or UC” while spokespeople from partners AudioCodes and IBM used the term liberally in presentations. The company does have a UC play, including home-grown IP telephony, unified messaging, presence, instant messaging, mobility, multimedia soft clients and more, as well as integrations with third-party UC (Microsoft now and IBM planned for 1H2011), telephony, messaging, video, conferencing, mobility, CRM, end points and social media solutions. However, Interactive Intelligence’s unwillingness to position itself as a UC solutions provider, coupled with its reluctance to compete for SMB and basic IP telephony accounts leaves the company with more narrow addressable markets than its foremost rivals. The company clearly has the technology foundation to be more competitive in the enterprise UC space, yet with the limited emphasis on non-contact center capabilities Interactive Intelligence is selling itself short.

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