Supercharge Digital Transformation

Transcription

1 Supercharge Digital Transformation Well-Managed UCC Foundation Delivers Measureable Digital Success Using third-party performance and operations management tools with Skype for Business results in a 58% reduction in operational costs and a 19% reduction in implementation costs. Learn more about how to make your UCC (unified communications and collaboration) investment yield a better return and how a well-functioning UCC investment rolls up into digital transformation success organization-wide. Brought to you by Unify Square Unify Square s software and cloud managed services power the world s largest Microsoft Skype for Business and Teams deployments. Built on innovative technology, our solutions create actionable insights and help enterprises transform their UC&C infrastructure, delivering enterprise-grade service availability, data-driven end-user satisfaction, and double-digit ROI increases. Founded by SfB product visionaries, Unify Square is one of Microsoft s global elite partners and a founding Cloud Voice and UC IT Pro Tools partner. Unify Square solutions have delivered value to more than 5 million Skype for Business seats, in over 275 enterprises across more than 50 countries, and in most major industry verticals. Skype for Business & Teams Cloud Managed Services Headquartered in Bellevue, Washington, Unify Square also has offices in the United Kingdom, Germany, Switzerland, India, Australia and Lithuania. We invite you to learn more. Contact sales@unifysquare.com or visit unifysquare.com.

2 Q1 18 Supercharge Digital Transformation Well-Managed UCC Foundation Delivers Measureable Digital Success As business and technology leaders increasingly focus on how to digitally enable their organizations, they must first ensure key foundational technologies are ready to support demanding, next-generation applications. Two of the most vital technologies among successful transformative companies are Unified Communications and Collaboration (UCC) and analytics. A broad set of software that analyzes patterns in data, analytics are crucial to UCC success. Analytics in UCC are derived from management tools that evaluate real-time and historical performance data. This report provides guidance on how these two technologies if implemented and managed properly can supercharge digital transformation initiatives. Compass Direction Points ± UCC, analytics key to digital transformation success. Successful digital transformation initiatives require a well-managed communications and collaboration infrastructure, along with analytics to help with day-to-day management and business decisions. ± Management tools reduce UCC opex by 58%. UCC operational costs are 58% and implementation 19% lower among large enterprises that use performance management tools. ± User adoption up 30% with management tools. Large enterprises have 30% more active UCC licenses when they use performance management tools. By Robin Gareiss President Nemertes Research Nemertes Research Group Inc

3 Table of Contents TABLE OF FIGURES 3 EXECUTIVE SUMMARY 4 THE ISSUE 5 UCC S ROLE IN DIGITAL TRANSFORMATION 6 MEASUREABLE VALUE 6 REVENUE BOOST 6 FASTER DECISION MAKING 6 MOBILE ENABLEMENT 7 UCC MARKET AND PROVIDERS 7 UNIFIED COMMUNICATIONS 7 TEAM COLLABORATION 7 MEETING APPLICATION 7 STAYING ON TRACK WITH SOLID MANAGEMENT 7 MANAGEMENT TOOL DRILLDOWN 8 INTEGRATED UCC PLATFORM/CLOUD MANAGEMENT 8 SPECIALTY MANAGEMENT PROVIDERS 8 IMPACT ON COST AND USER ADOPTION 10 ADDITIONAL DECISION FACTORS FOR UCC 11 BUSINESS REQUIREMENTS 12 UCC APPS 12 ARCHITECTURE 12 NETWORK 13 COST 13 CONCLUSION AND RECOMMENDATIONS 15 2

4 Table of Figures FIGURE 1: UCC COST SAVINGS WITH SPECIALTY MANAGEMENT TOOLS...5 FIGURE 2: IMPACT OF MANAGEMENT TOOLS ON COST FOR LARGE IMPLEMENTATIONS FIGURE 3: UCC LICENSES WITH/WITHOUT MANAGEMENT TOOLS FIGURE 4: FIRST-YEAR COSTS FOR 1,000+ ENDPOINTS FIGURE 5: OVERALL UCC COSTS

5 Executive Summary Digital transformation is all the rage among business and technology leaders. Truly transforming takes significant planning, discipline, and focus with swift turnaround times. Step 1 is understanding the core definition of digital transformation and what s required for success. Step 2 is evaluating the key technology areas that support the operational execution of digital transformation. Unified Communications and Collaboration (UCC) and analytics are among the top technology areas successful companies cite to facilitate digital transformation. UCC delivers the ability for employees to communicate and collaborate effectively with one another, and with customers or partners. It typically speeds decision-making and provides the context required for effective meetings in real time and on any device. As UCC becomes more complex, with new applications, integrations, and architectures, effective management is paramount to achieve the aforementioned benefits. By leveraging analytics through information gleaned from relatively affordable management tools, UCC will run better fewer outages, more predictive analytics to avoid problems, lower jitter, etc. What s more, organizations can drastically reduce the implementation and operational costs of UCC, while also increasing user adoption because of improved performance and better metrics. For example, operational costs drop in large part because the management tools automate manual functions, requiring a smaller staff to manage UCC. Case in point: Large organizations using performance management tools reduce their UCC management team by 36%, according to our research. This report covers the decision points for UCC and associated management tools that deliver analytics, including the following: Provider selection Management and analytics Business requirements UCC apps Architecture Cost 4

6 The Issue More than 75% of organizations have or are developing a digital transformation strategy. Only 33% of those, however, have an enterprise-wide strategy where they collaborate on projects, decision-making, and technology selection across departments. Among the top areas that IT and business leaders say are crucial to successful digital initiatives: Unified Communications and Collaboration (UCC) and analytics. UCC enables employees to collaborate and make faster, better-informed decisions, so the technology itself is transformative. It also bolsters customer experience by providing options for interaction, whether via voice, video, or screen sharing. But problems such as repeating outages or poor voice quality could erase UCC s benefits. Enter analytics, sophisticated software that discovers, analyzes, and interprets important patterns in data. Analytics is a broad field, covering numerous areas in any business, where the goal is to use the data to improve a business function. For UCC, analytics are derived from management tools that evaluate real-time and historical data that help companies operate UCC more efficiently and significantly more cost effectively. Cost Savings With Performance Management Implementation 19% 58% Percentage saved vs. using no performance management tools Figure 1: UCC Cost Savings With Specialty Management Tools Operational In fact, companies save 58% on UCC operational costs and 19% on implementation when they use performance management products, according to our research. The knowledge gleaned from performance and administrative management enables IT to offer high-availability UCC apps, customized to what results in the best customer experience and employee productivity. By combining UCC with analytics, organizations will supercharge their digital transformation strategies cost effectively. 5

7 UCC s Role in Digital Transformation Companies increasingly are focused on providing a rich set of UCC apps to support digital transformation initiatives. UCC apps include a broad IP voice communications infrastructure, and associated features, such as abbreviated dialing, call logs, contact lists, unified messaging, and mobile enablement. In addition, they include a growing list of collaboration apps, such as video conferencing, screen sharing, team collaboration, and digital whiteboards. Measureable Value UCC helps drive digital transformation success in several ways, including the following: Revenue Boost New communications channels boost revenue. By reaching new customers through webchat or text messages, companies have seen revenue increases. Associated management tools are vital to ensuring the channels have high percentages of uptime and fast Mean Time To Repair (MTTR) any issues. They also may provide metrics (such as user adoption) used to measure business success. Faster Decision Making Internal decision making accelerates. With a variety of remote collaboration tools, employees can meet, view documentation they need, review historical data or files, and make decisions more quickly than requiring an in-person meeting. This also boosts revenue and improves competitive advantage. However, if the company starts to rely on such apps (i.e., video conferencing, audio conferencing, team collaboration, digital whiteboards, etc.), and they fail, so does any digital transformation project associated with UCC. Again, this is why management tools are so vital. Digital Transformation Defined The term digital transformation can have many definitions. Here is how Nemertes defines the term: 1.) Innovative application of technology This could be the application of existing technologies or entirely new ones. 2.) Improves or creates a process, product, or experience Because of that technology implementation (along with the right people, processes, and budgets), something changes and indeed, improves. 3.) Drives measureable business value The improvement must be a measurable enhancement to the business increased revenue, improved customer experience, reduced cost, improved employee liability, and competitive advantage. 4.) Happens quickly Digital transformation initiatives must prove incremental value within six months. Exceeding this timeline may result in competitors developing something faster, stakeholders losing interest, or budget cuts. 6

8 Mobile Enablement Team collaboration emphasizes mobile-first. Key employees who can finalize a decision or help with a high-value customer question are often mobile. Making such UCC apps available to mobile devices is another success factor. Given differences in network speeds, form factors, and locations, fine-grained management is crucial. UCC Market and Providers The UCC landscape is changing rapidly. There continues to be a broad set of UCC providers in each of the three of the areas described below, and some provide services in all: Unified Communications This area includes voice, instant messaging, presence, and possibly screen sharing. Among the most widely adopted Unified Communication platform providers are Cisco, Avaya, Microsoft, and to a lesser extent, ALE and Mitel. Top Unified Communication service providers are AT&T, BT, Deutsche Telecom, Telstra, and Verizon, and to a lesser extent, pure cloud providers RingCentral, 8x8, and Vonage. Team Collaboration An emerging space, team collaboration includes persistent workstreams, channels that are mobile optimized, search, document collaboration, voice and video chat. There are dozens of team collaboration providers, but the most widely used are Microsoft Teams, Cisco Spark, RingCentral Glip, and Slack. Meeting Application Meeting apps include Web and desktop video conferencing, along with technologies such as digital whiteboards to improve meetings. Meeting application providers are widespread, with products and services integrated with UC, such as Cisco Webex, Microsoft Skype for Business, and Polycom, along with point products, such as Adobe Connect, CafeX Chime Meetings, or Citrix GoToMeeting. Staying on Track With Solid Management Managing UCC apps and gathering associated metrics are crucial to digital transformation success. Unfortunately, one of the most frequently overlooked and under-budgeted areas of any UCC rollout are management tools, which provide the insight and administration for optimal app performance and metrics required to measure true digital transformation. IT leaders have compelling reasons to consider specialty management tools. Not only do they reduce operational costs, they also increase user adoption by preventing outages and improving voice and video quality, among other things. 7

9 Management Tool Drilldown There are three primary types of tools specific to managing UCC, and a total of 55.3% of companies use either one or multiple of the tools: 1. Integrated UCC Platform/Cloud Management: These are providers of on-premises or cloud-based UCC (as described in the previous page) that offer management tools as part of their platform or service. o Our research indicates that 42.6% of IT professionals use integrated UCC management from their platform providers. 2. Specialty Management - Performance: These are third-party specialists (i.e. not the UCC suite vendors themselves) whose tools focus on UCC uptime, problem/resolution, root-cause analysis, reporting, predictive analytics, and ongoing performance of UCC apps. o Our research indicates that 22.7% of IT professionals these tools mostly large enterprises. 3. Specialty Management - Administrative: These are third-party specialists whose tools focus on UCC configuration, event, and address management, among other things. o Our research indicates that 28.8% of IT professionals use these tools. Integrated UCC Platform/Cloud Management Most of the major platform providers (Cisco, Avaya, Mitel, etc.) develop and offer their own management tools, but they are somewhat rudimentary. Microsoft has licensed technology from Event Zero for Unified Communications as a Service (UCaaS) management. But enterprise IT leaders in our research say direct UCC management and analytics from Microsoft is sub-par, leading enterprises to leverage emerging specialty tools from vendors that focus solely on management and monitoring. Only about 16% of Microsoft Skype for Business customers in our research used such management tools but those that did saved a whopping 63% on their operational costs. Because platform providers tend to be weak with management capabilities, it s important to evaluate vendors who specialize in management, monitoring, and associated reporting. Specialty Management Providers For many years, Nemertes has recommended organizations consider specialty providers for management. By focusing on management, they offer more features, reports, and insight. Consequently, they reduce operational costs more than platform-only tools. 8

10 Organizations can optimize UCC by adopting both performance and administrative management. But often, this requires multiple tools. For example, IR and Nectar focus on performance management for multiple vendors, but they do not specialize in the administrative functions. Meanwhile, Voss and Unimax specialize in administrative capabilities but not performance management (Voss has started to dabble in performance management through a partnership). Unify Square provides both performance and administrative management focused specifically on Microsoft UCC systems eliminating the need for multiple tools. Riverbed primarily offers performance management for multiple platform vendors, but it also provides limited administrative functions via its acquisition of Clarus. Without management tools, our research shows companies spend more on UCC operational costs. Additionally, the communications systems and collaboration apps do not function as efficiently as possible, and it takes IT longer to isolate and resolve problems. What s more, without the tools, companies will have little to no metrics, historical or real-time reports to help with decision making (i.e., who is using/not using which apps and for what purposes to identify where to focus user awareness and adoption; which apps are helping to drive revenue in the contact center to expand rollout, etc.) Nemertes Cost Methodology Nemertes tracks UCC costs by vendor, size, and architecture. In our UCC Total Cost of Operations research, we gathered information on capital, implementation, and operational costs from more than 700 organizations using the following metrics and calculations: Capital cost per endpoint: Includes PBX, endpoint devices and licenses, servers, other hardware. In some cases, bundled licenses include certain UC apps o = Capital costs / number of endpoints (handsets, softphones, etc.) Implementation cost per endpoint: Includes staff time and third-party consultants and integrators o = ((Staff time * loaded hourly rate)+third-party costs)/ number of endpoints Operational cost per endpoint: Includes staff time (measured as Full Time Equivalents, or FTEs), equipment maintenance, third-party managed services, training and certification. o = ((Number of FTEs * average annual loaded salary) + equipment maintenance + managed services + training/certification) / number of endpoints 9

11 Impact on Cost and User Adoption It s clear that UCC and associated management tools enable companies in their digital transformation projects. Equally as compelling, they do so while reducing operational costs by 58% (with performance management) to 66% (with administrative management) and increasing user adoption by 30% among large enterprises. Focusing on rollouts with 2,500 or more endpoints (the size at which companies really start purchasing specialty tools and applying complex requirements to them), cost savings for both performance and operational management is significant. Figure 2 shows the relative annual operational costs per endpoint (handset, audio bridge, softphone, etc.) of those who do and do not use both performance and administrative management tools. In all cases, IT implementation and operational costs are lower when tools are in use. Impact of Management Tools on Cost (2,500+ Endpoints) With Tools Without Tools $400 $350!$376!! $300 $250!$252!! $200 $150 $100!$132!!!$107!!!$104!!!$107!!!$148!!!$127!! $50 $- Implementation Operational Implementation Operational Performance Management Administrative Management Figure 2: Impact of Management Tools on Cost Per Endpoint for Large Implementations Typically, the largest component of operational costs is IT staffing. Given that management tools should automate manual oversight functions, it s no surprise that companies need fewer people to manage UCC when they re in use. Large organizations that use performance management tools reduce their IT staff managing UCC by 36%. The tools provide automation, foresight, data, and reporting 10

12 to help administrators keep UC running more efficiently. They also provide the metrics to showcase user adoption collaboration apps, among other things. What s more, large enterprises using management tools see a 30% improvement in user adoption of UC. (Please see Figure 3.) When the communications systems and collaboration apps run without sound quality degradation, choppy video, or other performance problems, employees are more eager to rely on them to do their jobs, IT leaders say. What s not explicitly factored here are costs associated with reduced employee productivity resulting from outages and poor performance. Increasingly, IT leaders say they are starting to tie the cost of downtime in with their executive dashboard reports to illustrate the need for more sophisticated management tools. Percent of Employees With UCC Licenses (2,500+ UCC Endpoints) 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 94%$ 72%$ With Tools Performance Management Without Tools 86%$ 83%$ Administrative Management Figure 3: UCC Licenses With/Without Management Tools Additional Decision Factors for UCC Understanding the products, services, and cost savings is a good start. But solidifying a next-generation communications infrastructure one that performs well, is flexible, and functional is easier said than done. As organizations work to improve their UCC capabilities and evaluate product/service options, they must also take time to evaluate and make several decisions in the following additional areas: Business requirements 11

13 UCC apps Architecture Cost Business Requirements IT and business leaders must determine the business drivers for improvements in UCC. Doing so requires detailed discussions with business unit leaders to uncover problems and opportunities that UCC can address. For example, a manufacturing company may have a production problem that requires engineering input but delays the production by two to three days while the appropriate engineer changes his schedule and arranges travel to the relevant facility. This causes competitive disadvantage because it delays bringing the product to market. By implementing a high-definition, hands-free video conferencing system, the person on the production floor can show the engineer the problem with getting the real-world product to match the engineering blueprints. The engineer, who now can see exactly what s wrong (two parts don t fit together like they should, according to the blueprint, for example), can make the adjustment to get the product back on track in minutes or hours, rather than days. UCC Apps The situation discussed could benefit from any number of communications and collaboration tools, ranging from voice to video to webchat to team collaboration. Information about existing adoption of collaboration tools already available in the company, success rates, decision timeframes, and more may help the IT staff members decide exactly what apps they should enable or add to address the specific problem or opportunity. For example, in the situation previously described, the engineer may need to consult with other experts in the company to resolve the problem. And, they may want to screen share and use a persistent chat stream to help make the decision and to archive the path to the decision. That may dictate a team collaboration tool, such as Microsoft Teams, Cisco Spark, Slack, or others. It also may require the use of a new video conferencing system or even better quality telephony and associated headsets on the manufacturing floor. Architecture As with any new technology, IT must determine whether to roll out the UCC apps, as well as the tools to manage them, on-premises, in the cloud (either UCaaS or singleserver hosted), or a combination. Many larger companies often want to keep tools and technologies on premises because many have large IT staffs to manage and maintain the infrastructure. Others have fully or selectively outsourced various 12

14 components of IT. With UCC, many work with Managed Service Providers (MSPs) who handle day-to-day updates, break-fix, and operations of the infrastructure. Other organizations (including mostly small and midsize today, though some larger companies, as well) want to offload the technology to third-party cloud providers to free the IT staff to focus on more strategic functions. In fact, in our research, companies that are most successful in their digital transformation projects use UCaaS 3.7 times more than less-successful counterparts (It s notable that this group contains mostly small and midsize businesses). Onpremises solutions remain more prevalent for voice, while cloud is more prevalent for more advanced team-collaboration apps. Though this is only a correlation and not necessarily causation, it at least suggests a link between digital transformation success and cloud-based services. Network As part of the architecture discussion, companies also must evaluate the network another important part of the foundation. This becomes particularly vital when adding new collaboration apps, video infrastructure, or a new voice architecture. Questions to consider are: Is the core network engineered properly to handle the changing UCC traffic load? What percentage of the employee (or customer) base will communicate with a fast and reliable access network, vs. best effort? What percentage of the workforce will use a PC or Mac, vs. a tablet or mobile device on a slower network? How will the company keep track of changes in any of the scenarios affecting the network? Cost A detailed cost evaluation is paramount to every decision, whether it s the technology itself, the architecture, or the provider selection. In addition, management tools heavily influence implementation and ongoing operational costs, as mentioned earlier. From a high level, Figure 4 shows the differences in UCC costs by architecture only, while Figure 5 details the UCC costs by size of organization, regardless of architecture. The cost assessment is important as companies evaluate management tools to demonstrate the previously discussed implementation and operational cost savings such tools enable. 13

15 $1,400 First-Year Costs 1,000 + Endpoints $1,200 $1,000 $800!$1,154!!!$984!! $600 $400!$517!!!$653!!!$570!! $200 $- On-premises Cloud Shared Tenant (UCaaS) Hosted (Single Server) Figure 4: First-Year Costs Per Endpoint for 1,000+ Endpoints Hybrid (Mix of on-prem, cloud, and/or hosted) Overall MEDIAN Overall1UCC1Costs,1All1Providers,1All1Sizes,1Any1UCC1App1(Including1Telephony) Size Implementation Capital Operational Total1First1Year Less$than$50 $$$$$$$$$$$$$$$$$$$$$$ 672 $$$$$$$$$$$$$$$$$$$$$ 258 $$$$$$$$$$$$$$$$$ 1,651 $$$$$$$$$$$$$$$$$$$$ 2, $$$$$$$$$$$$$$$$$$$$$$ 324 $$$$$$$$$$$$$$$$$$$$$ 200 $$$$$$$$$$$$$$$$$ 1,148 $$$$$$$$$$$$$$$$$$$$ 1, $$$$$$$$$$$$$$$$$$$$$$ 321 $$$$$$$$$$$$$$$$$$$$$ 296 $$$$$$$$$$$$$$$$$$$$ 801 $$$$$$$$$$$$$$$$$$$$ 1, $$$$$$$$$$$$$$$$$$$$$$ 280 $$$$$$$$$$$$$$$$$$$$$ 253 $$$$$$$$$$$$$$$$$$$$ 527 $$$$$$$$$$$$$$$$$$$$ 1, $$$$$$$$$$$$$$$$$$$$$$ 112 $$$$$$$$$$$$$$$$$$$$$ 223 $$$$$$$$$$$$$$$$$$$$ 274 $$$$$$$$$$$$$$$$$$$$$$$ 608 More$than$10000 $$$$$$$$$$$$$$$$$$$$$$ 132 $$$$$$$$$$$$$$$$$$$$$ 222 $$$$$$$$$$$$$$$$$$$$ 100 $$$$$$$$$$$$$$$$$$$$$$$ 454 Overall1Median $$$$$$$$$$$$$$$$$$$$$$ 305 $$$$$$$$$$$$$$$$$$$$$ 250 $$$$$$$$$$$$$$$$$$$$ 739 $$$$$$$$$$$$$$$$$$$$ 1,294 Figure 5: Overall UCC Costs Per Endpoint Among organizations with more than 1,000 employees, on-premises deployments continue to have the lowest first-year costs. The primary reasons for cost increases in UCaaS are the new monthly subscriptions and increased staffing, despite the fact that some enter cloud services thinking they will reduce their IT staffs. It simply is not happening at most organizations. They are actually hiring new people to work on integrations between cloud collaboration and enterprise apps, to manage the relationship with the provider, and to market the cloud services internally to employees to ensure they know why and how to use them. Because hosted offerings are single-server and sometimes dedicated staffing and connectivity, the provider is not able to leverage economies of scale, resulting in a higher cost. Hybrid deployments also are costly because the customer must maintain an in-house staff to manage the on-premises deployments as well as new integrations between cloud and on-premises, continue to pay for equipment maintenance, pay monthly subscription for the cloud services, and also maintain staff to manage the provider relationship. 14

16 Conclusion and Recommendations UCC-driven digital transformation initiatives can be literally life-saving (such as patient diagnostics in healthcare) to efficiency-driving (such as video conferencing to speed or add visuals to decision-making) to innovative (such as an artificial intelligence app that posts in a team collaboration channel: Jim will be 15 minutes late to the meeting stuck in traffic ) to simply convenient (such as the ability to find all documents and chat streams associated with a project in one team collaboration channel.) Such digital transformation projects require an advanced communications and collaboration infrastructure to support swift internal decision-making, as well as enhanced customer experience. Management tools and associated analytics are key to making sure the UCC apps run properly and to providing data that monitors success or failure. Consider the following in the execution of your digital transformation strategy: Understand what constitutes a digital transformation the injection of technology to create or improve a process, product, or experience that ultimately drives value. Don t rush into the initiative, particularly if your foundational technologies need some dusting. Establish that an advanced set of UCC capabilities is imperative to help the company with its digital transformation business goals. If you can t communicate efficiently, that s where the focus needs to be, rather than an advanced transformation. Acknowledge that management of UCC, along with reporting and analytics, are a key part of the equation. In order to keep the apps working properly and report on whether new collaboration apps are achieving their stated goals, you must have management tools. Realize, however, not all management tools are created equally. Evaluate your options with specialty providers. Different tools will apply if you re using a single UCC platform provider vs. multiple, or if you re looking for performance vs. operations/administration tools. We recommend applying both operations and administration tools to your UCC deployment. About Nemertes Research: Nemertes Research is a global research-advisory and consulting firm that specializes in analyzing and quantifying the business value of emerging technologies. You can learn more about Nemertes Research at our Website, or contact us directly at research@nemertes.com. 15