TCO Cook Book 7 Ways to Reduce TCO and Improve Business Operations
Table of Contents Introduction #5 Openness #1 Simplified Architecture #6 Protection from Data Loss #2 Scale-Agility: The Ability to Easily and Rapidly Scale Up and Out #7 Future-Readiness and Wide Application Support #3 Ease of Operation Additional Thoughts on Driving Business Value and ROI #4 Ease of Implementation About NICE Engage Platform and Advanced Interaction Recorder (AIR)
The Parameters Included in Tco Calculations in Most Cases are: 7 Ways to Reduce TCO and Improve Business Operations What is the purpose of enterprise technology? It is a tool for achieving a goal that will promote growth, raise revenue, increase productivity, cut costs, serve your customers or promote your brand. Before being initiated, any technology project needs to be justified; and the most common justification is the project s Return on Investment, its ROI. The ROI equation takes into account both the total cost of ownership (TCO) of a given technology and, on the flip side, its benefits, or its ability to deliver business value, over time. The Mechanics of Total Cost of Ownership (TCO) Calculations The TCO of the vast majority of technology solutions is evaluated primarily based on defined, measurable cost parameters. Contact center recording and interaction management platforms are no different. Hardware necessary investment in servers, storage, PCs, network devices, etc. Implementation and integration deployment service fees and the cost of customization. Ongoing service periodic technical support fees or one-off service charges. Third-party software the cost of supporting software, such as operating systems, databases or virtualization software. Direct software the cost of recording and interaction management platform software. the in-house and external labor costs of configuring, administering and maintaining systems, as well as network, security, facilities, cooling and power costs. Downtime and risk the cost of restoring services, lost productivity or regulatory exposure due to not recording calls. There are common models to calculate TCO and most vendors can provide cost indications for at least some of these parameters. But consider this: what are the drivers that affect and cause these parameters to change? What are the underlying factors that that may change the cost parameters of a recording system over time? If not taken into consideration, these underlying factors may have a significant impact on mid- to long-term business operations. This paper outlines some of the key factors driving the costs of onpremises 1 recording systems, discusses how they affect TCO and business operations over time, and recommends a course of action to reduce TCO and improve business operations. * Cloud-based solutions, or XaaS business models, are entering the contact center and gaining traction. However, their TCO, as well the benefits they deliver, vary significantly based on specific delivery models. Consequently, this e-book is focused on on-premises solutions
#1 Simplified Architecture Enterprise systems - such as recording and interaction management systems - often have complex architectures. A complex architecture is hard to plan, hard to configure, and includes a significant number of components performing different functions. Complex architectures are also difficult to manage and maintain, and they have a higher risk of failure. Simplified recording architecture is characterized by a consolidation of processes on a few, standard components. This is achieved by ensuring that as much of the functionality required is conducted in a single server. A single server that captures all interaction types and performs the realtime recording and archiving decisioning, results in a significantly lower server count. Functional consolidation also minimizes the risk of errors, reduces load and requires lower processing power. A solution with simplified architecture and a minimal number of components Use of common, off-the-shelf (COTS) servers and up-to-date standard software A single server supporting any media type Support for all related functionality, such as encryption, archiving and real-time mediation in the recording server Hardware Third-party software (labor, training, spare parts, etc.) Downtime and risk
#2 Scale-Agility The Ability to Easily and Rapidly Scale Up and Out Ability to scale easily from a few channels to thousands Software that can be run on different server types to minimize underlying infrastructure costs Sizing and scale do not affect channel distribution Software, in many cases, comes with limitations and boundaries: capacity, processing power, connections and scalability. Another layer of boundaries and limitations comes from the infrastructure layer the servers and hardware or virtualization environment it can run on. All these limitations, in turn, limit the ability to perfectly align your system with your needs on an ongoing basis. Mismatch between needs and capacity leads to excessive investment and cost in anticipation of growth and unexpected change, or to insufficient capacity in the event of unforeseen rapid growth or the introduction of new business applications. Scale-agility is the ability of software to quickly and seamlessly meet capacity needs, without excessive investment. Hardware Software Implementation and integration
#3 Ease of Operation There is a common rule of thumb in the IT industry that the cost of systems is only between 25-30% of the TCO, and the rest is the ongoing day-to-day expenses of operating and managing the system. The effect of ease of operation on TCO cannot be exaggerated. Ease of operation comes into effect in numerous areas, such as building IT personnel expertise, the impact of ongoing maintenance and procedures, the speed and cost of reacting to failures, and even allocating licenses across locations or lines of business to meet dynamic business needs. Complex operations, therefore, affect the direct cost of running a recording system. They are time consuming, adding alternative costs, and often lead to additional payments to vendors and third parties. Hardware and software standardization Simplified architecture Simple, centralized channel management Risk-free channel configuration with no effect on the system One-click recovery solutions in the event of failure or disaster Root-cause and rapid-mitigation tools Third-party software Downtime and risk Ongoing service
#4 Ease of Implementation A contact center recording system operates in a complex environment. Upgrades or new system installations carry the cost of customization and installation, as well as the cost of integration with telephony systems, switch environments, networking, agent desktop environments, databases and archiving systems. Integration with a wide range of contact center solutions Central deployment tools enabling automated software installation and configuration Mechanisms that enable migration to new recording solutions with zero downtime, and no data loss Ability to seamlessly migrate from several versions, across distributed locations Ability to re-use existing hardware infrastructure during migration COTS servers and standard software Implementation complexity impacts the cost and time-to-value of adding new types of recording channels, or introducing new recording features and business applications. In addition, altering mission critical systems carries the costs of downtime and data loss, and in extreme cases, the risk of failure with no fallback mechanism. Implementation and integration Downtime and risk
#5 Openness Interaction recording systems are part of a complex environment of related contact center technology. Therefore, their capability to effectively interface with, and share information across, contact center solutions affects more than just costs. Openness and the ability to share information across contact center solutions is a key element enabling flexibility in design and technology selection. It is critical to the contact center s smooth operation and efficiency, and impacts its ability to adopt new technologies, add new capabilities and build new processes - all with the purpose of serving customers better. Open APIs that standardize and streamline integration with: - SIPREC interface - Export to external BI - External business data systems - CTI systems - Generic text sources - CRM systems Hardware
#6 Protection from Data Loss systems are mission critical, tasked first and foremost with recording for regulatory compliance purposes. Furthermore, numerous business applications - such as quality management, interaction analytics and real-time applications - depend on recording to drive business value and improve customer experience. system failure, downtime or data loss can thus lead to significant fines for failure to meet regulatory compliance standards. Without the tools dependent on recording for providing agents real-time guidance, call handle times will be dragged out and customers are more likely to be dissatisfied with their service quality. In addition to the resultant inefficient business operations, the cost of restoring service to its previous level can also be prohibitive. The means to avoid those costs fall into two categories: a) operational tools and mechanisms to prevent data loss and minimize recording downtime; and b) rapid recovery tools for various types of failure. Mechanisms to allow maintenance and upgrades with no downtime Advanced monitoring solutions that can alert when recording does not happen, and explain why Mechanisms to identify failure at any level: component, telephony, network, or event datacenter Mechanisms to ensure data loss prevention in case of maintenance, Rapid one-click recovery tools at every level Downtime and risk
#7 Future-Readiness And Wide Application Support Today s business environment is dynamic, with repid bussiness and technological change. New interaction channels, telephony technologies and real-time applications are constantly being introduced into the contact center, with the purpose of creating a rich customer experience. In addition, the recording system and its interactions data from the platform on which real-time value-generating business applications reside. Quality management, interaction analytics and real-time applications all improve customer experience and operational effiency. Agnostic to the telephony environment Designed to adapt and easily integrate with multiple switch environments and various recording methods All-in-one recording solution, supporting multiple channels Integrated real-time engine A rich portfolio of business applications designed to optimally leverage real-time interaction information Direct software Hardware Third-party software Implementation and integration Downtime and risk
Additional Thoughts on Driving Business Value and ROI When conducting a TCO evaluation, it is easy to lose sight of the original purpose of the system: capturing interaction data to ensure regulatory compliance and to leverage those interactions to drive customer experience. The top line of the ROI calculation, or the ability to meet these goals efficiently now and down the line, is often more important than the cost of ownership. TCO Is More than Cost It is a Measure of the Future As we have seen, an accurate TCO evaluation has to be forward-looking, taking into account dynamically and at times, even unexpectedly changing business operations over time. Understanding the seven key factors we outlined above make such a TCO calculation valuable, as these factors play a significant role in creating flexible and responsive business operations. In adopting or upgrading a recording solution, looking for these seven elements - scale-agility, simplified architecture, ease of operation, ease of implementation, openness, protection from data loss, and future readiness is the key to making sure the solution provides the value it promises.
NICE Engage is the industry-leading multi-channel recording and interaction management platform. It helps organizations comply with the strictest regulations and extract business value from every customer interaction. About NICE Engage Platform and Advanced Interaction Recorder (Air) The NICE Advanced Interaction Recorder is NICE s new recorder and part of the NICE Engage Platform is at the cutting edge of interaction recorder technology. NICE AIR consolidates multiple channel recording including video, text and chat, and interaction management functionality such as encryption archiving and real time streaming into a single server. NICE AIR provides seamless customer experiences, with breakthrough recording scalability and a low TCO. NICE AIR and Engage Platform Support the Most Advanced It Standards and Business Requirements, and are Built on Four Pillars: Minimized IT footprint and higher scale Next generation business continuity Simple system management Redefined compliance recording NICE Engage platform and AIR provide contact centers with dramatically reduced TCO while generating high business value and setting the foundation for the future. For more information please visit: http://www.nice.com/engage/cross-channel-interaction-recording
About NICE NICE (Nasdaq: NICE) is the worldwide leading provider of both cloud and on-premise enterprise software solutions that empower organizations to make smarter decisions based on advanced analytics of structured and unstructured data. NICE helps organizations of all sizes deliver better customer service, ensure compliance, combat fraud and safeguard citizens. Over 22,000 organizations in more than 150 countries, including over 80 of the Fortune 100 companies, are.using NICE solutions www.nice.com