The Hidden Risks of On-premises Contact Centers

The pressure is on for customer experience (CX) leaders.

In a recent survey of more than 1,200+ executives, 79 percent agreed CX is a top priority in 2023. Viewing it as central to growing revenue, attracting and retaining customers, and strengthening their brands. That's not to say leaders haven't made progress in these areas in the last few years. They have. We've helped many organizations digitize patient processes, personalize shopping experiences, create new revenue streams and reimagine their business models. 

Despite these cutting-edge experiences and innovations, many organizations are still lagging in one key area of CX: the contact center. 

Why should CX leaders care about the contact center?

The contact center, also referred to as the call center, is at the heart of CX. Why? Because it's a gold mine of customer data and one of the biggest contributors to customer sentiment and loyalty. In many cases, it's the only interaction between an organization and its customers, patients, fans or constituents. Meaning, the contact center absolutely must offer top-notch customer and agent experiences. Experiences that can be accelerated in the cloud. 

The problem is cloud contact center migrations are often buried at the bottom of an organization's to-do list. There are several reasons why this happens. We've heard leaders express concern about security and compliance in the cloud, fear of losing control and the sheer complexity of migration. We discuss these concerns and provide advice for determining what's right for your business in this article. 

While keeping your contact center on-premises once seemed like a safe bet, it is no longer. The long-term consequences can be devastating for organizations. The resulting inability to innovate and downstream implications to the CX — and to the entire organization — should not be overlooked.

CX leaders must understand the risks of this decision, including how ignoring the cloud in this case might negatively impact their ability to drive customer retention, loyalty and positive sentiment. 

Lack of agility 

Perhaps the greatest risk of keeping your contact center on-premises is stagnancy. Because an organization's IT team is responsible for acquiring hardware and conducting all necessary maintenance, patches, upgrades and integrations, it can take months (or longer, if they're short-staffed) to add a new feature or capability. Meanwhile, customers and agents are exposed to stale experiences, which may encourage some to look elsewhere for what they need. 

Inability to compete

While modern businesses are designed to move fast, customer expectations can evolve even faster. If organizations fail to keep up with the demand for easy, seamless and personalized experiences, they'll eventually get left behind. Due to the lack of agility inherent to on-premises contact centers, CX leaders might feel like their organization is always chasing their cloud-based competitors instead of leading the market with cutting-edge innovations. 

An organization's lack of innovation and agility also impacts the contact center workforce. Manual and disjointed agent experiences can lead to perpetual cycles of employee burnout and, turnover, plus increased costs for talent acquisition, onboarding and training. Contact centers that offer positive digital employee experiences are better situated to attract and retain valuable customer service talent for years to come. 

Overspending 

Organizations with on-premises contact centers typically leverage a capital expenditure (CapEx) budgetary model, which means they pay significant upfront costs for pre-built solutions at max capacity paired with ongoing maintenance costs for a fixed number of licenses. In this model, organizations risk overspending on unused licensing and capacity, especially if they experience seasonal peaks and valleys in call volume. For example, retailers are busier during the holiday season and slower in the summer months. With an on-premises contact center, these retailers will pay the same amount regardless of the time of year or the number of licenses being used. 

So, what does this mean for CX leaders?

Fiscally, it means CapEx costs are potentially cutting into their CX budgets. Instead of investing in advanced contact center capabilities like artificial intelligence (AI) and omnichannel, organizations are throwing money at empty seats and unnecessary capacity just to keep the lights on. Moving the contact center to the cloud allows organizations to pay only for what they use, freeing up potential funding for transformational CX initiatives.

Missed revenue opportunities 

In addition to overspending, organizations with on-premises contact centers may also miss out on potential revenue opportunities due to a lack of innovation, flexibility and speed.

Our work with a large pet retail chain is a great example of recapturing lost revenue. While the retailer was booking 200,000 appointments per week, staff noticed an increasing number of missed appointments. We helped integrate an automated notification solution into the retailer's existing contact center platform that would notify customers of their upcoming appointments and prompt them to confirm, cancel or reschedule their appointment. After implementing the solution, the retailer significantly reduced the number of missed appointments and increased revenue by $600k per week. If this organization were utilizing an on-premises contact center, this type of integration would have taken much longer to achieve with much larger revenue losses. 

Explore what's possible in the cloud

A cloud contact center offers many benefits to CX leaders. Most importantly, it enables them to deliver best-in-class experiences while making it easier to achieve business goals. 

If you feel like your organization's contact center is stuck on-premises, don't wait. Start having conversations today with your IT and contact center operations teams about potentially migrating to the cloud. The sooner you can build alignment across IT, contact center operations and CX teams, the better. These leaders will need to work together to select the right cloud contact solution for the entire organization. But know you don't have to do it alone. WWT can help.

Our experts have in-depth experience helping customers evaluate, test, architect, implement and deploy complex cloud contact center solutions. We partner with leading cloud contact center vendor providers, including but not limited to Cisco Webex Contact Center, Five9 and Genesys, allowing us to offer an informed opinion on the best solution to meet your specific business requirements.