Friday, 09 August 2013 10:13

Old School Vendors in the Next Gen Industry

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So I wasn’t going to write about Avaya for fear of sounding unnecessarily negative, but the glaring differences between the Avaya of old the Avaya of today are crying out for commentary and I just can’t resist.  Avaya is the epitome of the old school contact center vendor.

Yesterday we saw record revenues and profits announced by ShoreTel, within hours of Avaya’s announcement of revenues that went up less than three percent over the prior quarter and were down eight percent year over year.  Avaya’s announcement credited revenues to increased demand in the U.S. and the U.S. federal government.  If anyone’s spending freely anymore, it’s the U.S. government.  These are good days to be GSA approved.

The failure of Nortel marked the beginning of what I believe is a period of major upheaval in the U.S. and, for that matter, global contact center industry.  Where Avaya was once the absolute industry leader, seemingly unbeatable with their massive market muscle and product innovation, it is now more like the fading industry star.  Rather than leading the market with product ideas it is chasing the market and the innovations of smaller, more nimble specialty companies like VPI, Nexidia, Calabrio, OpenSpan and many others.

The Avaya name still carries weight with the current generation of buyers, but that generation is itself a group in transition.  Buyers from the baby boomer generation are starting to retire and the next generation of purchase decision makers is moving in.  This is the Apple generation, with little knowledge of old school telecom industry powerhouses and even less concern for the reverence that big name companies once commanded.

The next generation of contact center industry leaders is ready to move up, and they look a lot different than the leaders of yesterday.  Cisco is ready to come out of the data closet.  Verint is finding its way into the enterprise at large through a series of strategically brilliant product acquisitions and innovations.  Aspect is firmly anchored in its rediscovered identity as a contact center solution provider.  And let’s not overlook a growing group of cloud providers who are poised to meet market demand for contact center cloud solutions as it develops.

Avaya isn't out of the game yet, but it is going to have to undergo some significant changes if it is to remain competitive in a rapidly changing industry.  During the 1980s I lived in the San Francisco Bay Area.  Any football fans who remember that era will certainly remember how dominant the San Francisco 49ers were in professional football.  They seemed invincible and had the Super Bowl championships to prove it.  Then the 1990s came along and a new generation of coaches and players took over the NFL leadership, leaving the old school 49ers behind.  After a series of bad coaching choices and questionable players, the Niners have once again found their way to the top of the NFL.  Last season they went to the Super Bowl.

Avaya seems to be tenaciously holding on to the old school way of thinking in order to maintain industry cred.  I don't think it's too late for Avaya to change, but don't see any indication that they are motivated to do so.  Only time will tell.

What about other old school vendors like Siemens?  Stay tuned.  I have a feeling this might turn into a continuing series.

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