Cloud-Based Systems Lower Costs Overall
Contact centers can lower the cost of their customer service infrastructure by up to 43% over a five-year period by choosing cloud-based customer care tools rather than on-premises options, according to Frost & Sullivan's Premise Vs. Hosted Contact Center: Total Cost of Ownership Analysis.
The study demonstrated a consistent savings over support centers of all sizes on implementation costs, maintenance and upgrades, and subscription costs.
Cloud-Based Systems Yield Higher Return on Investment
On-premises systems can cost hundreds of thousands of dollars and take months to install and configure. The decision to go with an on-premises system or a hosted cloud-based system should be based on not only the initial cost, but also the administration.
BrickHouse Security, which installed Assistly through Google Apps Marketplace, cited as a key benefit that the hosted platform avoided what they consider to be the IT cost center trap:
Todd Morris, BrickHouse Security CEO: "It's business decisions that drive all our technology decisions. We're technically savvy, and we want to avoid the traditional pattern of seeing IT turn into a cost center."
"The ROI calculations are the trickster's tool," says Drew Kraus, Research VP at Gartner. "What we are finding is that many organizations are looking at the software costs, but forget the administration costs. If they have personnel in charge of the care and feeding of this environment, and if that goes away by having someone else run the infrastructure, then that can really tip the scales."
Cloud-based Systems Lower Total Cost of Ownership
The Frost & Sullivan study analyzed 12 different contact center configurations and concluded that hosted contact center services reduced TCO in all 12. The larger the center, the higher the savings were with a hosted model. Interestingly, the more hosted contact center applications a company used, the more money was saved.
BrickHouse Security uses hosted Google Apps Marketplace applications for just this reason, and cites savings of over $600,000 as a result-about $90,000 per year-plus $40,000 in initial software costs. Because of services like Google Apps they have been able to allocate more resources into customer service and customer support.
"That's how we got to the decision to go with Assistly as our hosted CRM solution. We went out, looked at our options, and talked to vendors. We look for cost savings, low risk, and ease of integration. We got the white board out, balanced the cost and features, and Assistly came out the clear winner. "By our calculations, going with Assistly over the alternative will save an additional $80,000 a year."
There will be some situations where maintaining an on-premises platform will make more sense than a hosted platform-for instance, if the system was purchased at a premium and/or is operating in a highly-customized environment. But even in these legacy situations, there may be room for powerful and economical cloud-based solutions that can be set up in hours rather than months.