Message from Call Center to Customer: I Can Feel Your Pain Convergys Corp., a Cincinnati-based customer service outsourcer with more than 60 call centers around the world, recently started using a quality management system that can detect the emotional states of both customer and representative. "It's not just what you're telling the customer," says Bob Lyons, senior vice president of global services at Convergys. "It's how you're telling them. That 'softer side' contributes hugely to overall customer satisfaction."
By analyzing both the customer's and agent's voices—all within the first 10 to 15 seconds of a call—the software can flag the call for review based on changes in pitch, tone, cadence and speed. The system also records how long the customer spent on hold, and the information that was available to the agent on his or her computer screen during the call. Each call is digitized and stored, making it keyword- and emotion-searchable.
Source: CIO Insight, http://www.cioinsight.com/
It's Often Cheaper to Hire Third-Parties to Maintain Your Software, But There Can Be Risks In an effort to save on software maintenance fees, some companies are turning to third-party maintenance vendors for an assortment of reasons, according to vendors, customers and consultants.
For one thing, the third-party alternatives are frequently half the price of direct vendor support, according to a Gartner report prepared by analyst Alexa Bona and released in December 2005. However, Bona points out, there is risk associated with the alternative maintenance contracts because of legal challenges and retaliatory tactics by the enterprise software vendors.
Source: Baseline, http://www.baselinemag.com/
Should You Care Who Owns Vendor That Develops, Maintains Software You Use? Everyone knows about the rapid consolidation going on in the enterprise software market. CIOs are now accustomed to frequent ownership changes among their application vendors, but most assume it simply signifies a maturing software industry in which larger vendors buy up smaller ones to fill holes in their product lines, gain entry to new markets, or build critical mass. Oracle's 20-plus acquisitions the past two years are solid evidence of this type of acquisition.
But something more is happening—something that may have very different implications for application buyers. Private equity firms have been spending billions to buy up software companies and combine them into very large portfolio businesses. While this activity may not necessarily be a threat to the industry, software owners and buyers should be aware of the ownership structure of their key vendors. After all, the strategies and goals of investment fund managers are quite different than those of traditional software entrepreneurs.
At first glance, it may not be easy to distinguish whether your software vendor is simply borrowing some money to purchase additional functionality, or being used by one or more private equity firms as a vehicle to accumulate multiple businesses. While nearly every acquisition is positioned as one software company buying another, it may not be that simple. If the acquiring company is owned or controlled by a private equity firm, there is a good chance that the transaction has more to do with investment strategy than application synergy. But should that make a difference to the customer?
Source: AMR Research, http://amrresearch.com/
U.S. Employment Picture Really Isn't So Bad. Well, Maybe It Is. There is the truth about the U.S. workforce. And then there is a deeper—and troubling—truth.
he truth, according to the U.S. Labor Department, is that the nation created about 5.3 million net new jobs between August 2003 and May of this year, more than all the jobs Europe and Japan together created during the same period. Overall U.S. unemployment remains relatively low at 4.8% percent. This year's college graduates found themselves in the most positive job market in five years.
The deeper and troubling truth is that much of U.S. manufacturing is faring far less well. U.S. manufacturing has lost nearly 3 million jobs since January 2001. Many are gone for good. What's more, such emerging manufacturing sectors as biotechnology and nanotechnology—along with such established and restructured manufacturing sectors as aerospace, autos, steel and textiles—require fewer production people than did the dominant industries of the past. Some domestic jobs—estimates range from a few hundred thousand to the low millions—have moved offshore as manufacturers have sought lower-cost labor and shortened the supply chains that link them to foreign customers. Some domestic jobs have disappeared as manufacturers have dropped secondary product lines to concentrate on core businesses. Some domestic jobs have been eliminated in the wake of corporate mergers. That said, more than 14 million people, greater than the combined populations of Virginia and Massachusetts, the U.S.'s 12th- and 13th-most populous states, remain in the U.S. manufacturing workforce, nearly 10.2 million of them in production jobs.
Source: Industry Week, http://industryweek.com/
What to Do if the Laptop Ban on Airplanes Is Long-Term or Becomes Permanent • Have 'guest computers' set up in the company's other offices so travelers can access corporate applications and e-mail away from home base. Travelers can take key information with them on a thumb drive, plug it in and go to work
• Find out what enterprise applications road warriors need when they're away, and make them available as web-based software
• If business travelers use an SSL VPN connection on a 'guest,' borrowed or rented computer, then they'll have a secure connection, and it will do a disconnection cleanup so the next person using the computer can't see what the last person was working on
• If you can't carry it, ship it. If they have to have a laptop when they arrive, have it shipped there. It's insured and traceable along the way
• If workers need to stay connected while they're on the road, consider having them just take a cell phone and PDA. Even if these electronics are ever relegated to checked baggage, they have a better chance of arriving undamaged. And if they're stolen from the suitcase, they're less expensive to replace
Source: Internet Week, http://internetweek.cmp.com/
You Have a Service-Oriented Architecture Strategy, Don't You .... Don't You? With SOA and Web services high on most organizations' priority lists, perhaps it's time you took a look at your internal SOA readiness. Do you have an SOA strategy and vision? A simple self-evaluation will give you a better feel for your readiness. When it comes to SOA strategy and vision, what business goals are you seeking—improved agility, lower integration costs, reduced development budget? Whatever your goals are, you must explicitly describe them as clear outcomes of your SOA efforts.
Source: Managing Automation, http://www.managingautomation.com/
VoIP Continues to Make Impressive Inroads in Enterprise Telephony A lot of IT executives are taking the VoIP plunge, ditching dated, feature-poor phone systems called private branch exchanges (PBXs) that send voice calls over copper wire networks. By the end of the year, there will be 14.7 million enterprise IP telephone lines, about 21 percent of the North American installed enterprise base, according to Gartner.
That's up from 11 percent in 2004. Global sales of enterprise IP telephony gear are projected to reach $4.9bn this year and more than double to $10.6bn in 2009, according to Synergy Research Group.
The number of enterprise VoIP vendors is growing, too. Just in the past few weeks alone, Microsoft and Vonage have announced plans to enter the fray. They're angling for a slice of a market dominated in the U.S. by Cisco, Avaya, Nortel, NEC, and Mitel.
Source: CRM Daily, http://www.crm-daily.com/
What Do Ford's Plans to Suspend Truck Production Mean for Its Suppliers?
Ford Motor Co. recently slashed its second-half production plans and announced that 10 North American plants will be shut for extended periods much of the rest of the year as it tries to trim costs and deal with slumping sales of its light trucks. The automaker said its moves will result in a 21 percent drop in production in the fourth quarter compared to a year ago, as it makes 168,000 fewer vehicles. The company also trimmed third quarter production by an additional 20,000 vehicles from its previously announced production target, leaving it 78,000 vehicles short of year-ago production. "We know this decision will have a dramatic impact on our employees, as well as our suppliers," said a statement from Chairman and CEO Bill Ford. "This is, however, the right call for our customers, our dealers and our long-term future."
The upshot for suppliers: A substantial amount of steel, aluminum, plastics, copper wiring, electronic components and other production materials will be available to buyers through the rest of the year.
Source: Purchasing, http://www.purchasing.com/
Your Company Has a Potential Profit Center in Early Payments Early pay discounts are an often-ignored source of solid bottom line growth. Savvy CFOs and AP managers are emerging as a new kind of portfolio manager, earning annualized returns of up to 36% on cash, just by paying bills earlier.
Through the use of electronic settlement networks and by instituting powerful core AP practices to uncover and take advantage of discounts from suppliers, a growing number of businesses are turning their accounts payable operations into profit centers, and having a big impact on bottom line earnings and working capital.
Source: Line 56, http://www.line56.com/
Poll: Companies Bringing IT, Business Process Outsourcing Contracts Back In-house
Businesses have started bringing IT and business process outsourcing contracts back in-house or signing shorter length external contracts, according to research from analyst PMP Group.
The analyst questioned 100 UK businesses and discovered that 47 percent of respondents were attempting to reactivate services internally. Conversely, 39 percent admitted that they now expect an outsourcing contract to last between one and two years, whereas the previous length was about 10 years.
Source: CRM Buyer, http://crmbuyer.com/
Remember the Discount, and By the Way, Where Is Their Catalog? Is This Your Idea of Spend Management?
Andrew Bartels, a vice president with Forrester Research, says companies can break down spend management into the following six steps. (There can be between five and eight steps, depending on definitions.)
• Spend management starts with spend analysis: figuring out from whom the company is buying and what is being bought.
• Next is supplier assessment and identification. During this step, company officials examine the suppliers they use and determine the suppliers they should be using.
• Companies then go through the sourcing phase, when experts solicit and compare competitive bids from vendors in order to determine the best price.
• Next, company officials must draw up and manage contracts with company suppliers. Here, procurement helps secure employee compliance with negotiated contracts.
• Then, professionals must follow through with order fulfillment.
• Lastly, invoices must be verified and paid.
Within the spend management cycle, Bartels says procurement clearly plays an important role. Automating procurement takes something that was paper based and puts it online, enabling employees to go directly to supplier sites, find exactly what they need, and verify the items presented are offered at the prices negotiated. This certainly is an improvement from sending a memo out to all employees and hoping three, four, or six months later they remember when they order to ask for the discount from the supplier. Or, worse yet, the employee can't remember where the catalog is, and he or she rushes to the nearest office supply store to purchase the item at an undiscounted rate.
Source: APICS, http://www.apics.org/
Wireless Technology to Move Out of the House and Onto the Plant Floor in a Big Way
Wireless technology, now the networking backbone in homes and offices worldwide, is about to see widespread adoption where it will have, perhaps, its most profound impact: on the plant floor and out in the field. The worldwide market for wireless technology in manufacturing is expected to grow at a compounded annual growth rate of 26 percent over the next five years. The market was $325.7m in 2005 and is forecasted to be over $1bn in 2010, according to a new ARC Advisory Group study. The desire for new and improved business processes extends across all types of manufacturing. A major factor favoring greater deployment of wireless technologies in manufacturing is the ability of wireless applications to enable new and better ways of operating manufacturing plants, and process manufacturing stands to feel the greatest impact. Field operations within a process plant are a classic case of the need for more information that can only be delivered wirelessly. Historically, process manufacturing has not been able to use wireless on a broad scale, but new sensor networking and WLAN developments will soon change this, presenting a huge opportunity for manufacturers who can use wireless to gain visibility into hidden processes, assets, and activities. These now represent “invisible” assets still not well integrated into the enterprise.
Wireless technology offers a more cost-effective means of monitoring plant equipment and production processes, and enables real-time decision making to optimize production or to head off maintenance issues before they interrupt production. Literally millions of field devices are installed at great cost in process manufacturing facilities. However, because most are not digitally enabled, their ability to share process and maintenance information is extremely limited. This presents a huge opportunity for wireless technology, which can be used to enable these “stranded” assets to the benefit of operations, maintenance and business systems across the enterprise.
Source: ARC Advisory Group, http://arcweb.com/
You've Outsourced IT, Financial Services and Business Processes—Now Outsource Your Legal Help
Tech support, financial services and retailing led the wave of business services increasingly being sourced overseas. But the offshoring effect is now rippling outward and upward to encompass more sophisticated—and more profitable—work. Now, a growing number of U.S. companies are turning to India-based lawyers for a wide range of legal services.
While Indian lawyers cannot argue in U.S. courts, they can negotiate and draft contracts, review litigation documents, conduct competitive intelligence, perform patent research and analysis, and manage nondisclosure agreement processes for some of America's leading corporations. What's more, operating from state-of-the-art offices half a world away in Mumbai, India, these lawyers provide services at 25 to 70 percent less than the cost of comparable legal work done in the U.S.
Why is India a particular hot spot in legal service outsourcing? Law school in India is taught exclusively in English, so its lawyers speak the language fluently. And because India's legal system, based on British Common Law, is similar to that of the the U.S., Indian lawyers are able to grasp its intricacies with little additional training. The country's law schools graduate 75,000 lawyers annually, which means there is an abundance of highly trained lawyers there—many of whom are attracted to outsourcing firms for their highly competitive salaries, sophisticated work and merit-based career advancement opportunities.
Source: Chief Executive, http://chiefexecutive.net/
Dynamic 3PLs with Dynamite Growth Burgeoning growth among companies of all sizes is energizing many mid-market 3PLs and creating the need for new logistics providers with unique capabilities and service offerings.
In the September issue of Global Logistics & Supply Chain Strategies magazine.
