Change Or Die

Change Or Die

Peter Titmus, Managing Director – Networks First

With everyone from Gartner to equipment manufacturers predicting the death of the telephony reseller as it is known today, the future for the sector looks pretty grim. The great innovation of convergence and VoIP has done nothing but drive margins down, service costs up and open up what was a very profitable marketplace to a raft of new players – so says Peter Titmus, Managing Director, Networks First

So is there a future for the telephony reseller? Or will those hard won skills in areas such as CRM, IVR and contact centres, alongside excellent customer relationships, become irrelevant as customer demands for robust, reliable and scalable converged networks stretch resellers beyond the limit?

Something has got to give. And it is only those resellers that realise that they should specialise in what they excel at, which may well be integration, system design or pure sales & marketing, and wake up to the need to use third parties to deliver vital convergence expertise in both implementation and 24-hour service and support that will have a chance of meeting customer requirements within a profitable business model. The rest will simply fall by the wayside.

Plug & Play Myth

 

Converged technology is complicated. Adding voice to a Local Area Network adds an unprecedented layer of complexity: from ensuring voice prioritisation to managing resilience. And the problems that can be experienced by users are legion: voice call drop out, simplex (one way) voice, general instability of voice communications and, hence, failure to handle the CTI applications linked to the users’ PCs and IP handsets.

And, despite the growing evidence to the contrary, manufacturers are maintaining the plugand- play message. They are aided in the propagation of this misconception by the perceived ease of initial implementation. But the fact that performance

 

guarantees are associated with ‘day one’ set-up only should be a give-away: if not correctly implemented, these converged networks very soon begin to fall over or experience a degradation in service that fundamentally undermines business value.

It is often one, two, three, even eighteen months down the line that problems can appear – either highlighting initial implementation mistakes or as a result of changes undertaken to the LAN environment, legal or illegal. It only takes one user to download a game onto the LAN and the entire voice network can suffer business damaging degradation.

And for the telephony resellers without adequate converged skills tracking down the source of the problem is a major challenge – and cost. For example, as one reseller discovered, following expansion the quality of voice calls and reliability began to cause concern for a customer. Yet investigation revealed nothing wrong with the voice switches or routers – nor could the ISP explain why voice traffic was struggling over the WAN.

 

Changing Service Dynamic

For a telephony reseller that has traditionally been required to deliver little more than 9am-6pm service, Monday to Friday, this level of complex technology assessment, evaluation and support is transforming the service dynamic – and driving out the small margins that can be attained from product sales.

Not only have telephony resellers got to step up to the plate – but they face competition from data resellers who have often already invested in this level of robust support infrastructure to support customers’ data networks.

Yet the solution currently being adopted by an increasing number of telephony resellers – namely to sell separate voice and data networks – may appear to be avoiding the complexities of convergence, but it is also ignoring the true technology benefits, which are significant when correctly applied, and mis-selling technology to the customer. And, more often than not, such solutions also fail to deliver the quality of service required – resulting in additional cost and potential business loss to the reseller.

 

Sharing Risk

Gartner is predicting that telephony resellers will cease to exist by 2007 unless they make radical changes to business practice. And central to that change is a recognition that firstly, this market is not the plug-and-play ‘free-for-all’ promised by the vendors. These companies simply do not have the right skills today – or the resources to develop the right skills – to adequately and profitably deliver and support business critical converged solutions.

Working with a third party expert in convergence at both implementation and support cost effectively provides the back-up resources that can transform the viability of converged technology sales. Customer problems are minimised by fit for purpose initial implementation while a 24-hour infrastructure can provide the second line support required to meet customers’ rapid response demands. Immediately the business model is transformed: customers are happier, engineers are no longer permanently camped on site at huge cost and management can refocus attention on business development.

Unlike the primary competition – the data resellers – telephony resellers have excellent customer track records and a breadth of application skills – from IVR to CRM – both of which are invaluable. Rather than waste these fundamental business assets, telephony resellers have got to change and embrace partnership – or face a slow, lingering death.

 
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