2015 Latin American Mid -Market Enterprise Communications ... · 201 5 2015 Latin American Mid...
Transcript of 2015 Latin American Mid -Market Enterprise Communications ... · 201 5 2015 Latin American Mid...
2015
2015 Latin American Mid-Market Enterprise Communications Platforms Growth Excellence Leadership Award
BEST PRACTICES RESEARCH
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Contents
Background and Company Performance ........................................................................ 3
Industry Challenges .............................................................................................. 3
Growth Performance and Customer Impact ............................................................. 4
Conclusion........................................................................................................... 7
Significance of Growth Excellence Leadership ................................................................ 8
Understanding Growth Excellence Leadership ................................................................ 8
Key Benchmarking Criteria .................................................................................... 9
Best Practice Award Analysis for Avaya ......................................................................... 9
Decision Support Scorecard ................................................................................... 9
Growth Performance ........................................................................................... 10
Customer Impact ............................................................................................... 10
Decision Support Matrix ...................................................................................... 11
The Intersection between 360-Degree Research and Best Practices Awards ..................... 12
Research Methodology ........................................................................................ 12
Best Practices Recognition: 10 Steps to Researching, Identifying, and Recognizing Best Practices ................................................................................................................. 13
About Frost & Sullivan .............................................................................................. 14
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Background and Company Performance
Industry Challenges
The small- and medium-sized business (SMB) communications market is growing at a
steady pace as businesses increasingly migrate from legacy telephony platforms to next-
generation communications solutions. SMBs are looking for technologies and tools to help
consolidate their communications infrastructure, integrate applications, and reduce the
cost and complexity of ownership.
Cost savings and productivity benefits compel SMB customers to invest in Internet
Protocol (IP) telephony and unified communications (UC) platforms. Competitive pricing
and solutions tailored for the specific needs of the SMB market are driving demand.
Furthermore, session initiation protocol (SIP) technologies, virtualization, mobility, and
other technology trends are helping to enhance the value proposition of next-generation
solutions and accelerate the migration process. Other trends impacting the market include
the consumerization of IT and the growth of hosted and cloud communications. These
trends are affecting demand for premise-based communications solutions, vendor
strategies, and vendor assessment criteria.
As the large enterprise communications market matures, vendors are turning to the SMB
market for growth opportunities. Strong differentiation and sustainable competitive
strategies, however, are required to overcome the numerous challenges in the SMB
market. Tight IT budgets, evolving customer needs, continually declining prices, and
competition from new entrants are restraining market growth and putting pressure on
vendor profit margins.
The SMB communications market in Latin America is undergoing a major transformation
and posing significant challenges to communications vendors targeting this customer
segment. Knowledge is profoundly lacking within SMBs about the existence of a UC
solution that encompasses several applications. As a direct consequence, SMBs usually
have not yet implemented a UC solution as they consider it would add low value to their
company.
Within that context, vendors aiming to remain competitive must offer advanced features
and capabilities such as mobility, presence, conferencing, and collaboration, while
developing IP communications solutions that consolidate infrastructure components and
simplify deployment and administration and while providing end users with access to
various advanced applications.
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Growth Performance and Customer Impact
Growth Strategy
Avaya’s recent success within the mid-market enterprise communications platforms
industry (including IP and TDM PBX line licenses, UC software clients, and unified
messaging seats) in Latin America is tightly related to its robust portfolio, its go-to-market
strategy, and its own support organization that nurtures channel partners to achieve their
business goals and service level agreements when dealing with SMBs in the region.
Avaya’s flagship product for SMBs is the IP Office. When deployed as an appliance, this
platform provides 3 options (basic, essential, and preferred edition) to tailor the
collaboration system to specific communications requirements, from basic to highly
sophisticated.
Avaya’s IP Office basic edition is the best fit for small enterprises looking to add more
productivity with a professional touch and with the right mix of flexibility, sophistication,
and expandability.
The IP Office essential edition adds to the functionality of the basic edition the desirable
mobility, call handling, and routing capabilities, helping businesses to incorporate the
communications tools (such as one number access, caller ID, dial-by-name, automated
attendants, conferencing, and voicemail) they need to operate effectively and efficiently.
The IP Office preferred edition provides intelligent communications capabilities (such as
intelligent call routing, powerful mobility, intuitive Web control, sophisticated messaging,
and application integration) that enable the staff to collaborate easily and respond quickly
to customers and colleagues.
While the platform can scale up to 3,000 users and 150 locations (with IP Office select),
the sweet spot in Latin America is companies with 100 to 500 employees.
With regards to the go-to-market strategy, Avaya has added new channel partners with a
clear focus and expertise on the mid-market segment, while pushing for improving the
skills of existing ones (especially service providers and traditional channel partners that
have come to terms with the needs of SMBs).
Avaya is actively pursuing to close further agreements with service providers in Latin
America. Some current hosted IP Office partners are among the biggest carriers in the
region, such as Telmex and Alestra.
Avaya has created a new and specific organization to provide further support on
commercial matters and pre- (training and installation support) and post-sales services
affairs to its channel partners currently farming the mid-market segment in Latin America.
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Additionally, a mid-market sales development team is based in Miami, with performance
tied exclusively to channel partners’ IP Office sales in Latin America.
Growth Diversification
Avaya’s strategy for the mid-market segment intends to leverage its channel partners’
current installed base and clients in Latin America, whether or not they use Avaya’s
solutions. The company’s intention is to migrate and upgrade existing legacy users to the
IP Office suite, while approaching other vendors’ installed base being served by Avaya’s
business partners.
Mid-market organizations typically purchase Avaya solutions from Avaya partners that in
turn may package Avaya solutions within their own service offerings. To enhance its
channel partners’ positioning, Avaya has created the IP Office Support Services that is
globally available for Avaya clients that have purchased IP Office through the Avaya
partner channel community.
The IP Office Support Services provide in-depth, solution-specific Avaya expertise and
resources that reinforce the value of the solutions and services offered by Avaya’s
authorized partners, whether jointly by the partner and Avaya or delivered by the partner
with Avaya’s support.
Furthermore, in May 2015, the company acquired Esna Technologies Inc. (Esna), a
provider of real-time collaboration and communications software, to accelerate the
adoption of communications-enabled applications for mid-market companies. Through the
acquisition, Avaya is aiming to enable end users to access multi-vendor communications
capabilities (voice, video, IM/presence, conferencing, and messaging) from within cloud-
based business applications using their device of choice.
Growth Sustainability
Mid-market is the fastest growing segment, not only in Latin America but worldwide. After
the Nortel acquisition, Avaya focused on enterprises because a big share of its revenues
were coming from this sector. However, during the current economic downturn, Latin
American governments are investing more in SMBs to stimulate the economy, and Avaya
decided to make a comeback to the mid-market segment through the IP Office platform
surrounded by mobility, conference, security, and video. The IP Office suite emphasizes
Avaya’s commitment to the mid-market segment.
Avaya considers this segment as a fast, agile, and often one man decision (meaning the
decision making process remains as a one man decision). IP Office scales significantly
higher to provide mid-market organizations with an array of collaboration capabilities in a
simple, easy to-use solution. This channel-only product provides mid-sized companies an
affordable, simplified way to manage more people on a network across one or multiple
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sites. Additionally, IP Office features new mobility, management, and security functions to
help SMBs take advantage of growing trends such as bring your own device (BYOD) in the
enterprise.
Performance Value
Avaya’s IP Office platform is being positioned in Latin America as a complete, across-the-
board solution that brings it all together, from telephony and video to mobility and contact
center applications, networking, security, and ongoing services, allowing clients to do
more with less. The system is sophisticated but simple to use and can drive profitable
growth without driving up costs.
Avaya’s channel partners usually introduce IP Office as a smart investment proven to
deliver exceptional returns with a total cost of ownership that it is hard to beat. IP Office
cost effectively grows with end-users’ needs, allowing them to keep their original
investment and simply build on it for capacity adjustment or new capabilities (easily
adding software to enhance and expand capabilities as needed) such as growing from 5
users to 3,000 and from a single site to 150 networked locations. Wherever you take
your business, IP Office will go there with you is the living motto Avaya is using to
boost IP Office sales in the region.
This mid-market solution has proven to be resilient and reliable. No business can afford a
breakdown in communications as maximum uptime is critical. Avaya provides proven,
reliable strategies for worry-free, 24/7 communications. Whether or not the business is
small with one site or a multi-location midsize enterprise, Avaya’s approach to resiliency is
powerful, helping to ensure maximum uptime to keep communications and collaboration
moving at the speed of business.
Customer Service Experience
Avaya grabs a comprehensive view of how communication impacts people, infrastructure,
and customers. Through its authorized partners, the company delivers best-of-breed
systems, services, applications, and processes to ensure high performance and ease of
use, which are critical to maintaining a strong communications presence.
Avaya’s users can access several maintenance options to match their business’ growing
needs. Through Avaya’s network of authorized partners, expert support options provide
remote technical support as well as access to updates and service packs to keep systems
functioning with high reliability. Support options include major software upgrades for
increased investment protection, with enhanced remote access to help ensure faster issue
resolution, increased speed of service, and security.
The IP Office Support Services offer complete and affordable coverage that maximizes
system uptime, optimizes solution performance, and protects client investments as it is
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available for the IP Office, the IP Office contact center, and the contact center select
platforms.
The base offer (incorporated compulsorily (not optional) within every IP Office sale in Latin
America since 2016) for IP Office Support Services includes remote technical support for
hardware and software during the business day; software patches and updates; major
software upgrade licenses; enhanced remote connectivity through secure socket layer;
virtual private network (SSL-VPN) technology for improved security, diagnostic access,
and accelerated time to resolution; and prepaid terms of 1, 3, or 5 years.
Additionally, end users can use Avaya’s support Web site services that include access to
Ava (the Avaya virtual agent and gateway to support for quick and accurate resolution of
common requests using natural language parsing and question recognition); sophisticated
Avaya knowledge base search for fast self-service and education needs; a total service
outage that offers fast access to specially trained Avaya experts who are dedicated to
recovering total service outages; a single view of Web ticketing and service request status
for faster response times; online service request for faster assignment; and access to
chat, voice, and video collaboration with a live Avaya agent on the support site.
Brand Equity
Avaya is a leading, global provider of customer and team engagement solutions and
services available in a variety of flexible on-premise and cloud deployment options. A
spinoff of Lucent Technologies’ enterprise communications group (formerly part of AT&T
Corp.), this California-based company was publicly traded until 2007, when it was
purchased by 2 private equity funds: TPG Partners and Silver Lake Partners.
In Latin America, Avaya has more than 1,000 employees in 42 countries and territories,
including about 100 employees at the Miami-based regional headquarters. Avaya’s offices
in Miami were first opened in Coral Gables in 2000, moved to Doral, and are now located
off Blue Lagoon Drive.
Conclusion
Avaya’s recent success in Latin America is tightly related to its robust portfolio, its go-to-
market strategy, and its own support organization that provides desirable support when it
is needed through flexible options.
Based on this strong overall performance, Avaya has earned Frost & Sullivan’s 2015
Growth Excellence Leadership Award in the mid-market enterprise communications
platforms market.
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Significance of Growth Excellence Leadership
Growth Excellence Leadership is about inspiring customers to purchase from your
company, and then to return time and again. In a sense, then, everything is truly about
the customer, and making those customers happy is the cornerstone of any long-term
successful growth strategy. Companies that excel in driving growth strive to be best-in-
class in three key areas: meeting customer demand, fostering brand loyalty, and carving
out a unique, sustainable market niche.
Understanding Growth Excellence Leadership
Companies that creatively and profitably deliver value to customers ultimately set up their
businesses for long-term, rapid growth. This is what Growth Excellence Leadership is all
about: growth through customer focus, fostering a virtuous cycle of improvement and
success.
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Key Benchmarking Criteria
For the Growth Excellence Leadership Award, Frost & Sullivan analysts independently
evaluated two key factors—Growth Performance and Customer Impact—according to the
criteria identified below.
Growth Performance
Criterion 1: Growth Strategy
Criterion 2: Above-Market Growth
Criterion 3: Share of Wallet
Criterion 4: Growth Diversification
Criterion 5: Growth Sustainability
Customer Impact
Criterion 1: Price/Performance Value
Criterion 2: Customer Purchase Experience
Criterion 3: Customer Ownership Experience
Criterion 4: Customer Service Experience
Criterion 5: Brand Equity
Best Practice Award Analysis for Avaya
Decision Support Scorecard
To support its evaluation of best practices across multiple business performance
categories, Frost & Sullivan employs a customized Decision Support Scorecard. This tool
allows our research and consulting teams to objectively analyze performance, according to
the key benchmarking criteria listed in the previous section, and to assign ratings on that
basis. The tool follows a 10-point scale that allows for nuances in performance evaluation;
ratings guidelines are illustrated below.
RATINGS GUIDELINES
The Decision Support Scorecard is organized by Growth Performance and Customer
Impact (i.e., the overarching categories for all 10 benchmarking criteria; the definitions
for each criteria are provided beneath the scorecard). The research team confirms the
veracity of this weighted scorecard through sensitivity analysis, which confirms that small
changes to the ratings for a specific criterion do not lead to a significant change in the
overall relative rankings of the companies.
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The results of this analysis are shown below. To remain unbiased and to protect the
interests of all organizations reviewed, we have chosen to refer to the other key players
as Competitor 2 and Competitor 3.
DECISION SUPPORT SCORECARD FOR GROWTH EXCELLENCE LEADERSHIP AWARD
Measurement of 1–10 (1 = poor; 10 = excellent)
Growth Excellence Leadership
Growth
Performance
Customer
Impact Average Rating
Avaya 7 9 8.0
Competitor 2 8 7 7.5
Competitor 3 7 7 7.0
Growth Performance
Criterion 1: Growth Strategy
Requirement: Executive team has a shared vision for the organization’s future growth,
and has created and implemented a strategy that is consistent with that vision
Criterion 2: Above-Market Growth
Requirement: Company’s growth rate exceeds the industry’s year-over-year growth rate
Criterion 3: Share of Wallet
Requirement: Customers allocate a greater percentage of their total spend to purchasing
products or services produced by the company
Criterion 4: Growth Diversification
Requirements: Company is equally able to pursue organic (e.g., distribution channel
optimization, new product innovation) or inorganic (e.g., acquisitions, partnerships)
growth opportunities consistent with the long-term objectives of the organization
Criterion 5: Growth Sustainability
Requirement: Company has consistently sought out opportunities for new growth,
enabling the organization to build on its base, and sustain growth over the long-term
Customer Impact
Criterion 1: Price/Performance Value
Requirement: Products or services offer the best value for the price, compared to similar
offerings in the market
Criterion 2: Customer Purchase Experience
Requirement: Customers feel like they are buying the most optimal solution that
addresses both their unique needs and their unique constraints
Criterion 3: Customer Ownership Experience
Requirement: Customers are proud to own the company’s product or service, and have a
positive experience throughout the life of the product or service
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Criterion 4: Customer Service Experience
Requirement: Customer service is accessible, fast, stress-free, and of high quality
Criterion 5: Brand Equity
Requirement: Customers have a positive view of the brand and exhibit high brand loyalty
Decision Support Matrix
Once all companies have been evaluated according to the Decision Support Scorecard,
analysts can then position the candidates on the matrix shown below, enabling them to
visualize which companies are truly breakthrough and which ones are not yet operating at
best-in-class levels.
DECISION SUPPORT MATRIX FOR GROWTH EXCELLENCE LEADERSHIP AWARD
High
Low
Low High
Customer Impact
Growth Performance
Avaya
Competitor 2 Competitor 3
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The Intersection between 360-Degree Research and Best
Practices Awards
Research Methodology
Frost & Sullivan’s 360-degree research
methodology represents the analytical
rigor of our research process. It offers a
360-degree-view of industry challenges,
trends, and issues by integrating all 7 of
Frost & Sullivan's research methodologies.
Too often, companies make important
growth decisions based on a narrow
understanding of their environment,
leading to errors of both omission and
commission. Successful growth strategies
are founded on a thorough understanding
of market, technical, economic, financial,
customer, best practices, and demographic
analyses. The integration of these research
disciplines into the 360-degree research
methodology provides an evaluation
platform for benchmarking industry players and for identifying those performing at best-
in-class levels.
360-DEGREE RESEARCH: SEEING ORDER IN
THE CHAOS
Technology
Obsolescence
Disruptive
Technologies
New
Applications
CEO
Demographics
Needs
and
PerceptionsSegmentation
Buying
Behavior
Branding
and
Positioning
Competitive
Benchmarking
Emerging
Competition
Competitive
Strategy
Capital
Investments
Availability
of
Capital
Country
Risk
Economic
Trends
Crowd
Sourcing
Growth
Strategies
Career
Development
Growth
Implementation
Industry
Evolution
New Vertical
Markets
Industry
Expansion
Industry
Convergence
Emerging
Technologies
Smart Cities
Sustainability
New Business
Cultures
GeoPolitical
Stability
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Best Practices Recognition: 10 Steps to Researching, Identifying, and Recognizing Best Practices
Frost & Sullivan Awards follow a 10-step process to evaluate award candidates and assess
their fit with select best practice criteria. The reputation and integrity of the Awards are
based on close adherence to this process.
STEP OBJECTIVE KEY ACTIVITIES OUTPUT
1 Monitor, target, and screen
Identify award recipient candidates from around the globe
• Conduct in-depth industry research
• Identify emerging sectors • Scan multiple geographies
Pipeline of candidates who potentially meet all best-practice criteria
2 Perform 360-degree research
Perform comprehensive, 360-degree research on all candidates in the pipeline
• Interview thought leaders and industry practitioners
• Assess candidates’ fit with best-practice criteria
• Rank all candidates
Matrix positioning all candidates’ performance relative to one another
3
Invite thought leadership in best practices
Perform in-depth examination of all candidates
• Confirm best-practice criteria • Examine eligibility of all candidates
• Identify any information gaps
Detailed profiles of all ranked candidates
4
Initiate research director review
Conduct an unbiased evaluation of all candidate profiles
• Brainstorm ranking options • Invite multiple perspectives on candidates’ performance
• Update candidate profiles
Final prioritization of all eligible candidates and companion best-practice positioning paper
5
Assemble panel of industry experts
Present findings to an expert panel of industry thought leaders
• Share findings • Strengthen cases for candidate eligibility
• Prioritize candidates
Refined list of prioritized award candidates
6
Conduct global industry review
Build consensus on award candidates’ eligibility
• Hold global team meeting to review all candidates
• Pressure-test fit with criteria • Confirm inclusion of all eligible candidates
Final list of eligible award candidates, representing success stories worldwide
7 Perform quality check
Develop official award consideration materials
• Perform final performance benchmarking activities
• Write nominations • Perform quality review
High-quality, accurate, and creative presentation of nominees’ successes
8
Reconnect with panel of industry experts
Finalize the selection of the best-practice award recipient
• Review analysis with panel • Build consensus • Select winner
Decision on which company performs best against all best-practice criteria
9 Communicate recognition
Inform award recipient of award recognition
• Present award to the CEO • Inspire the organization for continued success
• Celebrate the recipient’s performance
Announcement of award and plan for how recipient can use the award to enhance the brand
10 Take strategic action
Upon licensing, company may share award news with stakeholders and customers
• Coordinate media outreach • Design a marketing plan • Assess award’s role in future strategic planning
Widespread awareness of recipient’s award status among investors, media personnel, and employees
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About Frost & Sullivan
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