Making a Case for IVR Hosting

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Building and maintaining an IVR on premises can be complex and costly. In addition to the costs of deployment, periodic upgrades should be expected. But the details of the maintenance and upgrade costs raise questions: When is the next upgrade? How disruptive will the deployment be to systems and processes? How long will the upgrade take? How much it will cost?

There are situations—as suggested by our cover story, “Hosted IVRs Bring Peace of Mind”—in which on-premises IVRs are more economical than hosted IVRs. However, on-premises solutions require a large up-front capital expense. And, unless an organization sets aside money and resources to maintain and upgrade its IVR system periodically, it can easily get stuck with antiquated technology—especially during prolonged economic slumps. According to research cited in our story, the on-premises IVR market has been in decline in recent years during The Great Recession. Conversely, the hosted IVR market has been trending upward.

Many who still resist the hosted model argue that organizations lose too much control of valuable data, processes, and customer interactions. And, unfortunately, some fool themselves into thinking they can do a better job than a company that specializes in customer service. That is akin to saying, “I don’t want to lose control, so I’m going to fly the plane instead of an experienced pilot.”

Additionally, farming out the IVR to a third-party vendor doesn’t mean you have to lose control, either. Too many organizations mistakenly think that handing an important business process to a vendor means that they should throw the project or process over the fence and walk away. On the contrary, organizations should get regular reports and necessary alerts from the hosting provider, and they should periodically discuss opportunities and concerns that undoubtedly will arise.

Those who recognize the value of the hosted model appreciate the fixed and predictable costs. Plus, they get technology upgrades at the push of a button at no additional cost. They also get a scalable system, so when IVR usage dips, the client can scale down to cut costs and scale up as needed.

If that doesn’t convince you to consider a hosted IVR, contemplate this: What happens if your IVR vendor gets acquired? Acquisitions are common, according to the feature, “Don’t Let M&As Steer You Off Course.” It states, “In an industry rapidly evolving, acquisitions have become a common way for vendors to expand their businesses. Last year brought more than a dozen purchases…and Nuance Communications Inc. has made more than 30 acquisitions—including nine in 2007—since the turn of the millennium.”

This article offers tips for navigating a new course if your on-premises speech vendor gets acquired. On the other hand, if your hosted IVR solution provider gets acquired, it’s immensely easier to switch to another hosting provider than it is to try to protect your on-premises investments. The benefits of the hosted model are clear, but if you’re still not sure, then conduct a low-cost, no-risk test run—something you can’t do with an on-premises solution. But, first, read our cover story on the topic.

Editorial Director David Myron can be reached at dmyron@infotoday.com and @dmyron on Twitter.

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