Putting Endpoints First

Comms Business Magazine met up with Chris Wortt, EMEA Director of Sales, Advanced Technology Group – IP Telephony at Polycom who says it might sound like putting the cart before the horse, but when it comes to selling Hosted or Cloud based IP Telephony, there’s a very strong argument for putting the handset or endpoint first.

According to Chris Wortt, Polycom’s EMEA Director of Sales for IP Telephony, the handset is arguably the most important piece of communications hardware for your business.

“Typically, the endpoint is often the last consideration in hosted telephony projects. Infrastructure, price modelling, asset management (and everything in between) keeps all parties occupied until attention is finally turned to the handset that people will actually use. This, in our experience, is a serious mistake. The endpoint is the average end user’s only interaction with the hosted service, and that end user could carry anything but ‘average’ influence.  Indeed, I’ve known projects run into serious difficulty because the executives and other professional users don’t like the proposed / selected handsets based on feel, function, ergonomics, build quality and clarity of audio – we do after all live in a HD enabled world. The device on the desk is incredibly emotive in a world where the vast majority still use a physical phone (with or without headsets attached) and would likely never know – or care – whether or not it was a VoIP set up.

In the modern enterprise, the leaders of business functions have more and more influence on technology purchasing decisions, but they view them through their own personal prisms of finance, marketing or HR. What’s important to them is how the technology enables improvements to their mission critical workflows and for most organisations the basic ability to make phone calls is the one thing they want most.

Polycom recommends that partners show customers the endpoints upfront. The range of decision makers will have varied requirements from ruggedness to comfort, and it is good practice to confirm that the endpoints can meet these before securing the deal. Often the customer is not IT or telecoms focused so leaving them the choice is often like asking a telecoms professional the best option to deliver fresh groceries to a store.  Telephony providers’ costs are fixed, from research and development to set up and beyond. Therefore they often have to invest fairly heavily before they begin to see the return from their service revenue. In this sense the endpoint becomes the most valuable part of the estate in terms of touchpoint and often, investment – it has to continue to function or the hosted telephony proposition and business case doesn’t stand up.  It is about moving from return on investment to return on asset for any service provider.

A failed unit can cost a provider around $200 by the time you factor in product replacement, the salary of those sent to retrieve it, fuel and insurance for the van, office overheads, VAT and so on. The industry fail rate is between 1.5% and 2% on average and when you scale that up, it can be a big financial impact on the provider’s margin expectations over the course of a contract.  As such, I don’t believe you can underestimate the value of a quality endpoint in an enterprise scenario. In the consumer or residential setting you might use a phone ten times a week; in an enterprise setting it could be ten times an hour – even more in a call centre. It must be completely fit for purpose.

Traditionally the view was that the endpoint was the least exciting, or profitable, part of a cloud or hosted deployment, but it’s simply not the case. That’s why Polycom is working closely with its partners to help set the standard for endpoints. Polycom’s failure/return rate is below industry average.

We believe that a high quality phone equals a happy customer. Our recommendation is that partners stipulate a preferred endpoint to the customer right at the beginning, and let the decision makers get their hands on it. The danger of leaving it up to the customer to choose from a vast array of options including low-value / quality units, or leaving it to the very end of the process, is risky and can introduce potential for ongoing support and replacement costs. Those costs, support, firmware revisions, replacements, etc., can reduce the margin expectations over the lifecycle of the service.

Ultimately the endpoint is the human interface into hosted / cloud telephony and unified communications.  Further it represents the brand of the cloud / hosting organisation and so should be first and foremost in any providers offer. We increasingly see more and more hosted / cloud telephony providers being more successful by offering less choice of end point and even more so when the endpoint is included in the price per seat cost.”

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David Dungay

Editor - Comms Business Magazine