3rd Annual TEQConsult Group Consultant Survey3rd Annual TEQConsult Group Consultant Survey

The results of the 3rd annual TEQConsult Group consultant survey are in and although surprises were few, some of the isolated results are sure to lift eyebrows. The survey was designed and prepared by this writer and distributed to members of the two North American professional consultant organizations: Society of Telecommunications Consultants (STC) and Canadian Telecommunications Consultants Association (CTCA). Sixty nine consultants responded to the survey: 30% had 15-25 years telecommunications industry experience and 63% had more than a quarter century. Needless to say, the respondents as a group are highly experienced, with strong opinions (based on the optional comments).

The focus of the survey, as in the past two years, was the enterprise communications market. Questions were included to grade the capabilities and effectiveness of Consultant Liaison Programs (CLPs); evaluate system supplier product portfolios and future viability as competitors; gauge product market activity for recent/emerging solutions; and also solicit feedback on the role Microsoft and IBM may play in the voice market a few years down the road.

It must be noted that the consultants did not provide complete responses to questions grading the systems suppliers. One group of system suppliers--consisting of Cisco Systems, Avaya, Nortel, NEC Unified, Siemens Enterprise Communications Group, and Mitel Networks--typically received at least 50 responses per survey question, and for some questions received more than 60 responses. Of this group, Siemens usually received the fewest responses per survey question. A second group--consisting of Alcatel Lucent, 3Com, Aastra, Interactive Intelligence, and Toshiba--typically received between 20 and 40 responses per survey question.

ShoreTel was in a group of its own, typically receiving between 35 and 50 responses per survey question. Based on the three-year survey trend, ShoreTel is likely to join the top tier next year for a majority of the system supplier-specific questions.

The grading procedure for survey questions evaluating the system suppliers was based on a weighted grading system. Response grades were weighted according to the following scale: Weak = 0; Fair = 2; Good = 5; Excellent = 9. Point totals were added and divided by the total number of responses, excluding No Answer (N/A) responses.

I recognize that the weighting factors used were somewhat arbitrary, but I believe that a higher grade deserved a disproportionate weighting than a lower grade. Small overall grade differences between system suppliers can be attributed to a single good or bad consultant response, but the overall rankings are not affected in a significant way.

How should readers interpret the survey grades for the systems suppliers? The highest possible system supplier grade for any question is a 9, but that would require all Excellents. Avaya’s overall contact center grade was the only one above an 8 (signifying how strong they are in this application area). Taking the weighting factors into account, a grade above a 4.5 should be considered good; a grade above a 6 should be considered very good; and a grade above a 7 should be considered excellent for that question based on the overall grading result. On the downside, a grade below a 2 should be considered weak or poor; a grade between a 2 and 4.5 should be considered fair.

SURVEY RESULTS

Question 1: Based on your personal experiences and perceptions, please rate the overall performance and quality of each vendor's consultant relations program (CLP) on the scale Weak, Fair, Good, Excellent.

Cisco Systems recaptured its #1 ranking after falling behind NEC Unified last year. One consultant commented that "Cisco is strongest across the board for disseminating materials, responding to consultant inquiries, providing information in a timely and efficient manner." Another noted that Cisco has set a "pretty high bar for the other CLPs."

I personally agree with Cisco's leading ranking for a variety of reasons, with special praise going to the supplier's Deep Dive webinar presentations. Fran Blackburn has done an exemplary job with the program and her efforts are supported by a strong staff (Denise Britten and Charlotte Woods).

Larry Kollie, the sole member of the NEC CLP, gave Cisco a strong run for the money despite working on his own and having lesser financial resources. The Nortel program again came in third this year and Avaya moved up a notch to fourth. I personally would have flipped the results, placing Avaya closer to the top based on its improved efforts this past year. Mitel barely edged out Siemens Enterprise Communications Group for fifth place.

Among the second tier suppliers, Interactive Intelligence had the strongest grades, mostly owing to the strong efforts of its Manager Marsha Bailey. Interactive Intelligence is known for its webinar schedule that covers a variety of topics involving its solutions. ShoreTel’s grades are probably a reflection of a CLP still in its infancy stage. Aastra established its CLP only a month ago, so its very low grades were not surprising. Toshiba’s relative low grades (for this question and the remaining survey questions) are likely the result of limited consultant interaction compared to the other vendors, because the company is focused in the Small/Medium Enterprise (SME) market space. Both Alcatel Lucent and 3Com need to significantly step up CLP efforts, because a strong majority of their grades were either Weak or Fair. I think Alcatel’s grades were slightly lower than deserved, because they have conducted a good series of webinars focused on vertical market applications.

Question 2: Based on your experiences, please describe your personal working relationship with CLP contact(s) for each of the following vendors on the scale Weak, Fair, Good, Excellent.

NEC had the highest grades for this question. According to one consultant, "Larry Kollie at NEC still runs the most responsive CLP program single handed." Another commented that "the attention follow up and service we get from Avaya, Nortel, Interactive Intelligence and NEC puts all others to shame."

Cisco ranked second, barely edging out Nortel. Siemens, Mitel, and Avaya were closely bunched for the next three positions. Interactive Intelligence received the highest grades among the second tier competitors. Aastra had a combined six Good/Excellent grades, not bad considering it lacked a CLP for the evaluation period.

Question 3: Based on your personal experience, please rate each vendor based on its proven ability to satisfy your information needs about its product/service offerings and solutions on the scale Weak, Fair, Good, Excellent.

The results of this question closely resembled the results of the preceding two. NEC was a few higher grades ahead of Cisco. NEC has a strong reputation for alerting consultants that new documentation is available at its online Information Portal. As regards Cisco, one consultant wrote "Cisco lives and dies on their ability to email out gigantic PDF documents that somehow describe some portion of information requested. "

Avaya, Nortel, and Mitel were closely bunched, with Siemens rounding out the top tier. ShoreTel’s grades were the highest of the second tier, slightly ahead of Interactive Intelligence who received the following praise: "While Avaya, Cisco, Nortel and Siemens have always had strong programs, Interactive Intelligence is starting to come on strong." The other suppliers’ grades indicate they need to step up their game regarding information distribution.

Question 4: Based on your personal experiences, please rate each vendor based on its proven ability to support your needs as a consultant in a timely and satisfactory manner when you are working on a client project, on the scale Weak, Fair, Good, Excellent.

Responses to this question were similar to the preceding questions, with NEC and Cisco virtually tied for the highest grades. Siemens, Mitel, and Avaya were closely graded to round out the top tier. Nortel placed a strong third, followed by Avaya, Mitel, and Siemens. The latter supplier received far more No Answer responses than the other top tier suppliers, a reflection that its market presence diminished during the most of the past year while its corporate parent was desperately seeking a buyer for the enterprise communications unit. The second tier as a whole received far fewer graded responses than the top tier; ShoreTel and Interactive Intelligence received the highest grades among these six.

Question 5: Based on your knowledge and perceptions, please rate each vendor's overall voice communications system portfolio (core systems and all integrated/peripheral application capabilities) on the scale Weak, Fair, Good, Excellent.

Avaya received the highest grades for overall portfolio and for each of the succeeding questions re a specific portfolio product/application element. I personally agree that Avaya has the strongest overall portfolio among its competitors, based, as one consultant noted, "(on) product depth and performance capabilities." In my opinion Avaya has few, if any, significant product gaps or weaknesses.

Nortel came in second, proving that despite its financial difficulties, it still has a strong product portfolio as reflected by its grades. NEC, Mitel, and Cisco received comparable grades. A consultant's comments re the latter: "Cisco is rated less than excellent due to the fact that most peripheral applications still require a separate server and admin interface. Until they integrate more apps 'under the skin' with a single admin interface, their product will be overly expensive, overly space intensive, and difficult to administer."

Siemens' grades do not properly reflect its current product portfolio capabilities, indicating better marketing communications is needed to get the word out to consultants. Interactive Intelligence and ShoreTel both received higher grades than Alcatel Lucent despite narrower portfolios targeted at more highly focused markets. There is no reason for Alcatel Lucent to receive these grades after close to a decade in the North American market--other than poorly executed marketing programs or a too-lax approach to the local market in general. I'm of the opinion that it’s a combination of both. It sometimes feels Alcatel Lucent has been hanging around the North American market for appearances, only. That 3Com received the lowest grades of all system suppliers is not surprising, because several of its application offers are third party solutions

Question 6: Based on your knowledge and perceptions, please rate each vendor's IP Telephony System offering(s) based on its technical attributes. Take into account the following: system architecture, design and topology; redundancy; survivability options; port/traffic/call processing parameters; scalability; generic software features; and environmental factors, on the scale Weak, Fair, Good, Excellent.

Avaya easily received the top grades from the consultants, as more than two thirds rated their IP telephony solution as Excellent, while no other system supplier received more than half Excellent ratings. Cisco placed a strong second, comfortably ahead of Siemens, Nortel, Mitel, and NEC (in descending order). ShoreTel and Interactive Intelligence also received good grades. Alcatel Lucent’s grades were disappointing, considering the strength of their product offering. For purposes of the survey, perception usually overrides reality. Toshiba was the only system supplier who failed to receive at least one Excellent rating.

Question 7: Based on your knowledge and perceptions, please rate each vendor's desktop IP telephone instrument portfolio taking into account the following: number of distinct models; design; basic and advanced features/functions; ease of use, and performance quality on the scale Weak, Fair, Good, Excellent.

Avaya, Cisco, Mitel, and Nortel had the strongest grades for their IP telephone portfolio, each receiving at least one third Excellent ratings from the consultants. NEC’s and Siemens' grades were good, but probably deserved to be on par with the higher rated system suppliers. NEC’s DT700 models were announced a few months ago and the consultants are likely not yet familiar with some of their unique and enhanced capabilities.

A surprising one-fourth of the responding consultants for this question did not rate the Siemens' IP telephones, although these were introduced during 2007; based on the design and performance attributes of the OpenStage models, Siemens should have received far better ratings. ShoreTel deservedly received the best grades among the remaining systems suppliers: they substantially improved their IP telephone portfolio during the past two years.

Question 8: Based on your knowledge and perceptions, please rate each vendor's contact center solution(s) taking into account the following: ACD features; agent/supervisor terminals (desktop telephone and PC client workstation); reporting; self service features; workforce management, and administration management on the scale Weak, Fair, Good, Excellent.

Avaya almost lapped most of the field for this question, leaving no doubt who the consultants believe has the best contact center solution. More than three quarters of the responding consultants rated Avaya as Excellent. As the global market leader in high end contact center systems Avaya’s grades were well deserved.

Interactive Intelligence also received very good grades for its contact center solution (the primary product focus of this system supplier). Nortel, Siemens, and Alcatel Lucent received relatively good grades befitting their respective global market share positions in this solution category. (Note: Alcatel's grade takes into account contact center solutions from Genesys Labs, a sister unit of Alcatel’s Enterprise Networks unit). Mitel and NEC grades were mixed, and Cisco’s were definitely a disappointment for the system supplier (though not a surprise based on the server-intensive design of its IPCC Enterprise offering). Cisco received only four grades of Excellent (the same number as ShoreTel).

Question 9: Based on your knowledge and perceptions, please rate each of the following vendor's messaging system (voice-only, unified) portfolio taking into account available models; hardware design; station user and system features; reporting; ease of use; and administration management on the scale Weak, Fair, Good, Excellent.

Another strong win for Avaya: almost 95% of the consultants grading them Good or Excellent. The other top tier suppliers were: Nortel, Cisco, Siemens, NEC, and Mitel (in that order). Interactive Intelligence and ShoreTel had the highest grades of the remaining suppliers.

There were relatively few Weak grades in this category, indicating that almost all voice messaging systems are adequate for customer’s basic needs. As one consultant wrote: "Everyone does a good job with basic voice messaging."

Question 10: Based on your knowledge and perceptions, please rate each vendor's overall Unified Communications offering and solutions taking into account the following: Desktop PC client; presence/ID management; IM; call screening; coverage; mixed media conferencing & collaboration; third party interoperability; ease of use; and administration management on the scale Weak, Fair, Good, Excellent.

The grades for Unified Communications (UC) solutions were generally lower than the other product/application categories. Avaya barely edged out Siemens and Cisco for first place. I am not sure if Avaya’s UC portfolio is better than the Siemens OpenScape solution, but it is certainly improved from last year.

As one consultant commented, "On the surface they're all pretty much alike. I haven't drilled into the details enough to differentiate between them." The survey results are good news for Avaya, because they recently announced that they will bundle station user licenses for many of their UC options into their Communications Manager Enterprise Edition generic software at no cost to the customer (a savings of up to $650 per user).

Nortel's grades were lower than I would have expected, considering that its MCS 5100 is a strong UC solution. Nortel’s decision to market Microsoft OCS 2007 ahead of its own offering may have affected the consultant grading. Then again, one consultant noted that they "never have understood why Gartner ranks Nortel UC so high."

NEC and Mitel grades were mixed, each receiving fewer Excellent grades than the other top tier suppliers. Interactive Intelligence received good grades, but more received far fewer responses than the top tier suppliers. Alcatel Lucent’s poor marketing most likely affected its grades, because Gartner ranks it in the Leader quadrant of its UC Magic Quadrant.

Question 11: Based on your knowledge and perceptions, please rate each vendor's mobile communications solutions covering the following areas: premises WLAN/DECT; cellular extension; FMC; and teleworking options on the scale Weak, Fair, Good, Excellent.

This question received a sizable percent of No Answers from the consultants and the fewest grades of Excellent, even for the top system suppliers. As mobile communications will represent a significant paradigm shift for enterprise communications during the next few years, supplier solutions need to be better marketed and promoted. A consultant wrote that "I don't think any vendor gets a true, passing grade, yet. So these evaluations are relative among this set of companies."

Avaya and Cisco received the highest grades for their mobile communications solutions. The next group was closely bunched: Mitel, Siemens, Nortel, and NEC (in that order). In my opinion, Alcatel Lucent’s grades were not a reflection of their relatively strong mobile communications capabilities.

Question 12: Based on your knowledge and perceptions, please rate each vendor’s overall pricing strategy (unit list price, upgrade costs) and tactics (discounts, bundles, promotions) for its offerings and solutions on the scale Weak, Fair, Good, Excellent.

I wasn’t sure what the grades would be for this question. Based on the results, the consultants were not kind. As one commented: "All the Vendors are guilty of 'Smoke & mirror' pricing, some more than others. They do make consultants work for their fees to assess TCO etc. Some is driven by the manufacturer, some the vendor."

Consultants gave Mitel the best overall grades for its pricing strategy, closely followed by NEC and ShoreTel. Nortel also received decent overall grades, but Cisco, Avaya and Siemens grades were not positive. About 20% of the consultants gave Cisco a grade of Weak; Avaya grades were almost evenly distributed between Weak/Fair and Good/Excellent; and Siemens Weak/Fair grades easily outnumbered its Good/Excellent grades (with almost one fifth of the respondents not providing a grade).

The remaining suppliers received grades from less than half of the responding consultants and were mostly in the Fair/Good range.

Question 13: Based on your knowledge and perceptions, please rate each vendor’s future outlook for the next 3-5 years as a viable competitor in the North American enterprise communications market taking into account the following: management team; financial resources; R&D; products; distribution; and customer support services on the scale Weak, Fair, Good, Excellent.

This is arguably the most important question in the survey, because it gauges consultant perceptions about each supplier's future place in the market. Cisco is easily the winner: the supplier received more than double the number of Excellent grades (49) of runner-up Avaya (24), and was the only supplier not to receive a single Weak grade. Avaya received 85% Good/Excellent grades, something that should make its owners Silver Lake and TPG happy, especially after investing $8 billion in the company last year.

Other suppliers with a decent future ahead of them, according to a majority of responding consultants, are NEC, Mitel, Interactive Intelligence, and ShoreTel. Consultants did not think that Nortel, Siemens, or Alcatel Lucent had strong futures in the North American market. For each of these three, their Weak/Fair grades outnumbered Good/Excellent grades.

This is not good news for Nortel, because North America is their primary geographic market. Siemens' new majority owner Gores Group needs to get the word out to the consultants about its future plans, because consultant perceptions of the system supplier have been declining for years. Alcatel Lucent must quickly decide if it is in or out of the North American market, and if the former, demonstrate its commitment in a big way. 3Com’s future is most in doubt, as 95% of its grades were Weak/Fair (only two were Good and zero were Excellent).

I will let one of the consultants’ comments close this section: "Avaya's new management team may not grok the business, but has strong installed base loyalty and name recognition. Nortel seems to be adrift. NEC doesn't excite. Siemens is struggling, bleeding installed base. Mitel's merger with Inter-tel is a marriage of mediocrity. Alcatel can't get no traction. Aastra is bottom of mind. ShoreTel excites. 3Who? I3 [Interactive Intelligence] is on the right track. Toshiba never a player." Sounds like a child of the 1960s!

Question 14: Based on your industry experience, knowledge and perceptions do you think Microsoft will become a viable competitor in the enterprise communications market with a full-featured voice communications solution within the next five (5) years?

Almost three quarters (73%) of the consultants believe that Microsoft will be a viable competitor in the upcoming years. A year ago, the results would have been significantly different based on my conversations with consultants at last year’s STC conference.

The latest release of OCS 2007 may have done a lot to change consultant minds. According to one consultant, "Microsoft is moving at a fast clip with OCS 2007 and will follow Cisco's lead in expanding its market reach into telephony systems. Microsoft's desktop dominance and marketing skills will be a deadly combination for climbing to the top of the market sector during the next decade."

Another commented: "They already are [a viable competitor] and their interest in the consulting community was surprisingly strong." From a consultant not impressed by Microsoft’s enterprise communications plans: "They are inching their way along to play catch up, I doubt they truly understand voice, it isn't just another desktop app! Also no good ‘go to market’ channel strategy."

Question 15: Based on your industry experience, knowledge and perceptions do you think IBM will become a viable competitor in the enterprise communications market with a full-featured voice communications solution within the next five (5) years?

Just over one quarter (27%) of the consultants responded that IBM will be a viable competitor, the opposite of the Microsoft response. IBM’s plans for the enterprise communications are not well known or understood by most consultants, but things may change at VoiceCon Orlando 2009, when the computer giant--as a participant on my IP telephony system RFP panel--presents current and near-term capabilities for its Unified Telephony offering.

Only one consultant mentioned Unified Telephony in their comments. Another consultant wrote that "[their] product is irrelevant. IBM does not know how to sell voice." Another wrote that "the IBM folks I have worked with so far don't have a clue about the market and what customers want." A few consultants thought that IBM would need to acquire an existing system supplier to successfully enter the market. Based on the overall results, IBM needs to follow Microsoft's lead and implement a well planned marketing campaign to turn around consultant perceptions.

Question 16: During the past year have you recommended to a client an off-premises hosted IP telephony solution?

Not quite half (44%) of the consultants responding said they recommended a hosted solution to a client. A few reasons were given for not providing a recommendation, including "It is still just Centrex, very old news!" and "Too risky, no control over client's destiny, plus it does matter what market you're selling this stuff to...well established firms I think they have resources and staying power to run their own systems."

Personally, I am surprised that the number of affirmative responses to this question was as high as it is, because most hosted services customers are concentrated in the smaller end of the line size spectrum that do not usually engage (or can afford) a consultant.

Question 17: During the past year have you recommended to a client an open source IP telephony solution?

No surprise here that the consultants are not partial to by open source solutions; a resounding 83% said no to this question. Some reasons why: "Too much trouble to maintain and risky. Requires a lot of staff time and expertise with complete and thorough knowledge of Linux" and "Only University wonks seem to have time for this kind of solution and all of the patch support required."

Question 18: During the past year have you worked with a client to purchase and install a full-featured UC solution as described above in Question 12? (audio conferencing bridge system, only, and/or cellular extensions do not count).

Almost an even split as slightly more than half (52%) said yes. One consultant wrote "I have a couple of clients who are using Presence Mgmt and desktop clients." Several comments were from consultants who have not worked on an UC installation: "Not yet, although the idea is finally mainstream and we will in the next six months;" "Still trying to find a compelling sales case to do so."

Question 19: During the past year have you worked with a client to purchase and install a Communications Enabled Business Process (CEBP) solution that integrates communications tools with a Line of Business application, such as SCM, ERP, CRM, et al?

Less than one fourth (23%) said they did engage on a CEBP project. The following comment is probably representative of those consultants that answered no: "Lots of interest, feasibility discussions, but no takers thus far." CEBP is still in its infant state and customers today may find it a too-risky undertaking, especially when budgets are being squeezed by most companies.

SOME CLOSING COMMENTS

There is, of course, a strong correlation between the grades the system suppliers received from the consultants and the strength of their market presence, although Interactive Intelligence received several very good grades that belie this assertion. Cisco and NEC appear to have the strongest CLPs and the best relationships with the consultants. Both also received good product ratings (discounting Cisco’s poor contact center grades). The consultants may be highly favorable toward Avaya’s product offerings, but feel there is room for improvement when personal relationships are an issue.

Several other prominent organizations also have clear areas to work on in this regard. Siemens should interpret the survey results as a signal to increase its consultant marketing efforts, because some of the product grades it received were lower than I expected based on my strong knowledge of the offerings. Although Nortel has been in the news recently for its financial difficulties, the consultants still assigned strong grades to their products and personal interactions. Nortel’s future, however, is in some doubt, but that is mostly out of the hands of the Enterprise Solutions organization.

ShoreTel's results have improved from the past survey, which is a good sign. Establishing a full time CLP will help them continue to improve in the future. Although Interactive Intelligence is among the smallest competitors, it has strength in several product areas and a strong reputation among the consultants for what it does. Alcatel Lucent, despite beginning its tenth year since re-entering the North American market, continues to receive many low grades despite global market leader status. Its North American market position is tenuous and demands increased marketing.

Several organizations have challenges. As cited above, a major reason for the poor grades received by Aastra was the absence of a CLP. The new Aastra CLP will have a hard uphill climb to turn around consultant perceptions. Adding to the difficulty is the addition of the Ericsson product line to the mix: Ericsson’s grades in previous consultant surveys were also poor.

3Com's viability in North America is at stake, at least based on the survey results. Its corporate focus on the Chinese market and networking does not bode well for its voice communications business. Toshiba's grades are likely affected by minimal presence in the intermediate/large system market, the line size segment in which most consultants operate. I know that its products deserve better grades than received and that its position in its chosen target markets at the lower end of the line size spectrum is stronger than reflected by the survey results.

Allan Sulkin, President, TEQConsult Group, was a long time contributor to Business Communications Review and is currently a Contributing Editor to No Jitter. He is often recognized as the leading enterprise communications market analyst, has consulted for many of the system suppliers included in the survey, and will again present his annual IP telephony system RFP tutorial and market review sessions at VoiceCon Orlando in March 2009.