'Service Cloud To Become Critical Factor For Contact Centres'

According to Gartner, worldwide service cloud revenue is on pace to surpass $56.3 billion in 2009. Business processes delivered as service cloud are the largest segment of the overall cloud services market, accounting for 83 percent of the total market in 2008. The service cloud is a relatively new platform for customer service. In conversation with Biztech2.com, Lindsey Armstrong, president, International Field Sales, Salesforce.com, elaborates on the power of the service cloud.

According to a recent McKinsey report, cloud computing is not suitable for large businesses. What is your take on that?

Cloud computing is suitable for both large and small businesses. In times like these, credit is tight and capital is scarce. Thus, companies (both enterprises and SMBs) are turning to cloud computing.

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Over the next five years, IDC expects spending on IT cloud services to grow almost threefold, reaching $42 billion by 2012. More importantly, spending on cloud computing will accelerate throughout the forecast period, capturing 25 percent of IT spending growth in 2012 and nearly a third of the growth the following year.

Leveraging the Internet and building on cloud-based platforms, requires relatively little capital from entrepreneurs to get started and grow. We are entering a new era of democratisation for software developers around the world; a huge shift in power is being observed in the software industry; and for customers, an explosion in choice and innovation is waiting to happen.

The cloud computing model does not have any of the costs, risks or complexities of traditional software. Cloud computing is less risky – there is no huge up-front capital expenditure in hardware or software and no hidden costs pop up nor are armies of consultants required to get started. With cloud computing, there are moderate, predictable operating expenses – front-loaded investments in commodity infrastructure and software licences are replaced by pay-per-use fees. And the best part is that the system is completely scalable and able to grow with you.

How far do you think mission-critical applications can be run on the SaaS model?

There is an increased emphasis on integrity and security in today’s business environment, and a concern for regulatory standards. At Salesforce.com, we partner with our customers to help them manage their businesses better, including the ever-increasing compliance burden. Security concerns are one of the biggest misconceptions of cloud computing. One of the major benefits of security in a multi-tenant cloud is that all customers benefit from the same rigorous security standards.

Application features like workflows, approvals, validations, triggers, audit trails and fine-grained sharing rules provide firms with the tools to tailor solutions to meet their unique compliance requirements. These compliance rules vary based on line of business, product, location, and the business process.

Cloud has become a multi-vendor environment. How are you planning to tackle the competition and how do you view this multi-vendor scenario?

In the last few years, organisations that were dismissing the idea of the services model are now eagerly embracing it. Salesforce.com has been steadily growing for the past 10 years. Today, there are a number of cloud vendors – like Google and Amazon – whom we have synergies with. Our platforms provide different types of services and are complementary to each other.

Salesforce.com is breaking into new markets as a platform provider in addition to its traditional application offerings with the introduction of Force.com. The latter delivers a new way to create and deploy business applications.

Gartner predicts that by 2013, 75 percent of customer service centres will use SaaS applications as a part of their contact centre solution. What is your take on this?

The service cloud transforms customer service through the power of cloud computing. It combines traditional customer service channels like phone, e-mail and chat with industry-leading cloud computing services like Google, Facebook and Twitter to capture every conversation and leverage every community expert in the cloud. By capturing all of these conversations in one central location, the service cloud helps companies deliver the expertise of the community to customers, agents and partners regardless of location or device – ensuring that the quality of customer service is consistent across every channel.

As more applications are built on a cloud-based model, cloud computing will evolve from an interesting alternative delivery model into a critical selection factor at all levels of the customer service contact centre in the future.

How is the service cloud helping Indian businesses to expand and create new revenue models?

Businesses in India are looking for a way to significantly reduce IT expenditure and yet maintain world-class IT infrastructure. They are coming to Salesforce.com because of the low cost, low risk, and rapid results that our cloud-computing model provides. Cloud computing offers a predictable, pay-as-you-go model for businesses to access computing resources, and in an economic downturn, the appeal of this cost advantage is greatly magnified.

For internal IT departments, we envision that the Force.com platform as a service will completely change the role of IT departments. The break-fix-patch-upgrade components of IT will become irrelevant. However, it also creates a new role for IT departments, viz. innovation.