The Economic Impact of Contact Center AI
How AI in your contact center leads to a positive Return On Investment.
AI Contact Center
Cost Savings And Business Benefits Enabled By Ai Contact Center.
The Total Economic Impact™ Of Dialpad Ai Contact Center Cost Savings And Business Benefits Enabled By Ai Contact Center SEPTEMBER 2023 A FORRESTER TOTAL ECONOMIC IMPACT™ STUDY COMMISSIONED BY DIALPAD
Table Of Contents Consulting Team: Margaret Firth Executive Summary ................................................. 1 Matt Dunham The Dialpad Ai Contact Center Customer Journey ................................................................................... 6 Key Challenges ...................................................... 6 Investment Objectives ............................................ 7 Composite Organization ......................................... 7 Analysis Of Benefits ................................................ 8 Contact Center Agent Productivity ......................... 8 Manager Productivity ............................................ 10 Contact Center Reduced Turnover ...................... 12 Reduction In Downtime And Abandoned Calls .... 14 Legacy System Deprecation ................................ 16 .............................................................................. 17 Unquantified Benefits ........................................... 18 Flexibility ............................................................... 20 Analysis Of Costs .................................................. 21 Investment Costs .................................................. 21 Financial Summary ................................................ 23 Appendix A: Total Economic Impact ................... 24 Appendix C: Endnotes .......................................... 25 ABOUT FORRESTER CONSULTING Forrester provides independent and objective research-based consulting to help leaders deliver key transformation outcomes. Fueled by our customer-obsessed research, Forrester’s seasoned consultants partner with leaders to execute on their priorities using a unique engagement model that tailors to diverse needs and ensures lasting impact. For more information, visit forrester.com/consulting. © Forrester Research, Inc. All rights reserved. Unauthorized reproduction is strictly prohibited. Information is based on best available resources. Opinions reflect judgment at the time and are subject to change. Forrester®, Technographics®, Forrester Wave, and Total Economic Impact are trademarks of Forrester Research, Inc. All other trademarks are the property of their respective companies. For additional information, go to forrester.com. THE TOTAL ECONOMIC IMPACT™ OF DIALPAD AI CONTACT CENTER
Executive Summary Traditional contact centers are grappling with challenges such as long customer wait times, inadequate routing of inquiries, and limited agent efficiency, resulting in suboptimal customer experiences. To improve the operational efficiency of contact centers, organizations need a contact center solution with AI-powered automation and analytics, intelligent call routing, and data-driven insights into agent performance. Dialpad Ai Contact Center is a solution that leverages artificial intelligence (AI) and advanced automation to KEY STATISTICS improve the operational efficiency of contact centers. The solution provides organizations with AI-powered call routing and real-time assistance for agents, streamlining customer interactions and reducing wait times and handle times. Additionally, businesses can use Dialpad to gain visibility into their contact centers’ Return on investment (ROI) Net present value (NPV) workflows, enhancing customer and agent 381% $10.42M experiences. Forrester research describes how contact center-as- a-service (CCaaS) systems have become channels, and it promises to have greater relevance 2 increasingly important to customer service in recent and value in the future. AI capabilities also gather years: “The flexibility and agility of CCaaS systems and quantify customer feedback from previously inaccessible call recordings and support more useful cement the technology’s role as the norm for resilient 3 contact centers [on-premises and in work-from-home feedback within the contact center. environments]. Meanwhile, CCaaS has morphed into Dialpad commissioned Forrester Consulting to its own beast — it is no longer just a cloud-based conduct a Total Economic Impact™ (TEI) study and copy of premises-based systems. CCaaS systems examine the potential return on investment (ROI) make advanced customer service practical. They enterprises may realize by deploying Ai Contact simplify omnichannel communications, provide critical 4 Center. The purpose of this study is to provide customer data on the agent desktop, and tightly readers with a framework to evaluate the potential integrate with workforce optimization (WFO) tools to financial impact of Ai Contact Center on their improve agent performance and customer experience organizations. 1 (CX).” To better understand the benefits, costs, and risks AI has fueled transformation in the contact center. associated with this investment, Forrester interviewed According to Forrester research, it now permeates four representatives with experience using Ai Contact every element of a differentiated CCaaS offering, Center. For the purposes of this study, Forrester from self-service to post-contact analytics. It already aggregated the interviewees’ experiences and drives value by summarizing call transcripts for combined the results into a single composite efficiency and boosting productivity in text-based organization that is a global organization with THE TOTAL ECONOMIC IMPACT™ OF DIALPAD AI CONTACT CENTER 1
EXECUTIVE SUMMARY $100 million in annual revenue and 6.5 million yearly organization reduces both average call handle contacts. time and the amount of time agents spend on Prior to using Dialpad Ai Contact Center, the post-call administrative work, resulting in interviewees noted how their organizations’ legacy significant agent time savings. Over the course of environments consisted of several disparate contact the three-year analysis, this productivity center solutions with limited functionality and poor improvement is worth $9.7 million to the reliability. The interviewees reported that their contact composite organization. centers had long handle times and a high rate of • Reduction in time spent coaching agents and abandoned calls, frustrating customers and agents reporting on contact center performance. Ai alike. Additionally, the organizations lacked visibility Contact Center features such as Ai Coaching into customer sentiment, agent performance, and capture and analyze real-time interactions other contact center analytics. between agents and customers, providing both After the investment in Ai Contact Center, the agents and supervisors with insights into interviewees’ organizations were able to optimize performance and contact center trends. As a customer interactions, minimizing handle and wait result, managers at the composite organization times as well as call abandonment while ensuring are able to reduce by 75% the amount of time consistent, high-quality service. Moreover, the they spend coaching agents and reporting on the interviewees’ organizations gained valuable insights contact center, leading to $655,000 in time into their contact centers’ performance, allowing them savings over three years. to refine processes, boost agent productivity, and • Cost savings from reduced agent turnover. improve customer and employee experience. The The composite organization’s agents receive investment in Ai Contact Center also enabled the real-time assistance and coaching with Ai organizations to retire their legacy systems, leading Contact Center, helping them feel equipped to to substantial cost savings. deal with customer inquiries and challenges. Additionally, improvements in productivity make workloads more manageable, further improving agent satisfaction. The elevated employee Reduction in average experience leads to a 10-percentage-point handle time: decline in agent turnover, resulting in $1.1 million in cost savings for the composite organization. 20% • Higher revenue from the decrease in abandoned calls and avoided downtime. After implementing the solution, the composite organization responds to calls faster, enabling KEY FINDINGS them to address calls that previously would be Quantified benefits. Three-year, risk-adjusted abandoned. Because many of the composite present value (PV) quantified benefits for the organization’s calls involve upselling or cross- composite organization include: selling opportunities, the decline in abandoned calls helps the organization realize more revenue • Improved contact center agent productivity. opportunities, leading to an increase in profits. With Ai Contact Center, the composite Furthermore, the reliability of Ai Contact Center THE TOTAL ECONOMIC IMPACT™ OF DIALPAD AI CONTACT CENTER 2
EXECUTIVE SUMMARY helps the organization reduce its downtime and customers to resolve their inquiries via self- the associated revenue losses. Overall, the service and reduces the number of levels decrease in abandoned calls and downtime customers must move through to speak to the amounts to $281,000 over the three-year right person. Crucially, customers have the option analysis. to navigate using voice and can be directed • Cost savings from retiring legacy systems. through automated routing. The improved menu After investing in Ai Contact Center, the routing speeds up service for callers and reduces composite organization is able to retire its costs for the composite organization. existing systems and eliminate legacy solution, • Happier employees. Interviewees shared that real estate, maintenance, and long-distance call employees appreciated Ai Contact Center’s costs. The legacy system deprecation costs are intuitive platform and efficient menu routing, worth $1.4 million to the composite organization which effectively balanced workload among over three years. agents in the contact center. Additionally, Unquantified benefits. Benefits that provide value Dialpad’s cloud-based solution is accessible from for the composite organization but are not quantified anywhere, facilitating remote or hybrid work and in this study include: ensuring a seamless experience and easy communication across in-office and remote team ● CSAT insight and customer experience. The members. interviewees’ organizations reported that Dialpad Ai Contact Center reduced customer wait times Costs. Three-year, risk-adjusted PV costs for the and call times, reducing customer frustration. composite organization include subscription costs Additionally, the solution’s data-driven insights and call credits, as well as labor costs for and real-time assistance ensures consistent and implementing and maintaining the solution and for personalized support, leading to smoother training new users. customer interactions. Dialpad’s Ai CSAT feature The representative interviews and financial analysis helped service teams gain a full view of found that a composite organization experiences satisfaction across every interaction, delivering a benefits of $13.16 million over three years versus more complete understanding of customer costs of $2.73 million, adding up to a net present needs. value (NPV) of $10.42 million and an ROI of 381%. • Visibility into contact center analytics. By continuously capturing and analyzing customer interactions across various communication channels, Dialpad Ai Contact Center generates comprehensive insights into agent performance, customer behavior, and operational trends. This real-time and historical data empowers the composite organization to make informed choices when managing agents or allocating resources. • More efficient menu routing and reduced demand on agents. Dialpad Ai Contact Center enables the composite organization to streamline menu and IVR systems, which allows more THE TOTAL ECONOMIC IMPACT™ OF DIALPAD AI CONTACT CENTER 3
EXECUTIVE SUMMARY ROI BENEFITS PV NPV PAYBACK 381% $13.16M $10.42M
EXECUTIVE SUMMARY TEI FRAMEWORK AND METHODOLOGY From the information provided in the interviews, DUE DILIGENCE Forrester constructed a Total Economic Impact™ Interviewed Dialpad stakeholders and Forrester framework for those organizations considering an analysts to gather data relative to Ai Contact investment in Ai Contact Center. Center. The objective of the framework is to identify the cost, benefit, flexibility, and risk factors that affect the INTERVIEWS investment decision. Forrester took a multistep Interviewed four representatives at approach to evaluate the impact that Ai Contact organizations using Ai Contact Center to obtain Center can have on an organization. data with respect to costs, benefits, and risks. COMPOSITE ORGANIZATION Designed a composite organization based on characteristics of the interviewees’ organizations. FINANCIAL MODEL FRAMEWORK Constructed a financial model representative of the interviews using the TEI methodology and DISCLOSURES risk-adjusted the financial model based on Readers should be aware of the following: issues and concerns of the interviewees. This study is commissioned by Dialpad and delivered by Forrester Consulting. It is not meant to be used as a CASE STUDY competitive analysis. Employed four fundamental elements of TEI in Forrester makes no assumptions as to the potential ROI modeling the investment impact: benefits, costs, that other organizations will receive. Forrester strongly flexibility, and risks. Given the increasing advises that readers use their own estimates within the sophistication of ROI analyses related to IT framework provided in the study to determine the appropriateness of an investment in Ai Contact Center. investments, Forrester’s TEI methodology Dialpad reviewed and provided feedback to Forrester, but provides a complete picture of the total Forrester maintains editorial control over the study and its economic impact of purchase decisions. Please findings and does not accept changes to the study that see Appendix A for additional information on the contradict Forrester’s findings or obscure the meaning of the study. TEI methodology. Dialpad provided the customer names for the interviews but did not participate in the interviews. THE TOTAL ECONOMIC IMPACT™ OF DIALPAD AI CONTACT CENTER 5
The Dialpad Ai Contact Center Customer Journey Drivers leading to the Ai Contact Center investment Interviews Role Industry Region Contact Center Agents CTO Transportation North America with global operations 800 Senior manager of operations Education North America 1,000 VP, director of communication Financial services North America 30 CIO Healthcare North America 400 KEY CHALLENGES agents during periods of high call volume. Before implementing Dialpad Ai Contact Center, the Without any tools for live call assistance or interviewees’ organizations had a variety of contact intelligent call routing, customer interactions often center solutions, including on-premises or cloud- took longer than necessary. Additionally, agents based contact centers as well as additional ancillary often had to spend several minutes after a call to software solutions, with limited functionality in place. write down notes on the interaction, further The interviewees noted how their organizations cutting into agent bandwidth. struggled with common challenges, including: • Extended contact center wait times. Prior to the investment in Dialpad Ai Contact Center, the “[Our legacy system] had no interviewees reported that callers dealt with long features. It was poorly designed, wait times, leading to a high rate of abandoned really hard to manage, and not calls, low customer satisfaction (CSAT) scores, only that, the costs were at least and diminished brand perception. Describing twice — if not three times — their legacy system, the CTO at a transportation what we’re paying Dialpad organization said, “The system really wasn’t as today.” manageable, which was resulting in a lot of CIO, healthcare unhappy customer experiences for callers.” The interviewee went on to say that the number one driver for investing in Dialpad Ai Contact Center was “making sure that when they call in that we • Too many disparate solutions. Before adopting can get them to a human being as quickly as Ai Contact Center, interviewees revealed that possible and as easily as possible, not just during they had a range of communication solutions in business hours, but after hours as well.” place, which made their environments expensive • Heavy agent workload. The interviewees noted and difficult to maintain. The senior manager of that their organizations had difficulty staffing operations at an education organization contact centers, which often led to overworked described the disjointed environment: “The tool THE TOTAL ECONOMIC IMPACT™ OF DIALPAD AI CONTACT CENTER 6
THE DIALPAD AI CONTACT CENTER CUSTOMER JOURNEY that we used before [had] three different • Reduce downtime and its accompanying revenue platforms for voice, voicemail, and contact center, loss. and then we had to purchase call recording from • Improve customer and employee experience. a separate company and then texting from a separate company as well. It was a little all over • Provide real-time visibility into contact center the place.” performance metrics to empower decision- • Difficulty tracking agent and contact center makers. performance. Interviewees noted that without AI- COMPOSITE ORGANIZATION driven insights, tracking and evaluating agent Based on the interviews, Forrester constructed a TEI performance was a cumbersome and manual framework, a composite company, and an ROI process. The lack of visibility hampered effective analysis that illustrates the areas financially affected. coaching and training, making it challenging to The composite organization is representative of the identify areas for improvement and offer targeted four interviewees, and it is used to present the guidance to agents. aggregate financial analysis in the next section. The • Excessive downtime. Interviewees shared that composite organization has the following they often encountered issues related to characteristics: downtime and service disruptions in their existing Description of composite. The composite contact center systems. These interruptions led organization is headquartered in the US and has to unproductive periods where agents could not $100 million in annual revenue. The organization has respond to customer inquiries. The CIO at a 500 agents and receives 6.5 million contacts per healthcare organization described how their year. legacy system often experienced periods of planned and unplanned downtime: “[Our legacy system] was guaranteed 10 hours a year of downtime for upgrades — just updates Key Assumptions [themselves] alone, never mind the different • $100 million annual outages that they would have. … We had 20 revenue hours of [unplanned] outages over the year.” • 500 contact center INVESTMENT OBJECTIVES agents The interviewees’ organizations searched for a • 6.5 million contacts per solution that could: year • Increase the productivity of the contact center, allowing agents to respond to more customer inquiries without increasing headcount. • Streamline the contact center environment into a single solution and reduce legacy costs. • Decrease internal labor and maintenance costs on communications environment. THE TOTAL ECONOMIC IMPACT™ OF DIALPAD AI CONTACT CENTER 7
Analysis Of Benefits Quantified benefit data as applied to the composite Total Benefits Ref. Benefit Year 1 Year 2 Year 3 Total Present Value Atr Contact center agent productivity $3,900,000 $3,900,000 $3,900,000 $11,700,000 $9,698,723 Btr Manager productivity $263,250 $263,250 $263,250 $789,750 $654,664 Ctr Contact center reduced turnover $450,000 $450,000 $450,000 $1,350,000 $1,119,083 Dtr Reduction in downtime and abandoned calls $113,077 $113,077 $113,077 $339,231 $281,206 Etr Legacy system deprecation $563,550 $563,550 $563,550 $1,690,650 $1,401,465 Total benefits (risk-adjusted) $5,289,877 $5,289,877 $5,289,877 $15,869,631 $13,155,141 CONTACT CENTER AGENT PRODUCTIVITY real-time assist cards have been extremely Evidence and data. With Dialpad Ai Contact Center, helpful for our customer service staff. If interviewees reported that their contact center agents something comes up, agents can easily click a were able to address customer inquiries faster, button and find the information they need instead resulting in labor savings. of trying to search through a notebook or their • Summary and transcription features such as Ai email or search anywhere. We've just seen a lot Recap saved agents time on tasks like listening of time savings on calls.” to and transcribing voicemails and setting action • Dialpad Ai Contact Center helped bridge gaps in items after calls. The senior manager of knowledge to ensure continuity and efficiency in operations at the education company stated, customer interactions. The CTO at the “The real-time assist cards and [other features] transportation company shared: “You don’t have are getting them the information they need faster, to ask repeatedly anymore because [the historical information] is right there and you can so they don’t spend time researching and following up with the customers.” see it. It also helps with historical conversations. • Agents used real-time assist (RTA) cards to … If you have somebody calling back and they’re ensure that they had the information they needed dealing with somebody from a different shift, [the to address customers inquiries. The RTA cards agent] can have that context of why they called 4 automatically display relevant information based hours ago and what they were talking about.” on voice recognition technology, eliminating a • Interviewees reported significant time savings time-consuming and error-prone hunt. across a variety of metrics. Handle time was The senior manager of operations at the reduced by up to 30%, and interviewees reported education company described how the features up to a minute or more in time savings related to have helped their contact center agents: “The post-call work. THE TOTAL ECONOMIC IMPACT™ OF DIALPAD AI CONTACT CENTER 8
ANALYSIS OF BENEFITS Modeling and assumptions. For the financial Risks. Benefits realized may vary based on the analysis, Forrester assumes: following factors: • With Dialpad Ai Contact Center, the composite • The number of contacts annually. organization reduces an agent’s average handle • The average handle time and post-call work time time from 5 minutes to 4 minutes. before the investment. • After implementing the solution, agents spend an • The hourly wage of contact center agents. average of 30 seconds on post-call work, compared to 1 minute before Ai Contact Center. Results. To account for these risks, Forrester • Contact center agents have a fully burdened adjusted this benefit downward by 20%, yielding a hourly wage of $30. three-year, risk-adjusted total PV (discounted at 10%) of $9.7 million. Contact Center Agent Productivity Ref. Metric Source Year 1 Year 2 Year 3 A1 Contacts annually Composite 6,500,000 6,500,000 6,500,000 A2 Average handle time before Dialpad Ai Contact Interviews 5 5 5 Center (minutes) A3 Average handle time after Dialpad Ai Contact Interviews 4 4 4 Center (minutes) A4 Contact center agents Composite 500 500 500 A5 Average fully burdened hourly wage for contact TEI standard $30 $30 $30 center agent A6 Agent labor savings from reduced call time A1*(A2-A3/60)*A5 $3,250,000 $3,250,000 $3,250,000 A7 Post-contact work before Dialpad Ai Contact Interviews 1 1 1 Center (minutes) A8 Post-contact work after Dialpad Ai Contact Center Interviews 0.5 0.5 0.5 (minutes) A9 Reduced agent labor from post-contact work after A1*(A7-A8/60)*A5 $1,625,000 $1,625,000 $1,625,000 Dialpad Ai Contact Center At Contact center agent productivity A6+A9 $4,875,000 $4,875,000 $4,875,000 Risk adjustment ↓20% Atr Contact center agent productivity (risk-adjusted) $3,900,000 $3,900,000 $3,900,000 Three-year total: $11,700,000 Three-year present value: $9,698,723 THE TOTAL ECONOMIC IMPACT™ OF DIALPAD AI CONTACT CENTER 9
ANALYSIS OF BENEFITS MANAGER PRODUCTIVITY sometimes. Now they could just have a report Evidence and data. With Dialpad Ai Contact Center, they could just read through or scan through.” managers and supervisors at interviewees’ Modeling and assumptions. For the financial organizations increased their efficiency at reporting analysis, Forrester assumes: and coaching tasks. • The contact center organization has a total of 30 • Features such as Ai Custom Moments provided managers. managers with readily available transcripts and summaries, eliminating the need to manually sift • With Dialpad Ai Contact Center, each manager through past calls to find examples of good reduces the amount of time they spend on performance. Additionally, these features coaching from 10 hours per week to 2.5 hours expedited the identification of specific areas per week. where agent coaching can be applied, making • The fully burdened hourly wage for contact center the entire process quicker and more efficient for manager is $50 . managers. • Fifty percent of time saved by managers from Ai • The senior manager of operations at the Contact Center is repurposed productively. education company described how Ai Contact Risks. Benefits realized may vary based on the Center saved managers time on coaching: “Our following factors. managers and our sales trainers can find calls [and recordings] so much easier, and agents can • Time previously spent on coaching and send calls that they want help with so much supervision. faster than before. It’s really reduced the time for • Compensation for managers. the sales trainer to actually find prompted or unprompted calls. It was just a guessing game Results. To account for these risks, Forrester before. Now, with [Ai] Custom Moments, I’d say, adjusted this benefit downward by 10%, yielding a ‘I want this topic for this person’ and find relevant three-year, risk-adjusted total PV of $655,000. examples so much faster.” • The same interviewee also said: “Managers are able to go and look at [Ai] Custom Moments and real-time analysis and say, ‘Oh, they’re calling about [a particular topic].’ [We can then] make changes to proactively reach out to customers and get in front of different topics [and] to make real-time decisions on and update their staff with a training.” This allows managers to focus on the most important issues and avoid wasting time. • The CIO at the healthcare company said, “A conversation between an agent and a patient [is] transcribed for quality and training purposes, so a supervisor may be able to utilize that versus just sitting there and listening for minutes or hours THE TOTAL ECONOMIC IMPACT™ OF DIALPAD AI CONTACT CENTER 10
ANALYSIS OF BENEFITS Manager Productivity Ref. Metric Source Year 1 Year 2 Year 3 B1 Manager time per week spent on reporting and Interviews 10 10 10 coaching prior to Dialpad Ai Contact Center (hours) B2 Manager time per week spent on reporting and Interviews 2.5 2.5 2.5 coaching after Dialpad Ai Contact Center (hours) B3 Contact center managers Composite 30 30 30 B4 Fully burdened hourly wage for managers Composite $50 $50 $50 B5 Time savings on coaching and reporting (B1-B2)*B3*B4*52 $585,000 $585,000 $585,000 B6 Productivity recapture TEI standard 50% 50% 50% Bt Manager productivity B5*B6 $292,500 $292,500 $292,500 Risk adjustment ↓10% Btr Manager productivity (risk-adjusted) $263,250 $263,250 $263,250 Three-year total: $789,750 Three-year present value: $654,664 THE TOTAL ECONOMIC IMPACT™ OF DIALPAD AI CONTACT CENTER 11
ANALYSIS OF BENEFITS CONTACT CENTER REDUCED TURNOVER Results. To account for these risks, Forrester Evidence and data. After the investment in Dialpad adjusted this benefit downward by 10%, yielding a Ai Contact Center, interviewees described decreased three-year, risk-adjusted total PV of $1.1 million. agent turnover, alleviating the need for them to hire and train as many new agents. • Interviewees reported that Ai Contact Center’s “If [contact center agents] are real-time assist cards and coaching helped not happy because of overwork, agents feel better equipped to address customer contacts, improving agent morale. Describing the they’re not going to be happy impact this had on agent satisfaction, the CIO at with the [customers]. When you the healthcare organization said, “You can supplement their work with the resolve issues much quicker, which helps our AI that Dialpad provides, they’re employees’ morale, and they are excited about happier because they’re seeing that.” that the foundational things are • Ai Contact Center contributed to a more pleasant being taken care of automatically work experience for agents, with balanced or by the technology, so they workloads to ensure that individual employees could truly focus on what they are not overworked. The senior manager of need to do, which is an actual operations at the education company noted, “We person-to-person relationship.” have been able to make sure people leave at the CIO, healthcare end of the day [without getting] stuck with a large queue.” • Contact center attrition rates reduced by up to 22% with Dialpad Ai Contact Center. Modeling and assumptions. For the financial analysis, Forrester assumes the following: • The composite organization’s contact center has an annual turnover rate of 35% prior to adopting Dialpad Ai Contact Center. • The cost to recruit and replace a contact center employee is $10,000. Risks. Benefits realized may vary based on the following factors. • Cost to replace contact center agents. • Amount of attrition addressable by CCaaS software. THE TOTAL ECONOMIC IMPACT™ OF DIALPAD AI CONTACT CENTER 12
ANALYSIS OF BENEFITS Contact Center Reduced Turnover Ref. Metric Source Year 1 Year 2 Year 3 C1 Cost to replace a contact center employee Composite $10,000 $10,000 $10,000 C2 Contact center turnover rate prior to Dialpad Ai Interviews 35% 35% 35% Contact Center C3 Contact center turnover after Dialpad Ai Contact Interviews 25% 25% 25% Center Ct Contact center reduced turnover C1*(C2-C3)*A4 $500,000 $500,000 $500,000 Risk adjustment ↓10% Ctr Contact center reduced turnover (risk-adjusted) $450,000 $450,000 $450,000 Three-year total: $1,350,000 Three-year present value: $1,119,083 THE TOTAL ECONOMIC IMPACT™ OF DIALPAD AI CONTACT CENTER 13
ANALYSIS OF BENEFITS REDUCTION IN DOWNTIME AND ABANDONED • Operating margin applicable per industry. CALLS • Value of revenue associated with the contact Evidence and data. Dialpad Ai Contact Center center. helped interviewees’ organizations deliver better customer experiences by improving both their system • Volume of calls involving revenue generation uptime and the proportion of customer calls that they opportunities. were able to respond to. • Amount of downtime before the investment in Ai • Interviewees leveraged Dialpad Ai Contact Contact Center. Center’s callback, intelligent routing, and call • Average cost of an hour of downtime. queue features to reduce hold times and call Results. To account for these risks, Forrester abandonment rates. The improvement in call adjusted this benefit downward by 20%, yielding a response rates led to more revenue-generating three-year, risk-adjusted total PV of $281,000. opportunities, including cross-selling and upselling calls. • Some interviewees reported 20% to 30% declines in call abandonment rate. “[Customers] don’t just drop off • Interviewees recounted that the implementation anymore. They say, okay, they’re of Ai Contact Center significantly reduced the going to call me back, and they amount of downtime. The CIO at the healthcare hang up and they do get a call organization described the solution’s reliability: back within an hour.” “Dialpad itself has never gone down in the three CIO, healthcare years we have used it. … Dialpad has been very, very reliable.” Modeling and assumptions. For the financial analysis, Forrester assumes. • Annual revenue of $50 million is associated with the contact center. • Thirty percent of all contacts annually involve revenue-generating opportunities. • The composite organization has an operating margin of 5%. • The composite organization avoids 30 hours of downtime annually with Ai Contact Center. • Each hour of downtime costs the organization more than $19,000. Risks. Benefits realized may vary depending on the following factors: THE TOTAL ECONOMIC IMPACT™ OF DIALPAD AI CONTACT CENTER 14
ANALYSIS OF BENEFITS Reduction In Downtime And Abandoned Calls Ref. Metric Source Year 1 Year 2 Year 3 D1 Reduction in abandoned calls Interviews 15% 15% 15% D2 Contact center revenue per year Composite $50,000,000 $50,000,000 $50,000,000 D3 Calls involving sales including upsell or cross-sell Composite 30% 30% 30% D4 Operating margin Composite 5% 5% 5% D5 Profit from increase in answered calls D1*D2*D3*D4 $112,500 $112,500 $112,500 D6 Cost per hour of downtime Composite $19,231 $19,231 $19,231 D7 Avoided annual downtime (hours) Interviews 30 30 30 D8 Operating margin Composite 5% 5% 5% D9 Avoided lost revenue D6*D7*D8 $28,846 $28,846 $28,846 Dt Reduction in downtime and abandoned calls D5+D9 $141,346 $141,346 $141,346 Risk adjustment ↓20% Dtr Reduction in downtime and abandoned calls (risk- $113,077 $113,077 $113,077 adjusted) Three-year total: $339,231 Three-year present value: $281,206 THE TOTAL ECONOMIC IMPACT™ OF DIALPAD AI CONTACT CENTER 15
ANALYSIS OF BENEFITS LEGACY SYSTEM DEPRECATION • The composite organization eliminates $3,000 in Evidence and data. Interviewees told Forrester how annual legacy long-distance call charges. adopting Dialpad Ai Contact Center allowed them to Risks. Benefits realized may vary based on the discontinue their legacy contact center solutions. following factors: • Interviewees described being able to deprecate a • The number and nature of systems retired. variety of legacy systems and software. Eliminated costs included both subscription costs • Maintenance effort required for legacy systems. and maintenance costs for licenses purchased in • Real estate footprint prior to Dialpad and remote perpetuity. Annual maintenance costs for these work strategy. types of licenses could be between 20% and • Call volume and geography. 30% of the initial licensing cost annually. • Interviewees noted a decrease in maintenance Results. To account for these risks, Forrester cost and efforts with Ai Contact Center, which adjusted this benefit downward by 15%, yielding a they attributed both to consolidating onto a single three-year, risk-adjusted total PV of $1.4 million. platform and to Dialpad’s easy-to-use features. • Dialpad Ai Contact Center’s cloud-based system eliminated long-distance charges and enabled a shift to remote contact centers, which meant “We were able to repurpose [two customers could save on real estate costs such FTEs] for other needs because as rent and utilities. Dialpad support is so Modeling and assumptions. For the financial straightforward. [We can] analysis, Forrester assumes: actually utilize our help desk • The composite retires multiple legacy systems, folks to help manage and eliminating $500,000 of annual solution costs. support Dialpad needs and even escalations.” • Maintenance effort for the legacy system is CIO, healthcare handled by one FTE at a fully burdened annual rate of $110,000. • After implementing Ai Contact Center, the composite organization relies more on remote work, resulting in a $50,000 decline in annual real estate costs. THE TOTAL ECONOMIC IMPACT™ OF DIALPAD AI CONTACT CENTER 16
ANALYSIS OF BENEFITS Legacy System Deprecation Ref. Metric Source Year 1 Year 2 Year 3 E1 Legacy solutions cost Interviews $500,000 $500,000 $500,000 E2 Legacy long-distance charges Composite $3,000 $3,000 $3,000 E3 Real estate costs Interviews $50,000 $50,000 $50,000 1 FTE at E4 Legacy maintenance effort $110,000 fully $110,000 $110,000 $110,000 burdened salary Et Legacy system deprecation E1+E2+E3+E4 $663,000 $663,000 $663,000 Risk adjustment ↓15% Etr Legacy system deprecation (risk-adjusted) $563,550 $563,550 $563,550 Three-year total: $1,690,650 Three-year present value: $1,401,465 THE TOTAL ECONOMIC IMPACT™ OF DIALPAD AI CONTACT CENTER 17
ANALYSIS OF BENEFITS UNQUANTIFIED BENEFITS my branch and find out when their payment is Interviewees mentioned the following additional getting made, that branch director would have benefits that their organizations experienced but were visibility that their customer or their carrier called not able to quantify: them through their branch, and they got • CSAT insight and customer experience. With transferred over to the accounts payable team Dialpad Ai Contact Center, contact center teams over in finance. So they still get that visibility.” could not only standardize high-quality responses Ensuring a single view also unlocked new to deliver an improved customer experience, but opportunities for cross-sell and upsell. The CTO Dialpad’s Ai CSAT feature also enabled at the transportation organization stated: “We organizations to track CSAT automatically intend on using the AI coach and have those without relying on customers to participate in coaching cards so that, for example, if somebody surveys. Teams could then respond with mentions, ‘Hey, do you offer [a specific] service?’ additional training and coaching where needed to That would trigger a popup [to the agent] saying, shore up performance or learn from and iterate ‘Well, yes, we do. Here’s who to contact and on highly rated interactions. Features such as here’s where you can find more information about RTA cards help ensure all agents had the best, that.’” most up-to-the-minute information for customers. Interviewees gained insight into when staffing Forrester research correlates business benefits should be scaled up or down to properly balance and customer loyalty with improved CX as workloads. The CTO at the transportation 5 measured by CSAT (see figure, next page). organization said: “It tells us that ‘Hey, the The senior manager of operations at the mornings are when you need to staff. You need education company said: “With [Ai Contact to staff up to make sure that we’ve got enough Center’s] CSAT, it looks at the call and people to handle those volumes of calls.’ We can transcription and gives us a score, so we are not do a lot of workforce scheduling around that, and chasing people down to try to get answers or that also helped to mitigate it. So really, the getting more information and more data points. analytics is the short answer that’s really helped We can see where they dampened and figure out us see this.” what could be going on.” • More efficient menu routing and reduced • Visibility into contact center analytics. Dialpad demand on agents. With Ai Contact Center, Ai Contact Center created visibility across a interviewees could streamline menu and range of domains for the interviewees. With Ai interactive voice response (IVR) systems, gaining Contact Center, it was possible to see where efficiency and reducing the number of levels calls were being directed and have a record of customers had to move through to speak with the call topics. This helped break down silos across right person. In some cases, customers could departments, providing context for calls across even get the information they needed without the organization and putting contact center talking to an agent, which was more efficient for agents in a position to seamlessly pick up where customers and a cost savings for the company. the customer needed help. The CTO at the The CIO at the healthcare company noted: “We transportation organization detailed the were able to implement things like business improvement in visibility: “I’ve got visibility of all hours, as an example — a quick the calls that are coming in. If they’re trying to call THE TOTAL ECONOMIC IMPACT™ OF DIALPAD AI CONTACT CENTER 18
ANALYSIS OF BENEFITS THE TOTAL ECONOMIC IMPACT™ OF DIALPAD AI CONTACT CENTER 19
ANALYSIS OF BENEFITS recording that says on this day, we’re closed or • Better together with CCaaS and UCaaS. we’re open to a certain hour. That really helps the Forrester research finds “an obvious synergy” in [customers] to know when we’re open and when “the adoption of cloud-based UCaaS and CCaaS we’re not.” solutions. … UCaaS and CCaaS tools Customers could even navigate using voice and fundamentally enable the same thing — the 6 could be automatically routed. The CIO at the ability for humans to contact one another.” Using healthcare company shared, “Dialpad recognizes Dialpad UCaaS and Dialpad Ai Contact Center certain vocabulary, and it actually auto-reroutes CCaaS together creates efficiencies for users to certain departments or to management, and unlocks new opportunities to leverage AI depending on what the patients may be looking features across the organization. End users can for or how they are talking.” seamlessly navigate between UCaaS and CCaaS, while IT can enjoy streamlined • User-friendly interface with flexibility for management across systems. remote work. Interviewees shared that • Features and updates. Dialpad continuously employees appreciated Ai Contact Center’s develops new features for Ai Contact Center, intuitive platform and efficient menu routing that most of which customers receive free of charge effectively balanced workloads among agents in as part of automatic updates. Interviewees the contact center. Additionally, Dialpad’s cloud- expressed excitement about adopting additional based solution is accessible from anywhere, AI-powered features over time. facilitating remote or hybrid work. Flexibility would also be quantified when evaluated as part of a specific project (described in more detail in Appendix A). “We’ve simplified our menu system, and we’ve simplified how to direct-access those contact centers. So that’s probably one of the biggest efficiency gains we got out of that and again, better customer experiences or better caller experiences.” CTO, transportation FLEXIBILITY The value of flexibility is unique to each customer. There are multiple scenarios in which a customer might implement Ai Contact Center and later realize additional uses and business opportunities, including: THE TOTAL ECONOMIC IMPACT™ OF DIALPAD AI CONTACT CENTER 20
Analysis Of Costs Quantified cost data as applied to the composite Total Costs Ref. Cost Initial Year 1 Year 2 Year 3 Total Present Value Ftr Investment costs $64,223 $1,073,875 $1,073,875 $1,073,875 $3,285,848 $2,734,791 Total costs (risk- $64,223 $1,073,875 $1,073,875 $1,073,875 $3,285,848 $2,734,791 adjusted) INVESTMENT COSTS • After an initial training effort, new staff to replace Evidence and data. Investment costs for Dialpad Ai attrited staff are trained each year. Contact Center include subscription costs payable to • The composite organization has an agent Dialpad as well as internal labor costs associated turnover rate of 25% in Years 2 and 3. with implementation, ongoing maintenance, and training. • Ten percent of one FTE’s time is required for ongoing maintenance. • CCaaS subscriptions are per seat and payable monthly or annually. • Pricing may vary. Contact Dialpad for additional details. • Interviewees valued the simplicity of implementation and useful out-of-the-box Risks. Costs may vary based on the following features. Implementation times vary but were factors: typically around six weeks. • The number of staff and features elected. • Interviewees reported that agents could be • The degree of change management capabilities trained on using Ai Contact Center in a few at an organization. hours. • Additional internal effort related to rolling out new • They also shared that Ai Contact Center required modules and features. less ongoing maintenance effort compared to Results. To account for these risks, Forrester legacy systems. adjusted this cost upward by 10%, yielding a three- Modeling and assumptions. For the financial year, risk-adjusted total PV (discounted at 10%) of analysis, Forrester assumes: $2.7 million. • All contact center and management staff hold a fully loaded $150 per month per seat license. • Two FTEs with a fully burdened annually salary of $110,000 each spend six weeks on implementation. THE TOTAL ECONOMIC IMPACT™ OF DIALPAD AI CONTACT CENTER 21
ANALYSIS OF COSTS Investment Costs Ref. Metric Source Initial Year 1 Year 2 Year 3 F1 Subscription costs (A4+B3)*$150*12 $954,000 $954,000 $954,000 6 weeks*2 F2 Implementation efforts FTE*Average fully $25,385 burdened annually salary of $110,000 2 hours * F3 Training efforts ((A4*$30)+(B3*$50)) $33,000 $8,250 $8,250 $8,250 Year 2 and 3 25% turnover F4 Call credits Interviews $3,000 $3,000 $3,000 F5 Ongoing management 10% of 1 IT FTE $11,000 $11,000 $11,000 Ft Investment costs F1+F2+F3+F4+F5 $58,385 $976,250 $976,250 $976,250 Risk adjustment ↑10% Ftr Investment costs (risk-adjusted) $64,223 $1,073,875 $1,073,875 $1,073,875 Three-year total: $3,285,848 Three-year present value: $2,734,791 THE TOTAL ECONOMIC IMPACT™ OF DIALPAD AI CONTACT CENTER 22
Financial Summary CONSOLIDATED THREE-YEAR RISK-ADJUSTED METRICS Cash Flow Chart (Risk-Adjusted) Total costs Total benefits Cumulative net benefits The financial results calculated in the Benefits and Costs sections can be used to determine the ROI, NPV, and h s$14.0 M payback period for the composite ow Casfl organization’s investment. Forrester $12.0 M assumes a yearly discount rate of 10% for this analysis. $10.0 M $8.0 M $6.0 M These risk-adjusted ROI, NPV, and payback period values are determined by $4.0 M applying risk-adjustment factors to the unadjusted $2.0 M results in each Benefit and Cost section. -$2.0 M Initial Year 1 Year 2 Year 3 Cash Flow Analysis (Risk-Adjusted Estimates) Initial Year 1 Year 2 Year 3 Total Present Value Total costs ($64,223) ($1,073,875) ($1,073,875) ($1,073,875) ($3,285,848) ($2,734,791) Total benefits $0 $5,289,877 $5,289,877 $5,289,877 $15,869,631 $13,155,141 Net benefits ($64,223) $4,216,002 $4,216,002 $4,216,002 $12,583,783 $10,420,350 ROI 381% Payback
Appendix A: Total Economic Impact PRESENT VALUE (PV) Total Economic Impact is a methodology developed by Forrester Research that enhances a company’s The present or current value of technology decision-making processes and assists (discounted) cost and benefit estimates vendors in communicating the value proposition of given at an interest rate (the discount their products and services to clients. The TEI rate). The PV of costs and benefits feed methodology helps companies demonstrate, justify, into the total NPV of cash flows. and realize the tangible value of IT initiatives to both senior management and other key business stakeholders. NET PRESENT VALUE (NPV) TOTAL ECONOMIC IMPACT APPROACH The present or current value of Benefits represent the value delivered to the (discounted) future net cash flows given business by the product. The TEI methodology an interest rate (the discount rate). A places equal weight on the measure of benefits and positive project NPV normally indicates that the investment should be made the measure of costs, allowing for a full examination of the effect of the technology on the entire unless other projects have higher NPVs. organization. Costs consider all expenses necessary to deliver the RETURN ON INVESTMENT (ROI) proposed value, or benefits, of the product. The cost category within TEI captures incremental costs over A project’s expected return in the existing environment for ongoing costs percentage terms. ROI is calculated by associated with the solution. dividing net benefits (benefits less costs) by costs. Flexibility represents the strategic value that can be obtained for some future additional investment building on top of the initial investment already made. DISCOUNT RATE Having the ability to capture that benefit has a PV that can be estimated. The interest rate used in cash flow analysis to take into account the Risks measure the uncertainty of benefit and cost time value of money. Organizations estimates given: 1) the likelihood that estimates will typically use discount rates between meet original projections and 2) the likelihood that 8% and 16%. estimates will be tracked over time. TEI risk factors are based on “triangular distribution.” PAYBACK PERIOD The initial investment column contains costs incurred at “time The breakeven point for an investment. 0” or at the beginning of Year 1 that are not discounted. All This is the point in time at which net other cash flows are discounted using the discount rate at the end of the year. PV calculations are calculated for each total benefits (benefits minus costs) equal cost and benefit estimate. NPV calculations in the summary initial investment or cost. tables are the sum of the initial investment and the discounted cash flows in each year. Sums and present value calculations of the Total Benefits, Total Costs, and Cash Flow tables may not exactly add up, as some rounding may occur. THE TOTAL ECONOMIC IMPACT™ OF DIALPAD AI CONTACT CENTER 24
Appendix C: Endnotes 1 Source: “The Forrester Wave: Contact Center As A Service, Q1 2023,” Forrester Research, Inc., March 27, 2023 2 Source: “First 90 Days: Contact Center Director,” Forrester Research, Inc., April 10, 2023 3 Source: “Five Lessons Learned From The Forrester Wave™: Contact Center As A Service, Q1 2023,” Forrester Research, Inc., June 20, 2023. 4 Total Economic Impact is a methodology developed by Forrester Research that enhances a company’s technology decision-making processes and assists vendors in communicating the value proposition of their products and services to clients. The TEI methodology helps companies demonstrate, justify, and realize the tangible value of IT initiatives to both senior management and other key business stakeholders. 5 th Source: “How Customer Experience Drives Business Growth, 2022,” Forrester Research, Inc., June 6 2022. 6 Source: “Come Together: Combining UCaaS And CCaaS Unlocks New Customer Value,” Forrester Research, Inc., July 21, 2023. THE TOTAL ECONOMIC IMPACT™ OF DIALPAD AI CONTACT CENTER 25
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