Genesys and Overstock.com - A Brand Built on Service

 
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Genesys and Overstock.com - A Brand Built on Service
SUCC ES S S TORY

                     Genesys and Overstock.com
                     A Brand Built on Service
                     Founded in 1997, Overstock.com is a premier online retailer that offers a wide variety of
                     quality, brand-name merchandise at discount prices. The company provides customers the
                     convenience of online bargain-shopping, while giving manufacturers, distributors and other
                     retailers an alternative sales channel for liquidating inventory. Overstock.com offers 24x7 sales
                     and customer service and support via phone, email, and the Internet—and prides itself on
                     providing customers with white-glove treatment.
                     Around the time of its eight-year anniversary, Overstock.com had reached a business
                     crossroads. The company enjoyed a well-earned reputation for providing outstanding customer
At a Glance
                     service—a key differentiator in the highly competitive online retail space. But as it continued to
Overstock.com        grow and experience seasonal spikes in call volume, the infrastructure that supported its high
www.overstock.com    standard of customer service was starting to become stressed.

Industry:            Signs of Stress
Online retail        At the time, the Overstock.com contact center infrastructure consisted of a combination of
                     on-premises hardware, hosted software applications from third parties, and both manual and
                    “homegrown” systems. The ACD/PBX distributed incoming calls, but lacked the advanced
                     skills-based routing needed to match caller with skilled agent to deliver the desired levels of
                     customer service.
                     The retailer also relied on an outsourcer to supplement the in-house agents during the high
                     volume holiday period. The Overstock.com contact center and the outsourcer’s contact center
                     operated on separate platforms running different systems.
                     The combination of the existing infrastructure, use of an outsourcer and the limitations of
                     network-based routing led to a number of problems. The on-premises contact center systems
                     weren’t flexible and couldn’t easily expand when needed. Call routing was slow and inefficient
                     at matching agent skills with customer needs, and agents couldn’t easily find the information
                     needed to fully resolve customer issues on the first call. Finally, disparate reporting systems,
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                                                                                             Genesys and Overstock.com / page 2

Challenges                      coupled with management tools and agent         > Meet internal customer service
• Call routing was slow and     pools lacking a common infrastructure,            enhancement metrics while reducing
  inefficient at matching       couldn’t provide Overstock.com with a             agent head count by increasing agent
  agent skills with customer    comprehensive view of the total customer          efficiencies.
  needs.                        experience, which hindered its overall goal     > Redeploy IT resources and staff personnel
• Agents couldn’t easily find   of increasing customer satisfaction.              managing contact center infrastructure
  the information needed                                                          to other more strategic Overstock.com
  to fully resolve customer     A Costly Situation                                business initiatives.
  issues on the first call.
                                Complicating matters further, the               > Satisfy Service Level Agreements
                                hardware-based nature of the overall              (SLA) to ensure the high availability
                                on-premises contact center architecture           necessary to drive customer service and
                                required costly backup equipment to deal          other corporate goals.
                                with potential system failures. As such,
                                                                                Overstock.com conducted an evaluation
                                comprehensive system-wide redundancy
                                                                                process to select the best solution to achieve
                                across all applications was lacking, further
                                                                                its objectives. The retailer concluded early
                                stressing system reliability. In order to
                                                                                on that advanced routing was essential,
                                support the contact center infrastructure,
                                                                                both to handle its current customer service
                                Overstock.com had allocated three full-time
                                                                                objectives and the anticipated additional lines
                                IT resources solely devoted to contact center
                                                                                of business. A decision was made to select
                                systems management and support, as well
                                                                                contact center routing technology from
                                as an ongoing contract with an external
                                                                                Genesys, the market leader in advanced
                                consulting firm. Further investment in the
                                                                                routing capabilities.
                                existing infrastructure would continue to
                                require a disproportionate amount of system     Beyond the routing technology itself, the
                                support from the IT department. And the         company also examined vendors that could
                                purchase of incremental contact center          deliver the required contact center solutions
                                hardware and software would only partially      in a cloud-based, Software as a Service
                                solve the problems.                             (SaaS) model. As an early adopter of cloud
                                                                                technology, Overstock.com did not want to
                                                                                continue to devote the time, IT staff, and
                                Exploring New Options                           overall cost of managing and maintaining its
                                At this juncture, Overstock.com adopted         contact center infrastructure on premises.
                                a strategic goal of increasing customer         A cloud-based model would also alleviate
                                satisfaction levels as it grew. The company     the scalability and flexibility challenges that
                                also realized it would need to cut contact      Overstock.com experienced during its peak
                                center infrastructure costs. Recognizing that   holiday season.
                                a new approach to its contact center systems
                                and technology would be required, the
                                company determined that a new solution          The Genesys Cloud-Based
                                would need to:                                  Contact Center
                                > Provide a flexible contact center             After diligent investigation, analysis, and
                                  model able to match seasonal call volume      speaking with other large enterprise clients
                                  fluctuations without the costly need to       as references, Overstock.com selected
                                  have full-time agents during the other        Genesys to provide, integrate and manage its
                                  nine months of the year.                      complex contact center environment.
                                                                                Genesys offered extensive contact center
                                                                                capabilities, a cloud-based delivery model,
                                                                                industry-leading Service Level Agreements,
                                                                                and solid existing enterprise customer
                                                                                references.
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                                                                                                 Genesys and Overstock.com / page 3

The Genesys Professional Services and           on premises. Unlike the previous contact
Customer Engagement resources engaged           center infrastructure, Genesys provides
with the team at Overstock.com to fully         Overstock.com a Service Level Agreement
                                                                                                   Solutions
discover, analyze, evaluate, and                (SLA) with performance guarantees                  • Genesys Cloud-based
recommend possible system configuration         to ensure overall system availability                Contact Center
designs to address strategic and tactical       and reliability.
goals. The process was completed in fewer
than 45 days, and the recommendation
was accepted by Overstock.com executives,
                                                Designed for Continuous
contact center, and IT support teams.           Improvement
The new Genesys solution included a full,       Overstock.com wanted its new contact
virtualized contact center with advanced        center solution to offer capabilities and          Benefits
routing, IVR, multi-site transparency,          methodologies for continuously improving
                                                                                                   • Enhanced agent and supervisor
single-view reporting and administration,       customer satisfaction. Because Genesys
                                                                                                     productivity
integrated call monitoring and quality          captures and stores all historical interaction
                                                data between callers and Overstock.com             • SLA with performance guarantees
assurance, and integrations to legacy                                                                ensure system availability and
applications. The final system implementation   agents, the entire scope of agent and
                                                contact center performance has become                reliability
took place within just 90 days of the project
                                                both available and quantifiable for                • Average hold time decreased
kickoff, both rapid and well within the                                                              over 93%
window necessary to support the intense         management through dashboards and
holiday period.                                 internal consolidated reporting. With              • Abandon rates decreased by 85%
                                                Genesys, Overstock.com now generates               • TCO savings of $13,908,000 over
                                                activity reports and agent scorecards,               five years compared with an
IT and Operational Savings                      analyzes and measures agent and customer             on-premises solution
Compared to the on-premises solution that       feedback, and highlights potential new
required several full-time Overstock.com IT     opportunities for improvement across all
resources plus outside consultants, the         of their sites and various agent groups.
company has been able to redirect those
valuable IT resources to more strategic         Future Proof
initiatives and projects, and eliminate the
need for the consultants. Furthermore,          As a further benefit, there is no technology
Genesys enhances the productivity of both       obsolescence for Overstock.com, as the
agents and supervisors so they can be           Genesys cloud-based service delivery
more effective in their jobs and Overstock.     model and platform is continually being
com can realize ongoing operational savings.    upgraded with the most current
                                                technologies—essentially providing a
                                                future-proof solution. Overstock.com can
A Unified System with                           easily add new “best-of-breed”components
Performance Guaranteed                          and features to the solution as they become
By fall 2010, Overstock.com added a             available to further enhance customer
second contact center facility in Salt Lake     engagement and improve ease of use.
City with over 90 full-time agents. Both        Genesys provides ongoing scheduled and
sites are now managed as a single virtual       ad hoc client services to help Overstock.com
contact center through the Genesys              leverage industry best practices and achieve
solution with 24x7 Genesys support. All         the maximum value from existing contact
systems are fully redundant through             center applications. With Genesys providing
Genesys, and all existing applications are      industry thought leadership, valuable insight,
integrated by Genesys, including a small        advice, and extensive analytics, Overstock.
number of legacy applications that              com is able to achieve their goals of
Overstock.com continues to maintain             delivering an outstanding customer
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                                                                                   Genesys and Overstock.com / page 4

experience and maintaining competitive                             TCO Results
market differentiation at dramatically
                                                                    For the on-premises solution, the five-year
lower costs.
                                                                    combined cost was $19,828,000, including all
                                                                    relevant costs.
Total Cost of Ownership (TCO)                                       For the cloud-based solution from Genesys,
Analysis and Comparison                                             the five-year combined cost was $5,920,000.
As part of the overall evaluation for                               TCO analysis shows that the cost of the cloud-
replacement of its existing contact center                          based solution at the projected peak seat
infrastructure, Overstock.com compared the                          count of 462 seats is significantly less
costs of a new cloud-based based contact                            expensive: less than the on-premises solution
center solution with the equivalent cost of a                       by $13,908,000. In addition, the cloud-based
traditional hardware-based purchase solution                        solution cost advantages began in year one
requiring capital expenditure spending and IT                       and remained less expensive throughout the
resource dedication.                                                TCO five-year time frame.

Five-Year TCO Cumulative Cost Comparison

On-premises option
cumulative cost:                                                       Estimated Annual Costs
$19,828,000
Genesys cloud option                              $8,000,000
cumulative cost:
                                   Annual Cost

                                                  $6,000,000
$5,922,000
                                                  $4,000,000

                                                  $2,000,000

                                                          $0
                                                                       1          2            3        4         5
                                                                                            Year
                                                  Premises-Based             Hosted-Based

TCO Annual Cost Comparison

Observed total cost of ownership savings year over year

On-premises option                                                 Estimated Cumulative Costs
cumulative cost:
$3,966,000                                       $25,000,000
Genesys cloud option
                               Cumulative Cost

                                                 $20,000,000
cumulative cost:
                                                 $15,000,000
$1,184,000
                                                 $10,000,000

                                                  $5,000,000

                                                          $0
                                                               1 4 7 10 13 16 19 22 25 28 31 34 37 40 43 46 49 52 55 58

                                                                                      Months

                                                 Premises-Based            Hosted-Based
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                                                                                                   Genesys and Overstock.com / page 5

With the Genesys cloud-based contact center solution, virtually                                     Contact Center
every targeted metric has improved within the Overstock.com                                         Improvements
contact center environment..                                                                        Contributing to
                                                                                                    Greater Operational
                                                                                                    Efficiency
TCO Assumptions                                 Operational Results and
                                                                                                     • Advanced skills-based routing
The comparison utilized a comprehensive         Ongoing ROI                                            capabilities
TCO analysis of alternatives. It examines       Results since the 2007 Genesys
and compares all the costs to install and       implementation have exceeded all                     • Ability to establish call priority
maintain the different solutions, but does                                                             levels by group
                                                expectations.
not include anticipated agent performance                                                            • Enhanced agent overflow
                                                The ability to measure and calculate                   capability
improvement and associated cost savings.
                                                agent activity enables Overstock.com to
The TCO analysis for Overstock compared         understand the operational efficiencies              • More granular reporting to
the Genesys cloud-based SaaS contact                                                                   enable fast response to
                                                achieved with the Genesys cloud-based
center offering with an equivalent                                                                     changing conditions
                                                contact center in comparison with results
on-premises solution.                           during the previous environment. It also allows      • Enhanced real-time
                                                comparison between specific periods (e.g.              dashboards and a
The TCO framework assumed:                                                                             360-degree view of all
                                                month or quarter) on an ongoing basis.
> Equivalent costs over the five-year                                                                  reporting records
                                                Consequently, Overstock.com has visibility into
  timeframe that Overstock.com was              areas where the contact center is performing         • Agent workflow
  projecting.                                   well or might need additional improvement.             optimization tools
> The full set of required applications and     Furthermore, Overstock.com has been able
  the associated IT staff to manage either      to see beyond the forecasted cost savings
  solution.                                     shown in the pre-deployment TCO analysis
> A peak load of 462 agents: 287                to view and calculate the actual ongoing
  year-round and 175 seasonal in Q4             Return on Investment (ROI) from new
  only, with an agent utilization rate of       operational efficiencies and cost savings
  85% and all calls being connected to l        resulting from deployment of the
                                                Genesys solution.
  ive agents.
> Inclusion of every contact center
  component from each alternative solution:
                                                Average Speed of Answer
  software licenses, hardware, professional     Decreased Over 93%
  services, maintenance, operations,            Callers now reach agents in less than two
  connectivity, upfront costs, periodic event   seconds compared to over 22 seconds
  costs (for patches, upgrades, hardware        previously, and to the newer three-second
  refresh), other associated recurring costs,   target. Streamlining of the reporting package
  and the SaaS monthly expenses for the         and the new 360-degree views that include
  full contact center services from Genesys.    both the ACD and CRM records, and the
                                                website purchase records allow supervisors to
> Inclusion of additional costs to support      quickly identify potential blockages and hurdles
  the contact center: facilities, power, air    to incoming transactions and to utilize dynamic
  conditioning, security measures, and the      routing and queue change capabilities to
  required IT resources.                        immediately address the issues. Priority levels
                                                that were established by group, coupled with
                                                the enhanced call overflow capabilities, also
                                                positively impact the overall significant
                                                improvement in customer service.
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                                                               Genesys and Overstock.com / page 6

Average Hold Time Decreased                      productivity was attributed to several items,
                                                 including the implementation of real-time
Over 21%                                         dashboards and reports that indicated a
Average hold time (AHT) has decreased from previously “hidden” large population of
537 seconds (8.9 minutes) to an average of       agents who were erroneously logged out as
422 seconds (7.0 minutes) including higher      “not ready”. The previous Nortel contact
Q4 call durations since Overstock implemented center environment had required Overstock.
the Genesys solution. By design, Overstock.      com to overstaff their workforce in particular
com typically increases AHT beyond the           agent groups to overcome the inherent
seven-minute target during Q4 to provide         product reporting deficiencies.
outstanding “white-glove” service during the
busy holiday period when customers typically
have more complex conversations related to       Abandon Rates Reduced
gift orders. The AHT goals were met with the     Abandon rates have been reduced by 85% to
help of advanced routing capabilities which      less than .4%, helping further drive improved
ensure that callers are directed to the most     customer satisfaction. This is due to the
capable agents.                                  implementation of multiple agent pools with
                                                 assigned skills. Dynamic queue management
                                                 immediately re-directs calls to lower skilled
Service Level Agreement                          available agents when queue thresholds are
Objective Exceeded                               exceeded, thus enabling significantly greater
Over 99% of all incoming calls to Overstock.     call capture rates.
com last year were answered within two
seconds compared to the internal goal of 80% Scaling Up is Easier
answered within 30 seconds. As a direct
                                                 Overstock.com seamlessly scales up with
correlation between call answer and customer
                                                 Genesys by 175-plus agents during its busy
satisfaction, Overstock.com staffs its two
                                                 season in Q4 with no capital expenditures,
contact centers with sufficient agents to
                                                 and none of the quality control issues
promptly answer each customer call, as well
                                                 associated with the outsourcer utilized prior to
as designing their call flow patterns to ensure
                                                 the Genesys deployment. This enables the
adequate agent distribution and minimal
                                                 company to realize annual savings of over
queue lengths. Caller queues are managed
                                                 $1,678,000. Overstock.com was able to bring
aggressively to provide for almost immediate
                                                 the outsourced agents in house at a lower
overflow to secondary agent pools for
                                                 overall cost due to two factors. First, the cost
maximum customer service. The ability to
                                                 of the new in-house agents was offset by the
reposition agents from other less productive
                                                 significant cost savings achieved from the
areas into critical service environments, while
                                                 improved efficiency in the primary internal
closely managing costs, has been a major
                                                 contact center. Second, the flexible Genesys
change in the Overstock.com contact center
                                                 cloud model saved the company from having
framework. Exceeding this internal 80% SLA
                                                 to hire the seasonal agents during the less
has helped enable Overstock.com to achieve
                                                 busy times of the year.
its overall high Net Promoter Score ranking.

Agent Productivity Improved                       Net Promoter Score Improved.
                                                  Post-incident Net Promoter Score has
Overstock.com has increased agent
                                                  improved to over 60% and the company
occupancy rates by 27% since 2007,
                                                  achieved its fifth consecutive year ranked in
requiring 30 fewer Full-Time Equivalent
                                                  the top five in customer service by the National
(FTE) agents and realizing annual savings of
                                                  Retail Federation. Enhanced agent training,
over $930,000. The improvement in agent
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                                                                                                  Genesys and Overstock.com / page 7

In addition to meeting the primary contact center metric goals,
the Genesys solution also enabled Overstock.com to achieve
significant benefits in other tangential objectives.

monitoring, and compliance—capabilities         Total Savings Opportunities
now provided by a fully capable
quality management and call recording           from the Genesys Solution
solution—help the contact center                The total savings emerges from the
contribute to the company’s score               combination of the infrastructure savings
improvement. A much more streamlined            derived from the total cost of ownership
incoming call flow and reduced queue            analysis, the conversion to a Genesys solution,
holding times also help Overstock.com           and the ongoing separate operational
maintain the higher score.                      savings. Combined total savings are over
                                                $26 million.

Ongoing Cost Savings from
                                                Contact Center Improvements
Operational Changes                             Contributing to Greater
Due to operational improvements resulting
                                                Operational Efficiency
from the Genesys cloud-based platform,
Overstock.com is saving over $2,608,000 on       Total TCO savings over         $13,908,000
an ongoing annual basis in agent labor costs,    five-year period:
beyond the comparative savings of the            Total ROI operactional         $14,040,000
infrastructure platform in the TCO analysis.     savings over five-year
To put these ongoing operational savings in      period:
perspective, we look at both the monthly
                                                 Total five-year savings        $26,948,000
incremental ROI and the annual ROI.
                                                 with Genesys cloud-based
On an annualized basis, the full year costs      solution:
divided by the monthly savings show ROI          Annual savings with              $5,390,000
payback in terms of months. Calculated as        Genesys cloud-based
an annualized ROI (which would assume full       solution:
annual payment in advance), the Genesys
solution payback period for Overstock.com is
measured at just 3.84 months.
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                                                                     Genesys and Overstock.com / page 8

Solution Details
The following chart compares the on-premises Overstock.com infrastructure with the
Genesys cloud-based solution.

Capability       Before Genesys     With Genesys     Discussion
Carrier          Verizon            Verizon and      Gained redundancy, and managed by Genesys
                                    XO
 PBX             Nortel, tied to    Cisco-PBX        Cisco now used just for internal calls
                 ACD                only
ADC              Nortel             Genesys          Gained cloud-based scalability
                 Symposium
Auto             RightNow IVR       Genesys          Gained skills-based routing
Attendent/IVR
Telephone        TDM                SIP              Reduced cost and gained scalability
Platform
 WFM             IEX/Nice           IEX/Nice         Integrated by Genesys
Call Recording   Manual             Verint           Integrated by Genesys, enables agent coaching
& Monitoring
Call Reporting   Nortel OTM         Genesys          Genesys feed to Business Intelligence
CRM              Hosted RightNow    Hosted           Integrated by Genesys
                                    RightNow
 Redundancy      Raid 5 selective   Genesys—all      Gained cost-effective system-wide redunancy
                 only               but COAM
Agent            Internal &         Internal—in      Improved agent skills, gained comman platform
                 Outsourced         multiple sites
Summary          Mostly COAM        Mostly           Creating virtual contact center with common
                                    cloud-based      reporting, fully intergrated application set, scalable,
                                                     calls routing to best agent

Genesys Applications                                 > Genesys cloud-based IVR System using
                                                       Genesys Voice Platform (call prompting,
The complete set of Overstock.com contact
                                                       menu tree design) fully integrated to the
center applications includes:
                                                       Genesys contact center solution to provide
> Genesys cloud-based ACD/contact center               call delivery information to the agents
  using Genesys technology and Genesys
                                                     > Overstock.com owned and maintained
  Software as a Service delivery supporting
                                                       in-house IEX workforce management,
  two different locations
                                                       integrated to the Genesys contact center
> Cloud-based Workforce Optimization                   solution to retrieve call handling data
  solutions utilizing Verint Technology
                                                     > Genesys cloud-based reporting: real-time
  call recording, live monitoring, full-time
                                                       and historical reporting through Genesys
  recording, and complete integration to all
                                                       and Microsoft reporting services
  Genesys solutions
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                                                                                                                     Genesys & Overstock.com / page 9

A robust, cost-effective and agile contact center plays a pivotal
role in creating the competitive differentiation and brand loyalty
so important to enterprise success in rapidly evolving markets.

Genesys-Provided Integrations                       Cloud-Based Contact Centers
> Hybrid integration to on-premises and             Offer Substantial Benefits for
  customer-owned IEX WFM solution
                                                    the Large Enterprise
> Net based API for integration to hosted           Today’s cloud-based contact center
  RightNow Technologies CRM application             solutions offer substantial benefits for the
> FTP feed for Genesys data sent to an              large enterprise. As demonstrated by the
  Overstock.com on-premises Business                Overstock.com experience, whether
  Intelligence system for generation of             companies need to address agent
  executive management reports and                  scalability or business seasonality, enhance
  dashboards that include contact center            company agility, consolidate or virtualize
  data, as well as internal customer service        multiple contact centers, enable IT or
  and sales data and benchmarks                     business transformation, or facilitate
                                                    faster time to market, there are proven
> SIP Infrastructure (Genesys SaaS
                                                    cloud-based solutions available to solve
  and Overstock.com on-premises
                                                    these tough challenges. And while a
  infrastructure) to support greater
                                                    decision to “move to the cloud”can have
  application and integration capability,
                                                    significant cost savings and compelling
  as well as lower network costs
                                                    lower total cost of ownership results, the
> A fully redundant solution portfolio across       opportunity to empower business change
  all systems and applications provided             while improving the customer experience
  under the Genesys service offers                  are powerful motivators in today’s highly
                                                    competitive global marketplace. A robust,
                                                    cost-effective and agile contact center
                                                    plays a pivotal role in creating the
                                                    competitive differentiation and brand
                                                    loyalty so important to enterprise success
                                                    in rapidly evolving markets.

Corporate Headquarters          About Genesys
Genesys                         Genesys is a leading provider of multi-channel customer experience and contact center solutions. With over 3,500 customers
2001 Junipero Serra Blvd.       in 80 countries, Genesys orchestrates more than 100 million customer interactions every day across the contact center and
Daly City, CA 94014             back office. Genesys helps customers power optimal customer experiences that deliver consistent, seamless and personalized
USA                             experiences across all touchpoints, channels and interactions.

Worldwide Inquiries:            For more information visit: www.genesys.com, or call +1 888 GENESYS.
Tel: +1 650 466 1100
Fax: +1 650 466 1260            Genesys and the Genesys logo are registered trademarks of Genesys Telecommunications Laboratories, Inc. All other company
www.genesys.com                 names and logos may be trademarks or registered trademarks of their respective holders. © 2014 Genesys Telecommunications
                                Laboratories, Inc. All rights reserved.
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