inContact's Marriage is NICE
May 31, 2016
NICE, which as of this month has dropped the “Systems” from its name, had its big user conference, Interactions2016 in Orlando last week, and a number of industry analyst and journalists got to go along for the ride. The event was extremely timely as NICE had just announced one of the biggest industry acquisitions of the year the week before when it started the acquisition process of inContact, a premiere provider of cloud-based contact center solutions.
I believe that this was one of the few times that I’ve gotten to sit down with both CEOs of two companies that so recently had announced they were joining forces. It was quite refreshing. It was not just an analyst call with a PowerPoint that details why the merger occurred, but significant time to ask all the questions that might come up with such a marriage. And ask we did, not just as a small group of analysts, but individually.
I was quite pleased. NICE is no stranger to acquisitions, as just in the past 15 years it has acquired numerous companies to bolster its capabilities. This includes Thales Contact Solutions (contact center technology) in 2002, Dictaphone (speech technologies) in 2005, IEX (WFM and strategic Planning) and Performix (performance analytics) in 2006, Actimize (financial crime prevention, compliance and risk management)in 2007, eGlue (real-time analytics) in 2010, Cybertech International (security and compliance recording), Fizzback (real-time Voice of the Customer) and Merced Systems (service and sales performance management) in 2011, and Causata (Big Data analytics) in 2013. NICE continued again this year by acquiring Nexidia in January for its analytics capabilities, and VPI for WFO.
inContact was the latest and biggest. A few of the prior acquisitions, from an industry bystanders viewpoint, have been so-so, as does happen with any company that acquires a lot over the year - the types of acquisitions that people might say were done to knock out a competitor or to acquire assets. And indeed a lot of them did just that. But, it didn’t feel that way for inContact, however, we needed to check.
In the case of inContact, most of us voiced concern over what would happen to the people within inContact. Paul Jarman, CEO of inContact, was very candid in speaking about his reasoning for signing the deal and his confidence in becoming part of the NICE family, and how his people would fit in. Barak Eilam, CEO of NICE said similar things. But, it was the comments by Eran Liron, Executive VP of Marketing and Corporate Development that had revealed the most.
Eran detailed that the NICE 2020 strategy plan was put in place when Barak became CEO in April 2014 to transform the company, which they have diligently executed on since. In fact, he said that this was the first company he had been at where such a plan has been followed so closely. One component, become a pure enterprise software player, involved not just revamping internal processes, but also divesting itself of some hardware intensive businesses, which they did in 2015. In other cases, such as with inContact, it involved acquisitions. So to close the loop on getting the answers to inContact’s position, Eran said that they knew they wanted to acquire a cloud contact center player since 2014, and surveyed the field, but wanted to wait until a company matured enough so that they wouldn’t just buy them and make them like NICE. They wanted a partner that would bring to the party its own culture.
Now for my take. With the acquisitions made this year, if the company stays the course with the its strategy plan, this really is big for the industry. As they stated in the press release, “The acquisition marks the first time that one vendor offers both contact center cloud infrastructure as well as the full range of WFO applications and Analytics, providing a seamless integrated environment.” As the ink hasn’t dried on the deal, and associated regulatory process not completed, and integration work not done yet, I would simply change the wording to “the potential to offer a seamless integrated environment”, and of course really have the potential to change the Customer Experience.
Nancy Jamison is a Principal Analyst within Customer Contact within the Digital Transformation group at Frost & Sullivan. She covers all aspects of customer contact including cloud and premise-based systems and applications in the core areas of inbound/outbound routing, IVR, Workforce Optimization, and recording and analytics, with a particular focus on peripheral and emerging areas that impact the Customer Experience. These include speech technologies, omni-channel customer care, Big Data, digital marketing, Back Office Workforce Optimization, and Support Interaction Optimization.