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Challenges await Avaya's grand plans

Now-private Avaya wants to become more of a communications software player
By Tim Greene , Network World , 11/15/2007
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Lou D'Ambrosio

BOSTON -- Customers can expect newly private Avaya to push harder to integrate its communications software into business applications, industry analysts were told at the company’s two-day briefing last week.

“We believe this is the area where this industry is going,” says CEO Lou D’Ambrosio, referring to applications that can automatically trigger communications to speed up business processes.

That is but one highlight of the insights Avaya executives offered in their first shot at analysts since the company was bought for $8.2 billion earlier this year and taken private. Other directions include focusing more on small and midsize businesses, shaking up its sales force, improving services and fixing problems with its supply chain.

The company is pitted against Cisco, Nortel and Alcatel-Lucent for dominance in VoIP technology, placing first or second with Cisco in most categories. For instance, Infonetics places Avaya first in sales of IP PBXs and Cisco first in sales of desktop IP phones.

But the real battleground, analysts say, is for integrating VoIP with software that runs businesses to improve business efficiencies by speeding business processes along from step to step. As a result, all the top VoIP vendors are partners with Microsoft and its Office Communications Server and other software developers.

Avaya already has a significant partnership program called DevConnect to bring about these communications-enabled business processes, he says. Its partners include Bearing Point, IBM, SAP, Microsoft and Verizon.

“The long-term winners in VoIP are those who figure out how to create a community around themselves. DevConnect is by far the most mature of these [VoIP] vendor-development programs, moreso than Cisco,” says Zeus Kerravala, an analyst with the Yankee Group who attended the analyst event. “The value is all the things you can embed VoIP into.”

The company will shake up its sales force to accomplish this, D’Ambrosio says. By the end of the year, it will hire 350 salespeople, retrain many of them and perhaps lay off some that don’t snap around to selling Avaya hardware and software as solutions integrated into customer business processes rather than as isolated products.

The sales force is being realigned to address specific industries. “Is this perfect yet?” D’Ambrosio says. “No. There’s still some box-sellers versus solutions-sellers. We’ll try to improve their skills or remove them from the company.”

“They have a lot of legacy, buy-a-line type of salespeople,” Kerravala says, “and that’s not what we need to go forward.”

For Avaya employees who stick around, they’ll have a new criterion in the formula to figure out their bonuses: customer delight, D’Ambrosio says, as a way to combat shortcomings in customer satisfaction, particularly its service division.

The company is opening a service hub in Colorado and new offices around the world. “Our service is not what I would call extraordinary,” D’Ambrosio says. “That is not where we want to be.” But he says the company has key indicators that show it is improving and the goal is to make the services world-class.

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RE: Challenges await Avaya's grand plansBy Jim Sevier on November 27, 2007, 10:14 amAvaya's challenges can be summed up in the recent IBM ad's running on TV. Stop Talking and Start Doing. We are optimistic looking ahead with Silverlake and TPG...

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Avaya ChallengesBy Anonymous on December 4, 2007, 10:18 amAs a former Avaya et al and current Business partner salesperson, with over 25 years of listening to all the latest , greatest etc from AV and it dis-connected management,...

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RE: Challenges await Avaya's grand plansBy Pat Sutera on December 4, 2007, 10:51 amDitto - I look forward to Mr D'Ambrosio's return emails regarding support. My first comment is why would a company who is struggling with support decide to put their...

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