Avaya Consultant Conference

18 Jun 2015

This week, a small group of us from North America and Europe gathered in Denver to attend the annual Avaya Consultant's conference held in conjunction with IAUG. Fellow UCStrategies Experts J.R. Simmons and Melissa Swartz were also in attendance. Watch for the podcast on it next week.

All of us were interested in hearing what Avaya's senior management had to say about product, channel, sales, market perception and finances. There was a lot crammed into a day and a half so here's a quick rundown of the highlights:

Finances -David Vellequette (CFO) and Kevin Kennedy (CEO) indicated an improving financial outlook that included an upgraded rating from the financial community, improved margins, cash flow and EBITA, recent debt refinancing lowering interest rates and moving debt payments out. Overall, the message was that things are moving in the right direction. If the positive financial trend continues the desired scenario is for Avaya to become a public company.

Marketing -Although this is closely tied to the product area, it was great to hear from Andy Cunningham, the relatively new CMO. Avaya hasn't had the reputation of being a marketing company in the past, so it was good to see someone that seemed to get it. Avaya is utilizing lots of sports marketing (i.e. Avaya Stadium, Indy car sponsor, etc.). The messaging continues to be focused on "Engagement." Engagement appears to be the new "Unified" where it is becoming ubiquitous in Avaya's products and even organizational structure. Moving in the right direction, but a long way to go.

Sales Approach - Pierre-Paul Allard indicated that Avaya wanted to establish direct relationships with its customers rather than rely solely on the channel partner. I took this to mean that Avaya would be involved in the entire life cycle of their technology with their clients. Partners would still be used for fulfillment. Others took it to mean that Avaya would be selling to end users directly.

Product -This covered most of our sessions and was a mixed bag of the good, the bad and the ugly.

  • Cloud: Avaya has a multi-pronged strategy that left many in the room confused. This includes scenarios where Avaya owns and operates the equipment, scenarios where the enterprise owns the equipment but Avaya manages it, or through a third party public cloud provider that uses Avaya equipment for voice. We weren't made aware of the providers of the public cloud offerings. An exciting new development here is their offer of IP Office and Contact Center that will be run on the Google Cloud. This last development could be big for Avaya.
  • Core Voice Platforms include Aura and IP Office. IP Office continues to be upgraded in terms of functionality and user support that now extends to 3,000 users and has strong multisite and HA capabilities. The ongoing support costs for IP Office are a small fraction of Aura. There is clearly an overlap between the two product lines. When asked why IP Office wasn't being more heavily promoted, the answers varied from channel partner issues to statements indicating there wasn't much of a product overlap. Many of the consultants indicated that Avaya has lost sales due to the TCO of Aura and felt that Avaya is missing an opportunity here with IP Office being significantly more cost competitive.
  • Contact Center was another area of concern for most of the attendees. We understand that there are four contact center offerings (two on Aura and two on IP Office). Historically, this dates to the separate Nortel and Avaya product sets. However, much time has passed since the merger. Many of us discussed how enterprises will be challenged to choose the right product - right not only in terms of functionality but also in terms of survivability. Four is a big number for a company of Avaya's size to continue to invest in and support. Will they all still be in the product portfolio three years from now? Avaya has sent mixed messages in the past; time will tell.
  • A Universal Client will replace the various UC and CC clients that exist today. This is good news and should simplify things for enterprises and Avaya.
  • Engagement Development Platform is new software (ESNA) that enables a number of functions within a browser (Chrome for now). Functionality includes allowing users in their "core" apps (i.e. Salesforce, Oracle) to call/chat directly from their browser session. This was probably the coolest item that was discussed and requires seeing it demoed rather than reading about it here.
  • Data Networking has some unique features, most important being the ability to configure and make changes to a production network quickly. However, the small market share and lack of a full SDN/Openstack approach may relegate Avaya to being a niche player in this space. With one exception, most of the consultant attendees indicated that Avaya's name does not come up much for consideration in their projects.

Channel Partners - This was discussed in depth and covered a number of topics. Kevin Kennedy stated that he thought Avaya was under distributed. Clearly they want more feet on the street. In addition, Avaya management indicated that they were looking for new partners to sell IP Office and that much of the sales success for IP Office is coming from new partners. Avaya also faces the reality of many of their traditional partners selling other solutions such as Lync. Some consultants expressed concern about partner training/support, problem resolution, pricing, etc. My view is that these same issues applied to channel partners in general and were not specific to Avaya.

Conclusion -A lot of things are happening at Avaya - much of it good. They've made some good acquisitions and have some exciting technology. Partnerships with Google, HP and VMWare show promise. There is concern about core product overlap (Aura/IP office and the various contact center offerings). The channel can be a strength or weakness depending on whom you ask.

Overall, things seem to be better at Avaya than they've been in the recent past. Can they continue to improve? Can they capture mindshare from Microsoft and Cisco? What do you think?

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