Masergy CEO James Parker Talks Accelerating Digital Transformation, Amplified Relationship with Cisco and his Mandate for Growth

By Jim Burton
23 Jan 2019

In this Executive Insights podcast, BCStrategies’ Jim Burton welcomes new Masergy CEO, James Parker. Discussion topics include what James sees as his mission for the company, his vision of where Masergy and the industry is headed, how Masergy’s product offerings fit into that vision, and the company’s amplified relationship with Cisco-BroadSoft.

Transcript

Jim Burton: Welcome to BCStrategies Executive Insights. This is Jim Burton and I’m joined today by Masergy’s new CEO, James Parker. James, congratulations on your new position at Masergy and having known your career over a few years now, I’m curious as to what prompted you to make the change.

James Parker: Yeah, thank you, Jim, and I think to look at that question, the first place that I look at is really the industry and the changes that are happening in the industry. We see this acceleration – I would just say to all things that are software – and that is certainly happening in many parts of the industry, but also, happening within the network layer. And behind that is this acceleration of digital change and transformation that many enterprise customers are going through and industries are also going through. So there’s this clear need within the network layer to have this high degree of agility, resiliency, speed.

It is the software on top of the network that is a huge enabler to make that happen. So when I look at Masergy and its value proposition, it is clearly tied to that space of that enabler of digital change and digital transformation. And our core value proposition is built on top of our software defined network.

And then layered on top of that, we have cloud communications, we have managed security services, and that software defined network. That platform is a great enabler to help enterprises achieve their digital change, their digital ambitions.

So I’ve found that the product and the offering at Masergy is extremely compelling and clearly if I got into the company and really see the innovation also then tied with the culture. And I’d say the culture is one of success really focusing in on driving customer success.

We have an NPS score that has been over 70 for the last three years, which is phenomenal and this is against an industry backdrop of an NPS score of 21. So there’s this tremendous innovation, just a really deep culture around customer success.

There’s then the backdrop of the industry that’s aligned really well with the offerings that Masergy has and it’s just an incredible opportunity to drive, I would say, accelerated performance and certainly an opportunity to reach more customers and enable more customers to achieve their digital ambition.

It’s really exciting to be at Masergy at this point in time as we’ve seen the types of changes that are happening within the network space. And certainly, what we’re seeing is enterprise is undertaking and using the network layer to be that enabler.                                                

Jim Burton: I talk to a lot of channel partners out there and one of the things that I’ve heard on a regular basis is that the channel partners really like doing business with Masergy because of the level of support they get. The example that I’ve heard over and over again is that if they’re calling one of your big competitors and I won’t throw their names out there – everybody can figure out who the big name competitors are. They have to go through several steps to get a solution to a problem. Whenever they call Masergy, the people that they talk to are completely capable of helping them with that first call and that goes a long way. Because we all know that there are challenges from time to time with things and it’s how you get the problem fixed that’s as important as anything else. So kudos to you and that certainly raises your score very high and well higher than your competition, I guess.

So I know that you’ve only been there for a short while but I also know you’ve been off for a few weeks before you joined Masergy. So I’m just curious, what’s your mission for the company? Where do you see taking it?        

James Parker: Yes, and the clear mandate that I have from the board is one of growth. Really getting the scale in the business and accelerating both our top line and bottom line growth. We’ve had really a tremendous track record delivering double digit growth both in revenue and on EBITDA over the years and looking at the investments that have been made in technology.

Certainly, as we’re scaling the go-to-market, the potential that’s out there, the mandate here is really we have to drive high levels of performance. And again, we’re positioned really to do that and in combination, it’s not just the sales, but continue the innovation and the accelerated investments to stay ahead over market on that front. And then thinking through what is the next iteration for our customer experience. We’ve done an amazing job in the past but the buck keeps moving and we have to continue to innovate both in the technology and on the experience side. It’s a combination of those elements that will be the foundation for us to get to, I would say, higher levels of performance.              

Jim Burton: One of the things that it seems like, as you said, you keep winning. But your competition are the big guys. The AT&Ts, the Verizons, and the Century Links. But then you’ve got the smaller competitors who are certainly tough competitors like RingCentral and 8x8 and Fuse. So what’s your secret to success for winning some of those accounts?          

James Parker: It’s interesting. We sit, I would say, in between the two. So on the one side with the larger competitors, we have this agility that’s very hard to match within a larger legacy infrastructure and offering. Even when the offering is contemporary in capability, you still have all of that legacy around it that’s ultimately going to come and serve the customer.

So we bring to market an incredibly agile solution and then our speed. Because we’re software defined enables us to give a very, very rich experience. Again, that’s proven through our NPS scores. But then you look at the other end of the spectrum and you have some of the smaller firms.

By and large, they’re pure play offers and, in many cases, they have strong offerings in I would say a small fraction of the total solution. Not only do we have that strong offering, whether it’s a point solution around SD-WAN, but then we’re bringing in this broader set of capabilities where we can have a full hybrid network offering.

We can bring in cloud communications. We’re bringing in security layers with that. So as our clients are evaluating who to invest in, one, they’re looking to have fewer suppliers, not more. They’re looking to have that broader strategic relationship and they want to have the innovation and the agility to meet their business needs.

So we’re really filling that niche very well. We’re taking that share from the top end and we’re certainly taking fair share on that bottom end with those single source providers. 

Jim Burton: Last month, I was at a BroadSoft event, their big annual event, which will be their last one. Now they got acquired by Cisco and in front of all the industry analysts and consultants, they gave a case study that was about Masergy. And they just talked about what a great partner you are with them.

I’m kind of curious as to how does it look to you on your side, this position. I know a lot of people thought well, what’s going to happen now that Cisco is taking over? Does it turn out to be positive for you guys?

James Parker: Yeah. I think on one side, it’s early days but all the indication is this is a very, I would say, productive relationship. So we’re super fortunate within the partnership that we have with BroadSoft and what I can say is that’s translating into an amplified relationship with Cisco.

So the aperture of the business for us through that partnership has opened wide, very, very wide. So that’s giving us, I would say, more support, more go-to-market partnership, and we truly see this as an accelerant for our business.

Jim Burton: That’s fabulous. I’m glad to hear that. One of the things at BCStrategies, we want people to make sure that they understand industry trends and where things are headed. And part of that is making sure that they don’t get a product that’s got a dead end to it. That they buy it now and they’re disappointed they made that buying decision where they could’ve gone another direction.

So that kind of opens up this question about the industry trends that you’re excited about and where you see our industry going over the next few years.

James Parker: Yeah. There are a lot of different areas in which we can take this. If we think about IoT and the technology around the Edge, and that kind of thing, one, it just builds on the last question around BroadSoft and Cisco. I see clearly the UC space; there’s a lot of potential still there.

There is still a significant amount of migration that needs to happen and that definition is also widening. If we think through the different market segments around UC, whether it’s just for employees or employees to their customers or applications, it’s becoming a more sophisticated and broader market opportunity for us.

And I think that landscape is, I don’t want to say shifting, but it’s certainly getting wider and more inclusive of other segments that maybe weren’t so obvious in the past. So UC is clearly one area that’s going to continue to accelerate and we’re certainly involved there.

We see the context in our business as well for all the things I just mentioned and the different participants or users within that ecosystem. We’re going to continue to see interesting things come from that market. When I look at most of the networking side and things that are software defined, SD-WAN, a lot of this certainly on the SD-WAN side is still to come forward.

So we will see more software coming into the network layer and creating again I think higher levels of automation or easier ways to do dynamic resource allocation and all of those things. And some of this has been out there for a while but I think we’re going to continue to see the innovation come forward and make this more reality for a broader swath of the market.

And additionally, we’re certainly looking through and thinking through different variants and forms of AI and how you think about autonomous networks and self-healing, self-managing. You think about the talk of this driving and if we can get a car to drive the other driver on the road, I’m sure we can have a lot more capability in the network and how it can behave and manage itself, and support and make better decisions on how it’s operated and secured. So I think that AI front and machine learning front over top of the network is another area that’s really compelling. Security is also in this field but just picking out a couple of those elements that will clearly see UC, all variants and forms of software automation coming into the network.

And then that whole machine learning AI area is certainly going to be an element of amplification or a trend that’s going to be continuing to accelerate. I’m not even going to say it’s emerging because it’s out there and happening. But a lot more runway for it. 

Jim Burton: Yeah, I agree with your vision. There are a lot of exciting things that are happening and all it’s going to do is improve things for customers, giving them better quality experiences, give them better communications and collaboration capabilities. So that’s exciting stuff.

James, we’ve talked a lot about the industry, about competition, and your mission, and all of that. The thing we probably should’ve started off with is let’s talk a little bit about your product offerings.

James Parker: Yeah. So Jim, there are really three areas that we have a value proposition in. The first is hybrid networks and this is all built on top of our software defined network. The second is around cloud communication and then the third is around managed security.

And it’s important to note that in the end, this is all on top of the software defined network and that we have these elements that work well together. They’re not just in silos but it’s incorporated into the fabric of our software defined platform.

Jim Burton: Well, that’s really important. I think we see companies that have pieces of it but unless you start getting into some of the major vendors. And I’m talking about the big vendors. You don’t see them having all the elements that it takes to make that happen. Because even under your cloud solution, you’ve got a lot of components like you mentioned Contact Center as an example.

Well, James, I want to thank you for your time today and I appreciate you taking the time to give to me. Because I’m sure, I think you mentioned this was your tenth day.

You’ve probably got a lot of other things you could be doing. But I appreciate it and we want to make sure that people understand the opportunities they have in potentially working with Masergy going forward. Because you’ve got a lot to offer.

James Parker: That’s great and I appreciate being on the program as well. Thanks, Jim.

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