Microsoft Dynamics Contact Center – At Long Last!

Microsoft has had many of the pieces of a full-blown contact center/CCaaS offering for a while, and industry watchers like myself have been wondering when it would introduce a true CCaaS solution, but we don’t have to wait any longer. Microsoft just introduced Microsoft Dynamics 365 Contact Center, “a Copilot-first contact center solution that delivers generative AI to every customer engagement channel.”

Microsoft has dipped its toes in the CCaaS/contact center water several times over the past few years, and has made several relevant acquisitions, most notably Nuance and Metaswitch. In 2021, Microsoft added the voice channel to its Microsoft Dynamics 365 Customer Service, a digital-only offering introduced in 2019. With the voice channel, Microsoft created what it called an “all-in-one digital contact center solution.” Leveraging Azure Communication Service, the underlying platform that supports Microsoft Teams, Dynamics 365 Customer Service was a good first step. However, it was an add-on to Dynamics 365 with limited functionality, and couldn’t really be considered a competitive CCaaS solution. Another interesting-but-not-quite-there-yet announcement was in 2023 when Microsoft announced Copilot for Service, which “synthesizes vast amounts of data already available from an organization’s trusted knowledge sources to provide relevant, timely guidance to agents in their flow of work.” Another step in the right direction, but not a CCaaS solution.

For the past many months, Microsoft has been aggressively working on developing a standalone CCaaS offering, independent of Dynamics 365, with more of the necessary capabilities that contact centers require. With Microsoft Dynamics 365 Contact Center, Microsoft has introduced what many of its competitors have been fearing – an actual standalone CCaaS solution. Note that while it works on the same underlying Azure platform as Microsoft Teams, it is not a Teams contact center solution. However, I would expect to see a more integrated solution by the end of the fall.

During an analyst prebriefing, Jeff Comstock, Corporate Vice President, Dynamics 365 Customer Service, noted that contact centers are very fragmented, with piecemeal technologies and fragile integrations. This fragmented landscape creates data siloes, making it difficult for agents dealing with too many separate tools to get a full view of the customer experience.

Dynamics 365 Customer Service was developed to overcome these challenges, providing digital channels, telephony, voice, SMS, intelligent routing – all built on Azure. Comstock stated that Microsoft is the only leading CRM provider with a homegrown CCaaS solution (Salesforce, Zendesk, and others had a head start with their own CCaaS offerings, but they are not considered homegrown).

Channels include chat, social, email, SMS, and voice. Self-service chatbots and IVRs are pre-integrated at the platform level, leveraging Nuance’s enterprise-class technology. Microsoft will offer its own workforce management (WFM) capabilities, although there was no additional information on this.

While Dynamics 365 Contact Center provides an end-to-end CCaaS solution, it is also composable, supporting interoperability with all leading WFM products, as well as CRMs, with adapters and connectors for Salesforce and customer applications, with other adapters being added.

In case you thought Dynamics 365 Contact Center was an SMB offering, think again. Comstock noted that the offering was built on the most modern hyperscale cloud architecture, and was built for the largest, most mission-critical contact centers. When asked how high the service can scale, Comstock responded that Microsoft will publish numbers shortly, noting that Nuance has worked with extremely large customers and is known for its scalability. The service will be available in 240 countries and regions, with up to 30 languages supported. Pricing is not yet available, and will be released when the product goes GA on July 1.

Generative AI and Copilot are a key part of this new offering. Microsoft notes that it has infused generative AI throughout the service workflow, from self-service to routing, agent-assisted service, post-call wrap-up, and analytics – all connected to an organization’s data. While Microsoft touts the new offering as a “Copilot-first contact center solution that delivers generative AI to every customer engagement channel,” that actually worries me a bit. As I wrote in a recent No Jitter article, “How can we trust generative AI to interact with an organization’s customers with the possibility that it may provide false or even dangerous information?” I noted it’s important to limit the use cases to those where generative AI can provide value and cause little or no harm. During the analyst prebrief about Dynamics 365 Contact Center, I asked Comstock about how Microsoft will provide guardrails and keep Copilot from providing incorrect or fake information. Comstock responded that there’s a spectrum between probabilistic answers and more deterministic answers that customers want. Microsoft built that in and focuses on grounding Copilot on a company’s knowledge sources. By grounding the generative AI to trusted knowledge sources, the AI will only respond to specific topics and will not answer random unreleated questions. Microsoft also checks behind the scenes for bias. We’ll have to wait and see how well this works.