Avaya’s CEO Discusses Its “Crown Jewel”, Job Cuts, and “Innovation Without Disruption”

Masarek comes in amid a revenue slump, but he is confident in his turnaround plan

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Avaya’s CEO Discusses Its “Crown Jewel”, Job Cuts, and “Innovation Without Disruption”
Contact CentreNews Analysis

Published: September 1, 2022

Zac Wang

After a disappointing quarter which saw revenues decline 21 percent year on year, Avaya has refreshed its top leadership, bringing on board industry veteran Alan Masarek.  

He replaced former boss Jim Chirico, who had been at Avaya 15 years. 

Masarek has been tasked with turning the fortunes of the communications giant around, amid financial pressures and an ever-changing technological landscape. 

“I have a particular interest in trying to drive technical transformation, driving companies to the cloud. And I think there’s a great opportunity to do that here even more aggressively than they’ve done,” said Masarek. 

“Any large job like this, you’re sort of drinking off the firehose,” he added. But he is undeterred, buoyed by Avaya’s technological assets:  

“The assets are remarkable. They’re irreplaceable. In our lifetimes, we could not create something as significant as what Avaya has today.” 

So what is in store for Avaya, and how will Masarek leverage its extensive technology portfolio to bring the company back to growth? 

Avaya Will “Do Less, With Less” 

“We’re making changes in the cost structure. My goal is that we produce free cash flow in fiscal [year] ‘23,” said Masarek, adding that this cash will create adequate liquidity to invest in Avaya’s technology roadmap.  

Regarding the potential job cuts, Masarek said that “it’s not about cutting in areas that are important. I’m not asking you to do more with less, not asking you to do the same with less, I’m actually asking you to do less, with less.” 

“We’re trying to eliminate areas of duplication. You might have similar functions staffed in IT, in services, and in the software products. It just lends itself to being brought together. In the past, it was just too overly siloed, you had redundant costs, and those silos worked less effectively together.” 

“Innovation Without Disruption” 

Avaya’s transition back to growth will not be an easy one. A large part of its customer base is comprised of large enterprise customers, who might not be as receptive to disruptive cloud transitions. 

Masarek acknowledged that while not all businesses were ready to go transition fully to a public cloud, they should at least have a clear plan on how to get there.  

“I think of it as innovation without disruption.”  

“The growth products are going to be cloud-based”, said Masarek, adding that in the last quarter alone, Avaya added around 1400 new clients of all company sizes. But its performance with enterprise clients was equally strong: 

“We had 92 customers with contracts where TCV is greater than a million dollars. No one else in the industry has added any number anywhere close to [that].” 

CPaaS is another area where the new CEO is bullish on, citing strong partnerships with other leading tech firms. “CPaaS is […] about bringing programmability and extensibility to our products. And that’s just good architecture,” said Masarek.  

“We’re not going to do all elements of communications. It’s about having the open architectures, API driven, so that we can link in with other ecosystem partners, like Microsoft and RingCentral.”  

Leveraging Avaya’s “Crown Jewel” 

Masarek is confident that Avaya’s contact center solution will be a major driver of differentiation for the company. 

“CCaaS is the core of the whole cloud architecture going forward,” said Mazarek. “If you’re just providing modalities voice and video and messaging, I think you run the risk of being commoditized.”  

“You have to be part of your customers, you need to help your customer drive better customer experience, that’s sort of the Holy Grail.” 

But contact centers are not just inbound operations anymore. Companies can use CCaaS technologies to qualify targets, involve salespeople to turn those targets into customers, and then respond to customer queries. Account managers also can leverage CCaaS solutions to upsell and renew customers. 

“All of those interactions are now omni channel, all of those interactions need to be captured,” said Masarek. “That’s the real crown jewel, in my opinion.  

“We’ve got more contact center customers than I think anybody in the world. We’re now just extending that architecture from its traditional premise base into cloud. And I think that’s an enormous asset that we can build on.” 

This article is based on a video interview conducted by our sister publication UC.  

Digital Transformation

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