Has KANA Gotten Its Mojo Back? - Part 2

Part 1 of this blog series presented the opportunity of service economy and associated complexity of providing consistently an experience of customer service excellence. The article then introduced KANA Software, a provider of Service Experience Management (SEM) solutions. Although KANA has focused on enabling superior customer service for its enterprise clients since being founded in 1996, it has experienced periods of ups and downs.

Having been acquired and taken private under Accel-KKR in late 2009, the vendor has since regrouped and come out with its renewed value proposition. Part 1 concluded with KANA’s SEM approach and accompanying solutions that blend customer relationship management (CRM)business process management (BPM), business intelligence (BI), and knowledge management (KM)social media monitoring, and many other parts.

A Discussion with a Knowledgeable KANA Executive

What follows now is my discussion with Vikas Nehru, the Vice President (VP) of Product Marketing at KANA. Nehru’s 15 plus years of experience as a senior engineering, marketing, and product management professional in the enterprise software industry have been instrumental in leading the direction and strategy for KANA's innovative product line. Prior to joining KANA, Nehru spent a decade working in many diverse areas of the CRM software industry. He uses his experience to help deliver world-class customer service solutions.

My prodding questions and Vikas’ straight-shooting answers were as follows:
PJ: What would be KANA’s concrete landmark capabilities that no one (or hardly anyone) else does in the market?

VN: KANA has over 15 years of expertise in customer service. KANA SEM is the only platform in the market that has brought together technologies such as BPM, case management, KM, social experience management, and real-time analytics into a single unified offering, specially designed for creating adaptive service experience flows (see Figure 1 for more details on the SEM capabilities). All of the customer service channels incorporate BI and analytical tools to gain insight into channel usage, content usage, and customer behavior.


Figure 1

Given KANA’s origins in the e-mail response management, there are many differentiating capabilities there, such as the ability to perform e-mail routing based on e-mail content and the capacity to convert the e-mail content via optical character recognition (OCR) scanning. Moreover, we can spot keywords and perform text emotion detection to automate the process of capturing, documenting, interpreting, routing, and prescribing e-mail-based answers.

Last but not least, our KM capabilities are also world-class. KANA's knowledge base search can be driven within the context of a session (see Figure 2). The system is able to incorporate new knowledge gained from the customer, the particular case, and the customer's environment. The knowledge repository (and returned answers) can be filtered by the user (e.g., agent or end-customer) through an automated clarifying question process.


Figure 2

PJ: How would you describe your competitive landscape, and why do you win over/loose to these competitors?

VN: Our primary competitors include the following vendors: PegasystemsMicrosoft Dynamics CRM/Customer Care Framework (CCF), Oracle (both Siebel CRM and Fusion CRM), and SwordCiboodle. We also see some specialist players in niche segments, such as RightNow, eGain Communications, Genesys Telecommunications Laboratories, Jacada WorkSpace, InQuira, Amdocs, Consona CRM, etc.

We win because of our strong focus and successful track record in customer service and unique SEM platform. We lose to other vendors if customer service is not very strategic to the prospect, i.e., basically they treat it only as a cost center.

PJ: What is the breadwinning product and door opener for KANA? What else is selling well?

VN: Traditionally, KANA has been a leader in email management systems and KM systems.  KANA’s new SEM platform brings social, mobile, and BPM solutions to customer service and is performing very well. As described in Part 1, KANA offers agent desktop and self-service solutions on SEM that offer desktop consolidation and knowledge infused processes to offer unprecedented visibility, agility and consistency to customer service processes.

PJ: What is your message to customers where knowledge management (KM) and call-centers is not the top pain? In other words, how do you compete with the broader service suite providers (e.g., Oracle Siebel, Servigistics, RightNow, etc.)?

VN: What we know is that the customer service has to align with the business and brand promise. Each business is not out there to ‘delight’ the customer. As long as the customers are being delivered the service according to brand promise they are happy.

KANA has developed a detailed maturity model on service experience management called the Service Experience Management Maturity Model. The idea here is to help companies determine where they are on the maturity curve of customer service on multiple dimensions. It provides them a tool to prioritize their pains and then determine, given their strategy and pains, where in the maturity the company wants to be. Once that is determined we provide them with the exact action items and focus area that will help them reach their customer service metrics goals.

Some Technical Discussion
PJ: What is your go-forward unified technology platform, when did you decide on it, and what tools has it replaced? How far down the unification track are you?

VN: Our SEM Platform is built on a Java Platform, Enterprise Edition (J2EE) stack, but we support both Microsoft .NET Framework and Java installations, since our solutions are service-oriented architecture (SOA)-compliant. Depending on the function, user interfaces (UI) can be Ajax-and/or JavaScript-based.

The design environment and runtime is fully Web-based so it is pretty much platform agnostic. SEM can be deployed on premise or offered in the cloud. KANA offers fully managed services in the cloud so platform technology is not a major factor in our discussions with customers.

PJ: What percentage of your customers are software as a service (SaaS)/on-demand? Is that a major factor in selections?

VN: Approximately 15 percent of our customers are Cloud customers. Cloud is becoming increasingly important for customers especially when more business managers are getting involved in solution selection, design, and implementation.  As mentioned before we offer SEM on premise as well as in cloud.

Pricing for on-premises products is central processing unit (CPU)- and agent-based, and pricing for the SaaS offerings is subscription-based by seat or usage. Standard maintenance is offered at 15 percent of the net license fee, and premium maintenance is offered at 20 percent of the net license fee, with SaaS offerings including maintenance in the usage price.

PJ: What is your strategy towards social E2.0 tools and roles-based user experience, and their deployment for your target customers?

VN: One of the key pieces of SEM vision is social experience management and we recently acquired Overtone, a social listening platform, to complete our SEM vision (see Part 1). We see that there are the following three broad aspect of service and we support all three:

  1. Agent-assisted

  2. Self-service

  3. Social or peer-assisted

Role-based user experience is a key and that’s what SEM’s adaptive desktop and web self-service is designed to deliver (as explained in Part 1). The reason that companies cannot deliver that goal today is because the processes and technologies are so compartmentalized that they have to design either to the least common denominator or one-size-fits-all model. One of the key tenets of SEM is to change that. There is a significant shift in a thought process from efficient processes to effective experiences.

PJ: What is your mobility strategy (technology and platforms supported)?

VN: KANA sees mobile as a key platform to deliver applications. We already have customers in commercial and government sectors that have created iPhone and Android applications to help their customers create cases via their devices and check the status. Going forward, KANA will support both Apple’s iPhone and Google’s Android platforms and offer more self-service applications on mobile devices.

Today and After
PJ: What were the major highlights and messages from your recent user conference (or a like event)? What were the major highlights in 2010, and what do you expect in 2011, regarding demand for your solutions across different territories and product lines/modules?

VN: We conduct two user conferences a year: one in North America and the other one in Europe. We see a third wave of customer service coming. The first two were in the early1990’s when companies collected data and implemented service processes through different channels in silos. Then, in the late 1990’s and early 2000’s, they acquired and implemented CRM applications CRM in silos.

That paradigm is changing, as our customers are talking about breaking these functional, systems, and channel silos and focusing on customer experience rather than on technology or channels. KANA SEM with mobile, social, and BPM capabilities is the consolidation platform. SEM is the only product that has been designed ground up to deliver to that vision and we are seeing a high uptake in both commercial and government sectors. This is evident from the fact that Q1 2011 has been the best quarter in KANA’s history.

PJ: What issues/challenges are still keeping you awake at night?

VN: We are very focused on making our customers successful in delivering the desired service experience. Our roadmap strategy can be summed up in three words: Protect, Evolve, and Converge. We have committed to our customers to protect their investment in our existing channel products (i.e., our email response management and IQ KM products) and we are not “sun-setting” any of our existing products.

While maintaining that promise, we still want to upgrade our existing customers to the new best-in-class SEM platform. It is not easy to make and keep this commitment but we want to make sure that they can move to the new solution at their own pace.

PJ: Is there anything else that you are at liberty to volunteer on the company's future moves, i.e., new functional scope, verticals, etc.?

VN: Sure, as we have made public very early on that Accel-KKR acquired KANA to use it as a foundation to create customer service leader in the market. After acquisition by Accel-KKR, we have made significant investment to grow the product organically and inorganically. The trend is clear, after the acquisition of KANA we added Lagan Technologies and Overtone to complete the SEM vision (see Part 1), and this trend will continue.

In addition to expanding the horizontal footprint of KANA we shall also add vertical solutions to the offering. We already acquired the Government 311 solution from Lagan and we are working on adding more in verticals like telecommunications, insurance etc. This is really exciting phase in KANA history and we are on our path to be a leader in the customer service space.

PJ: Can you think of anything else worth mentioning?

VN: KANA sees a lot consolidation opportunity in the customer service space. Customer service is going through a revolution, and enterprises are focusing more and more on customer experience. We are well positioned to serve these enterprises and our commitment is evident from investments in the SEM platform and the aforementioned acquisitions of Lagan and Overtone.

Dear readers, what are your views, comments, opinions, etc. about the current economic climate in your region/industry and about your approach to customer service? What are your best practices as well as experiences with particular customer service applications? If you are a KANA user, I would appreciate hearing about your experiences with the product and the company.
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