Get Off of My Cloud featuring Fred Stacey

Transcript

Rob Dwyer (00:02.308)
Fred Stacey, you are again next in queue. Welcome to the show, my friend. It's been too long.

Fred Stacey (00:10.618)
Yeah, it's been a minute, man. We did have that one little startup that we put some recordings down and decided it wasn't the right time. But yeah, it's excited to be back as always. Our conversations are always awesome.

Rob Dwyer (00:19.3)
Yeah.

Rob Dwyer (00:25.508)
For those that don't know, you joined me in my very first season of the podcast, episode 23. And that was in early 2022. So it's been over two years since we had that conversation. And it strikes me that both the market has changed drastically and at the same time, a lot of things have just stayed the same. And...

I really wanted to talk to you about state of contact center tech. But before we get there, let's tell everybody what you, let's do a little background on Fred because you have been in the tech space for contact centers. Like I'm not trying to age you or make you feel old man. But it's, it's been a minute.

Fred Stacey (01:03.386)
Okay.

Fred Stacey (01:20.154)
It's been a minute.

Rob Dwyer (01:22.244)
and you've recently taken on a new role. So give us some background and tell us about what you're doing.

Fred Stacey (01:29.434)
Yeah, so over 28 years now in contact centers, man, I've been doing this longer than anything else. It's amazing. I started it too, you know, so that makes me a little over 30. No, I started as an agent. I mean, you know my backstory, but for those listening for the first time, don't know who I am. I started as an agent on the phones. Yeah. And...

Rob Dwyer (01:46.052)
Right?

Fred Stacey (01:57.466)
grew into leadership and ran centers, help companies start new call centers around the country. And then, um, a little over 20 years ago now, um, going on 21, my mentor pulled me into the software side of the business. And I've been in contact center tech ever since. Um, you know, I've ran everything in a software company minus development. Um, I'm not a coder. Anything past the SQL join just kind of goes over my head. Uh, and I've tried to learn code, man. I've tried, but it just doesn't stick. Um,

Yeah. So, uh, but that's okay. Uh, they're smart people out there that can do that stuff. Um, yeah. So I've spent a lot of time in this space. Uh, you know, recently in January, I joined a cloud tech overs as the CEO. Um, I've known the team for quite a while and I've known one of the founders, Darren prime for many, many years, um, since he came into the industry. Uh, you know, one day this crazy guy called Darren calls me up on the phone.

and introduces himself and starts asking me questions about call centers. And it was call centers back then. And I just kind of, I always enjoyed our conversations. We became friends and I've mentored him in space for many years and the opportunity finally came where we could work together. So happy to be a part of this. And I think for the conversation, this is really good for people to know CTG is a, we're what's called the TSD.

Uh, or formerly master agent is what they used to call it, but we represent about 150 different technologies, 50 BPOs, uh, in the space. And then we've got a bunch of consultants that we call our gurus. Um, you know, who helped clients really go through the whole, um, you know, requirements gathering documentation, you know, all the way through full blown, very complex RFPs and help the clients really guide through what products they should be evaluating and based upon their.

You know, their requirements, their stack, you know, their plans, yada yada. Um, so we have an interesting perspective because I get to see volumes of stuff, um, you know, all across the industry and all across the world, cause we do have gurus and global locations and we do work with, you know, contact centers all over the world. So most of our stuff is North America though. Um, or at least North American based companies.

Rob Dwyer (04:17.892)
Yeah, it's been a ride, and congratulations on the new role. Let's quickly back up. In 2022, you and I were talking about digital transformation, and you were talking about actually the slow adoption of cloud. And how surprising in some ways it was that a lot of

Fred Stacey (04:22.906)
Thank you.

Rob Dwyer (04:47.524)
hadn't even got to...

And that was preventing them from doing some of the other digital approaches. So let's fast forward. Today, here we are. It's May. It's 2024. What's changed in that regard?

Fred Stacey (05:00.346)
Okay.

Fred Stacey (05:07.61)
Well, we made a little bit of a dent based on the, I just recently, a couple months ago, saw another report on the fortune 500 status of cloud migrations for the telephony platform. And we're down to about 40%. I think the last time we talked, we were over 50. So there has been a little bit of a dent in the migration, but not nearly what you would expect. Yeah. So that means there's still plenty of room for, you know, the, the cloud vendors to continue to grow into premise. And there's some,

Some of the bigger technology players are sunsetting some of their premise stuff. So the forced move is coming at a larger scale. But funny enough, it's still not enough. I mean, you would think, I remember, I think the first time I ever played around with bringing Hosted to market was probably over 15 years ago. And then we quickly migrated to Cloud 1 .0.

And then over the course of about five -ish years, it's kind of five to 10. It kind of moved to cloud 2 .0. And now we're into a whole nother level. I think we're probably on a third iteration of that, but nonetheless, still slow adoption, still slow migration in the bigger scheme.

Rob Dwyer (06:32.292)
Yeah. So I wonder, do you have any insight as to what is holding companies back? I know we talked about this a little bit last time, but what's really getting in the way or preventing companies from making that move to a

Fred Stacey (06:53.818)
Yeah. Well, what's getting in the way? I mean, there's so many variables to that. You know this, you know, I think there's a fundamental challenge we still have in contact centers and customer experience. And that's, it's still seen, unfortunately, as a cost center. And despite all of the, you know, C level and, you know,

public articles on how important customer experience is. The proof is in the pudding and underneath the hood of all of this mess is still a bunch of duct tape and bubble gum and it's very hard to unwind. And there's all kinds of fears and you know, fears, uncertainty, doubts, you know, about migrations like that. And it's not cheap not to do it right. You know, so.

I think that's probably if I had to pick one thing to say why this has taken so long, it's a bunch of spaghetti of connected things that companies just haven't found enough pain to actually force them to make the change. And we're seeing that now. I mean, the pain's coming. Personally, it's been here for a long time in my opinion, but I'm on the inside.

you know, and I oftentimes get skewed by my understanding and, and beliefs.

Rob Dwyer (08:24.74)
I mean, you hit on something that I think we discount, and that is we are far more motivated by pain than we are pleasure. And the benefits aren't always what drive people to adopt new tech. It is the pain of not adopting that eventually moves them forward. So let's talk about, aside from cloud, right? There are plenty of people that have moved to the cloud and are using

Fred Stacey (08:33.274)
Oh yeah.

Rob Dwyer (08:54.212)
newer digital technologies. Let's talk about what are some of the really exciting things that you're seeing. What's grabbing your attention today? What are your customers really excited?

Fred Stacey (09:13.274)
Yeah. Well, you can't talk about the excitement in the technology space without bringing up artificial intelligence, right? You know, of course that's top. I just came back from a show and literally every booth, including some BPOs, you know, had AI front and center, which I think is necessary. Look, you know, I mean, you know, we've talked about this many a times, you know, AI is not new to us.

Rob Dwyer (09:20.068)
Hehehe.

Fred Stacey (09:41.306)
Um, you know, artificial intelligence has been around in the contact center space for a long time. Now, was it a shining penny that didn't quite deliver? Um, you know, yeah, for many years, absolutely. Uh, a lot of failures, uh, a lot of challenges, um, you know, but today it is ready. Um, you know, now is it ready to take over everything now? God, no, um, not even close. Um, but the actual point solutions are more.

What's interesting right now. Now we do see, I'll tell you, the majority of the flow is still the conversion or the conversion from cloud to cloud or the conversion from premise to cloud on the traditional CCaaS. Not traditional, just CCaaS in general. That's still the primary and the most activity because I believe it's the most complex. Because we sit in between all the vendors, it's only logical that with 200

you know, C -Cast vendors in North America that buyers are confused. They don't know who to go to, yada yada. Right. Now, a lot of these C -Cast vendors are bringing their own AI solutions or building or partnering in white labeling, however they choose to go about it. But I've seen a lot of activity on point solutions for more best in breed type discussions. Yeah. And the...

So there's still people trying to figure out what is actual, yeah, what is good quality, you know, bot technology with some generative technology built in, what's going on there. There are some interests and that stuff is exciting. I mean, some of the high end stuff out there, I, it's, it's pretty amazing how far it's come and how fast and the training models are accelerating at speeds like nothing we've ever seen.

Um, you know, but it's also the other little point solutions that seem to be really moving fast. Um, you know, for instance, uh, accent neutralization. Um, you know, that seems to be a real fascinating conversation when it comes to using anyone near shore or offshore. Um, and, and that technology is accelerating really fast when it was first introduced and the idea of it, um, was, you know, super interesting, but.

Fred Stacey (12:04.25)
You know, it wasn't quite there. Yeah. And now it's there. You know, there's some translation tools that we work with that are doing some amazing things to have an English speaker speaking to a French speaker, you know, and actually being able to translate back and forth bi -directional. Now voice.

It's no different in my opinion from the experience other than cost. You know, it's no different than the experience of using a translator service, a translation service, you know, because there's always a pause and there's back and forth and there's things you have to do. It's faster than that, but you still have to be patient in the translation process over voice. But on the digital side, it's instant instantaneous. You know, so you could have natural, you know, a person speaking in their own natural language that they grew up with.

Rob Dwyer (12:38.532)
Mm -hmm.

Fred Stacey (12:57.05)
communicating in multiple languages. That stuff is super fascinating. Those are the things, the point solutions that I see. Yeah, I mean, of course, voice analytics. I mean, that's an easy one. That one actually moves faster because it's already been proven, right? The ROI is easy to calculate. It's not hard to figure out how and why to implement voice analytics.

Rob Dwyer (13:15.78)
Yeah.

Fred Stacey (13:23.93)
especially with some of the automation and the QA scoring, which you know all too well. Yeah, you're welcome. I do what I can. I get paid well. Those are really the, I mean, there's so many things out there. I've got a literally a set of categories I was putting together of all the different technologies and services. And you're talking about like 50 different points.

Rob Dwyer (13:29.668)
Thanks for the commercial. Appreciate that.

Fred Stacey (13:52.41)
And it's no wonder that contact center buyers get that overload of information and they just don't know what to do. It's part of the challenge. And one of the beautiful things about our industry is we do seem to bring new technology and ideas to market, but the adoption is the challenge. It's what do you do? I feel bad for buyers. I was in that position.

Rob Dwyer (13:52.74)
Mm -hmm.

Rob Dwyer (14:02.34)
Yeah.

Fred Stacey (14:17.626)
Now that's how I ended up coming into the software side is because I was a buyer and got to know the team. Yeah. So it's tough. I do not envy anybody who's being told from a board level, Hey, get AI in here, but have no direction or no assistance or guidance. It's the reason why we see a lot of adoptions that fail until...

you know, they go back and do it two or three iterations before they finally figure out what really works for their business.

Rob Dwyer (14:50.404)
Mm -hmm. Yeah, you hit on some really interesting use cases that I'm personally interested in as well. I saw a demo about a year ago. I believe it was tomato AI. And that's the accent neutralization piece, right? So there are other vendors in that space. But it's an interesting technology because, look, I just had a conversation.

very recently within the last week and a half with someone who was, you know, you can judge however you want, but they were frustrated when they talked to someone who was offshore and they, you know, made a phone call to do something with a particular provider that they had. And, you know, they didn't like that experience. And I don't think that that's uncommon.

despite the amount of time that we've been offshoring that type of work. And so being able to present someone in an accent that is comfortable to the customer, that brings a lot of benefits, particularly quite honestly to the agent, because they don't feel like they're being judged based off of their accent and they can focus on providing a great service. The one that you talked about that really struck me,

And I noticed this too with the recent announcement that Klarna made, and that's the language piece. One of the things you mentioned, translation services, right? And we've used translation services in the past. I'm familiar with that. A lot of companies have used translation services, but there are certain languages that it becomes really hard to find translators for. And those services are providing

actual people working 24 -7 with sometimes unpredictable amounts of volume. So you don't know how long you're going to have to wait for a translator, particularly one of those harder to find translated languages. And it's potentially with AI a way that you can eliminate that problem. You don't necessarily change the experience other than you change the availability of

Rob Dwyer (17:20.004)
the translation being there. And certainly to your point when you're talking about chat or email, it's instantaneous. It feels very natural. So I think those are some really interesting use cases. They don't necessarily apply to everyone. But if you are offshoring, if you have a global customer base, these are things that you should be considering for sure.

Fred Stacey (17:23.578)
Right.

Fred Stacey (17:48.922)
Yeah, without a doubt. You know, I, those are the things that the little changes, right? These point solutions can make a big impact on the experience. And you're right about the agent. You know, I, I've been all over the world. You know, I ran Europe, Middle East and Asia for a software company in the space and agents all over the world get berated by people in the U S and no matter how long we've done this, they still get treated poorly. You know,

It gives the agent a better experience, but in the end, it gives the customer the experience that they would hope from a brand. There was a little bit of hubbub when it first came out about accent neutralization, turning all agents white, I think was the article. To me, they clearly didn't understand the value to the customer, to the experience, and to the agent.

Yeah. And that's okay. Hey, you know, new technology, people will do whatever they can to put out, you know, clickbait articles and, and, uh, talk negatively about, you know, changes in society. But, um, yeah, I really enjoy, um, you know, seeing this stuff come to life and, you know, it's, uh, it's moving at some amazing speeds, man. I mean, our world in two years, a lot has changed, but a lot has stayed the same as you started this.

Rob Dwyer (19:10.628)
Yeah.

Yeah, yeah. Let's talk about a little bit of market segmentation, if you will. What are you seeing that is different for smaller companies versus the enterprise? Is the adoption rate of some of these technologies faster? Is it slower? What's going on there?

Fred Stacey (19:39.738)
Yeah, I tend to see the small to midsize have already migrated faster to cloud. They had less than an investment, newer companies, of course, they've started on cloud. What I see super interesting, there's also a lot of newer companies, even in the bigger space like CCaaS that have come out to market that have phenomenal products that are native in the cloud and are cost less than the big enterprise players and do a phenomenal job.

So, yeah, I mean, if I segment this, I like to talk so small. I like to define the market segments, right? Cause everybody has their own opinions. What is large? You know, what is mid -size and what is small? I mean, to me, small is anything, you know, 50 or under, right? And, and that is comfortably a small, you know, you're probably talking about a couple of supervisors, you know, single, single primary hub, at least if not one location, depending on whether they do.

hybrid or work at home, yada, yada. You get to that midsize, that 50 to 100 is kind of hard to define, right? Because you may get a couple of VP or a couple of directors and a VP and a little more complexity. I don't know where to put, depending on the client that I'm talking to or the vendor or whoever.

that 50 to 100 is really hard to define. It's still technically kind of smallish, but you're starting to get a little more complex. Anything from 100 to 500, you got likely, if it's inbound, you need WFM. WFM really is justified at that 100 seat, kind of changes the dynamics. You need more staff, more leadership. And then mid -size up to 500, once you hit 500, the scale changes.

Yeah. I think there's really four segments that 500 to a thousand is unique. And then that thousand and above that's where things get really, um, complex. Uh, you know, so, I mean, to me, I see more like, I don't know what to name them, but yeah, there could be multiple segments inside that, but that's small. Yeah. Let's call it zero to a hundred, you know, just to be safe. Let's eliminate that. Okay.

Rob Dwyer (21:53.508)
I know what to call it. I know what to call it. It's small, small plus, medium, medium plus, and enterprise. I mean, look, the pluses all over these days. So I think we just throw the plus in there for those other two segments.

Fred Stacey (22:00.538)
I like it. I like it there.

Yeah, hey, let's roll with it. I like it, man. You just created new definitions for the market. Someone needs to call up Gartner and let them know that they gotta change their format. But I'm good with that. Let's roll with it.

Rob Dwyer (22:24.196)
So what we've talked about kind of what your customers are excited about or what they're talking about. We've talked about.

what is actually being deployed. I'm curious from your personal perspective, like what are you looking forward to or what are you most excited about as far as changing customer experience or changing the nature of contact centers? Like what really gets you excited?

Fred Stacey (22:58.714)
Yeah. So, I mean, I'll go back to what we kind of touched on, which is a lot of the old premise platforms are being sunset. You know, and that excites me because it forces enough pain on the industry as a whole to move that transition to full digital, full cloud. You know, that really excites me because, like you said, pain moves customers faster.

moves companies faster than anything else. In the end, the incentives negative are strong as strong a driver, often stronger in my opinion, than the positives. You know, you can talk to a company about all the ROI you want. And some of them will just never move until the pain of that old premise, Tyler, you know, or platform finally dying, right? You know, I found the last dialogic card on eBay that I can possibly find.

you know, in that for you server is starting to smell like it's burning. You know, it's time to, it's time to move. And that excites me because, you know, as the transformation goes, you know, we can start to normalize some of the data, you know, and start to really build their companies can start to really build their models towards what they need to do to prepare for true AI. You know, and that's coming.

Rob Dwyer (24:00.58)
Ha ha ha ha ha.

Fred Stacey (24:24.026)
Yeah, it's truly coming. You mentioned the Klarna article that almost comes up in every conversation. Yeah. And I find it super fascinating that I'm seeing a pattern. Bear with me and tell me if I'm wrong. Yeah. But when Twilio first came to market with their build concept, right? A lot of developers went out and added SMS and all of a sudden Twilio said it was, you know, it got into the contact center market. And, you know, because of the number of

deployments, they were able to make their numbers look really interesting. But how many really implemented a full contact center platform on just Twilio, right? It took time. They had to build Flex and even at that, you know, and then Connect comes out, right? Amazon Connect comes out and then people start adopting that, right? And you hear about Intuit, you know, building a whole custom, you know, Connect platform. And, but in the end,

CPaasS has only been deployed at really big, um, you know, software companies, uh, companies that have development teams because quite frankly, CPaaS requires developers support personnel, because if you build it, you have to support it. Right. You can't just stop contact centers continue to need to add technology services functionality. Yeah. So, um, but I'm seeing the same thing. You, Klarna, they built.

They didn't go out and buy some off the shelf AI tool. And the companies that I'm talking to that have started to advance in using generative along with bot technology, they're building. The ones that are doing like Klarna did, reducing that kind of cost by reducing agent count, they're building over time. And they're people that have the chops and the project management and the support teams and...

to be able to really do it, I'm still, so I think there's a repeat in that pattern, in my opinion. It's from CPaaS compared to the modern day, like super advanced, build your own generative AI bots. That's the pattern is that, you know, the people that have the chops, the development teams, and are willing to commit to the time effort to build, I think those builders are the ones that are leading kind of the way in that.

Fred Stacey (26:49.05)
And everybody else is there's I don't know many contact centers that have the type of budget to dive into building all this stuff custom from scratch. So I'm really excited once the conversion really starts to eat away and we get down to lower single digit percentages left on premise, then the conversion to the I think by that time that a lot of the bot out of the box technology will be much further along and we'll start to come down. Yeah. So.

the really good technology on the bot side, and like the stuff that can deflect 50%, that's expensive. But so are humans. And that's really what they're modeling it based upon is, what can we get compared to what value we bring to the client? And if we're reducing X, then we can charge Y. I think that'll change and that'll bring it to the masses.

Rob Dwyer (27:29.988)
Right.

Fred Stacey (27:49.018)
But there are a lot of up and coming technologies too that recognize that the midsize market doesn't get a lot of love. The small to midsize market doesn't get a lot of love and they're figuring out ways to bring in lower cost solutions that maybe can instead of taking 50%, it takes 25. And that's doable. And there's margins in that. So I'm excited to see where this accelerates to.

So yeah, I mean, that that's what really gets me excited is to see the speed and the movement and the forced movement that we're seeing today.

Rob Dwyer (28:27.268)
Yeah, it fascinates me how much.

just AI and that, right, take chatGPT and say about it what you will, right? And there are all kinds of good and bad things that you can say about open AI and their strategy. But one of the things that I think is most fascinating about their strategy was they basically said here.

Just try it. Just use it. We're just going to throw it out there and let you try it for free. And what I think that did is it opened everyone's eyes to what was possible. Now finding the right use case for your business or your immediate need and making it work and work really well is a separate thing. But creating that idea of what's possible,

I think they did an amazing job of moving a lot of people forward in that thinking process. And so I know, you know, we've had conversations with people that are like, well, I, you know, I don't know what's possible, but I know things are possible. So help me understand what we can do with AI. And I think that is a very different mindset than.

Like what we were talking about two years ago, where it's OK, well, what's possible with digital transformation and talking about, you know, chat bots and some self service options like those weren't things that got business owners excited. They may have looked at it and said, well, maybe this can help my bottom line if I implement it, but how much time is it going to take? And right now people are really getting excited and it's not just the tech.

Rob Dwyer (30:24.964)
technology people. It's not just your the people who own your tech stack in your company. It is business owners. Whether they are sole proprietors or owners of small and medium businesses that are now thinking, what does this mean for me and how can it help me? And that's what I feel like has been a sea change. Whether or not the adoption is there is a whole different thing, but I feel like more

people are thinking about it today.

Fred Stacey (30:58.906)
When you can't not think about it, right? I mean, there isn't a time that I open up, um, you know, any kind of news or content or places where I go to read and understand about what's coming up, um, that I don't see AI and at least half the articles, right? Or half the podcasts. Um, you can't not think about it. Now I agree. I mean, open AI love them or hate them. You know, they, they didn't even know they, they had.

I mean, I'm not going to lie...

Rob Dwyer (31:49.22)
Yes, they are full of it.

Rob Dwyer (31:54.82)
Even Sam Altman was caught off guard, like...

Fred Stacey (31:57.722)
Oh yeah, they were completely caught off guard. They weren't ready for that. I mean, you know, a million users in six days or something like just under seven days. I mean, nothing's ever been adopted that fast, right? It captured everybody's interest. What we're actually seeing today, you know, is usable, you know, they call them agents, right? Which is so confusing for us because we're like, wait, our agents are the ones answering the phone calls.

but actual AI agents, you know, are the really interesting game changer where they're actually doing activities. You know, and it's not stuff you necessarily have to hard code, right? The whole point is to use natural language and, you know, be able to get it to do things for you. I get really interested in the agent to agent, the AI agent to AI agent interactions.

And what the future is going to look like when I'm talking to my device, whether it's a phone as we know it today, or, you know, it's a, you know, a little clip on thing that I'm wearing around. You know, when I ask it to go pay my bill somewhere, it just goes off, you know, pulls from the right account, you know, pays it because it knows all this stuff about me and handles all that stuff. Or if I have a service issue, you know, it just knows call, call the Audi dealer and set up a, you know, time to bring my car.

I mean, I'm just waiting that that stuff's coming. Yeah, don't get me wrong. It's not coming today, right? There's some examples of it, but I mean, it's, it's, it's really interesting. And we haven't touched on the one thing that I, a lot of people tend to ask me, which is the impact of AI on jobs. You know, cause you and I have talked a lot about on the macro side, we're both little geeky on the macro stuff. We'd like to know what's going on on the financial side.

Yeah, and I just find that this is super fascinating. Have you been reading much about universal income? I mean, yeah, two years ago, it was all.

Rob Dwyer (34:00.484)
Yeah, it's, you know, it, it got a big push when, when Andrew Yang was, was running for president in the U S and then it felt like it kind of fell by the wayside for a little bit and people stopped talking about it. And to your point, it seems like that concept is popping up a lot more recently.

Fred Stacey (34:25.786)
Well, it has to, right? I mean, it's no matter, this isn't, I, so, you know, you've been in the game long enough. You know, this isn't IVRs where everybody in the world swore that IVRs were going to eliminate agents. There was not a chance that they would even eliminate hardly any. And for poorly deployed, it actually required more, right? You know, which happened a lot.

And not that we won't see some dynamics like that as we go through this growth, but I mean, it took forever. It took forever to implement, you know, telephony based or, you know, um, you know, original dialer, dialing platforms, you know, connecting, you know, digital cards to T1s. I mean, all that stuff was, it was hardware based, right? It costs a lot. It took a lot of time. It took a lot of expertise. Even IVRs took a lot.

to implement back in the day. They were code -based, right? The drag and drop, Wizzy Wigs, we know today were not what they first deployed. This is different, man. This is completely different. And it will change a lot. You look like...

Rob Dwyer (35:21.988)
Mm -hmm.

Rob Dwyer (35:36.484)
So I'm curious if you think, I have two questions. So the first question is,

Rob Dwyer (35:48.644)
Whose jobs are more likely to be impacted? Those that work at large enterprises or those that work at small and medium businesses? So I'm gonna start there and then I've got another question.

Fred Stacey (36:04.922)
So the large enterprises, obviously the ones that have the chops, have the funding, you know, have the ability to, to, to make a move. And there isn't a CFO in a publicly traded company that wouldn't absolutely drop everything and, you know, lay off a ton of people. Um, because I mean, you've seen it in the markets over the last two years. One of the most disturbing behaviors is every time a company goes through a layoff, their stock shoots up. Um,

You know, literally every single time it's, you know, it's kind of one of those disturbing things where once that change, and I don't know when that actually fully changed, but I mean, it's obvious now. Uh, yeah. So they're, they're financially rewarded. The incentives are always there. Um, they are always the driver, I should say, and they're, they're showing us exactly where these large enterprises will go. Um, you know, as soon as they can.

Rob Dwyer (36:36.324)
Mm -hmm.

Fred Stacey (37:04.986)
As soon as it's viable, they'll openly lay off. Yeah. So I would expect that the larger enterprises are much more at risk.

Rob Dwyer (37:11.236)
Yeah.

Rob Dwyer (37:17.668)
In my mind, the large enterprises are also the ones that have the bulk of their staff offshored or near shored. And so I'm curious how you think that plays out because my somewhat informed, but also knee -jerk reaction is that a lot of the job loss that we're

be seen as actually going to be in the Philippines, in India, in Latin America, where the US -based companies have sourced less expensive labor and now can use AI instead of that less expensive labor. And it can be even more less expensive. Is that what you anticipate? Or do you think that...

More of that's going to come onshore. Am I wrong about that?

Fred Stacey (38:21.786)
Are you wrong about that? I don't think so. I think there will be some impact. I mean, let's call it what it is. When Klarna released that article, right? Teleperformance stock dumped. I mean, what was it? I don't even remember. It was double digit drop in a very large company. And that was just one simple article.

Rob Dwyer (38:41.828)
Yeah.

Fred Stacey (38:50.97)
Right. Um, yeah, I think the outsourcers are definitely going to be impacted clearly. Um, I've been warning outsourcing companies, you know, for years that if they don't figure out how to become much more strategic about, you know, their CX initiatives and humans, um, that, you know, eventually they're not going to be able to win any new customers. And we're seeing it even more so. And actually we're seeing an acceleration so much that, um,

You know, outsourcers are actually really hungry for technology. Um, you know, which is a change. I mean, I, I love, I grew up around VPOs, right? You know, I'm both the customer experience side and the collection side. And I, I, I absolutely love a lot of people and owners and have great relationships there. Um, yeah, but they've all kind of sat on their laurels and, and, you know, been, been holding up, but now they're, they recognize it and they're moving.

They're moving fast to adopt this stuff. So bringing customers a combined, you know, technology based, you know, AI approach with the agents may actually make them really interesting, you know, players and in the space while, you know, being able to maintain a client base. So do I think that the BPO business, I think the BPO businesses are changing fast because they have to, but we'll.

Rob Dwyer (40:15.78)
Hmm.

Fred Stacey (40:19.066)
Will the layoffs impact offshore? Yeah, absolutely. Without a doubt. Of course, tier one's the easiest one to migrate even to today's or even last year's technology. So yeah, definitely. US will still be impacted though. There's a lot of small to mid -sized businesses that still have their contact centers here in the States. Still only

you know, outsource to domestic, you know, BPOs. So, I mean, it'll, it'll have impact, you know, all across the board for the industry, but yeah, I don't disagree. They will probably see it start to rear its head if not already. And we're just not seeing the numbers yet. Yeah. So yeah.

Rob Dwyer (40:52.004)
Mm -hmm.

Rob Dwyer (41:09.412)
Do you think that there are any specific industries, and I'm thinking about the type of data that they handle, do you think there are specific industries that will actively avoid moving in that direction despite the potential cost savings that they might have?

Fred Stacey (41:32.89)
an interesting question then. In the end, we're talking like long, let's call it, you know, 10, 20 years out. I don't think it'll matter. You know, I think everybody will have migrated because the technology will be there. Do I think agents are going away? No. You know, I think there are always going to be a need for a certain percentage. Right now, what I see is healthcare is so far behind.

that they're just trying to play catch up in the cloud migration, right? That's a big space that'll take a lot of time to see it kind of get there. Now they'll adopt the stuff like appointment setting, you know, the simple stuff, right? That should have already been automated. You know, but as far as going deep and wide across the entire healthcare space with AI and automation, that'll take some time. That'll take a long time. FinTech's already moving that way.

Rob Dwyer (42:28.42)
Yeah.

Fred Stacey (42:31.674)
I mean, you see every bank has, you know, apps and some kind of automation built in. Um, it's safer, right? I mean, you know, in the end, the human out of the loop means less likelihood of, uh, um, PCI violations. Um, you know, compliance is always adhered in an automated system. Um, as long as you're protecting the beta data on the backend, right. And in transit, yada, um, as long as you build it appropriately. Um,

I mean, high end goods, maybe, you know, they'll always need some level of personal touch where people are willing to pay more for that experience. It's in the end, though, it's it's a revolution. It's an industrial revolution and all industries are always impacted eventually.

Rob Dwyer (43:28.42)
Yeah, I mean, it's fascinating stuff to think about. And in some ways, it can be really scary.

Rob Dwyer (43:37.828)
This is not the IVR. Some people may have thought it was kind of like the IVR. And I'll throw myself into that camp early on. I thought, well, you know, yeah, it's new technology and it can do some things that are pretty interesting. But is this really going to change contact centers? I don't know. And there are still parts of me that are a little bit skeptical.

only because we see how slow companies are to adopt, right? You mentioned healthcare. Let me tell you some stories about healthcare. I'm not going to, but like just getting someone to call you back is a challenge in the healthcare space when you have an appointment. So to your point, like just using AI to do some of these little mundane things would be just.

great and not impact headcount at all just Make the customer experience a little bit better But I do see with some of the technologies that are out there that We are likely to see more companies Shed Agent labor in favor of AI as long as it performs

Fred Stacey (44:43.354)
Right.

Rob Dwyer (45:04.708)
And I think that's going to be the real, you know, potential stick in the mud here and there is, do I get bad press like an airline that we all recently read about where I give some wrong information? That's going to be the key. Can I get it to perform? Because I do see that the...

There is a different impact in the media attention for an AI making a mistake versus a human making a mistake. A human making that exact same mistake, number one, it doesn't go to litigation. Number two, nobody ever reads about it. Like it just doesn't happen. Somebody shares it on Facebook maybe and it gets, you know, traction for a half a day and then it's done and it dies down. I think.

Fred Stacey (45:47.418)
Yeah, yeah, it happens every day.

Rob Dwyer (45:58.116)
Think what we see is just like a Tesla that gets into a crash that's that's driving on auto, right? That gets media attention because we're. It's just who we are. We're interested in that we we we want to see that. I think in some ways we kind of want to see it fail as humans because it's scary to think about the fact that we are developing technologies that can do all the things that we can do.

or are approaching our level of proficiency in a lot of things. And that's, that could cause an existential crisis if you think about it too long in the wrong way.

Fred Stacey (46:41.338)
Oh yeah. Yeah. Not that we don't in our world today have enough other things that are bombarding us with negativity. You know, we now have to face the fact that, you know, we eventually in our lifetimes man will not be the smartest thing in, in, in our world. Um, we will no longer be the apex. Um, so to say, so yeah, I mean, it's, it's, it's super interesting times to be alive though. And I'm, I'm a techno -optimist. I mean, I just don't.

I can't help myself. I've just seen it time and time again. Technology does have its negatives. I mean, you know, there's some things, you know, that I absolutely do not participate in that I did at first with technology, like certain social media platforms, but I've just changed my perspective as knowledge has came. But for the most part, technology has made our lives pretty damn good. I mean, you know, I'm no longer trying to hunt, you know, my nightly food.

you know, to keep my people fed and, uh, you know, I get to go to a nice store or even better. I get to open up my phone and click a few buttons and have my food delivered right to my door. So we got it pretty good. Um, you know, but it is, it's an interesting time. I mean, this is, I don't normally, you know, I'm sure you've heard this in, in financial world, you know, this time is different or the worst words you can say, but in the case of this revolution, this technological revolution, it is.

Rob Dwyer (47:52.676)
Yeah.

Fred Stacey (48:09.562)
It is completely different and we have to face those things and, you know, and, and figure out, you know, how, how we move ahead.

Rob Dwyer (48:18.724)
tell you how I'm going to move ahead and that is I'm going to continue to cook on the grill because so far AI has not not replaced my cooking skills. Although it probably could. I'm not that great. Like, let's be real. But I get enjoyment out of it, so I'm going to I'm going to still cook on the grill myself. Fred, man, thank you so much for dropping by the show. It was great.

Fred Stacey (48:35.162)
Yeah, yeah, it ain't making my mom sauce though.

Fred Stacey (48:42.746)
There you go.

Rob Dwyer (48:48.676)
It's great to talk with you again. And it is fascinating to hear your perspective because I know that you are sitting in front of not just these technologies, but the people who are considering and or implementing these technologies every day. And so I knew that you would bring amazing perspective and you have. Thank you.

Fred Stacey (49:13.434)
Thank you for having me, man. It's always a pleasure.