Cloud & customer experience drive KCOM’s reinvention

KCOM is breaking out from its background in regional communications to target the growing opportunities around cloud applications migration and customer experience modernization.

The company has undergone a major change in the last 18 months, selling its physical network assets to CityFibre in a £90m deal, and unifying the four different parts of its business under a single KCOM brand.

KCOM has just closed its latest financial year and will be looking to build on its solid performance in the previous 12 months when it posted its first revenue increase in eight years (up 0.3% to £349m). A decline in legacy network services activities is being offset by higher-value cloud and digital business, where KCOM says it is experiencing renewed growth and interest from both legacy and new customers.

The company now sells to three different groups: enterprise (where it provides strategic services around contact, collaboration and cloud services); business (cloud, hosted and communications-based services for smaller businesses, increasingly on a subscription basis); and end-consumers (phone and broadband services for the Hull and East Yorkshire region).

The enterprise division has been the driving force behind the business in recent times, and PAC recently caught up with Darryl Beckford, the group’s head of digital acceleration, to get a better understanding of how the company is positioning itself against the rest of the highly competitive systems and network integrator community.

KCOM makes two-thirds of its revenue from selling to commercial and public sector accounts, with recent wins including a five-year deal with BUPA to implement a new cloud-based system across the healthcare group’s four contact centres, that will incorporate Interactive Voice Response (IVR) call recording, screen recording, social media integration and quality management.

The company also won a recent deal with the UK Rail Settlement Plan (or UK RSP) – which provides IT services to franchise rail operators - to migrate legacy ticketing and revenue management applications to an AWS cloud platform. On this deal KCOM benefitted from the earlier acquisition of cloud applications integrator Smart421 way back in 2006.

Beckford says that a key part of KCOM’s proposition is in helping clients re-architect their applications landscape for the cloud. Rather than simply shifting workloads to an Infrastructure-as-a-Service (IaaS) environment, KCOM looks to abstract the applications from the hardware layer and to break them down into microservices (using tools such as AWS Lambda) on a platform-as-a-service. This approach, says Beckford, brings a greater deal of agility and can drive much more significant cost (or capex) savings.

KCOM supports a number of different cloud platforms, including Microsoft Azure, AWS and UKCloud, providing related migration and service management services. Beckford’s view is that today’s cloud services will become increasingly differentiated – Google, he expects, will focus on enhancing their cloud services with big data analytics, and he sees a role for KCOM in helping clients convert these escalating data volumes into business intelligence.

Another of KCOM’s sweet spots is in modernizing customer experience through the implementation and management of contact centre and customer interaction technology. Beckford sees an interesting evolution from companies looking to implement single systems that act as central, multi-channel hubs for all customer contact, which in his view don’t often provide a consistent end-to-end customer experience. Instead, KCOM takes the view that rather than getting bogged down with imposing a single platform, it is more important to ensure that the customer gets the best possible experience at different stages of their journey, with KCOM integrating the different tools.

The company is also trying to help its customers make better use of the data being generated in their contact centers, and to help them take cost out while driving top line opportunities.

IoT is another opportunity on the digital horizon and Beckford believes that KCOM’s role will again be in helping clients generate business value from the rapidly growing number of smart connected devices, by processing the data on scalable cloud platforms. In the shorter term, Beckford says that the company is also seeing solid demand for voice biometrics solutions – particularly in the financial services sector – following its successful deployment at HMRC.

As with all established IT services providers, KCOM has a distance to travel to get past its legacy operations. But the wins with BUPA and UK RSP suggest that it is heading in the right direction.