Avaya Bosses Promise 2011 Move From Defense To Growth

Avaya's top executives on Wednesday sought to paint Avaya as a company in growth mode, moving out of a defensive position following its channel changes and its acquisition of Nortel's enterprise unit, and into one of growth, scale and partner profitability.

Avaya is winning market share and dominating segments, especially UC and call center, and has become a disruptive player in data networking and video, said Kevin Kennedy, Ayaya president and CEO, who added that the company made good on the promises it made to partners a year ago.

"It was a tense year, a tough year, and year of transformation, and now in fiscal year 2011, we believe we're focused almost singularly on one thing, which is growth," said Kennedy during the opening session of Avaya's Americas partner conference in Las Vegas.

Kennedy said Avaya's 2011 focuses will include brand stewardship -- developing increasing relevance for Avaya as a go-to business brand -- as well as operational improvements and continuing a level of growth he said the company hadn't seen in a decade.

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All of that means Avaya is moving from being a voice company to a true business collaboration company, he explained.

Next: Where Avaya's Growing

Avaya has a $5 billion run rate, has market leadership positions in contact center and UC, and is a disruptive vendor in data networking -- the portfolio it obtained through its Nortel acquisition -- and in video, thanks to its UC interface Flare Experience and the video portfolio it launched in September. Avaya's gross margin, EBITDA and revenue are all growing, Kennedy said.

In line with last year's launch of Avaya Connect, its streamlined channel program, Avaya has invested about $1 billion in being more channel centric, Kennedy said.

"We're trying to tune our emphasis," he said. "We've spent a billion to accelerate our reach and our coverage and our commitment to the channel, and now we're continuing to tune it so there is customer alignment all throughout the model."

Avaya's FY11 will see continued investment in devices, emphasizing applications, building its integration capabilities and scaling its efforts with virtualization and communications-as-a-service opportunities, Kennedy said.

Its priorities include a more customer-aligned sales and engagement model, monetizing the Nortel base and continuing to tell the story of Session Initiation Protocol (SIP) technology, where Avaya has placed a big bet with Aura, its virtualized UC platform.

Next: The Promise Of SIP

SIP, said Kennedy, will have as profound an impact on the industry as the move to TCP-IP did years ago, and that story is "in the early innings." The introduction of the Flare Experience, he noted, moved Avaya's SIP commitment past the level of cost savings through SIP and to the level of creating a new user experience with SIP.

"Our assertion that we wanted to be a leader in SIP was crucial," he said. "We've just crossed a fundamental point."

The company will also be committed to open technology environments and multi-vendor partnerships, as well as being more cost-effective, Kennedy argued, versus Cisco, Microsoft and other competitors.

"In a world of goliaths who like to lock customers in, we have to be the answer and choice that is open," said Kennedy, in a veiled swipe at Cisco. "We offer choice to a larger alternative."

Next: "The Cynics Are Turning Into Supporters"

Following Kennedy's presentation, Avaya's Joel Hackney said he'd been listening for a year to partner concerns and Avaya was making the changes necessary to relieve tension in its channel. Part of that, Hackney said, was Avaya's move to attack opportunity.

"We are moving from defend mode to aggressive growth mode," said Hackney, senior vice president of global sales and marketing and president, field sales. "You will be convinced that this is a new Avaya."

What he'd heard from partners, Hackney said, is that Avaya needs to make clear its market and brand direction, provide partners with air cover, and ensure the channel is an extension of Avaya's sales force. Market share is strong, Hackney said, adding that Avaya is No. 1 in UC, No. 1 in contact center, No. 1 in enterprise messaging, No. 1 in maintenance services and No. 2 in SME telephony.

"The cynics are turning into supporters," Hackney insisted, citing statistics that Avaya's unaided brand awareness has grown 4 percent over the past year.

What'll come next, he explained, is rewarding partners for performance and also moving away from a structure of "one size fits all" to greater segmentation in how Avaya partners and goes-to-market with the channel.

"Our sales and channel model is absolutely structured to reward growth," he said.