Scattered Genesys Needs to Regroup After Alcatel-Lucent Split, Says Analyst

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Alcatel-Lucent has closed the sale of its customer-service software and contact-center business Genesys, which now needs to regroup and start working on improving areas such as analytics, Gartner analyst Steve Blood said.

Permira Funds and Technology Crossover Ventures paid US$1.5 billion for Genesys, and approximately 1,800 employees worldwide will be transferred to a new company.

"It was the right thing to do; Alcatel-Lucent needed the money and Genesys needed to be separate," said Blood.

With the backing of its new owners, Genesys will strengthen its products in growing areas such as cloud computing, workforce optimization, process workflow, social networking and analytics, according to Permira.

Analytics has become more important to businesses and Blood said he wouldn't be surprised if Genesys acquires a company to improve its portfolio.

"Enterprises want to know more about how the company is running and what customers are calling about," said Blood.

But the first thing Genesys needs to do is to regroup, and bring everyone together following a reorganization that saw employees scatter across different parts of Alcatel-Lucent, according to Blood.

"Had it gone on longer, I think more people would have become fed up from working in the slow-moving carrier environment and left," said Blood.

Genesys has lost some good talent, but the damage wasn't huge, according to Blood.

Genesys also needs to put together long-term product plans.

"If you ask what its products will look like in three years, the plans are a little light on content because they are not sure," said Blood.

Over the next few months the company will be able to formalize more detailed plans. Still, any investment Genesys wants to make needs to be approved by the new owners, which could be a tricky process.

Last week, Blood met with one of the investors and was reasonably impressed.

"They don't have that much experience in contact centers and customer services, but I think there is enough knowledge there to be able to support what Genesys needs to do," said Blood.

Genesys' claim to fame will be that it is one of only a few vendors that actually focuses on customer services and contact centers, according to Blood.

A competitor like Interactive Intelligence, which is releasing its fourth-quarter numbers later on Wednesday, is also focused and has grown rapidly, he said.

"I am sure Genesys thinks it can do the same when let loose," said Blood.

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