Avaya CEO: Post-Bankruptcy, Channel Partners Enabling Collective Growth

Lenders and the might of its brand have given Avaya a chance to rectify past mistakes. That is not to say the road to getting there has not been fraught with barriers. Following two bankruptcies and having eliminated 2,500 employees, including many high-dollar executives, the firm now has $830 million in financial obligations — down from nearly $3.5 billion.

Avaya’s Alan Masarek

Avaya CEO Alan Masarek notes that this is 75% lower than before restructuring, with the company also now having cash and cash equivalents that amount to more than $600 million. These figures are heartening, says Masarek, as they are preferable to the firm’s initial numbers.

In an interview with Channel Futures, Masarek credited the company’s immense brand for helping with materializing from bankruptcy for a second time, with him sharing, “it’s the more than 90 million unified communications seats.” Furthermore, Avaya has an ecosystem of more than 4,000 partners and 120,000 developers, which Masarek asserts, remain central to Avaya’s recovery.

Rebranding as a More Modern Avaya

For a long time, one of the criticisms directed at Avaya is that it typically failed to feel or appear contemporary. With leadership changes across the board, we asked Masarek if he thinks this has changed.

“I think that is appropriate criticism that goes back several years, but we have changed that notion,” he said. The thesis when I joined, having come from within the communications industry where we moved from residential VoIP to UCaaS/CPaaS/CCaaS — we played our strengths up toward the macro trend of customer experience (CX).”

Masarek acknowledged that in the past, the firm had been “slower to product development,” adding that “the world [was] reduced to a bumper sticker: ‘[on-premises] bad, cloud good,’ which is just not true.”

Avaya’s customer base is “overly skewed toward the largest, most complex deployments,” notes Masarek. Many deployments reside in investment management, critical care hospitals, governments and other verticals, laying out a case for on-premises communications continuing to play a considerable role in the future of any customer journey led by Avaya.

“Each journey is gradual, especially for large-scale deployments, so things like bringing social, digital, and AI over the top resonate with our customers and channel partners,” the Avaya CEO said. “There is also the ability to modernize our customer base at the pace that works for them, meaning we are equally thrilled if you are 98% cloud and 2% on-prem, and vice versa.”

Avaya CEO: Channel Partners Playing a Hardy Role in Emergence

Seventy percent of Avaya’s global revenue is thanks to channel partners, notes Masarek, with 30% of Avaya sales being direct. He says Avaya is doubling down on this strategy and beefing up work with agents, service providers, and increasingly, with system integrators (SIs)

Perhaps surprisingly, with a partner community relatively slow at adopting tools such as AI, Masarek told Channel Futures, getting these bleeding-edge technologies into the right hands has actually not proven to be too grueling.

“AI has a huge impact in the CX market – call deflection, intelligent routing, chatbots, what you can answer digitally – and this all plays up to the benefit of the partner,” Masarek added.

The way the Avaya CEO sees things, “partners are more and more embracing AI rather than running from it, as it is on the lips of everyone.”

With channel partners, he adds, it is all about collective growth, the customer journey, and the modernization path. It is either direct or via a partner, but what’s most important is that channel partners can monetize while modernizing, which Masarek calls “very substantial.”

Continuing investments in education, stressing the importance of AI, sales enablement training, and selling access to its professional services organization, he contends, puts channel partners in a better place to make money as they can sell these assistance packages — creating a path to loftier revenue.

“Our partners believe in our success, and now we have the solutions to help back that up. Avaya might have been slow years ago to bring innovation, but that notion [has been] shifted upside down,” Masarek concluded.