Back Office Performance Management Initiative

Witness Systems Unveils Back Office Performance Management Initiative, Providing a Comprehensive Solutions Framework to Optimize Back Office Processes

- New eQuality Office offering helps improve quality and productivity of back office functions - such as order fulfilment, claims processing and billing
- enabling companies to optimize customer service in the back office, as well as in traditional contact centre environments -

WELLINGTON (March 25, 2004) - Witness Systems (NASDAQ: WITS), a leading global provider of performance optimization software and services, today announced a new strategic initiative that extends its eQuality® contact centre application suite to back office environments. The company's new eQuality Office offering helps organizations audit critical business functions to better understand the inter-departmental impact back office functions have on customer service and satisfaction. eQuality Office also helps organizations address specific "root causes" of customer contacts into the call centre, enabling them to uncover data entry errors, compliance issues and ineffective processes - for example - that result in the breakdown of customer service.

Based on extensive market research, feedback from Witness Systems' customers and industry-specific studies conducted by the Witness Consulting Network team, the eQuality Office performance management initiative provides an innovative approach that allows companies to extend their contact centre recording, analysis and e-learning investments to the entire enterprise. As a result, organizations can increase customer satisfaction, reduce costs and better pinpoint new revenue opportunities through first-hand business intelligence.

When companies identify the underlying motive for calls into the contact centre, they often find processing delays causing customers to call for status checks and data entry errors driving customer changes, as well as billing mistakes and unclear information creating customer frustration. Unnecessary repeat calls due to inadequate back office processing often contribute heavily to call volumes, which directly impacts a company's bottom line and signals declining customer satisfaction.

"Our eQuality Office performance management initiative flows from our belief that there are many opportunities for the optimization of enterprise processes today. These primarily lie in the back office, where employees struggle with systems to observe internal processes or comply with regulatory requirements without knowing the effect each has on potential customers," said Dave Gould, CEO of Witness Systems. "This offering can help them determine what's causing customers to pick up the phone, become dissatisfied and stop buying their products or services altogether."

Forward-Thinking Organizations Leverage eQuality in Back Office Environments During Witness Systems' annual Driving Innovation user conference in October 2003, more than 250 attendees participated in an interactive polling in which they were asked if they were using the eQuality software to monitor the quality of back office functions today. Of those in attendance, 53 percent indicated they were leveraging eQuality in this capacity already, or had plans to do so within the next 12 months. Witness Systems' customer satisfaction survey, which was conducted in December 2003, reported similar findings. Independent researchers surveyed approximately 450 of the company's customer sites. The results showed that 22 percent of Witness Systems' customers were already using eQuality outside their contact centres, leveraging the software's data capture capabilities to monitor back office processes - such as order fulfilment, claims processing, billing and payment processing.

Reinforcing Witness Systems' findings, independent surveys conducted by industry analysts from the Robert Frances Group (RFG) further support the value associated with monitoring back office transactions. Of the RFG clients surveyed, no less than 56 percent of end users indicated that they audit the quality of their back office processes, revealing that "it is an important issue with managers; a high quality and efficient method is something they would desire," according to Ken Landoline, RFG's voice telephony business practice leader. The RFG study identified the top reasons companies audit back office functions: to track adherence to policy, data quality and productivity, as well as fraud detection. The same research found that the types of transactions audited in the back office most frequently (in order of priority) were order processing, billing, payment processing, customer administration and claims processing.

About the eQuality Office Performance Management Initiative The eQuality Office performance management initiative originates from the eQuality performance optimization software suite from Witness Systems, creating a distinct bundling of applications that work together to offer unique business drivers and financial benefits. eQuality Office captures employee desktop activities, evaluates recorded transactions, identifies best practices and trains staff effectively by:

* Capturing sample transactions by initiating recording based on user-defined business conditions.

* Placing sample recordings into unique contact folders for specific business functions/departments, as well as providing notification when a business condition exists.

* Evaluating operational effectiveness by helping identify trends and implement tactics to improve performance.

* Identifying best practices, allowing users to edit recorded transactions to create company-specific electronic learning.

The heart of the Witness Systems eQuality software is desktop recording that uniquely captures the exact keystrokes on employee desktops - such as data entry and screen navigation - so companies can replay and evaluate transactions just as they occurred. Advanced recording capabilities enable users to define and maintain screen-based triggers to capture specific business functions based on the values of individual fields within an application.

Recording and reviewing transactions can provide valuable insight into the effectiveness of specific areas of the organization and their impact on the customer experience. By capturing sample transactions, companies can assess the ease with which their staff completes processes and the effectiveness of their systems. In some situations, 100 percent recording of all transactions is necessary - such as for fraud detection or regulatory compliance - but often the key is to capture representative samples that are critical to the organization.

eQuality's business-driven recording capabilities allow a company's business objectives to drive the types of transactions captured. For example, organizations may choose to randomly record five percent of certain business functions for coaching and training purposes, capture all orders processed beyond a certain transaction amount and record 100 percent of high-risk situations for audit purposes.

Reviewing transactions enables companies to pinpoint where errors or fraud are likely to occur, so they can improve their auditing capabilities. Organizations can minimize expensive penalties for non-compliance by isolating how well staff adhere to business processes and ensure those processes are followed throughout their lifecycle. They also can decrease re-work by improving data quality, as captured transactions show exactly where the problems are, so companies can improve error ratios and boost productivity.

About the eQuality Software Suite

The eQuality software is deployed in thousands of customer contact centre environments worldwide. Many of these organizations distribute recorded customer contacts from the contact centre directly to other areas of the business, such as marketing, engineering and IT, to make sure the right people receive customer intelligence first-hand. Leveraging the same eQuality software, users can address specific root causes to determine areas of customer frustration originating from back office departments.

While replaying captured transactions, organizations can leverage the custom design capabilities and flexible format of the eQuality software's performance evaluation forms to enhance the way they measure productivity. Managers can create forms, reports and graphs for summarizing staff performance and then use that information to compare the results to established goals.

Based on these evaluations, management can determine how effectively their staff is leveraging the technology resources available to them and how well they are adhering to processes. If those resources and processes are determined to be ineffective, they can then focus on making the necessary adjustments. In addition, organizations can quickly address skill deficiencies with e-learning based on actual performance - without the time-consuming hassles of expensive course development - by producing company-specific libraries of best practices by evaluating how well staff leverage their desktop applications. These types of examples can serve as "role models" for new employees to learn rapidly, so they can emulate rather than figure out how to abide by the company's business processes on their own.

About Witness Systems

Witness Systems (NASDAQ: WITS) provides the contact centre industry's first integrated performance optimization software suite to help global enterprises capture customer intelligence and optimize workforce performance. Comprised of business-driven and/or full-time customer interaction recording, performance analysis and e-learning management applications, the browser-based eQuality® solution is designed to enhance the quality of customer contacts across multiple communications media, including the telephone, e-mail and Web. The closed-loop suite enables companies to record, evaluate, analyse and learn from customer contacts and the touch points they use to develop staff, generate revenue, reduce costs, and achieve greater customer retention and loyalty - all by sharing captured customer and business intelligence throughout the entire organization. An integrated business consulting, implementation and training methodology provides services to support an effective, rapid deployment of eQuality that enables organizations to maximize their return on investment. For additional information about Witness Systems and its eQuality software suite, visit www.witness.com

Cautionary Note Regarding Forward-looking Statements: Information in this release that involves Witness Systems' expectations, plans, intentions or strategies regarding the future are forward-looking statements that are not facts and involve a number of risks and uncertainties. They are identified by words such as "anticipates," "expects," "intends," "plans," "believes," "estimates," and similar expressions. These statements are based upon information available to Witness Systems as of the date of this release, and the company assumes no obligation to update any such forward-looking statement. Forward-looking statements believed true when made may ultimately prove to be incorrect. These statements are not guarantees of future performance and are subject to risks, uncertainties and other factors, some of which are beyond our control and may cause actual results to differ materially from our current expectations. Some of the factors that could cause actual future results to differ materially from current expectations include fluctuations in customer demand and the timing of orders; the company's ability to manage its growth; the risk of new product introductions and customer acceptance of new products; the rapid technological change which characterizes the company's markets; the risks associated with international sales as the company expands its markets, including the risks associated with foreign currency fluctuations; the ability of the company to complete and integrate successfully any acquisitions or investments it may make; and the ability of the company to compete successfully in the future, as well as other risks identified under the caption "Management's Discussion and Analysis of Financial Condition and Results of Operations" in the company's Quarterly Report on Form 10-Q for the period ended September 30, 2003, and any other reports filed from time to time with the Securities and Exchange Commission.

Witness, eQuality and the Witness logo are United States registered trademarks of Witness Systems, Inc., protected by laws of the U.S. and other countries. All other trademarks mentioned in this document are the property of their respective owners.

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