Microsoft Office SystemCustomer Solution Case Study

Fitness Giant Reduces Costs and Improves Customer Service with Unified Communications

OverviewCountry or Region: United StatesIndustry: Health

Customer ProfileFounded in 1984, LA Fitness operates sports clubs at more than 300 locations throughout North America. It employs 20,000 people.

Business SituationLA Fitness wanted a unified voice platform that would help it reduce costs and meet its large-capacity needs while also providing a reliable, flexible solution that was easy to manage and maintain.

SolutionLA Fitness deployed a Unified Communications solution from Microsoft that included Microsoft Office Communications Server 2007 R2 for its robust enterprise voice capabilities.

Benefits Reduced costs Improved customer service More efficient operations Improved productivity

“With the Enterprise Voice solution we were able to eliminate the PBX systems in our clubs resulting in less expensive telecommunications.”

George Bedar, Chief Information Officer, LA Fitness

LA Fitness offers a network of more than 300 sports clubs that provide fitness and wellness services to customers throughout North America. The ability for employees to share sales, operational, and training information and to efficiently communicate with members and prospective members is critical. LA Fitness relied on a mix of traditional private-branch exchange (PBX) telephony systems and an open-source voice over IP solution, but the solution was not reliable and was beginning to reach its capacity. The company realized it needed to provide a more stable, unified voice solution for its employees, so it deployed Microsoft Office Communications Server 2007 R2 to help it reduce costs and provide a stable voice platform that could grow easily as it adds locations. LA Fitness also found the solution helped it improve operational efficiency and provide better customer service.

SituationEstablished in 1984, LA Fitness operates a network of sports clubs across the United States and Canada that offer state-of-the-art amenities and professional personal fitness training. Its primary mission is to help as many people as possible achieve the benefits of a healthy lifestyle by offering its members the friendliest service at affordable prices.

At its more than 340 sports clubs and at its corporate office, communication is key for helping LA Fitness employees increase sales, promote customer loyalty, and maintain high levels of customer satisfaction.

For its voice capabilities, the company had deployed a mix of traditional private branch exchange (PBX) telephony systems and an open-source voice over IP (VoIP) solution. It used Asterisk products both for its voice mail and audio conferencing solutions. Corporate employees and some club employees also used Microsoft Exchange Server 2007 and Microsoft Office Outlook 2007 to communicate with one another and with partners and customers outside the organization. Some employees also used instant messaging services such as Bold Chat or Spark, an open-source solution. For web conferencing, the company used Microsoft Office Live Meeting, and it used Microsoft SharePoint Server 2007 to post training materials and important company information.

The main challenge for LA Fitness was that as it continued to expand, it found that it was outgrowing its voice solution.

In particular, the open-source VoIP solution offered poor fault tolerance, and employees found it increasingly unreliable, while the PBX systems were expensive to maintain and required a large collection of different local voice providers. The company found that maintenance of both systems made it nearly impossible to predict costs as it continued to add clubs. It wanted to find a voice solution that would offer more reliability, as well as more robust communications capabilities, but most importantly it wanted a system that would be fully interoperable across the organization.

SolutionFor an integrated voice solution, LA Fitness considered unified communications solutions from Cisco and Avaya, but ultimately rejected those offerings because of cost and the complexity of the licensing. It also had some concerns about the compatibility of their technology with internal applications built on the Microsoft .NET platform that LA Fitness had developed for its clubs. Finally, it believed that neither company’s technology was progressing in a way that would meet its needs.

Working with partner CDW, LA Fitness ultimately decided on a Microsoft Unified Communications solution that included the robust enterprise VoIP capabilities of Microsoft Office Communications Server 2007 R2. It began deploying the solution in July 2009, beginning with its corporate headquarters, and completed

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deployment of the solution to all its sports clubs in July 2010.

One of the main advantages to Office Communications Server was the fact that it could be easily integrated with the existing Exchange Server and Office SharePoint Server solutions. Another advantage was the additional capabilities the solution provided, such as presence and instant messaging: “What really made the decision for us was the fact that with the Microsoft solution, we could solve our telecommunication problems, and we could get all of these other capabilities as well,” explains George Bedar, Chief Information Officer at LA Fitness. It has currently deployed VoIP, instant messaging, presence, and audio and web conferencing capabilities to almost 6,000 employees. It has also deployed Exchange Unified Messaging to 3,600 employees.

LA Fitness worked with CDW to plan the deployment to ensure the success of the project. It analyzed costs carefully to understand additional costs associated with additional hardware requirements, at each site. Next it considered who its carriers would be, and whether they were Microsoft Unified Communications certified. It also determined how it would handle calls to and from all common area phones, as well as its paging and emergency call systems. During the deployment, the company found that the large call volume at some sites affected the Office Communicator Server performance and call quality, but it was able to adjust its Dial Plan—the rules of behavior set in Office Communications

Server for incoming and outgoing calls—to resolve these issues.

To configure its Enterprise Voice solution, LA Fitness used SIP trunking to connect Office Communications Server directly to the public-switched telephone network (PSTN). SIP trunking uses the session initiation protocol (SIP) and real-time transport protocol (RTP) to pass network traffic from Office Communications Server over an IP connection to the PSTN. This capability was critical to the company’s decision to deploy the solution, because it determined that it ultimately wanted to remove all its PBX systems and to save the cost of maintaining them. It also integrated its paging system in the clubs with Office Communications Server, so employees can handle all communications through Office Communicator.

Club employees are using the instant messaging and presence capabilities to assist new customers and club members alike. Using presence information, staff at the front desk can see who is available to answer questions about memberships or about how to use equipment—without leaving the front desk unattended. Sales counselors use the instant messaging capabilities to share discussion points about the clubs’ benefits or valuable promotion information with each other as they talk to prospective members. Employees also use instant messaging to communicate about operations and maintenance issues without disturbing club members. They can also use the Office Communications Server audio conferencing capabilities on the fly to

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“What really made the decision for us was the fact that with the Microsoft solution, we could solve all of our telecommunication problems, but we could get all of these other features as well.”

George Bedar, Chief Information Officer, LA Fitness

discuss important club issues or promotions.

Desktop sharing has proved to be another productive tool for employees, who use it to conduct remote training sessions for new employees. The sessions might present changes to the company Intranet or train employees on how to use new applications.

LA Fitness is also using the Response Group Service in Office Communications Server to configure workflows that route and queue incoming calls to the proper channels. Club employees can click a link on the company Intranet, built using SharePoint Server, to initiate a call to the help desk, human resources, or payroll departments, and automatically be placed in the correct queue.

Corporate employees at LA Fitness have access to some additional unified communications capabilities. At its corporate office, LA Fitness has enabled federation with vendors and partners. Employees can place Communicator calls, share a desktop, start an instant messaging session, or view presence and calendar information for any trusted organization in its network that has also enabled federation. It has also deployed Exchange Unified Messaging for employees. With Unified Messaging, employees can receive and manage both voice mail and email messages through the Microsoft Office Outlook messaging and collaboration client.

Another Unified Messaging feature LA Fitness uses is the Auto Attendant. With the Auto Attendant, companies can

create voice menu systems that callers use to navigate and locate the department or person they need to reach within an organization. LA Fitness has built a custom application on top of the Auto Attendant that will call club members using electronic funds transfers to pay their monthly membership fees to notify them of billing issues. Members can also call into a system that lets them make changes to their accounts, pay membership dues, or opt out of automatic notices.

Although LA Fitness employees at the corporate headquarters and at the sports clubs adopted the new solution quickly, the company ensured that everyone received proper training so they could fully leverage the unified communications capabilities available to them. Because the clubs have fewer features than the corporate office, all club operations managers received training, and the operations managers were responsible for training the rest of the staff. It also created custom documentation for all the clubs based on the unified communications documentation provided by Microsoft.

Going forward, LA Fitness plans to upgrade to Exchange Server 2010 and SharePoint Server 2010 to take advantage of additional enhancements available for its unified communications solution. It also plans to expand its integration with SharePoint and Microsoft Dynamics. It will also continue to improve its call workflows and call center applications, and better tailor the functionality across user roles in the

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“Everyone took very quickly to instant messaging. It’s one of the best features we could have given them.”

George Bedar, Chief Information Officer, LA Fitness

company to ensure high productivity at every level.

BenefitsBy deploying a Microsoft Unified Communications solution to provide a stable enterprise voice platform for its employees, LA Fitness found the additional features such as instant messaging, presence, and desktop sharing have offered its employees benefits far beyond a reliable voice solution. While LA Fitness was able to meet its original goal of providing a unified voice platform that would also help it reduce costs, it also improved customer service and helped operations in all of its locations run more efficiently. “Overall, the voice quality is better, and we’ve seen a significant improvement in the way we communicate,” says Bedar.

Reduced Costs for Voice SolutionLA Fitness significantly reduced its yearly costs for its communications solution. “The biggest factor in our cost savings was that with the Enterprise Voice solution we were able to eliminate the PBX systems in our clubs,” says Bedar, “resulting in less expensive telecommunications.” By eliminating lines in clubs and long distance charges, LA Fitness will save well over a half million dollars a year. It was also able to drop several third-party applications for an additional yearly savings.

Improved Customer ServiceLA Fitness believes the additional unified communications capabilities such as presence, instant messaging, and auto attendant have helped it improve customer service. Its sales counselors

have access to support and valuable information when they talk to prospective clients. “With instant messaging, while one sales counselor talks to a potential member, another sales counselor can provide talking points to provide up-to-date information. With a short sales cycle and very little face time with the customer, this is a key benefit,” says Bedar. “Everyone took very quickly to instant messaging. It’s one of the best features we could have given them.”

Using instant messaging and presence, front desk operators are also able to ensure the front desk is never unattended. They can easily locate the right person to talk to a potential member or help a current member with equipment or a fitness question.

More Efficient OperationsLA Fitness has found that their clubs operate more efficiently with the new solution in place. Corporate can easily send alerts through Communicator to let clubs know about upcoming routine maintenance that needs to be performed, and club employees can communicate about ongoing club maintenance without disrupting members’ workouts.

Sales counselors find it easier to communicate with one another, whether during a meeting with a potential member or when new promotions become available. They are able to have multiple conversations at one time—for example, a voice call and a chat or desktop sharing session—or to set up an audio conference on the fly to discuss

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the best sales strategies and how to keep members happy.

With response groups, club managers find it easier to locate the right people at the corporate office when they have questions about hiring or payroll, or when they need to contact the help desk with technical questions. Desktop sharing also makes it easier for corporate employees to properly train club managers or inform them about new processes, and club managers can ensure that new employees have access to the latest information and the right contacts.

Improved ProductivityLA Fitness has also seen significant improvements in employee productivity. Individuals no longer waste time trying to locate the right people to talk to or looking up phone numbers. With the integration of presence information into SharePoint and Exchange, employees can see at a glance if the person they need to talk to is available. If not, they can easily find someone else. “SharePoint is a significant element of how we operate, and we have been able to leverage the communications capabilities provided by the integration of Office Communicator with SharePoint, which makes us all more productive in the long run,” explains Bedar.

Enhanced collaboration has also helped to improve productivity. “The ability for

employees to hold audio conferences and pull people in as needed has really improved communication across the organization,” says Bedar. Microsoft Office SystemThe Microsoft Office system is the business world’s chosen environment for information work, providing the programs, servers, and services that help you succeed by transforming information into impact.

For more information about the Microsoft Office system, go to: www.microsoft.com/office

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For More InformationFor more information about Microsoft products and services, call the Microsoft Sales Information Center at (800) 426-9400. In Canada, call the Microsoft Canada Information Centre at (877) 568-2495. Customers who are deaf or hard-of-hearing can reach Microsoft text telephone (TTY/TDD) services at (800) 892-5234 in the United States or (905) 568-9641 in Canada. Outside the 50 United States and Canada, please contact your local Microsoft subsidiary. To access information using the World Wide Web, go to:www.microsoft.com

For more information about CDW products and services, call (866) 782-4239 or visit the website at: www.cdw.com

For more information about LA Fitness products and services, call (800) 600-2540 or visit the website at: www.lafitness.com

This case study is for informational purposes only. MICROSOFT MAKES NO WARRANTIES, EXPRESS OR IMPLIED, IN THIS SUMMARY.

Document published August 2010

Software and Services Microsoft Office−Microsoft Office Communications

Server 2007 R2−Microsoft Office SharePoint Server

2007

Microsoft Server Product Portfolio−Microsoft Exchange Server 2007

Enterprise Edition

Partners CDW