We Blog CRM

A very nice and succinct piece here that touches upon the manner in which businesses into commodity trading and those selling high-value goods can make use of CRM. CRM is now being used by businesses to add to the soft value that a consumer perceives in a transaction apart from the object/service he purchases and the amount he pays for it.

The value-adds act as important differentiators and allow businesses to create space for themselves in competitive scenarios. Product and price differentiation is no longer sufficient to draw in the customers. CRM helps by making sense out of data that is gathered from the customers and the information is used to tailor service around a customer’s likes and dislikes.  The service sector finds it the hardest to do business on quantitative value alone and hence is pressed to come out with innovative value propositions for customers.

Reframing service as a profit center is the key to driving new growth – So says James L. Watson, regional manager, Neocase Software. In an exclusive viewpoint published at DestinationCRM, James states that all you need to do to drive growth from CRM is to look at it differently, consider it a profit center. Apparently, a shift in perspective will enable you to get your CRM activities to become a major revenue driver.

A read through his article tells that this is all that you need to do to make money from CRM, get a quick ROI. I say this because, although he suggests a difference in perspective, the accompanying activities are simply those that one would normally associate with a successfully operating CRM deployment.

James goes on mention activities such as offering good service, up-selling, cross-selling, etc as those that you need to do if you are going to look at CRM as a profit center on par with sales and marketing.

To be honest, I didn’t really understand the point of the article. I mean the ultimate objective of deploying a CRM solution has always been to make money – make money by keeping the customers happy. So, how does adding some new nomenclature to it make a difference when you are not introducing any new activities to go with your new concept? Is this vinegar in a wine bottle?

P.S The last paragraph of his article reminds me of typical boardroom pep talk that my boss used to give me. Does nothing to make it easy for the guys who are actually facing the heat out there.

Customer Experience Management, or CEM, is becoming a popular way for industries to capture customer loyalty. CEM puts the focus on the customer rather than the goals of the company, leading to better customer service and ultimately a higher number of loyal customers spreading word-of-mouth advertising to potential customers. Companies that use customer experience management practices strive to make the most out of every interaction with the customer; through advertising, sales, delivery, service and communications. This leads to the “customer-centric” approach that CEM stresses. The customer needs to have the experience that the customer desires and expects at every level of interaction.

Effective CEM plans start with data gathering and analysis and ends with a customer service focused start-to-finish strategy to increase customer loyalty in a financially optimal way for the company. The strategy must give your company an advantage over other industries that are currently implementing CEM programs as well. Probably the most important issue to watch is the involvement of top executives in the CEM program. Goals should be set including the involvement of all levels of personnel in the company. When programs are initiated but not followed through on, CEM cannot accomplish the purpose set forth. Staff from every department should be on board with the planning and implementing of the customer experience management program. Read more

Business consultancy How to Experience CEO David Williams has a bit of a scathing editorial running at CRM2day.com. In a piece entitled “The Customer Focus Myth,” Williams takes nearly every organization he has dealt with (and over ten years in the biz, that would appear to be quite a few) in simply failing to go the extra mile for customer loyalty.

“The last 10 years have convinced me that virtually all organisations could do ‘customer focus’ better,” Williams writes in CRMToday.com. “The internal ‘stickers and brochures’ campaigns, the new bold talking PowerPoint are harmless and well meaning. But they change nothing and challenge no one. At worst, they are divisive – with unclear objectives that distract the organization from its core objective.”

For a positive example, Williams cites – as many such authorities do, it seems – Virgin Atlantic airline, a firm “brave enough to invest in things around the customer’s real needs” in Williams’ view.

Ultimately, Williams makes an “Emperor’s New Clothes”-like deduction that is surprisingly unique: “Often, CEOs are too far removed from the service reality. A middle management layer protects the status quo. In one PLC, it emerged the service director used the engaged tone on one of its call answering lines … because calls lost in this manner didn’t affect the headline call answering metrics. Good customer focus initiatives change the metrics and understand the business impact of actions.”

CRMchump is down with Williams on this one. This writer has ranted on such a topic for some time, as middle management’s job in the late 20th/early 21st century has more often than not consisted of a lot of rah-rah cheerleading prompted by guys with university degrees doing things by the (school)book.

“The Customer Focus Myth” can be read in full at CRM2day.

Like top-five lists? Well, you’ll love the telephony/customer relationship management VendorGuru.com this week. The loftily-named company yesterday released a pair of white papers entitled The Top 5 Telephony Solutions Your Business Needs Today and The 5 Must-Have Features of a CRM Solution.

Best of all, the white papers are free after the registration process.

The Top 5 Telephony Solutions Your Business Needs Today promises to expostulate on how the telephone communications landscape is changed and how businesses like yours have increased productivity by implementing the new standards.

For those who love only the thrill of the list and find the prose second, the following are the five “must have features of a CRM solution":

• data tracking and integration, to give users throughout the company access to key data;

• customer support, to provide high levels of service, quick response times, accountability, and prompt problem resolution;

• sales management tools, to help managers distribute sales leads and help salespeople process orders in real time and close more sales;

• marketing automation, to generate automatic responses and collect data to help track leads and results; and

• analytics to organize and analyze customer data, for more better customer experiences.

Cutting Edge Information has released a report on that nice niche industry, pharmaceutical CRM. Not so aesthetically-titled Pharmaceutical Customer Relationship Management: Developing and Improving CRM, the report seeks to identify and analyze the pharmaceutical companies recognized as leading the field in customer relationship management.

The sound-bite version of the piece, broken down into a 21st-century quick list format, states that organizations “on the cutting edge of CRM” share similar secrets of success in that all

• invest adequate resources at the outset of the initiative and provide sufficient investments annually to support the program;

• create an internal champion for CRM, through the structuring of a CRM department, team or ad hoc group;

• establish a centralized database to share knowledge across the company;

• define CRM and educate internal parties to ensure buy-in;

• understand target audiences and provide customized messages via preferred media touch points;

• recognize that CRM requires a long-term commitment, in terms of both resources and measurements; and

• improve their programs by continuously monitoring progress and industry advancements.

The report contains budget and staffing metrics for thirteen different customer relationship management programs. A summary of Pharmaceutical Customer Relationship Management: Developing and Improving CRM is available for free at the Cutting Edge website, but you’ll have to pay to get the whole thing.

With an abundance of CRM products and a plethora of online pundits examining them, this market of the software industry is seeing awards and honors within the field graced every week of the year. Heck, to keep up, you’d need a scorecard.

Below is one writer’s attempt to provide such; a look at some of CRM’s recent trophy-hoisters and the reasons for their pride.

Catch a rising star

Voice Print International became perhaps the latest in the industry to bag a trophy, announcing last week that the company had taken one of three Rising Star Award from CRM Magazine. The contact center solutions provider was cited by CRM editorial director David Myron for “expanding its portfolio of integrated quality monitoring and workforce optimization technologies and positioning itself as a serious player in a very competitive space.”

Centive back-to-back

On-demand sales compensation management specialists Centive were pleased to accept Technology Marketing Corporation’s Customer Interaction Solutions magazine CRM excellence award, and even more so that the prize was the firm’s second consecutive nod from the prestigious publication. Web-based Centive Compel has also won the firm a CODiE and a “Wiz Kids Award” from Beagle Research.

In Cali, it’s Kintera

Kintera Inc., specialist in CRM solutions for non-profits, recently showed CRM development’s advancing place in the software world. This month, Kintera took home a California Innovation Award from the California Innovation Corridor. Kintera made the final 15 from an initial pool of 300 nominated. Finalists were chosen based on market leadership within their industry, employment figures, continuous innovation of products and services, contribution to the California economy, and significant accomplishments in 2006.

Link me up

Product of the year? For TMC’s communications solutions department, it’s Envox PhoneLink. PhoneLink is a CTI application that allows service and support organizations to leverage data from CRM solutions.

Quick what?

Ah, the ever-elusive and -prestigious Software & Information Industry Association CODiEs…this month, on-demand financial applications provider Intacct Corporation is polishing one of those bad boys off, getting a "Best Financial Software Solution" prize for its Intacct Enterprise application. A more unique title given Intacct came in March with Inc. Magazine naming the product "Best for Replacing QuickBooks."

Praise and prize

KNova, already a prize bagged by Consona CRM in a recent acquisition, made its new benefactor proud with last month’s Service Excellence Award from CRM Magazine. Together with Onyx, a second Consona solution frequently teamed with KNova, Consona now has “a powerful combination that would give larger competitors like Oracle and SAP a run for the money.” Now that’s praise that might be more valuable than the prize…

OSS on FTS’ promise

CRM solutions provider FTS has a bright future ahead, at least in the eyes of those at the TeleStrategies Billing & OSS World 2007 conference and exhibition in Chicago last month. FTS was named the “Most Promising Company” at the show and in the Windy City showed off its recently released version 7.0 of Leap Billing RevChain, a billing product specifically targeting the American market; and version 4.0 of its Leap Billing, a solution serving customers worldwide.

Salesforce.com gives back

Sure, Salesforce.com has an edge-up in most awards competitions by dint of size and reputation, but sometimes the recognition is harder earned. To wit, the Salesforce.com Foundation’s winning of a “2007 Building Strong Communities Award” from YMCA of San Francisco. Sometimes, winning isn’t only about sales.

Technically excellent

Sogeti Group was named winner of the “Overall Technical Excellence in an IBM Business Partner” award from the big company in April. Sogeti is a systems integration firm. It’s a hard-earned nod, indeed: In 2006, Sogeti opened three centers of excellence in Spain, Sweden and the United States, training more than 500 consultants; hosted more than 25 seminars featuring Rational offerings in Europe and the United States with more than 500 clients attending; and opened testing centers in Sweden and the US using Rational technology. Sogeti also opened two mainframe academies in France and Belgium with the full support of IBM, to expand the life of the mainframe in large accounts.

A Dialogical decision

The Frost & Sullivan awards are another set that are well lusted after for their prestige; this year, the multinational consulting firm bestowed a Market Leadership Award on media and signal processing technology provider Dialogic Corporation. Said Frost & Sullivan analysts: “[Dialogic] has continually demonstrated an ability to closely monitor market changes and implement superior market strategies accordingly.”

Joe Jackson would be proud

Probably the prizes with the coolest names, the Steppin’ Out Awards are presented by internationally acknowledged “CRM guru” Paul Greenberg and usually quickly reported on by industry writers referencing the 1980s pop hit. The awards haven’t stepped out for 2007 quite yet, but Zoho is already pumped that the firm bagged a finalist nod in the “Vendor” category. Zoho’s nomination is based on its “customer-centric focus, constant innovation, and comprehensive and remarkably inexpensive Office 2.0 suite.”

Intelligent, sophisticated, calls you back…

Product of the year? According to Call Center Magazine, that would be Interactive Intelligence Inc.’s contact center automation software, Customer Interaction Center. CIC was selected by magazine editors as “Product of the Year” for its “open, sophisticated architecture built to process multiple types of interactions, including calls, faxes, e-mail, web chats and web callbacks.”

Take us to your (Service) Leader

KANA Software, Inc. can now call itself a true leader, having earned a “2007 Service Leader” from CRM Magazine. The 2007 Service Leaders Awards are given to “honor CRM vendors who are committed to making the customer a strategic business priority.” The rankings are derived from a weighted formula that considers factors including company direction, reputation for customer satisfaction, depth of functionality, and market share. KANA reportedly earned the highest scores for “Reputation for Customer Satisfaction” and “Reputation for Company Direction,” while ranking a close second in “Reputation for Depth of Functionality” among the companies evaluated.

Software and The City

Meanwhile, in the shadows of Gotham…Vormittag Associates, Inc., a provider of enterprise solutions specializing in the distribution, manufacturing, retail and service industries, are polishing their LISA. Spelled out, that’s a Long Island Software Award given to the company for its S2K Enterprise for Retail. LISAs are awarded by the Long Island Software & Technology Network (a.k.a. LISTnet) to software product developers that demonstrate excellence in development and design.

Developing Seagull

Seagull Software brought home a CODiE from the beach in April, as its HostFront was selected as the “Best Software Development Solution” by the SIIA. Seagull specializes in solutions that transform legacy business applications into service-oriented architecture programs. HostFront is a native extension to Visual Studio.NET that offers .NET developers a familiar development environment in which to transform IBM host applications into web services.

Follow the Beacon

It’s always nice to be noticed by the big guys: Just ask Axentis, winner of the “IGS Teaming Award for Independent Software Vendors” in the annual IBM PartnerWorld Beacon Awards competition. Judges remarked that Axentis “has a unique compliance, risk and governance application that is delivered totally as service using IBM hosting, which helps take care of the scaling requirements of their clients. This is a good way of delivering this kind of solution to the SMB and enterprise space.”

The great Dane

Denmark, a land not normally known for its software accomplishments, nevertheless produced at least one player on the international market last month in a repeat performance of last year. Danish IT firm Zoomio took home no less than a CRM prize from CeBIT for a Microsoft Dynamics CRM marketing module. The independent jury’s award signified Zoomio’s solution as the most innovative in the CRM category. Not a bad win for the land of Hamlet, then.

High Altitude

Product of the year? From the Network Computing Awards, that would be independent contact center solutions vendor Altitude Software’s uCI 7.5. Around for 15 years, the latest version of Altitude uCI took home the prize based on reader votes, all the better to emphasize the product’s popularity with, eh?

Konftel’s big five-oh

Frost & Sullivan found conference telephone supplier Konftel pretty cool this year, too, giving the company a “Product Differentiation Innovation Award” in recognition of Konftel’s having “developed a technically innovative product that differs from competing products in terms of functionality.” Specifically speaking, the Konftel 50 was the innovative product.

Sage, again

Finally, some firms just can’t stop winning. Sage Software recently announced that SageCRM and Sage SalesLogix were both selected by ISM Inc. Customer Relationship Management and eCustomer strategic advisors as “Top 15 CRM Small & Medium Business Software Award” winners for 2007. SageCRM received the ISM award for a fifth consecutive year, while Sage SalesLogix received the award for a ninth straight year, Jordanesque streaks both.

“Consumer profiling” is a concept long since taken for granted by the users and gurus of marketing. Yet in that familiar way 21st century culture so often does, the complexity of a once simply-defined concept has obfuscated its simpler meaning, say, something like “The process of building profiles of consumers based on their purchases. Consumer profiles contain both demographic data and product preferences.”

Today’s marketing world has developed entire schools of thought on the meaning of consumer profiling, the data that should be accentuated within consumer profiling programs, and the boundaries of personal privacy while profiling.

There are two kinds of people…

…those who classify in two kinds and those that don’t, goes the new/old witticism. Under this premise, Jim Novo, author of Drilling Down: Turning Customer Data Into Profits With A Spreadsheet” and major espouser of best practices in CRM, would be in the former group.

Be sure to read the preview four pages at Amazon.com; there’s a great Platonic dialogue-like bit wherein Novo manages to realize that:

“No wonder nobody knows how to sell more to current customers while reducing costs. All customers are customers for life – unless they tell you they aren’t anymore. Sometimes it seems as if today’s marketing people have no sense of reality. They are thinking every person or business that ever transacted with them is still a customer!”

In consumer profiling, Novo sees profiles as being either essentially demographic-based or behavior-based. Novo appears to a huge advocate of the second mode, describing behavior-based consumer profiling as “involving what the customer is actually doing.”

Novo emphatically believes that “Customer behavior is a much stronger predictor of your future relationship with a customer than demographic information ever will be,” and it’s apparently not an obvious point. After all, without behavioral profiling, how can you accurate predict sales on erratically-buying customers or rainy-weather buyers?

Behavioral profiling may also be useful in determining customer awareness, particularly in the e-commerce sphere. You can’t make sales from that snazzy new website redesign if one-time customers don’t hear about it or aren’t compelled to return.

Privacy: not exactly mainstream

Professor Roger Clarke once wrote (and has seen been oft-quoted) that “Customer profiling appears to be regarded by marketers as a mainstream technique, [but] there are enormous dangers to consumers, that the public is increasingly aware of and concerned about those dangers, and that marketers who fail to appreciate the dangers will suffer.”

This is an increasingly salient point in these days of security-consciousness and awareness (perhaps overawareness) of threats to personal data: The most eager of eager consumers may be absolutely thrilled to be pitched at, but few would like their financial numbers in unknown databases.

Clarke further divides consumer profiling into “abstract” and “personal” varieties, with the latter representing the potentially paranoia inducing: “This is the accumulation, acquisition and cross-referencing of data about individuals, sometimes combined with geo-demographic data; followed by its use for various micromarketing purposes.”

Further, “personal profiling,” as Clarke sees it, can be subdivided into “applicant qualification” and “consumer marketing.” In both types, however, profilers are “flying in the teeth of the gale of public concern about privacy-invasive practices, and snowballing efforts by advocates and policy-makers to impose regulation on private sector use of personal data.”

Of course, the federal government addressed such regulations most notably in 1997 with the “Framework for Global Electronic Commerce, the Clinton Administration,” a document which “supports private sector efforts to implement meaningful, consumer-friendly, self-regulatory regimes to protect privacy.”

However, this appears to be a classic Clintonesque bit of regulation as the broad working includes the traditional “liberal” demands on “self-regulation,” and government regulations in this area of e-commerce haven’t gone far beyond.

Figure on tighter controls in the future. And remember, too, that in the post-Patriot Act world, the feds may well already have a pretty clear profile on you…

At first, on-demand CRM software looks like a can’t-miss opportunity in terms of rapidly upgrading lots of customer service really quickly under one base price of, say, $75 per user for marketing, sales force or service automation modules or $125 for all three suites.

At first.

Just as surely as time is money, however, hidden costs may be tucked away, despite promises of “this low price” or that.

Need proof? Check out the cautionary tale provided by appliance and automotive equipment provider Sterling PCU. Salesforce.com met all the company’s needs until a second database back-up. “That’s when,” a Sterling spokesperson said, “salesforce.com started to charge us an arm and leg for backing up our own data. It’s just not acceptable.” Today, Sterling claims their new CRM system saves them $18,000 annually.

A few tips, then, to help you ensnare some of those revenue-eating traps follow. We can’t guarantee savings of $18,000, but consider the following and you may well get what you pay for (and vice versa).

• Beware complexity. There is little that can be done, it seems, about the headaches certain to appear when faced with integrating data between on-premise and hosted software. Work stoppage may happen, shutdowns of some or all parts of your network may be necessary: All represent drains on resources and thus revenue.

• Think about consultants. Because of certain complexity in implementation, you will be hiring a consultant. iServiceGlobe SAP consultant Srini Katta, a specialist in e-business and CRM implementation was quoted at CRMblogger and SearchSAP.com as estimating that, “at a minimum, a company may need to bring in a business analyst to determine what data is needed and should go beyond a company firewall.”

Choose your consulting partner carefully; understanding exactly what’s in the consulting contract will help keep potential hidden costs within the potential hidden costs to a minimum.

• Consider storage space (but probably not too much). Much is made of “bloatware,” much of it colorful. One CRM world blogger writes of “the notoriously contagious ‘bloatware’ malaise that often affects ageing software – adding features for the sake of it,” describing the phenomenon as “like mutton dressed as lamb – full of superfluous features the developers have decided you need.”

This can mean having to buy further storage space either in that hardware the would-be CRM buyer was hoping to avoid or from the hosting service. Companies like SAP and Salesforce.com offer additional space as well, should you need it, but at an extra cost, naturally.

For an opposing viewpoint set to debunk all the myths about the ever-discussable bloatware, check out this entry by blogging software developer Joel Spolsky entitled Strategy Letter IV: Bloatware and the 80/20 Myth.

By the “80/20 Myth,” Spolsky is referring to a common rule of thought employed by software developers that goes as so: “80 percent of the people use 20 percent of the features. So you convince yourself that you only need to implement 20 percent of the features, and you can still sell 80 percent as many copies.”

But, Spolsky argues, that 20 percent of features is different from user to user; one of the beauties of web-based CRM is the pick-and-choose options most offer. The 20 percent your business needs can be yours at minimal cost. If you choose correctly.

As for the cost of hardware, Spolsky presents an eye-opening statistic: In 1993, Microsoft Excel 5.0 took up about $36 worth of hard drive space; in 2000, Microsoft Excel 2000 took up about $1.03 in hard drive space. That price you’re paying for extra space? Accept it; it could be much worse.

• And then there’s shelfware. Just because you’re not buying anything that can go on the shelf doesn’t mean you’re not paying for something that is utterly useless.

Shelfware is an already classic 21st-century phobia, programs that simply sit on the shelves after purchase due to one problem or another. In a Network World piece by Denise Dubie entitled “Net execs struggle to rid their shops of shelfware,” Dubie presents five cases of business had by (typically) CRM product that was too much, not enough, or just plain didn’t work.

Though the piece is focused on traditional hardware for IT companies, the lessons learned are the same, and the moral is simple: Do not buy that which you do not need.

• Know what you need to know. A guideline for costs in a CRM system deployment has been nicely summarized at CRM Lowdown. It looks like this: needs analysis and site preparation; software purchases and license support; implementation and deployment costs; ongoing operational support; and strategic development costs. Happy calculating!

• Finally, there’s the apocalypse. Back in early 2006, Salesforce.com suffered from a couple of power outages that took them – and subsequently their customers – off-line for hours. In light of the development, TMCNet posted a decent pros-and-cons list of hosted vs. in-house CRM software.

Reacting to the near-catastrophic power failure, contributing editor David Sims opined then that hosted CRM was still too immature to meet long-term business needs.

To be fair, nothing like the large-scale event Salesforcers suffered almost a year-and-a-half ago has occurred again. However, certain suppositions of early 2006 still hold: Hosted CRMs can be limited in custom features, carry untold hidden costs in the medium term, and cost companies extra when waiting for the subcontracted service.

Ultimately, Sims gives a warning of “caveat emptor” in recommending the avoidance of long-term contracts.

Some may attempt to convince the prospective CRM system purchaser that he/she is buying basically foolproof stuff with a no-nonsense billing structure. Just recall what they say about that which sounds too good to be true. And caveat emptor.

Here at CRMchump, we’ll arbitrarily declare “Pharmaceutical Customer Relationship Management: Developing and Improving CRM” the study release of the week. This one comes out of Cutting Edge Information (great name there: 9.4 out of 10 on the CRMchump Slicker Than Thou Company Names Scale) and features as principal finding that “many pharmaceutical CRM initiatives suffer from the lack of a firm definition.”

A free summary and the report itself are now available at PharmaIndustryCRM.com; the study focuses on the inner workings and best practices of CRM initiatives at top pharmaceutical companies. In the teaser preceding release of the report, Cutting Edgers write that “for some companies, CRM primarily means a database which tracks campaign efforts, whereas at others CRM has flourished into a culture of sorts, which encompasses all the marketing efforts for a brand.”

Clarification, concludes the study, is needed. “Pharmaceutical Customer Relationship Management” contains budget and staffing metrics for thirteen different customer relationship management programs. Research Triangle Park, N.C.-based Cutting Edge Information is a research firm specializing in reportage for the pharmaceutical, biotechnology and medical devices industries.