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CRM Simplified
New technologies, from Web services to wireless broadband connections, are opening doors that previously had been bolted shut.
Posted May 26, 2004
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The next phase of CRM technology may be more accessible than the current one has been, industry leaders told attendees at the DCI CRM Conference & Exposition in New York City on Tuesday. Several conference speakers devoted their presentations to discussing how new CRM technologies are lowering costs and raising efficiency--not just when acquiring and installing the systems, but also when using them, maintaining them, and maximizing their use. Barton Goldenberg, founder and president of consultancy ISM and columnist for CRM magazine, delivered an address at the opening of the conference. His "CRM State of the Union," enumerated the ways in which the "proven impact" of CRM in its current form is poised to lead to new options in its next. Software fees and implementation costs are down, Goldenberg said, and success stories abound. New technologies, from Web services to wireless broadband connections, are opening doors that previously had been bolted shut. But most important, Goldenberg said, is the fact that executives "have made the shift from 'It's all about technology,' to 'It's not just about technology.'" That represents progress, he said, adding that the reality is, technology is the least important of three components, with "people" and "processes" comprising 80 percent of the proper approach to CRM. The shrinking price point of CRM is the most captivating change, Goldenberg told the crowd. "If you're paying more than $600 [per seat], you're probably paying too much," he said. "Anything over $1,000 is just wrong. You got a bad deal." Goldenberg went so far as to predict that the price will fall "below $500 in the next few years--and the [CRM software] companies can still make a profit. We're not putting them out of business at that point." In other areas, however, cost will stay constant. Jonathan Wu, for example, an analytics expert and senior principal at consultancy Knightsbridge Solutions, used a discussion on analytics and business intelligence in part to dispel the notion that their increased use would reduce costs or personnel. A focus on analytics won't reduce headcount, he said; instead, "skill sets would change. Now that the data is available, additional business questions pop up," and employees will at last be free to address them.
When deploying BI technology, Wu said, companies have to ask a series of questions: What data is truly needed, who needs to see what portion of it, and how should it be delivered to them? Furthermore, Wu said, the right pieces of a data strategy are "the building blocks of technology and capability." Only by properly addressing those can BI lead to intelligent businesses--and by extension, successful CRM implementations. Another area allowing for improved results will be in the next generation of CRM technologies, according to David Schmaier, Siebel Systems' executive vice president. The next generation of CRM, Schmaier said, will be faster in performance, easier to deploy and use, more affordable, smarter in content, and built on an open architecture to allow for interoperability. The increased flexibility will finally allow CRM vendors to provide "different kinds of CRM for different kinds of situations," Schmaier said. He added that small and midsize businesses may be able to make use of the hosted version of CRM, but on a subscription basis the real future is in the hybrid model of implementation, which provides whatever form of the technology a company needs, in whatever circumstance is required. One opportunity for the hosted model in an on-premises deployment, he noted, would be in a company's service bureau. With hosted CRM an organization "can run a call center in 'the cloud,' he said, referring to the nebulous space between its installed infrastructure and the Internet. Instead of always relying on hosted CRM, he said, a company with that flexibility can use such a setup "to handle seasonal overflow." But new opportunities aren't the only driving force. Wu predicts a sea change in how companies are approaching CRM data in terms of compliance with government regulations. "There used to be this carrot," he says. "Undertaking these initiatives"--data warehousing and the like--"meant that significant competitive advantages would occur. Now, there's also this stick that's starting to rattle behind them." The threat of compliance regulations, such as Sarbanes-Oxley, Basel II, and HIPAA, is forcing companies to reprioritize their CRM efforts. The trick is to avoid whiplash in the process. "You can't go from green-bar reporting [on paper] to executive dashboards overnight," Wu says.
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