Logo
BodyBGTop
Intelligent CRM Requires Business Intelligence
Gartner Business Intelligence Summit '08: The need for better CRM is one of the factors driving growth in the BI marketplace.
Posted Apr 1, 2008
Page 1



CHICAGO -- Successful CRM initiatives depend on the adoption of a balanced set of business intelligence (BI) metrics, according to Gareth Herschel, a research director at Gartner. These metrics should comprise financial, employee, and business processes, as well as customer satisfaction measurements that highlight elements leading to better enterprise performance management, Herschel told an audience at the Gartner Business Intelligence Summit here today.

The need for better CRM is one of the factors driving growth in BI, according to Gartner estimates that project the worldwide BI market will reach $5.8 billion in 2008, an 11.2 percent increase over last year. Gartner further forecasts that worldwide BI platform revenue will increase at a compound annual growth rate of 8.1 percent over the next several years, reaching $7.7 billion in 2012. In fact, BI was the number-one technology priority in 2008, according to a worldwide survey of 1,500 CIOs by Gartner Executive Programs. That level of commitment is one reason the research firm expects BI revenue to perform better during an economic downturn than some other technologies might.

For companies to derive any meaningful value out of BI, however, they need to focus on metrics that actually drive transformation, Herschel said. "Unless something is changed, you can't say that business intelligence has provided any ROI for the organization." On the bright side, he added, the cost of creating and delivering metrics continues to fall, so some organizations are beginning to measure an increasing amount of detail.

Unfortunately, many -- and in some instances, most -- of those metrics don't measure the specific items that will lead to enhanced performance, Herschel said. All of the data "noise" also makes it hard to focus on truly meaningful BI, so he suggested that enterprises use BI applications that can highlight information that will lead to meaningful change in company performance. Rather than just running reports with reams of information, Herschel recommended using reports with "traffic lights" or other signals that alert the reader to the handful or so of the most meaningful data points.

"You won't find abnormal behavior in a [simple] report," Herschel said, adding that, in order to determine the most meaningful BI metrics, finance, marketing, and other stakeholders must work together. For example, though the concept of CRM has existed for more than a decade, few companies or industries have seen consistent improvements in customer satisfaction. Additionally, while some companies have successfully used CRM initiatives to reduce customer churn, many of these efforts have been passive, which is less expensive than more proactive customer retention efforts. These passive efforts have done nothing more than retain dissatisfied customers, according to Herschel. "A happy customer is much more profitable for the company," he told the audience.

So Herschel suggested that companies focus on doing things right, rather than on retaining almost-lost customers. Flexible policies are key, he said: Why force a profitable customer to talk to live agents and threaten to close his account before waiving a small fee? While waiving the fee following a drawn-out procedure might still save the customer account, it would be better to waive it much earlier in the process: That would be less costly for the company (less time used talking to live agents) and result in a much less dissatisfied customer. Business intelligence can help companies assess those situations in order to derive positive outcomes.


Related articles:

Proper Measurements Lead to Improved CRM
Gartner Business Intelligence Summit '07: But too many measurements -- or too few -- mean failed CRM, according to an industry analyst.

BI Will Be Pervasive
Gartner Business Intelligence Summit '06: Analysts predict more business intelligence usage throughout enterprises, with increasing focus on seamless deployment into strategy and business processes.

The Coming of BI Competency Centers
Gartner Business Intelligence Summit '05: Many organizations have a long way to go before they achieve true business intelligence success.

MicroStrategy and Microsoft Move Up in Gartner's BI Magic Quadrant
2008: The research firm's assessment of the business intelligence sector shows the two vendors joining SAS Institute, Oracle, Cognos, and Business Objects in the top segment.

SAS Tops Gartner's BI Magic Quadrant
2007: The market will experience more growth as the technology includes more users within an organization while application and suite providers enhance their own offerings.

Gartner Releases Its BI Magic Quadrant
2006: The analyst firm expects the business intelligence market to experience sustained growth as the technology includes more users within an organization.

Feature: The 2007 Market Awards: Business Intelligence
As the market for business intelligence matures and users become more sophisticated, more companies are buying into BI.

Feature: The BI Tools Bonanza
Simple BI tools have been developed over the past three years, quietly accelerating marketers' ability to see and hear.

BI Tools Market Shows Continued Growth
A study by IDC reveals that BI software is both popular and necessary; Business Objects and SAS continue to lead the field.

The Best Companies Do Better with BI
Strong companies get more out of business intelligence than weaker ones do.

Business Intelligence's Intelligent Leap
Not every step toward a best-in-class BI deployment is going to be a smooth transition.

Viewpoint: 10 Ways to Improve Your Business Intelligence
Friendly suggestions to help revitalize and maximize your company's BI strategy.

Front Office: You Drive Intelligence
I've noticed an unfortunate eagerness to view business intelligence as a business panacea.

Business Objects Leads the Pack in BI ROI
An evaluation observes that standardization is growing as a trend, but that dashboards are driving BI adoption.

Page 1
To contact the editors, please email editor@destinationCRM.com
Every month, CRM magazine covers the customer relationship management industry and beyond. To subscribe, please visit http://www.destinationCRM.com/subscribe/.
Related Articles
Information Builders Summit '08: Analysts weigh in on the BI industry and a changing market.
Information Builders Summit '08: Information Builders strengthens its WebFOCUS platform, delivering on cost-effectiveness and demands for analytics.
New research shows that business intelligence tools have a higher adoption rate among small businesses than their medium-sized counterparts.
On-demand business intelligence may make it easier to get insight whether you're big or small.
SAS Institute takes the crown for the fourth year running as business intelligence evolves from reporting, analytics, and dashboards into a wealth of complexity.
Gartner Business Intelligence Summit '08: By 2009, 90 percent of mission-critical projects will depend on data warehouse information to drive higher revenues or lower costs.
Magic Quadrant '07: The market will experience more growth as the technology includes more users within an organization while application and suite providers enhance their own offerings.
Magic Quadrant '08: The research firm's assessment of the business intelligence sector shows the two vendors joining SAS Institute, Oracle, Cognos, and Business Objects in the top segment.
Forrester Wave '08: The latest report on enterprise business intelligence shows SAP's BusinessObjects property in a tight race with three other respected vendors.
A recent Gartner report bemoans the fact that "companies tend to view business intelligence as [just] a bunch of technology."
The research giant unveils five predictions for business intelligence in 2009.
Gartner unveils its 2009 "Cool Vendors" in business intelligence and performance management.
Magic Quadrant for Business Intelligence '10: Smaller vendors gain traction, but 75 percent of the market remains controlled by the top five vendors, with Oracle on top yet again.
 
Search
Popular Articles
 

BodyBGRight
Home | Get CRM Magazine | CRM eWeekly | CRM Topic Centers | CRM Industry Solutions | CRM News | Viewpoints | Web Events | Events Calendar
DestinationCRM.com RSS Feeds RSS Feeds | About destinationCRM | Advertise | Getting Covered | Report Problems | Contact Us