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7 Named Leaders in Forrester Wave of CRM Suites for Midsize Organizations
The Forrester Wave: CRM Suites for Midsized Organizations '10: In his annual evaluation, analyst Bill Band identifies the top-performing options for midmarket CRM.
Posted Jun 30, 2010
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Today's midsize organizations have everything but the proverbial kitchen sink to choose from when it comes to CRM solutions, according to the latest marketplace report from Forrester Research. At least 19 different CRM products are viable options for that segment of the marketplace, according to this year's Forrester Wave: CRM Suites for Midsized Organizations report — though those products come from only 13 different vendors.

Bill Band, a Forrester vice president and principal analyst and author of the report, says the midmarket simply has more choice in its available selections, and the software comes in a number of shapes, sizes, and flavors. One change this year, he notes, is that the midmarket is displaying renewed interest in CRM investments. Projects that were deferred or canceled due to economic conditions in 2009 are largely being built back up — with particularly burgeoning demand for easy-to-implement software. "Battered by two years of recession," he writes in the report, "buyers of customer management solutions have become extremely value-conscious." 

Forrester assembles its Wave diagram by assessing the relative strengths of each vendor's strategy and current offering, separating the players into sections labeled Leaders, Strong Performers, Contenders, and Risky Bets. (The graphic also reflects each vendor's market presence, but for informational purposes only; that value has no impact on the vendor's placement in the Wave. According to this year's Wave, the three vendors with the deepest market penetration among midsize organizations are, in alphabetical order, Maximizer Software, Microsoft, and Salesforce.com.) 

The Forrester report clearly establishes all 19 products as potential purchases. All of the 2010 report's 19 products — four of which, or more than 20 percent, are Oracle offerings — made it into the top two Waves. Here's the breakdown, with each grouping listed in descending order of "strength of current offering":

Leaders:

  • Microsoft — though the strength of its current offering outpaced the field, Microsoft was second to Salesforce.com in terms of strength of strategy.
  • Oracle CRM On Demand
  • CDC Software
  • SAP Business All-in-One — SAP's midmarket offering has the distinction of being the only CRM product included in this report but not also appearing in the companion Forrester Wave, CRM Suites for Large Organizations. 
  • Salesforce.com
  • RightNow Technologies
  • SugarCRM

On the border between Leaders and Strong Performers:

  • Maximizer Software — The report suggest maximizer is "appropriate for smaller firms and divisions of large organizations seeking an on-premises CRM suite application with a low price tag.
  • Sage CRM — Trailing several of the Strong Performers in terms of strength of solution, only Forrester's high estimation of Sage CRM's strength of strategy (and the value of integration with Sage's back-office offerings) nudged this product onto the crest between the two waves.

Strong Performers:

  • Oracle Siebel CRM
  • Sage SalesLogix
  • Oracle E-Business Suite CRM<
  • SAP CRM
  • NetSuite
  • Oracle PeopleSoft Enterprise CRM
  • Pegasystems / Chordiant Software — though listed separately in the Wave, Band notes that Pegasystems' April 2010 acquisition of Chordiant "will result in an even-more-robust process-centric solution." That's likely good news for Chordiant, considering the firm ranked dead last in the report according to its strength in strategy.
  • Sword Ciboodle
  • FrontRange Solutions — ironically enough, despite coming in last among the 19 products included in the report in terms of the strength of its solution, the CRM stalwart's rating for strength of strategy outpaced all other Strong Performers.

Band highlights five key points regarding vendor activity and placement on the Wave:

1. Fast time-to-deployment and ease of use have become a must-haves for many organizations.
With that goal, CDC, Microsoft, Oracle CRM On Demand, RightNow Technologies, and Salesforce.com gained ground, Band says. In particular, he notes, RightNow and Salesforce.com are much faster and easier to deploy than traditional on-premises offerings. Oracle CRM On Demand is also gaining traction in the market as a SaaS companion to Oracle Siebel, Band points out. Another key trend is usability. Microsoft gets points for this with its integration with Outlook and other pieces of the Microsoft technology tack. CDC's Pivotal, which also uses Microsoft technology, "is highly flexible and adaptable to complex use cases," Band says.

2. Midsize organizations can find solutions at lower price points. 
Band singles out several offerings that have a wide range of CRM functionalities at lower price points than some of the market leaders:

  • FrontRange Solutions;
  • Maximizer Software;
  • NetSuite;
  • Sage's SageCRM and Sage SalesLogix;
  • CRM functionality in SAP Business-All-in-One; and
  • SugarCRM.

Although the prices are low and the breadth wide, Band warns that these companies come up short in terms of depth.

3. The most complete solutions remain costly.
Oracle Siebel CRM and SAP CRM are known as industry heavyweights for a reason. They have deep solutions, but are expensive. "Both vendors have moved to address key complaints: poor usability, high cost, and long implementation times that are not suitable to the needs of midsized organizations," Band says. At least recognizing reputations as pricey and tough to implement, both SAP and Oracle are working to lower total cost of ownership (TCO) by introducing integrations to other product families and offering "rapid implementation" strategies, Band says.

4. ERP customers can have their CRM— and eat it, too.
Band says that Oracle EBS CRM and Oracle PeopleSoft CRM are good options for ERP customers. Both solutions are fairly robust in terms of marketing, sales, and firled service, but lack in areas of customer data manegemnt and e-commerce. PeopleSoft customers will find the product offers great functionality and "strong integration benefits," according to Band.

5. CRM befriends BPM.
"As enterprises begin to understand the importance of truly integrating end-to-end customer-facing processes from front office to back office, they turn to solutions with native business process management (BPM) capabilities that can support highly unique — and flexible — process flows," Band writes. "This is particularly important in supporting and integrating multichannnel customer service processes that cut across functional silos." Band cites the April 2010 acquisition of Chordiant by Pegasystems as evidence of this cross-process synergy, and also notes that Sword Ciboodle has pushed into the CRM market with a focus on the intersection of business process modeling, customer service, and customer interaction management. 

The Wave is only a starting point for midsize organizations looking at CRM suites, Band insists. In order to be included in the evaluation, Forrester requires that CRM vendors

  • offer a multifunctional CRM applications suite.
  • offer solutions for midmarket organizations or divisions of large enterprises.
  • offer solutions suitable for large organizations with complex requirements.
  • provide a solution targeted to multiple industries, and 
  • have a product now in general release and in use by customers.

News relevant to the customer relationship management industry is posted several times a day on destinationCRM.com, in addition to the news section Insight that appears every month in the pages of CRM magazine.

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