Call it the dark side of customer relationship management. Oracle has unveiled the newest application for its CRM suite: a collections module. It's all part of Oracle's drive to leverage its enterprise software legacy and close the gap between back-end financials and customer-facing e-business applications, say industry watchers.
Oracle Collections will enable a company to manage the entire collections lifecycle, from interacting with customers to managing cash collection. The software also helps companies chart a collections strategy and even automatically identifies delinquent customers. This means a company may plan various collections routes for different customers, depending on past payment history. Not surprisingly, Oracle Collections is closely tied to Oracle Accounts Receivable, in order to track outstanding debt.
But collections sounds more like a financials software add-on than a CRM module. Or is it? Juliette Sultan, vice president of CRM product strategy at Oracle, contends collection is more than just collecting cash -- it's about improving customer satisfaction. "Why is the customer delinquent?" asks Sultan. "Maybe an outstanding service request is making them delinquent or maybe they're delinquent because they just placed a big order or maybe they're delinquent because they're just late payers. Do you want to handle them all the same? In the end, you want them to pay and keep ordering from you... that's what makes collections a CRM application." Oracle Collections is available today through CD-ROMs and as a hosted service.
News of a collections module making its way into the CRM arena came as little surprise to industry watchers; Oracle also has a contracts-management module in its CRM suite. "With the introduction of Oracle Collections, Oracle is making another significant advancement in integrating CRM and ERP process," says Sharon Ward, vice president of enterprise applications at market researcher Hurwitz Group. Indeed, it's the latest trend in the shifting CRM landscape. "It's all part of building out the 360 degree view of the customer, and this means consolidating the front office and back office," says Sheryl Kingstone, CRM analyst at the Yankee Group. "The lines are blurring across the whole value chain."
Certainly, merging SCM, ERP and CRM applications bodes well for established enterprise software vendors that can leverage existing core competencies and customer base. But this doesn't necessarily spell doom for CRM vendors and even point-solution providers, says Larry Goldman, vice president of customer solutions at Braun Consulting. It all comes down to whether a software vendor gives its customers a competitive advantage, he says.
"For non-competitive advantage modules, it may make sense to install a suite to drive down integration costs, user training, and IT training," Goldman says. "But for systems that add to a firm's competitive advantage, like marketing systems, you may not want to compromise on functionality and [instead] install the best in class."
Tom Kaneshige also writes for Line56.com