Vertical Focus: Professional Services

Ask law firms, accounting firms, consultants, and financial services firms about CRM and most will tell you that the traditional CRM vendors are more focused on transaction-based customers than on billable clients. That's why many professional services firms, which typically revolve around billable hours, are looking to CRM providers offering vertical solutions. Companies like Interface Software are making specialized CRM software aimed at consultants, lawyers, financial advisors, and other professional services workers. Suite CRM players like Siebel Systems, PeopleSoft, and Pivotal also have vertical solutions. Nearly 50 percent of all financial and professional services companies in North America have deployed or are rolling out applications that help better manage the interactions they have with their customers, according to a report from Forrester Research. Of those without CRM 89 percent of all financial service firms have plans for implementing CRM. However, the majority of even the slowest movers are considering or piloting CRM projects, Forrester says. In the services world CRM is about sharing information and intelligence, rather than managing the sales process and tracking customers. And while CRM solutions facilitate the sharing of information, without the incentive of sales commissions or other compensation there is less motivation for professional services workers to actively use or contribute information to a CRM solution. Most view it as extra work on top of their already busy schedules, according to Erin Kinikin, vice president and research leader for enterprise applications with Giga/Forrester Research. And, because contacts and clients are the most valuable commodity at professional services firms, many associates are hesitant and protective about sharing the information that they feel gives them a leg up both in their company and against the competition. For example, in a law firm many clients who feel well served by an individual attorney have no qualms about leaving the firm along with the attorney--especially if the attorney is perceived as the "owner" of the relationship. However, if the relationships are not fully leveraged by the firm overall they are of little long-term value. That means CRM programs for professional services need to strike a delicate balance between privacy protection and sharing information across the company. "Many in service firms are hesitant to share information," Kinikin says. "They need to be convinced that they are likely to gain more information than they will lose control of." Kinikin adds that vendors need to show users how to "translate the fluffy relationship concept into business value." She claims that happens by connecting the CRM system to the delivery service system that tracks consulting hours. "There is just no point in entering information into two separate systems," she says. In addition, many services firms work on a project basis and want systems that support that model rather than just honing in on individual client data. That would also eliminate the entry of duplicate data, Kinikin says. The lack of a repetitive sales cycle coupled with an economic downturn means that like companies in many other industries professional services firms have to revisit their existing client bases for additional revenue. So these firms are looking to use CRM to create an uptick in cross-selling initiatives.