While high-end CRM vendors scramble to hedge their back-office integration bets, Interact Commerce Corporation is quietly working below the radar to cement its own total office strategy. Interact, which makes no bones about its desire to own CRM for the mid-market, has lined up vendor-supported CRM and financial integration with some of the top names in mid-market accounting.
This year to date, Interact has announced integration and marketing partnerships with five accounting software firms: Macola, Soloman, Sage, Affiliated Computer Services and Made2Manage. Between them, they represent well over 2 million users, and perhaps more importantly, more than 10,000 resellers. Although the details of each deal vary, each accounting vendor will offer both SalesLogix and the integration tools to their current and future customers. Integration with ACT!, as well as the emerging Interact.com e-business portal, is also covered.
Just as sales automation and customer support made for a logical CRM marriage (sales reps should think twice before pitching add-ons to a customer with a major outstanding support ticket), Simpson says that it's equally important for accounting and CRM to exchange information. If accounts receivable sees an open support ticket, "they shouldn't harass that customer who's over net 30," he says, and sales should think twice about making a deal with a customer who is chronically negligent about getting checks in the mail.
Moreover, Simpson says that answering accounting-related queries is actually a time-honored part of the sales job description, even if in the past reps have often been ill-equipped to provide answers. "Have their checks cleared? Have they been invoiced? These are the kinds of questions that salespeople are asked all the time out in the field," he says.
Clearly, Interact's partners are looking beyond the shrink-wrapped worlds of SalesLogix and ACT! "We're working closely with Interact because they have [Interact.com]," says Carol Kurinsky, vice president of marketing for Irvine, Calif.-based Sage. "We feel that's going to give us the opportunity to meet the needs of the future, and to tie in to e-business."
"Customers are looking for more than ERP, they want the total integration," says Rick Boyink, vice president of domestic sales for Marion, Ohio-based Macola, which specializes in accounting systems for distribution and manufacturing companies. For the 29-year-old firm, the Interact partnership is a first: While channel partners had developed connections between Macola and sales systems such as GoldMine, the SalesLogix integration will be the first available directly through the company. According to Boyink, signing on with Interact was simply a matter of staying competitive. "In new sites, CRM is very much a necessity."
Despite the well-publicized downturn in high-end ERP that has sent developers scrambling to add CRM functionality and integration, she doesn't believe that the pinch has impacted mid-range accounting in the same fashion. "They don't need CRM as much as CRM needs what's in the accounting system."
still, she says that the integration makes sound business sense for accounting providers. "They want to sell more, and the buzzword is to deal with outward-facing applications," says Laurie Orlov, research director of e-business applications at Forrester Research.
According to Simpson, while the CRM and accounting data will be fully interchangeable, in most cases he expects that while SalesLogix will gain a great deal of accounting functionality, the accounting systems will remain largely unchanged, because those applications were not designed to reflect a great deal of customer-facing information. "[Our partners] believe that the accounts receivable person will be looking at a SalesLogix client for 70 to 80 percent of the day," switching over to the core accounting system only to perform certain special tasks, such as requesting a check, he says. "That was surprising to me--how amenable they were to just running SalesLogix," rather than insisting that their own product get the larger "eyeball share" among joint customers.
In addition to requiring that each partner train a number of its inside sales and implementation staff on SalesLogix, Interact is offering discounted training to VARs in the accounting channels. That's a bargain at any price for Interact, according to Forrester's Orlov. "Anybody that provides them with a new channel of already-running customers and a ready sales force is worth it."
Sage alone has at least 8,000 individuals in its VAR program. Although there are already a number of firms that specialize in both SalesLogix and an accounting system from a partner firm, clearly not every accounting specialist is cut out to enter the CRM space overnight. "Ten to 20 percent are viable CRM vendors, or at least would be willing to partner with one of our VARs," says Simpson. Nonetheless, Simpson points out that simply converting 10 percent of partner VARs to sell SalesLogix would triple the size of Interact's global channel sales force.
Simpson says the partnerships are about providing a more comprehensive CRM environment to midsize enterprises, and not a ploy for incremental revenue from installed customers. "If they already have SalesLogix, we don't have a lot of revenue to gain if they go out and do the integration post-sale," he says. "The integration really isn't an expensive piece, but we do believe it's a huge differentiation for new customers."
Many of the integration systems are still in development by the respective back-office providers, so the precise cost of a SalesLogix accounting connection is not available. Macola's Boyink projected that an average Macola customer could expect to spend "under $10,000," not counting license fees for SalesLogix itself, to integrate the two environments. Macola is testing the connection on its own internal 120-plus seat SalesLogix system.
Because of the traditionally strong loyalty between accounting providers and customers, Interact may be trying to inherit the strong affection between its new partners and their clients to earn the same level of dedication. Forrester's Orlov says that isn't a sound strategy. "There's not much of a lock-in," she warns. "They can still toss out the CRM integration, or bite the bullet and do the custom integration [with another CRM system.]"
Simpson says that Interact appreciates that it needs to deliver to remain part of the equation. Whereas companies can bear the inefficiencies of foregoing CRM or transitioning to another system, "Accounting is like oxygen, you need it to survive," he admits. But he believes that his company has hit on the right partners to provide Interact's goal, which Simpson calls "front-office, back-office and Web-office integration."