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It's the Customer, Stupid
Confident Genesys CEO issues ROI challenge
For the rest of the July 2002 issue of CRM magazine please click here
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CRM is all about the customer, so it is no wonder that Genesys Telecommunications Laboratories Inc.'s recent annual Gforce user conference was on customers. "You are all my bosses. You pay for my house, my car, my salary, and my kid's school. Our customers are the most important thing," Genesys Chief Executive and President Ad Nederlof told the more than 1,000 attendees. "We all have to accept that the value of a company is no longer two times revenue, but the company's customers. The best customer experience becomes the standard. Customer care is the most important evaluation of a company," he said. "The customer is king," added Ray Lane, a general partner at the venture capital firm of Kleiner Perkins Caufield & Byers, and former chief operating officer at Oracle Corp., who delivered a keynote speech at the Gforce conference. This battle cry is more than just lip service. Nederlof is also willing to put his money where his mouth is, and plans to show just how important customers are by using ROI as a sales tool. Genesys will have a third-party, independent company create an ROI model for a customer, and if the customer gets a better ROI than expected, the customer will pay Genesys a premium. If the ROI is less than expected, Genesys will give a discount. "Yes it's a risk, but with commitment there is always risk," Nederlof said. Sharon Ward, vice president of Enterprise Business Applications for market researcher Hurwitz Group, based in Newton, Mass., said the idea is brilliant and that Genesys is putting real skin in the game. "There is so much distrust of the software vendors now, because of years of stretching the truth about the kinds of results to expect," Ward said. "Companies are weary of promises, and with the harsh economic climate companies are not making an investment without clear ROI and they are hesitant to rely on the companies for that information." Using ROI as a sale tool is not a new concept, but Genesys is taking a step further to give businesses a feeling of comfort that they are entering into more of a partnership agreement, Ward said. "This goes a long way to generate trust and a feeling of partnership with the vendor. That is likely to give companies the confidence to move forward faster," she said.
Nederlof also said there is a huge gap between how C-level (CEO, CTO, CIO, etc.) and lower-level managers feel about ROI. "The higher you are on the corporate ladder, the more it feels like it's all about the 'I.' While the lower-level people see more of the 'R.'" Instead, companies should focus on what Nederlof calls the four Rs: relationships with customers, reputation, rewards, and return. If you do well at the relationship part, the return will follow, he said. James Shoal, vice president of IT at Charles Schwab, agreed. Charles Schwab began implementing Genesys contact center solutions in 1994. The solutions have shaved time off calls and have Schwab's more than 10,000 agents at 285 call centers provide better service for customers, which Shoal thinks is a great return on investment. The contact center solutions more than paid for itself just by handling miscalls, he said. Similarly, Nordea, the largest financial services group in the Scandanavian region, with 9.7 million personal customers, 1 million corporate customers, and 500 large corporate customers, implemented Genesys' contact center solution across its enterprise and saved $125,000 a month. Over a one-year period between January 2001 and January 2002, the company saw a $1.3 million bottom line savings. The worldwide contact center market is expected to reach more than $90 billion in 2006, growing 20 percent per year, according to market researcher IDC. --Lisa Picarille
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