What's Hot, What's Not, and What's Next

The CRM industry continues to be anything but boring--mergers and acquisitions, innovative product announcements, and advances in technology platforms abound. Several major trends in 2005 are worth making note of. Here, some highlights. What's Hot: SaaS The accelerating interest in Software as a Service (SaaS) caught me off guard. In assessing the preliminary results of our most recent sales effectiveness marketplace study, it is clear that Salesforce.com is the SaaS solution provider generating the most attention in the CRM suite marketplace. The company is not alone, as we also found increased buying of NetSuite, Entellium, RightNow, and Siebel OnDemand SaaS offerings. There have been recent SaaS announcements by CRM suite vendors like Sage Software, Microsoft, and Maximizer, as well as other types of CRM players (Involve Technology in the sales knowledge space, Centive Systems in compensation management, AutoTask for customer service). The initial conventional wisdom was that SaaS would be a solid model to support SMBs, but we're seeing 1,000-plus-seat deals with companies like ADP, Heartland, Avnet, Staples, and Kaiser. These demonstrate that SaaS may also have a place in the larger enterprise world; based on these trends, 2006 should see even more firms choose this alternative to meet their CRM needs. What's Not: Siebel, the Company We witnessed a major turning point in the CRM world with Oracle's acquisition of Siebel Systems. While the products will continue to live on in some form, the firm that really made CRM a marketplace will fade away. The writing started to appear on the wall in 2004, when user satisfaction ratings plummeted to all-time lows for Siebel during CSO Insights' benchmarking efforts. It is to be hoped that CRM software vendors have taken the lesson that the vision of a brave new world may get you sales to heart, but long-term success depends on delivering that promise. (Will someone write the story of how Siebel went from the fastest growing firm in the history of the enterprise software marketplace to an asterisk in the Silicon Valley history book?) What's Next: Knowledge Sharing and Analytics Looking at ways to get information from CRM systems versus focusing on just putting data into them is an emerging trend sparking a lot of interest. It will come in two forms: knowledge sharing and analytics. Knowledge sharing is about collecting and disseminating best practices between marketing, sales, and support teams. These can be as simple as internal blogs or can take the form of advanced knowledge automation systems. As CRM systems become the application in which front-office professionals live during their working hours, improving collaboration through these systems via knowledge sharing will become a key use of the technology. Mining insights into service levels, marketing program ROIs, forecasting accuracy, and the like will be the focus of continued advances in CRM analytics capabilities. As companies now center their attention on getting insights out of all the data they have input into CRM systems over the year, the ability to make better business decisions will become easier for many firms. So even as a veteran contributor to CRM magazine, I continue to get excited to see what is next. As Christopher Lockhead, an early pioneer into the CRM space, reminds us, watching this marketplace is always an adventure. Jim Dickie is a partner with CSO Insights, a research firm that specializes in benchmarking CRM and sales effectiveness initiatives. He can be reached at jim.dickie@csoinsights.com