The 2014 CRM Service Leaders
Selecting customer service technology can be a daunting task. Technology buyers have to consider their customers' needs, their company's needs, and how well a vendor can meet those needs. What makes the selection process even more difficult—particularly this year—is that many of the leading customer service vendors have made great technological strides in social media, mobile technology, big data, virtual assistants, the cloud, analytics, and other areas. This is why we bring you our annual Service Awards issue (now in its 11th year).
As always, we never assume to know each of our readers' specific customer service needs, as they vary widely. Therefore, we've taken a broad view of the major vendors in eight customer service categories and asked our judges to evaluate and score the companies based on the following important criteria: reputation for customer satisfaction, depth of functionality or services, company direction, and technology costs over a five-year period.
It's a pretty rigorous process that requires a lot of researching and reporting. Once the numbers are in, we enter them into our proprietary scoring formula and come up with our esteemed list of Service Leaders. It is our hope that, combined with your own due diligence, our Service Awards issue can help you make the right customer service technology purchases for your company.
For the 11th year in a row, the editors of CRM magazine would like to offer their deepest gratitude to those who participated, in varying degrees, in evaluating the candidates for our Service Awards. This issue, and the awards themselves, would not be possible without the generous contributions of the following judges, commenters, assessors, and raters: Leslie Ament, senior vice president and principal analyst, Hypatia Research; Dick Bucci, founder and president, Pelorus Associates; Donna Fluss, founder and president, DMG Consulting; Paul Greenberg, president, The 56 Group; Johan Jacobs, independent consultant; Vicki Jenkins, CMS outsourcing consultant, NelsonHall; Esteban Kolsky, founder and principal analyst, ThinkJar; Mitch Kramer, senior vice president and analyst, Patricia Seybold Group; Ken Landoline, principal analyst, Current Analysis; Kate Leggett, principal analyst, Forrester Research; Michael Maoz, vice president and distinguished analyst, Gartner Research; Sheila McGee-Smith, principal analyst, McGee-Smith Analytics; John Ragsdale, vice president of technology research, Technology Services Industry Association; Peter Ryan, principal analyst, Ovum; TJ Singh, research vice president, Gartner Research; Paul Stockford, chief analyst, Saddletree Research; Ray Wang, principal analyst and founder, Constellation Research; Rebecca Wettemann, vice president, Nucleus Research.
CATEGORIES AND CRITERIA CRM magazine's 11th annual Service Awards names one winner and three leaders (listed alphabetically) in each of eight categories, using a proprietary selection formula. The overall award rating is based on a composite score of company revenue and analyst ratings for deployment costs, customer satisfaction, depth of functionality (or services, in the case of outsourcing), and company direction. (These ratings are based on a five-point scale, with 5 being the highest.) In addition, each category cites one "one to watch"—companies deemed worth tracking for their potential to appear on that leaderboard in the future.
Customer Case Management
As customers turn to more channels to reach companies, companies providing customer case management solutions have struggled to accommodate them. According to a "Social Media for Support" survey conducted by John Ragsdale, vice president of technology research for the Technology Services Industry Association (TSIA), only one third of companies currently create incidents for issues reported via social media. "We need to see more incident management platforms consolidate to offer multiple channels, but we also need more APIs provided to plug together common knowledge management and multichannel platforms," Ragsdale says.
Newer cloud tools may be easier to use, but they're also lightweight. "They don't support complex entitlements or automated renewals," Ragsdale says, "without major customizations or bolting on a third-party product—a big stumbling block for B2B support." These clients need automated dashboards that can handle customers with multiple products with different service-level agreements (SLAs), he says. He envisions analytics information to predict renewals, as well as the ability for an employee to see which SLAs are soon to expire.
Oracle's highest scores were for depth of functionality; it received an overall score of 4.6. "Oracle's RightNow capabilities are a strong competitor in the marketplace, particularly for firms wanting to streamline service and support to enable agents to handle multiple support channels," Rebecca Wettemann, vice president of Nucleus Research, says. Meanwhile, "[Oracle] Siebel remains the gold standard for CRM, with deep vertical-specific versions and infinite flexibility. The upfront costs may be high compared to a cloud tool, but the customization and integration capabilities allow companies to embrace innovative processes, not dumb them down due to system inflexibility," Ragsdale explains. Michael Maoz, vice president and Gartner distinguished analyst, voices one caveat. The "cloud is not dominant in new sales for case management," he notes, despite the growing market preference for it.
For last year's Service Awards, Wettemann identified Parature as a "good acquisition target"; less than a year later, Microsoft snapped up the fast-growing company. "Parature was the first multichannel/incident management platform to offer a fully integrated customer community and social media monitoring," Ragsdale says, anticipating that it "will be a big asset to Microsoft Dynamics." Parature has solid scores across the board, reflecting the company's excellence at serving midmarket customers feature-rich customer case management at a low cost, according to analysts.
Salesforce.com took a step down the podium this year, but remains a leader. It had the highest score for company direction (4.6) and a pair of 3.9s, one each for customer satisfaction and depth of functionality. Salesforce.com benefits from being part of a larger CRM ecosystem, with a "platform vision that takes it to a usage far beyond traditional CRM," says Kate Leggett, principal analyst at Forrester Research. However, in this specific category, Maoz cautions that "Salesforce.com is not proven in most parts of the world as a scalable B2C case management system." Ragsdale notes that it's "still missing key capabilities for success in the B2B world, including complex entitlement support and automated contract renewals." Its lowest score, 3.3, was in the cost category. Salesforce.com is "getting expensive over five years," notes Paul Greenberg, president of The 56 Group. Still, Salesforce.com is "the top installed incident management solution for TSIA members," Ragsdale reports.
Microsoft Dynamics CRM grabbed the top spot from Salesforce.com, which led the market the last two years. The acquisition of Parature was on the minds of many of the analysts, who gave Microsoft Dynamics a score of 4.4 for company direction. The company is "showing up on short lists for large enterprise support deals for the first time," Ragsdale says. "The acquisition of Parature shows Microsoft is taking service seriously, instead of investing only in sales and marketing, as most cloud CRM vendors tend to do," he says. Prior to the acquisition, Leggett noted that Microsoft Dynamics CRM was "missing core multichannel capabilities and knowledge management, which it addresses with partnerships [Moxie and Parature]." Parature will fill in some of those gaps in capabilities. It's also "one of the least expensive solutions in the marketplace," Leggett says.
ONE TO WATCH
As a large, established company, SAP has had "to live down legacy customer complaints," Greenberg says, "though to its credit, it actively interacts with customers more than almost any other company. Its biggest problem is being unclear on its direction." That direction may come in the form of SAP HANA,"and being able to leverage big data for more predictive, proactive customer service," states Vicki Jenkins, a customer management services outsourcing analyst at NelsonHall. "W've really only seen the tip of the iceberg."
Contact Center Infrastructure
Not surprisingly, vendors of cloud-based contact center solutions this year showed the most momentum, given how important cloud capabilities have become in the current economic climate. Ovum, in its annual Decision Matrix for contact center solutions, estimated that 10 percent of all U.S. call center agent seats are now provisioned by hosted service providers, and expects this number to more than double to 23 percent by 2018. In addition to cost savings, companies cited simplified deployment, scalability, and access to the latest technology upgrades as reasons for choosing the cloud.
In 2013, companies also showed a continued emphasis on purchasing much—if not all—of their contact center infrastructure from a single source in the pursuit of easier and enduring integration. In this environment, leading contact center infrastructure vendors offering complete portfolios of solutions, comprising their own products and those of partners, are being favored over those that offer piecemeal solutions, according to Gartner.
While the industry will likely continue to struggle with multichannel integration, Ray Wang, principal analyst at Constellation Research, says a broader push needs to happen: "The key area will be beefing up analytics—yes, still analytics after twenty years of this being a problem," he says. "Whoever gets this right will win key deals in 2014."
Aspect Software, a newcomer to the leaderboard and a company whose main focus has been on cloud-based deployments, put up strong numbers in depth of functionality (4.1) and customer satisfaction (4.2), but its greatest asset was its company direction. It scored a 4.3 in that area, primarily on the strength of a number of new appointments at the senior executive level. "Aspect's new management team helped breathe new vitality into what had been a declining brand," says Sheila McGee-Smith, principal analyst at McGee-Smith Analytics.
The company was bolstered by its summer acquisition of Voxeo and the release of Zipwire, a cloud-based contact center offering. "Aspect has embraced its contact center roots and is doing all the right things," says Paul Stockford, principal analyst at Saddletree Research.
InContact, a cloud-based solutions provider and newcomer to the leaderboard, earned scores of 4.0 in company direction, customer satisfaction, and cost. Hot off a number of sizable customer wins and key partnerships, this is a company on the move. "InContact is one of the ones to watch in 2014," McGee-Smith says. "Solid product improvement, coupled with strong reseller agreements with [companies such as] Verizon and Unify, have been key to its growth."
Interactive Intelligence has grown quickly to a point where it can now effectively compete with and win out over many larger rivals. "From being a supplier of systems with basic capabilities to [providing more robust solutions for] the midmarket, they are moving effectively in both directions to challenge the top companies in this segment," Stockford says. The company topped all competitors in its scores for customer satisfaction (4.3) and cost (4.2). "They have an aggressive pricing structure and a strong dedication to their customer base," Stockford says.
"Company direction is where Interactive Intelligence really shines," McGee-Smith adds. "The same strategy has been articulated and followed for several years, giving customers and prospects confidence when selecting this solution."
Cisco Systems continues to impress analysts this year. The company, Stockford says, "is the gold standard in infrastructure," and it has the numbers to back that up. It led all competitors, with a score of 4.4, in depth of functionality, and pulled in scores of 4.2 in company direction and customer satisfaction. "They have a fully developed contact center strategy that they are effectively executing upon," Stockford says.
And things are only going to get better as the company further develops and markets its Packaged Contact Center Enterprise offering, McGee-Smith adds. Partner and market acceptance of that solution set have already "helped deliver strong performance," she says.
ONE TO WATCH
Genesys Telecommunications Laboratories slid off the leaderboard for the first time in many years. The company's rankings dipped considerably in customer satisfaction and company direction, but its depth of functionality remains unparalleled (with a score of 4.5). "Genesys' customer-facing portfolio offerings are among the broadest," observes Leslie Ament, senior vice president and principal analyst at Hypatia Research. But analysts remain cautious about the company as it continues to distance itself from Alcatel-Lucent. "The transition was rough in early 2013, but it seemed to hit its stride by [the fourth quarter]," Wang says. A big part of that transition was its recent acquisition efforts—the company acquired Angel, SoundBite Communications, and Echopass—something that shows an aggressive move to the cloud and promise as well.