Best of Breed
Even companies that long for stem-to-stern integration, therefore, often begin with a tactical deployment of CRM and tie it to other systems with third-party software. At Excel Communications Inc., for example, Joe Pignatello, vice president of IT strategy and architecture, says the company had two clear goals in mind for CRM: get information about prospective customers to sales reps, and get a picture of who their customers are.
That's critical for Excel, because the $1.2 billion Dallas-based telecommunications firm, which initially concentrated on discount long-distance service, has "relaunched" itself with a new focus on local markets, E-commerce, wireless communications, and other services. That means that new and different sorts of customers will emerge. Excel faces a challenge in getting to know them, however, because it sells its services through thousands of independent sales reps. "We need to get to know our sales force," says Pignatello, "and, through them, our customers."
Toward that end, Excel bought CRM software from Siebel that supports the telecom industry, and which accommodates Excel's "MLM" (multilevel marketing) approach. "We can take orders, configure services for different kinds of customers, and begin to analyze who our customers are and what additional services they might be interested in," says Pignatello.
To do all that, Excel had to integrate the Siebel software with an Oracle database and back-office software from a number of suppliers. It turned to E-business infrastructure-software firm CrossWorlds Software Inc., of Burlingame, California, for a variety of integration tools that provide nearly instant linkage between those systems. It's a fundamentally different approach from that taken by Staff Leasing, and one which Pignatello says provides several advantages. "We wanted to go with best-of-breed software for each function," he says. "Once a vendor starts offering everything, I get concerned that it will lose its focus and offer mediocre products."
Addressing Pain Points
Many companies prefer to start small with CRM, implementing targeted solutions that solve an immediate need and putting integration issues on the back burner. At eMarquette Holdings, the online subsidiary of Marquette Financial Cos., both of Minneapolis, the goal was to better target its marketing efforts by understanding more about its customers. The company's commercial clients buy insurance, investment services, and other financial products. But until it began using CRM, eMarquette had no way of knowing just how many of its products a client was or wasn't using. "We couldn't see our customers across those different silos," says COO Margaret Murphy, "so we had no way of seeing how they clustered, or if they fell into certain affinity groups that might respond well to a certain marketing message."
Earlier this year, Murphy's company tapped Interelate, an Eden Prairie, Minnesota-based company that concentrates on customer analytics, assembling and analyzing data on customers in order to get a clearer view of their wants and needs. Interelate works on an ASP (application service provider) model, essentially renting software to eMarquette on a per-user, per-month basis. The monthly fee for a client starts at about $20,000. "We needed a tool we could use now," Murphy says, "at low cost and without a time-consuming installation and training process, something to give us a dynamic view of our customers."
Murphy acknowledges that at some point eMarquette will need a full suite of CRM products, but she sees a compelling value proposition in this limited approach. "With the data we now have about our customers, we can serve them better, retain them, and tap lots of up-sell opportunities. And we can distribute the insights we gain from Interelate over the Web to our sales force and customer-service people, which is a huge step forward."
Murphy doesn't believe this huge step forward will necessarily entail a big step backward when eMarquette decides to take CRM to the next level. "Certainly our business processes will have to change," she says. "We're looking at that now. But the technology is advancing so fast that I don't think integration is going to pose a major hurdle."
While eMarquette recognizes the need for process change with CRM, many companies don't, say analysts. Scott Nelson of Gartner Group says that too often technology is thrown at the customer-facing side of the organization without a clear plan for what it will accomplish. "Technology becomes like a rocket ship in the garage," he says. "It's powerful, but what are you going to do with it?" There's more to CRM than worrying about how all the applications fit together, Nelson points out; "there is also strategy, skill sets, and business processes to think about."
Most companies haven't made a significant change to business processes that affect customers in years, asserts Nelson. "Ideally, companies would rebuild themselves around how a customer wants to do business," he says. Unfortunately, most CRM products don't provide that flexibility. "They're designed around existing processes, which is constraining," he says.
Integration Through Consolidation
Further limitations come from the highly fragmented nature of the CRM marketplace. There are almost 50 subcategories of CRM products, and a company using CRM typically relies on products from nearly a dozen vendors. But that's one piece of the integration puzzle that may resolve itself, because vendors are consolidating or teaming up at a rapid pace. Last fall, for instance, PeopleSoft Inc. bought Vantive. In March, telecommunications giant Nortel Networks completed its acquisition of Clarify, while E.piphany Inc. acquired Octane Software Inc. In April, Kana Communications Inc. finalized its acquisition of Silknet Software, bringing together two leaders in E-CRM, which focuses on E-commerce and Web-based customer service. And in May, SAP announced a partnership with Nortel/Clarify, hoping to keep pace with Oracle and PeopleSoft.
Reader Comments» Post a comment