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CRM 2.0: Trends in CRM for 2010

Darius Vaskelis Sakonent 2009.10.23

[email protected] 312.805.3000

This presentation draws on original ideas, research with Professor Michael E. Porter, and from Professor Porter's books and articles, in particular, Competitive Strategy (The Free Press, 1980), Competitive Advantage (The Free Press, 1985), On Competition (Harvard Business School Press, 1998), and "Strategy and the Internet" (Harvard Business Review, March 2001) where Darius Vaskelis was a contributor.

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Firm Infrastructure

Support Activities

Human Resource Management Technology Development M Procurement Inbound Logistics Operations Outbound Logistics Marketing & Sales After-Sales Service a r g i n

Value = What buyers are willing to pay

Primary Activities

First, the Value Chain

Representation of activities within a firm to show how value is produced*

*Michael

E. Porter, Competitive Advantage (The Free Press, 1985)

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Value System

Firm Infrastructure Human Resource Management Technology Development M

Suppliers!

Inbound Logistics

Operations

Procurement Outbound Logistics Marketing & Sales After-Sales Service

a r g i n

Channels!

Customers!

Next, Value Chains within a Value System

Representation of activities across firms to show how value is produced*

*Michael

E. Porter, Competitive Advantage (The Free Press, 1985)

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Value System

Firm Infrastructure Human Resource Management Technology Development M

Suppliers!

Inbound Logistics

Operations

Procurement Outbound Logistics Marketing & Sales After-Sales Service

a r g i n

Channels!

Customers!

CRM activities

Customer Relationship Management (CRM) and the Value System

CRM activities are those that interact, optimize and collaborate with channels and customers

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CRM Functionality Examples

· Breadth of CRM covers sales, marketing and customer service activities · Depth of CRM covers data, transactions, reports, analytics and dashboards · Users can be internal or external partners, channels, prospects or customers · Delivery can be anywhere: client-based, web or mobile and can encompass social networking

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Sales

Marketing Multichannel Campaign Management Customer Data Mining

Service

Sales Force Automation (SFA) Partner/Channel Relationship Management Quote/Order Management Incentive Compensation Management Prospect/Lead Management Proposal/Contract and Billing Management Incentive Compensation Management

Call Center Management Field Service Management Return and Depot Repair Management Service Contract Management Spare Part/ Inventory Logistics Management Warranty/Claims Management Bug Tracking/ Defect Management

Email Marketing

Segment/List Management Marketing Resource Management Trade Promotion Management Collateral and Digital Asset Management

CRM Benefit Examples

Top Ten CRM Customer Benefits

Measured Outcome Average Observed Customer Benefit

1. Moved toward a more complete view of our

Operating Costs Sales Productivity

Service/Contact Center Productivity

-10.4% 17% 16% 12% 14% 10% 10%

Marketing Productivity Customer Satisfaction Customer Retention Increased Revenue

customers 2. Automated previously manual processes 3. Made business processes consistent across the company 4. An improvement in the quality of data 5. The replacement of various systems/ databases by one system 6. Improved sales force efficiency/complete view of customer information 7. Deploying CRM has enabled us to become more customer-centric in our business processes 8. Better user access to data and analytical tools 9. Improved communication among groups within sales and marketing organizations 10.Best practices are leveraged throughout the organization

source: Aberdeen Group

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Data computation, tabulation, and recording to assist with clerical tasks "Data Processing era" - PIM, Contact Databases, Database Marketing

PCs, relational databases, PBX, ACD, fax

Automation and enhancement to assist specific departmental activities

"MIS era" - SFA, Call Center, Campaign Management

local area networks, laptops, CTI, IVR

Enterprise view of departmental business "IT - Client/Server era" processes and decisions across functions - CRM

client/server, ERP, EAI, DSS, objects (DCOM, CORBA)

Past Evolution of CRM Information Technology (IT)

Larger competitors used to be able to out-market, out-sell, and out-service you with large CRM investments of money and time

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Using the Internet to deploy business processes and decisions to entire enterprise (self-service) and customers, channels, and suppliers

"eBusiness era" "eCRM"

web, mobile, XML, DW & BI, MDM, chat, analytics, web services

Optimization of activities inside and outside "Web 2.0 era" the enterprise in collaboration with - CRM 2.0 customers, channels, and suppliers

SaaS, PaaS, smartphones, social networking, blogs, wikis, Web 2.0, open source, cloud, SOA

Recent Evolution of CRM Information Technology (IT)

But now any firm can deploy a quick, tactical CRM implementation to solve a specific problem or "try it out"

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Data computation, tabulation, and recording to assist with clerical tasks "Data Processing era" - PIM, Contact Databases, Database Marketing

PCs, relational databases, PBX, ACD, fax

Automation and enhancement to assist specific departmental activities

"MIS era" - SFA, Call Center, Campaign Management

local area networks, laptops, CTI, IVR

Enterprise view of departmental business "IT - Client/Server era" processes and decisions across functions - CRM

client/server, ERP, EAI, DSS, objects (DCOM, CORBA)

Using the Internet to deploy business processes and decisions to entire enterprise (self-service) and customers, channels, and suppliers

"eBusiness era" "eCRM"

web, mobile, XML, DW & BI, MDM, chat, analytics, web services

Optimization of activities inside and outside "Web 2.0 era" the enterprise in collaboration with - CRM 2.0 customers, channels, and suppliers

SaaS, PaaS, smartphones, social networking, blogs, wikis, Web 2.0, open source, cloud, SOA

Evolution of CRM Information Technology (IT)

Business impact and IT enablers

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CRM has evolved into CRM 2.0

"Traditional" CRM Philosophy Implementation Technology Integration Sponsorship Users Data Financial Maintenance

inside-out "big bang" (months/years) re-engineer & slow, massive onsite implementation massive platform commitment integrate tightly inside the enterprise IT selects technology for the business forced to comply with "anti-social" system structured data (tables/screens) build vs. buy dedicated IT CRM application team

CRM 2.0

outside-in fast & iterative (days/weeks) "turn it on", roll it out fast, learn, tweak, continuously improve "try it out", open, modular, often cloud-based loosely couple inside and outside with internet data sources business-driven and IT-assisted system complies with empowered collaborating users and customers structured and unstructured (documents/blogs/wikis) buy/rent/build/open source outsourced CRM application team to scale up/down as needed

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CRM 2.0 Technology Deployment Spectrum

more on-premise "traditional" enterprise software ability to control the CRM application & need to maintain the CRM system hardware/software off-premise hosted enterprise software on-demand private/ single-tenancy SaaS less on-demand multitenancy SaaS/cloud computing

· While one size does not fit all, most new implementations of CRM are cloud deployments, with most customers gladly giving up control of the system to a technology vendor · If the CRM technology vendor has multiple deployment options, it's much easier to move from the right (on-demand) to the left (enterprise software) than the other way around · On-premise CRM deployment the most flexible, at the price of maintenance "...I believe in power; but I believe that responsibility should go with power..." (Theodore Roosevelt, 1908) · Sometimes, a hybrid CRM deployment may make the most sense, such as an enterprise software "hub" with offices or departments running on-demand "spokes"

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Forrester on CRM Suite Vendors

· They separate "Waves" for enterprise firms (>$1B revenue and >1,000 employees) and midmarket · "Oracle's Siebel and SAP CRM still offer the most complete solutions with better usability." · "Microsoft, salesforce, RightNow, and Oracle CRM On Demand prove enterprise credibility." · "Key strengths of the SugarCRM system include low application costs, internationalization support, usability, and SFA functionality."

source: Forrester Research

Enterprise CRM Suites

Midmarket CRM Suites

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Gartner on CRM Technology Vendors

Sales Force Automation

Field Service Management

· They separate nearly a dozen "Magic Quadrants" for specific CRM functions · Oracle-Siebel Systems tops many, but not all, of them · Microsoft Dynamics CRM, salesforce.com and SAP often rank highly as well · SugarCRM is the leading niche player in the SFA report, noted for its good cost/value ratio

source: Gartner

Customer Service Contact Centers

Enterprise Marketing Management

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CRM Cross-Activity Integration

Strategyspecific Fit

Configured/ Externally Integrated Tailored CRM "Out of Box" or "Vanilla" Integrated CRM Stand-Alone Departmental Point Solutions

Standard/Best Practice Unique to Firm

Tactical/ Generic Fit

none

CRM Activity Tailoring

Tailoring "Out of Box" CRM for the Highest Strategic Impact

At some point, "vanilla" won't work for your business... CRM that's tailored to your firm is more strategically valuable

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Operational Effectiveness for Best Practice Adoption

Unique Strategic Positioning for Sustainable Competitive Advantage

· Lower technology implementation costs

(although not necessarily simple projects!) · Closer to "out-of-box" or "vanilla" configurations · Integration often limited to common supporting ERP systems (order history, customer account master, accounts receivable, general ledger, etc.) · Potentially higher organizational change management costs if current processes need re-engineering · Business case primarily driven by quantitative short- and mid-term universal measures (NPV, EVA, SVA, pro forma, etc.)

· Higher technology implementation costs

(with sustainable returns!) · Tailored configurations to support unique activities · Integration may include proprietary production or front-office systems (project management, product development, etc.) or social networks (Twitter, facebook, etc.) · Potentially lower organizational change management costs if supporting current processes with less re-engineering · Business case primarily driven by qualitative long-term support of unique cross-functional activities

Run the same race faster

Choose to run a different race

Complimentary CRM Tailoring Approaches

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CRM 2.0 Lifecycle

· Target a specific problem or functionality to pilot/test · Minimally tweak "vanilla" and roll it out quickly

Target Tweak

Monitor/ Gather

Configure/ Integrate

· Monitor the pilot/test, gather requirements for improvement · Configure/integrate to support your needs and capture value

2-6 weeks

go live

4-16 weeks

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CRM 2.0 Lifecycle: Target

· Target a specific problem or functionality to pilot/test · Examples: forecasting, Twitter monitoring, integration with orders, opportunity teaming · Identify desired results and success criteria · Identify expectations of and from system users and management

Target

Tweak

Monitor/ Gather

Configure/ Integrate

1-2 weeks

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CRM 2.0 Lifecycle: Tweak

· Minimally tweak "vanilla" and roll it out quickly · Populate the system with converted data

Target Tweak

Monitor/ Gather

Configure/ Integrate

· Tailor the labels to your terms · Severely limit the tabs/functions shown (Less is more!) · Ensure at least one real problem of each target user group is solved

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1-4 weeks

CRM 2.0 Lifecycle: Monitor/Gather

· Monitor the pilot/test, gather requirements for improvement · Who is/isn't using it? How are they using it?

Target Tweak

Monitor/ Gather

Configure/ Integrate

· What related business problems can be solved?

2-8 weeks

· What are the wishes? · What could be done better? What's too complicated?

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CRM 2.0 Lifecycle: Configure/Integrate

· Configure/integrate to support your needs and capture value · Business value/ROI should drive configuration and integration decisions · Loosely coupling data via imports often deliver the highest ROI · External sources from the Internet can often compliment customer information

Target

Tweak

Monitor/ Gather

Configure/ Integrate

2-8 weeks

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Choosing a CRM Services Provider

· "Total solutions" can involve multiple partners · Look for case studies and fixed-fee pricing/timeframes (signs of good track record) · Look for strong software industry partnerships · The firms ranked best by customers are typically smaller, more nimble companies

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Who We Are

· Sakonent is a CRM consultancy for a 2.0 world · Focused on the new generation of CRM: Rapid, deployed-anywhere collaborative CRM that delivers business value quickly and iteratively · Onsite and offshore CRM consulting, implementation and outsourcing · Ten years of technology experience with the leaders in CRM (Salesforce.com, Siebel, Oracle, SAP Microsoft Dynamics, SugarCRM, and others) · Business process and user adoption first, technology second · Expertise and experience across sales, marketing and call centers

a CRM 2.0 consultancy

Our CRM Services

more onsite leverage

ONSITE & OFFSHORE CONSULTING

SALES, MARKETING, CUSTOMER SERVICE PROCESSES

STRATEGIC PLANNING

ONSITE & OFFSHORE IMPLEMENTATION

SYSTEM DESIGN/INTEGRATION PROJECTS

DEVELOPMENT & INTEGRATION

more offshore leverage

ONSITE & OFFSHORE OUTSOURCING

IT STAFFING/OUTSOURCING

MAINTENANCE & SUPPORT

Concept: SunTrust Robinson Humphrey

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Our CRM Clients (Selected)

· Life Time Fitness

· · · · · · CRM Process Definition Loyalty campaigns Identified new areas with cross-sell benefits Developed 3 year phased CRM Roadmap 600 users Increased membership renewals by 25%

· Ariba

· · · · · Global Sales and Service Implementation Global Process Standardization Multi-Language Support, incl Kanji 500 users Increased cross-sell revenue in support center

Our CRM Relationships

· Formal partnerships and experience with the leaders of CRM · Our heritage starts with the earliest client/server CRM systems to today's leadingedge cloud-based CRM · Custom development expertise across traditional platforms (MS & Java) and new architectures such as force.com

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Where to go from here?

· Use the CRM 2.0 Lifecycle framework to facilitate strategic thinking · Not sure how to start? Contact Sakonent to discuss an assessment

· www.sakonent.com

CRM 2.0 Lifecycle

Target Tweak Monitor/ Gather Configure/ Integrate

2-6 weeks

go live

4-16 weeks

· 312.683.4000

· [email protected]

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Information

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