PGreenblog

Ubiquity Means Both Upside AND Downside

Okay. Whew. I'm back to blogging. Was under the GUN last week with 3 courses to deliver for the CRM 2.0 and Social Media training that Chris Carfi and I are starting next week in San Francisco. Finished 'em Saturday but took a break on Thursday to go to the Politics Online conference which was both fascinating, occasionally horrifying and very telling when it came to a few things:

1. The struggle to figure out how to deal with constituents be they voters or social/political activists is proving to be difficult to a lot of the practitioners who attended the conference
2. The CRM world with the likely exception of salesforce.com doesn't seem to get the rich opportunity that the political and social activists provide as they increasingly feel their power.
3. Being really, really smart and visible sometimes works against you.
4. Google is still ubiquitous and an amoral morass of a company.

One, Two, Three, Four: The Struggle...The Failure...The Visibility...The Morass

The Politics Online conference is the stepchild of Politics Online which is the brainchild of Phil Noble, a good ol' boy from South Carolina who I had the pleasure of meeting. Lotta kids there. He is a down to earth fella that has an exceptionally large dollop of savvy mixed into his homespun gravy. An amazing dude. Also totally endearing, he's a Yankees fan and loves the 1961 Yankees, so you know that I'm gonna say lots of good things about him. He has a great sense of humor too. If you wanna check out what I'm saying, check out this Vlog interview that was done at the conference. Worth the listen. You'll see what I mean. He notes that the inflection point for politics and social networks and activism was the YouTube "macacca" incident with George Allen. Right as rain, Mr. Phil.

So, not only does he have it goin' on, as we relics of the 60s say, he zoomed to the lead of an evolution of politics to the constituency-based version it should always have been, with lots of Web 2.0 tools to support the active involvement of those constituents. Thing is, he had to foresight to see it and to create and then lead the effort. Thus there were around 300-350 attendees, and it drew some of the names in the blogging world to it to speak. I saw Jeff Jarvis, the uberblogger who runs "The Buzz Machine" wandering around the conference. He was there to host a panel. For his take on the whole thing, and a good reporting job it was, check out this link here at the BuzzMachine and it will cover the reporting that I don't want to do.

There were a lot of political mavens there but also a lot of small consulting companies that sorta get the 2.0 world. What was interesting was watching them wander the exhibition halls nattering away about their thinking on how to use social networks in campaigns - either for elected office or for a cause or ten. They really were unclear about it. The problem I think with the shebang, though no fault of the conference creators is that I heard lots of chatter about the idea of social networks but there were only a few things devoted to the "how to" on social networking with a notable exception being a track on the metrics of social networks. Some of the vendors, like Google, were just pushing their corporate agendas - in Googles case, world domination - but in an ironic twist, most of the CRM vendors were stupid enough to not be there.

With the notable exception of salesforce.com.

Salesforce is being really smart here. First, they've used their rather easy to develop authoring to create a good - in fact, very good - political app to track donations, activists, etc. for campaigns. Here's some screenshots to give you an idea of how to adapt a commercial app/service to the political world.

Cool mashup and smart-lookin' dashboard aren't they?

Okay, now for a regular old screenshot which, if you know salesforce.com's normal tabbed presence, will look awfully familiar. Basically, change the lingo for a few fields, alter the workflow, reapply the notion of an account and voila, you get a really slick little service app that works on AppExchange and is on demand and, is partisan-agnostic.

What astounds me is not that salesforce.com came up to the plate here, but that I didn't see ANY other CRM vendor at the event exhibiting. Nor did I see any social networking vendor exhibiting, though to their credit, Neighborhood America, my current favorite, was all over the place being there. The sponsors were Google, a smart move for a company that wants to be the non-judgmental political index for the universe, Washingtonpost.Newsweek Interactive, Blogads, the blog for pay bunch, Feedburner, Zogby International and a significant number of vertically-focused-on-politics web 2.0 companies (e.g. Care2, DemNet, ElectionMall.com). But NO CRM COMPANIES WERE HERE!!

Except salesforce.com

Salesforce's team, led by political veteran and now SVP of Public Policy Dan Burton were admirably low key. Dan's speech at the conference focused around the use of the on demand model as an excellent platform and toolset for political campaigns and he left salesforce.com implicit in that rather than trying a more markety approach. In fact, he deflected salesforce.com specific references or questions from there to the more universal. The high road.

It was smart.

In an ironic way, though, salesforce.com became a bit of a victim of its own success. United Way and Washingtonpost.Newsweek Interactive were on the stage along with Laura Graham, CEO of Catalist - a politically focused data company. It turns out that United Way and WNI (too long to write each time) were both salesforce.com customers and sang its praises non-stop, despite Dan's obvious attempts to keep things from being salesy, much to his and his compadres credit. Unfortunately, it was impossible to do that because their customers LOVED them - really, really LOVED them in a way that made it seem like a paid non-political announcement - though I know that salesforce didn't intend that at all.

Ironic in a way, but I'm personally very glad that at least ONE CRM related company had the smarts to move to this exceptionally important vertical "category" and hopefully, now, they'll own the market because no one else has the intelligence to get into it.

Now onto Google...

Man, I really don't like that dissembling, amoral company, despite their technological brilliance. They claim neutrality while they give up citizens in China in the name of the public good. In fact, Eric Schrage, the VP of Global Communications for Google was there and gave a nondescript keynote on Google - a job poorly done. When the questions came, he was asked one about China and he just went out there and made the whole thing into a "we thought at the time and still do, though things can change, that the way that we've handled China was done for the greater good because that way by doing what we did in China, we can get out more and more information and as you know information is freedom."

Something very close to that.

Forgot to mention that they gave up Chinese citizens to the government as the price paid for the greater good of information dissemination. I didn't see any Google senior management giving themselves up - sacrificing themselves for the greater good. Guy didn't EVER mention what they actually did and once again, forgot to mention there are more than business decisions to make in this world and that amorality is not a very nice thing.

Jerks.

Ah well, no reason to end on a Googlerant.

Peace, love, politics, campaigns and go salesforce for being smart enough to join this new vertical.

Just for the record...politics and government aren't the same. So get your act together CRM companies and make what I said dead wrong.

Prove it.

Technorati : CRM, CRM 2.0, Google, Web 2.0, politics, salesforce.com

2007 Steppin' Out Awards Finalists: Microsoft

Profiles in Innovation?

This is the first of the award finalists profiles. Don't worry. I'm not doing Microsoft first because they are the biggest - though they are. But they are the first in the alphabet lineup. There is curiously no finalist in the first half of the alphabet, so if I were Google I'd seriously consider a name change. TECHNICALLY, Zoho is a division of AdventNet so you could make the case for something here, but Zoho is the finalist, not AdventNet, so even that grey area doesn't get them first dibs.

Why Microsoft? Ecosystems & Environments, Not Products & Services

Oddly, this is one that you couldn't see coming, I bet.

Nor could I.

A year ago, I was admonishing Microsoft for not getting it....hell, less than a year ago...but I have to tell you, this monster sized company is getting it now. That doesn't mean that they are all of a sudden nimble and quick nor does it mean that one arm knows what the other is doing nor does it mean that they are homering (ahhhh, baseball is back) on every product, but their strategy has been dramatically transformed from a business-focused desktop strategy to a customer-focused 2.0 web based strategy and they are tying it all together.

They're leading the charge in building ecosystems and environments, not dealing in products and services.

When you buy Vista, for example, you're buying an operating system, for sure, but you're also buying a foundation for a consumer-focused media environment or a business driven ecosystem, depending on your chosen Vista flavor. Ultimately, though it ties together services/products/experiences - both visceral and intellectual.

But what does this have to do with CRM?

Let's look at that too - but just for a second.

Microsoft CRM - Only a Piece of the Puzzle

Microsoft Dynamics CRM 3.0 was/is a good product, but not a great one. Microsoft Dynamics CRM 4.0 is going to be a multitenant version that's due for arrival in June 2007. Better late than never. But even late, that can and will increase the level of Microsoft's impact in the CRM market.

And with the architecture of a multitenant CRM, based on web services - as they normally are, the 4.0 (like the O.C.?) will be better suited (architecturally) for integrating all of the initiatives that I'm getting to.

Which touches the tip of the iceberg of what is Microsoft's master plan.

What I think that Microsoft is doing, if the case, will be HUGE! It has the potential to have a greater dramatic impact than Gone With The Wind had on the movie industry in the 30s. Or that Microsoft had with the initial release of Windows.

OK. What DO You Mean, Rhett? (There's a Hidden Joke in This Headline - 2 Actually)

Okay. Let's begin.

What's the difference between...

Products/Services v. Environments/Ecosystems

The former Is the tired business model that dominated the 20th Century because of its manufacturing and generic mass production heritage. It's core idea of value is that it resides in the creation of those products and services.

How quaint. But as customers become the increasingly dominant force (maybe we'll give them their own species or at least gender....), environments and ecosystems begin to rule the planet.

By creating environments and ecosystems, the business model shifts.

1. From the world of the corporation to the world of the customer.

2. From separation of business from personal to the unification of the two - at least at an emotional and intellectual value.

3. From value residing in the products produced and the services created to the customer themselves.

4. From looking at the return at investment to seeing a return on customer.

5. From a business model where the company was the producer of goods and services to a model where the company is an aggregator of the necessary components to optimize a customer's individual experience.

6. To a recognition that it isn't a work life balance but a work-life integration - and the freedom to choose how that will be-achieved-by the employee (look at the Best Buy model). In other words from a business professional/consumer separation to a single"prosumer" model. In fact this is the beauty of what I think is Microsoft's Vista strategy.

It you were to view Vista as strictly an operating system well, I use it, enjoy it, but its got a lot of flaws technically and tactically. Technically, I won't go into it. Tactically, having 5 different versions seems a bit bizarre and has freaked out the consumer world a bit.

But if you see it as the platform. to create an environment for the prosumer... well, kids, folks, prosumers among you, that's another story.

The use of Vista as the embryonic prosumer platform for a highly personalized individual environment- or what I've called a set of personal value chains contained in an ecosystem -is only a small part of the Microsoft strategy-if it truly is a strategy-and not just wild foray emanating from my fevered mind.

Take a look, for example at Microsoft's most recent acquisition reported in the NY Times on Monday February 26. They acquired Medstory which applies artificial intelligence to medical and health info in medical journals, government docs and the unstructured Internet through a sophisticated search engine.

Why in hell would Microsoft do that? Well, a little math - addition works here - is in order. Last year they purchased Azyxxi -that's either a software company or Superman's old nemesis - oh... it's software...that retrieves and displays patient information from multiple sources including documents, xrays, MRIs, and ultrasound images.

Microsoft did this? Huh?

The article explains the "huh?" in two places So patience will be rewarded, bro's and sisters:

"The Med story purchase," said Peter Newpert, vice-president for health strategy at Microsoft, "was a first step in a broader company strategy to assemble technologies that would improve the consumer experience in health care."

AND

"…these companies and others are seeking ways to build businesses on the Internet that profit from what is called consumer-driven health care. The notion is that shifts in demographics, economics, technology and policy will inevitably mean that individuals will want to, and be forced to, make more health care decisions themselves... Aging baby boomers, accustomed to personal choice and to technology, tend to want a say in their treatment decisions."

Does it makes some sense for Microsoft to acquire those companies then?

Actually, not really, because why health care? They already have XBox 360, Windows Vista, MSN Search, Office 2007, CRM Dynamics 4.0, ad infinitum and have penetrated both the personal and the work side of life. Do they need more than that?

Yes, but to see that, kick it up a notch.

It makes perfect sense if you are trying to create the all-encompassing prosumer environment because health care addresses key portions of that personalized value chain - the individual's approach to gaining control over a hopefully rich life. But what about ecosystems? Environment seems to be covered. Microsoft has understood the business value of ecosystems for a long while. With all their faults, this wasn't one of them. The best reflection of their ideas around building ecosystems historically has been their partner network, Think of these two numbers:

• 775,000 partners globally

• 95% of total revenue from partners

While those are numbers that could stop Tony Stewart cold in Lap 50 of the Daytona 500, its actually not enough to understand how the ecosystems work in a contemporary frame. The partner ecosystem is a true ecosystem-not just a channel. Microsoft understands they 1. can't do everything to meet the prosumer's imperative or even the business and consumer's separate demands to provide even an adequate customer experience; and 2. can't acquire enough companies to do it without even them running out of money. So they built, after all kinds of permutations and glitches an extraordinary partner-driven ecosystem that covers what is perhaps every vertical and horizontal facet of an individual's life,

Okay - Interlude

Before all you 1984-readers and privacy paranoids get up into Microsoft's face about controlling your life and fulminations about the implications on privacy of this strategy, take a deep breath here. Remember a few things

1. Microsoft provides tools - not ankle shackles, Technology tools.
2. YOU CONTROL YOUR LIFE, no one else. Not even Bill Gates....
3. Use reason, not hyperventilation

Okay back to the strategy... the partner ecosystem was built with a lot of problems along the way. At one point, Microsoft had 54 partner programs, they've consolidated to a single program that is chock full of incentives for partners including Microsoft handing over business. The way that they focus their partner program is not only the revenue driver for the company but also each partner fits into an appropriate place in the overall ecosystem that they are utilizing to provide the level of personalized experience that each of us craves.

They also are quite generous with code so there is a large community of developers Dot Netting away and that can only bear fruit for Microsoft's plan to create that unique environment - because they have outside innovators innovating toward that end.

The Only Downside To Fear Is Microsoft Itself

So what could prevent them from having a HUGE impact on marketplace and life in general over the next year?

Their downside is that while they have the perspective of prosumer, they are still organized around consumer and enterprise as entirely separate operations. That might not be so bad, but the sad part is that one hand has no idea what the other is doing and in the case of Microsoft even the left arm doesn't know what the left hand is doing nor does the left hand know what each finger on the left hand is doing. They don't talk to each other. So the consumer experience side doesn't talk to the customer relationship management side. The CRM side doesn't talk to accounting. Ad nauseum.

But they are big boys and they will probably reorganize their way around that. They have highly capable people in the right places doing the right things and keeping life interesting.

The potential for impact beats anything a comet hitting the planet might do. In a much happier way.

Which is way Microsoft is the first of the 2007 Steppin' Out Awards Vendor Finalists to be profiled here. .

Technorati : CEM, CRM, Microsoft, Steppin' Out Awards, Vista, customer ecosystem, prosumer

SAP: Amazing, But You'd Never Know It, And That's Sad

When I started writing this, I'm was sitting ensconced in a chair at the Royal Pacific Resort at Universal Studios in Orlando FL. I was at Universal Studios once while at a Lotus Notes conference. Lotus "bought" the night and opened the amusement park up for free rides for all attendees. I took the one that they flip you high in the air and then let it free fall roughly 10 zillion feet.

Never again.

I was much safer where I was - in my hotel room at 5:AM writing this, bleary, dull brained, legs moving under me somewhat restlessly, but anxious to pen this entry because of what I'm doing here.

Now I'm home but at the time I was at the 2007 SAP CRM conference along with roughly 900 others - 150 SAP and 750 customers and prospects.

I gotta hand it to SAP. These really are customers, not the usual big contingent of consultants looking for work or overzealous IT guys looking for deep SOA knowledge - though there are a LOT of IT guys here. But what makes the makeup interesting is that they really are from SAP customers - not IT project dudes or dudesses who are hoping to latch on to something....SAPish....as they do "networking."

SAP hired me to meet with their key VIP clients - I met with 11 all told, plus I was co-host at a delightful event that was held at Don Shula's in Orlando on Monday night with SAP and its key clients - about 40 of 'em. They did it right. Up to an including giving out a small token of appreciation - actually two of them - my book, CRM at the Speed of Light and a this thing from Mont Blanc that while I'm not sure what it was exactly, it was silver and said Mont Blanc and was pretty. Maybe a money clip? Update: turns out to be a bookmark. Still pretty.

Doesn't matter. I won't be using either of them - I read my book already and don't need to mark pages of anything I can think of. But the gesture was baby grand.

In any case, these are just a little color for what I really want to say.

SAP is doing some remarkable things.

No one knows about them.

Ergo, they aren't doing these remarkable things as far as most of the world is concerned.

In fact, as far as the business world is concerned, SAP is an 800 pound gorilla.

As far as I'm concerned, they are this:

Yes, secretly, they are THAT nimble and smart. But only their labs (literally) know this.

Here's a great examples

The keynotes Monday were given by Michael De La Cruz, SVP and Eric Rantal, the new, charismatic as in friendly charismatic VP of North American Sales, etc. for SAP. While they both are highly articulate men and present well, unfortunately, the messaging they were told to present was about a hundred years old.

Here it is:

CRM is not a technology. Its all about the customer.

Yikes. Groan. That's so EIGHT years ago.

The irony is that the keynote presenters are young, experienced, hip guys who do "get it." But they're constrained by what "corporate" tells them to present. It ain't their call, which is too bad, because my conversations with Eric Ranta tell me that SAP picked the right guy to replace Cathy Rheiner there.

I wasn't alone in my thinking about the theme.

The consistent refrain that I heard from customers, partners, and SAP personnel was that the theme of "all about the customer" wasn't something they wanted to say or hear. Not a technology they know already too. They were looking for something fresh and new - something that told them that SAP was a "happn'in' organization." They didn't hear that but they still respected SAP as well they should. SAP needs to be respected for being the old gentleman it is.

The funny thing is that that the presentations, while tactical and mostly technical were excellent by and large. It was a good conference, actually, thanks to the drivers on the CRM side like Mary Cauwels, one of SAP's unsung heroes in marketing. I attended one done by Kelly Morris of the Defense Logistics Agency, a CRM program I've had some involvement with and she did a great job on how far that program had come. Gerhard Friedrich of RWD did an excellent job looking at performance management techniques to be used in the implementation of CRM programs.

These were good presentations.

But the problem is that the whole conference was entirely tactical and it WAS about technology.

That's the SAP Insider influence.

Yet SAP is a leading innovator and spends zillions of research dollars on innovation. You just don't know it.

They are so timid about their innovation, this is the extent of the recent public record - an article in Information Week on Feb 26.

"SAP announced sketchy Web 2.0 plans last month, promising collaboration capabilities such as wikis and widgets in more of its apps over the course of this year..."

Hard to dull up an exciting thing that they're doing but they did it with that announcement.

Lets take a quick peek at how innovative they really are:

Behind the Music

First, take a look at this article in CRM Buyer in January 2007 on what SAP is doing. There are two salient points. SAP is opening up much of its code to its partners and developers and even some to "the community" so that they can innovate with their products. Also, they have developed a "smart" search engine technology that understands the semantic web a helluva lot better than Google does. So if you type in Paul Greenberg, CRM, it won't just find "Paul" and "Greenberg" and "CRM" and then weigh relative value of the connectivity, it will treat the three terms as a semantic phrase and look for the structured and unstructured data about the CRM guy, Paul Greenberg . So its non-linear and semantic, not linear and filled with Google sand for weight. And they are finally pulling it out from behind their strictly internal firewall and letting it be sold. Smart move.

Second, check this out. They have been talking with a number of Web 2.0 companies as potential strategic partners and have been in collaboration with some of them at least as demonstrators of integration between SAP and the company. So for example, here's a report of a demo that was given by Zoho, one of my Steppin' Out finalists, in what looks to be Bangalore on Zoho/SAP integration. That hasn't stopped with Zoho. They are actively seeking out other core partners in the 2.0 space because they understand that finding and offering tools for customer collaboration is the mission-critical mission (critically) for CRM companies and enterprise applications leaders in 2007.

Which is more than I can say for the rest of the industry at this point. With a few exceptions that you'll read about in these pages in weeks to come. The ones that are doing that are the objects of my lust. The ones that aren't are the objects of my scorn.

But you wouldn't know even these little tidbits about SAP would you? Because they don't do the branding that moves them from sounding highly competent, useful and tired to energetic, exciting and highly competent and useful.

SAP, consider this tough love. Get out there and do what I tell you.

This instant.

Technorati : CRM, SAP, Web 2.0

Not The Winners Yet…The Steppin’ Out Awards 2007 & Beyond

 

For those of you who read CRM at the Speed of Light, 3^rd edition, if you paid close enough attention or cared about me even a little bit (sniff…), you might have noticed (or not) that I had a number of companies that I highlighted as best of breed in different chapters under the title "The Steppin' Out Awards."

The concept was simple. These were the companies that stood out in their category. They were companies that you might have been familiar with – Unisys, SAP, and occasionally surprises – Hitachi Consulting, Talisma, Quaero, Chordiant, among those. Most have lived up to their promise. Some not.

At the time of the book publication, a number of them issued press releases announcing their award. Which was a win-win. Nice for them and nice to know they gave me enough credibility to issue the press release.

But enough of the past. How many TV shows and movies have told us that we have to move on and can't dwell in the past. Actually, we can't dwell in the present or the future either. As far as I know, it takes a house or apartment or some sort of domicile to dwell….in. Or something.

In any case, I've decided to reinstate the Steppin' Out Awards for vendors and integrators and sprinkle it with a decidedly web-collaborative flavor. The criteria are a bit different and there will be separate awards for the vendors and the services organizations that are in the world of CRM/CEM etc. There will also be a third and new category which will go to the practitioners who are CRM 2.0-like.

So today, I'm going to give you the calendar and the criteria. Shortly hereafter the finalists for the vendors. Then the….wait, look at the calendar. You'll get the picture.

The Calendar

Event	Date
Award Criteria for Year	February
Finalists for Vendor Awards	February
Winner of Vendor Awards	March
Finalists for Services Providers Awards	May
Winner of Service Provder Awards	June
Finalist for Practitioners Awards	August
Winner of Practitioners Awards	September

 

The Criteria

First, as an exceptionally unpopular president once said (no not Bush…Nixon), "let me make one thing perfectly clear." The award selection process is NOT democratic. While I'm wide open to suggested candidate companies from ANYONE including from the vendors and their P.R. firms, that doesn't guarantee them a review by me nor does it even guarantee that I'll look into it, though odds are pretty good that with a reasonably compelling story I will. As far as this year's vendors go, I've already looked at over 100 companies, looked more deeply into over 50 companies and come up with a finalist list that will be announced in a few days. Its five companies with a possible sixth that I'm still contemplating. So there is no more opportunity for nomination on the vendors, though there is still plenty for the service providers and practitioners, if you have companies in mind.

It wasn't easy because there are a HUGE number of companies out there having an impact, but I'm limiting my choices to those that are reasonably blatant when it comes to the world of customers and neo-CRM. Thus a lot that were technologically exciting and have had significant impact are not finalists.

Thing is, they have to meet at least 3 of the a through f criteria. G is a must for everyone – period or they'd never make it even into the first round. I'm not assuming perfection. What I am assuming is impact. But more on that later.

The criteria for the finalists:

1. The company must be innovative and attuned to the Web 2.0/CRM 2.0 (for some of the details on CRM 2.0, go to the always popular CRM 2.0 Wiki, where the very discussion of what CRM 2.0 is is ongoing) world. Meaning that their offerings have to reflect any one or multiples of the following
   1. Collaborative or personalization tools that make the customer experience more engaging or interactive (social networking, user communities, ecommerce personalization, offer/price optimization)
   2. Contemporary technological innovations like service oriented architecture or AJAX or web-based set of applications/services
   3. An innovative pricing model (e.g. the on demand subscription model comes to mind here)
   4. A corporate culture that encourages innovation among the employees and that customers, partners and suppliers find engaging and "advocacy inducing." That includes good people at the decisionmaking level
   5. A sense of design (and hopefully, play) that increases customer delight.
   6. A sense of who their customer is (a.k.a. knows the voice of the customer) and shapes their customer strategy on that understanding
   7. It has to be clear to me that the company "gets" it.

As vague as some of these criteria sound, they aren't. Most of you (or some of you) know that I don't make statements without the ability to back it up. Trust me when I say, of the 50 or so companies that I looked into. I looked into them. That means that I researched them, looked at their offerings and looked at as many of the criteria that I could find without the company's active participation. This was a screening round. I graded their applications/features functions on 1-20 scale based on the customer friendly features and functions. That means that features and functions that enhanced collaboration in some way or improved experience in some way (e.g. on an ecommerce site, a tool to determine the cost and delivery time of UPS/Fedex based on where the purchaser lived) got much more heavily weighted than say, an pipeline management tool that simply exposed the multiple opportunities in a dashboard fashion to the sales manager. This is is no longer the award for customer relationship management but to steal Disney Destination's phrase for their change – it is the award for customer managed relationships.

At the high level, the vendor has to be committed to providing the tools that customers need and that partners and suppliers and employees need to create a seamless interactive, intertwined value chain that is geared toward customer value. Thus the weight on things that benefit the customers, not the managers. Though I don't rule out the features and functions that benefit the managers – merely weigh them less importantly than the others.

All of this will become clear when you see my finalists and my explanations as to why they made my finalist list.

That said, there are five finalists and about 3 (so far) backups.

Why backups?
Because, to have a chance to win, the five finalists will be sent a questionnaire of a few well chosen questions that they are expected to answer. If they don't care to or refuse to, then one of the backups will be elevated to the finalists and the finalist who refused will be acknowledged on the blog as having refused, or not gotten in the answers in a timely way.

Hey, I said this wasn't a democratic thing.

It REALLY isn't. But it is something that I think needs to be done.

The Rationale for Doing This

The reason it should be done is très simple. Good deeds and good thinking and good strategy should not remain unrewarded. Especially when it comes to understanding what the social customer is and how he/she relates to companies. That is forward thinking, cool thinking, contemporary thinking, smart thinking, strategic thinking and it should be acknowledged.

So the Steppin' Out awards are not based on how old or new a company it is; nor whether or not they fit into the traditional CRM "box" or not – meaning they provide somewhate operational improvements in sales, marketing, or customer service on the vendor side or give us great analytic algorithms. They are companies that in one way or the other, big or small, new or old, established or on the rise, who understand that the customer is at the hub of the business ecosystem and that their corporate ecosystem is now intertwined with the customer. In fact, probably the best war cry for these awards is from The Cluetrain Manifesto by Doc Searls, Christopher Locke, David Weinberger and Rick Levine:

"Companies must ask themselves where their corporate cultures end…If their cultures end before the community begins, they will have no market….Markets do not want to talk to flacks and hucksters. They want to participate in the conversations going on behind the corporate firewall….We want access to your corporate information, to your plans and strategies, your best thinking, your genuine knowledge….If you want us to talk to you, tell us something. Make it something interesting for a change…We've got some ideas for you too; some new tools we need, some better service. Stuff we're willing to pay for. Got a minute?"

That pretty much says it in a nutshell.

So on with the awards. The five finalists will be announced on this blog within a few days – two or three, which means with my usual rate of accurate forecasting, 5 or 7 or 30.

 

 

 

Hooray for Me!!

I just got this email from TechTarget:

Paul,

Congratulations!

On the basis of your previous (and ongoing) work at PGreenblog, we've chosen your blog for one of our editor's awards.

We've listed you on "Our Favorite IT Blogs" on WhatIs.com under (you guessed it) CRM:
http://whatis.techtarget.com/definition/0,289893,sid9_gci884512,00.html?offer=ed_award_blogs

Please feel free to link to us and display our award on your pages. Here's an image you can use, with the above link:
http://www.whatis.com/images/award-editor-180.gif

You can also just insert this code snippet into your template, if you like:

<b>WhatIs.com Editor's Award</b><br>
<a href="http://whatis.techtarget.com/definition/0,289893,sid9_gci884512,00.html?offer=ed_award_blogs"><img src="http://www.whatis.com/images/award-editor-180.gif" border="0"></a>

Keep up the great work -- and let us know if there are other blogs you think deserve to be listed under CRM.

Cheers,

And Cheers to you too.

Technorati : CRM, CRM 2.0, TechTarget, WhatIs

Woozy But Clear

I'm on a plane right now leaving San Francisco, the worse for wear (I'll explain later) and the better for the trip.

I was there at the largesse of the salesforce.com analyst relations crew and their VP of Product Marketing, John Taschek, who, incidentally, was one of the all time great Enterprise IT columnists/writers before he trotted on over to salesforce.com.

What I want to talk about for both causal reasons and let's egotistically say, insightful ones, is not the salesforce.com announcements on Winter '07 so much, which were interesting but not extraordinary. (In fact, the extraordinary stuff wasn't announced and won't be here until they do) - things like Apex tools that allow "killer apps" to be developed outside the salesforce.com now ecosystemic "AppExchange" but what I found between the lines in conversations and demos with salesforce folks and discussions with the SFDC (they hate that :-)) AppExchange partners.

Far more interesting.

First, the causal reason I don't want to talk about the announcement.

I wasn't there.

I was VERY woozy and VERY queasy and lying in my hotel bed being attended to by a doctor. He said that I had had a reaction to the wine I had the night before.

Hangover?

Nope. Only (this is one of the five things for the next time someone blog tags me) have had two hangovers in my entire LIFE and this wasn't that. Just some sort of reaction to a wine from one of the great properties in all of Burgundy - Eschezeaux. Too rich for my head and stomach I guess.

So I missed the announcement in the interests of wellness.

A brief sidebar: The doctor who attended me was one of a group of doctors in San Francisco called SF Doctors On Call. They are REAL doctors who do "hotel room calls" when needed and come prepared with the medication that you are likely to need - given the state of your illness in the state of California. The hotel calls them and their specialty is taking care of lonely errant pilgrims in the midst of their travels and travails.

I just thought the idea was cool so I would share it with you. Needless to say, they don't take your insurance but it is an out of network reimbursement. So $314 later, I'm completely better, though feel like I've been mildly hammered by a couple of killer whales.

Back To The Subject At Hand...

In any case, the announcements were welcome, but not terribly surprising. For a good take on it, read Barney Beal at SearchCRM

But what happened between the lines was very interesting.

First on the future of salesforce.com.

There were around 1000 people at this relatively non-descript but extremely well organized and well done event. Odd crowd to some extent. Good stuff with lots of partners, bunches of customers and analysts. But this bunch had a LOT of independent consultants (a.k.a. folks like me), and hard core IT types - good because its Apex, but not a strong lead generating crowd.

What made it fascinating and very valuable though, was the partner ecosystem that salesforce.com has been building with AppExchange. They had stars of all stripes and hues there. For example, AboveAll, one of my favorite companies - the best provider of composite applications frameworks on the market (see my blog on composite applications here) - was showing off their advances over the last year and their showcased positioning with salesforce.com - who wisely (as always), recognized the value of composite applications, now trendily being called an AppExchange mashup (I think that's SO funny) for their platform.

Also represented was Cast Iron, who provide pre-configured, ready to plug and play hardware. Basically they provide salesforce.com-in-a-box that requires little work other than the ability to stick a plug in a socket and a cable into a connector. Mostly. They do this for multiple other vendors too. In fact, last time I saw them was at NetSuite's partner conference, when I spoke there. These guys are really good and they provide something that is convenient and easy to use and simple in theory and even in practice to a large extent.

I met with a new client of mine who I was unaware was going to be there - InvisibleCRM. Imagine, if you will, what I said about Cast Iron, only the box isn't hardware, its Outlook's interface. Who in god's name doesn't know how to use Outlook. Everyone. That, of course, is the point. InvisibleCRM can provide you with a fully functional salesforce.com through the use of the Outlook interface - making it amazingly simple.

But those are just examples that were there of the cmpanies being drawn to AppExchange. Companies who grew up in the world of Enterprise 1.0 and 1.5 and are making a transition to Enterprise 2.0 due to the plaform provided by salesforce.com. In other words, salesforce is starting to achieve its vision - meeting what was not marketing hype - but in fact, truly visionary thinking with the AppExchange as the mechanism. Tien Tzuo, in Shanghai, in 2004 told me that salesforce.com was going to move away from being pure services to the platform for the Business Web, and while I'm loath to say that they are the only platform, damn if they aren't becoming a pre-eminent one. Vision, not hype. Which is pretty f-ing cool.

But there is more that I saw between the lines and despite my woozy head. Unless I imagined all this.

PRM Pahd-Nuh

I've been a fan of PRM for a long time and have been utterly disappointed about the lack of adoption of the PRM appls that have been out there. Its history has been promising and totally sad. Companies like Allegis who had good PRM applications were swallowed up and disappeared into the maelstrom forever; companies like ChannelWave (my personal favorite) were acquired by Aqueduct, a bunch of moronic retrobates who NEVER got PRM and destroyed a good product, and this "mush-up" got acquired by ClickCommerce, which then got acquired by someone who I presume is now part of Hakuna Matata.

Siebel PRM, a great version, just never had the PR its sister apps had and it too became a moot-up when Larry Ellison bought and dismantled Siebel in favor of Fusion - the drink of everyone.

As of now, while there are others, there are three PRM services - all on demand that are mention-worthy and only two of them good enough to be called, well, good enough. That would be NetSuite, salesforce.com, and the laggart, BlueRoads.

First, the latter (Have you noticed I often go from the "latter back." I think its a way of verticalizing my Hebrew school training) (anyone know what the heck I mean by that?).

BlueRoads is okay. Its a pureplay on demand PRM. I reviewed it pretty thoroughly awhile back and was disappointed. I thought at the time that it was missing key pieces of functionality and, from what I can tell, hasn't done a lot to overcome that recently. Though I'm willing to admit I'm wrong if someone from BlueRoads wants to prove it to me. Unfortunately, since their dynamo VP of Marketing, Kathleen Hayes, moved on to greener pastures, I've heard nada from them. So I can only work from what know to be the case. About 6 months old.

NetSuite was the first to the hosted block to provide a super feature rich and functionally sound and architecturally good version of PRM to the market. They still have it. It's more conceptually like a classic enterprise version of what channels want and one I would heartily recommend certainly.

Salesforce.com's version of PRM is VERY different in execution. What I saw was a highly configurable service that not only allowed the brandholder to provide customized programs to the channel and multiple program levels to the partners, but also would allow the partners to pick out the functional "objects" they need from AppExchange libraries that would allow them to personalize their company's use of the channel. Exactly what's needed in the world of a partner ecosystem.

One of the most telling and difficult problems of managing the channel is that while the brandholder knows what it needs and provides the capabilities to get what it needs, each partner is at a different stage of development and has a different culture from the brandholder and from the other partners. But a partner ecosystem is not a brandholder hub/partner spoke configuration. Each partner in the 2.0 customer universe we live in has two four things (at least for the purposes of this entry) that they have to be mindful of:

1. The brandholder
2. The other partners
3. The customers
4. Themselves

Rather than a partner who meets a brandholder criterion that when met will provide for a seamless interaction in the brandholder's enterprise value chain, the contemporary partner in the advanced partner ecosystems are transparently exposed to the other partners and to the suppliers/vendors that the brandholder needs to use. Each partner fulfills a role in the channel that fills a hole in the ecosystem. So its not a matter of overloading on partner carbs - which lots of carb-related partners and few protein-partners and fewer-vitamin/mineral partners signed up because that's the partners who applied, but a balance of carbs, proteins, vitamins/minerals - which, all told, as a unified ecosystem, provide the customer what they need - since the brandholder alone can't do that anymore.

More than that, though. The customer is no longer the recipient of this value chain's seamless integration. They are demanding a direct, collaborative role in that value chain - sometimes. That's why user created content is such a big deal these days. The customer wants to be engaged in the ecosystem as a part of it, not a mere object or even end-subject of it. Or else, they'll move on to where they're wanted.

So that means that there has to be some measure of transparency between the brandholder (check), the partners (check), the brandholder's suppliers/vendors (check) and the customer (che-che-che-check).

When you're in an environment which involves some common ground among companies that have been and continue to often be competitive and have different cultures and need to engage the customer as part of all this, the difficulties are, well, scary.

But interestingly, what I think will be the next iteration of salesforce.com's PRM services is actually mindful (even if by accident or just inference or dumb luck) of this set of Enterprise 2.0 circumstances. That means that from what I gather, they are going to add a customer portal to their already currently provided partner portal. All of which can be fully customized through AppExchange objects - meaning that whatever transparency in the supply, demand and what ChannelWave used to call the support chains is necessary can be provided in a partner ecosystem that includes the customer.

How smart indeed.

AND

It allows for completely customized versions of the appearance and the functionality based on the personalized requirements that each company demands due to its culture, level of trust, relationship with the brandholder, relationship with the customers, level of alliance with other partners in the ecosystem - ad infinitum.

THAT, folks is slick and, to my knowledge, not offered by anyone else. OnPremise, OnDemand OnCircle of Life. Literally, no one.

See what you can find out in between the lines.

So what's an unremarkable announcement, though not a bad one; and a bad reaction to wine, though not an unremarkable one; and a trip between the lines, makes life interesting and fresh again. And it is indeed fun to see salesforce.com doing stuff they don't even know they're doing.

Glad I could help, guys.

Technorati : CRM 2.0, PRM, on demand, partner relationship management, salesforce.com

This Borders on the Sane - A Bookstore That Might Get It

I'm sad and I'm happy. Not morosely depressed or wildly elated. Just...a little sad AND....a little happy.

Boo hoo. Yay

Why? Because Borders, the bookstore one that is, is being smart, but what has been smart for them so far isn't realizing the revenue they hoped so far. That's what makes me sad.

But what makes me happy is that they are taking the risk of moving ahead with their scheme, rather than just retreating and cutting bait and running as most traditional companies - on the retail side - the so-called "brick and mortar" stores - would ordinarily do.

I'll explain.

Borders Loyalty Program

I'm a member of Borders Rewards program. I'm a member of theirs RATHER than Barnes & Noble because Border's program offers more in a much more attractive way. From what I can tell as a member, there are two pieces to their fundamental value proposition. First, regular earnings of bonus award $$$$. Second, benefits in particular to members of the program. But presented in a way that delights you by the uexpected in combination with the base rewards, rather than providing you with the base benefits - pretty much as expected.

So for example, I will get a regular email that indicates that I have either a certain amount of money earned by my Borders spending ("You've got $17.50 in your Borders Rewards account" so to speak) or that due to my spending I have a day in the month (any day I choose within the specific month) that all items I buy will be 10% off no matter how many I buy and how many visits to the store I make. So I can purchase 100 items over the course of the day through 5 visits to 4 stores and the 10% will uniformly hold for the entire set of transactions during that single day of my choosing.

The other piece to the Border's loyalty program is that I get one to two emails per week with a 20% to 30% off a single item in a variety of categories with the ability to print out the coupon presented to me online that I bring to the store. That means I can buy ANY single item in any store and apply the discount with the coupon. Or sometimes, there are categories for the rewards. I'm not sure that they've targeted me personally on those categories, judging from the mix.

What makes this particularly attractive to me - aside from loving books so much I could cry - is that when you get to the register, the checkout folks at the register, gasp, remind you that "you have x and y available and would you like to use it, sir?"

On the latter, for example, The Best Buy Rewards Zone doesn't remind you of anything when it comes to the coupons you provide and the only discounts come based on your spending. There is no other benefit beyond getting a certain amount for a certain amount of points. The points are about a zillion per dollar earned but it sounds really good when you've earned a gazillion points until the real world benefit is realized - which is about none. By not having the dollars you've earned at the register, its very easy to not be diligent (believe me, I know this) and not use the coupons you printed out the once or twice you're allowed to. Since they have expiration dates, the Best Buy program is a use it or lose it program. That's pretty sad actually. Big ticket items are sold at Best Buy.

Best Buy is even worse than that though. One day, I spent about $300.00 at Best Buy but forgot to use my Rewards card. After I was rung up but before I even left the counter, I remembered and asked the checkout person if I could enter my number. Their program had no way of doing that so I just simply lost the points. Even though I hadn't even walked away yet. It was a technology problem, because of the human problem of bad thinking.

Makes me want to shop at Tweeters.

Border's also beats its competitor, Barnes & Noble, when it comes to loyalty programs, too. Barnes & Noble charges $25 a year for the privilege of a discount. Border's charges zero dollars for the benefits of being a loyal customer. BN thinks loyalty has a price - it does but the other way around - the customer exacts the price of loyalty and provides the revenues in return. Paying $25 for a loyalty program might be a prudent financial move to handle administrative costs but ain't real smart when it comes to trying to create advocates. Books are already too expensive. How do I know. Simple, I have major publishers for my books that sell to Barnes & Noble. I know that Barnes and Noble buys a $30.00 book for about $14.00 and charges $30.00. A 40% discount still makes them $4.00 per book over their cost which is about 35% margin. Not too shabby. And that's AFTER a 40% discount which they don't always offer. So $25.00 becomes an insult, given that Borders is free.

But Borders Is Even Smarter Than That...

Border's doesn't stop with just a good loyalty program that keeps it interesting. They are "customer ecosystem-friendly" a.k.a. customer eco-friendly. That means two things. One minor. One major.

The Minor Key

They are the only chain that sells the Sony Reader at their stores. The Sony Reader, much as I dislike Sony, is the first digital reading device that reasonably successfully mimics the printed page, using e-ink technology. I have one and think its well worth the cost. I take this eight ounce device with me on travel via plane because it eliminates the weight of books. I have 10 books and it is still no more than the eight 8 ozs. Borders is willing to carry this first "threat" (though I honestly think NOTHING will ever take the place of a real book) to the printed page out there.

The Major Key of G with a Sour Note In Between

Most importantly, despite the fact that Borders' announced they were disappointed with their holiday results:

"The holiday season was very competitive and highly promotional. We are disappointed that store traffic and sales trends were not better, especially considering the significant investment made in the Borders Rewards loyalty program," said Borders Group Chief Executive Officer George Jones.

they haven't retreated but, instead, moved ahead and announced a major alliance with Gather.com - a community-based social networking site, where they will form literary communities - e.g. virtual book clubs. The communities will discuss multiple topics of literary and personal interest. A coffeehouse on the net to talk it all over - that warm, toasty conversation over a good book with a virtual hot chocolate, cup of coffee and a scone or two.

Smart

SMART

SMART

Why? Because they are figuring out that the newer generations of customers in their competitive world, need these communities ONLINE and they are providing them. They have become aggregators of products, services and tools, the very model of the 21st century business with a brain.

First thing they've announced in their newly minted partnership with Gather.com is a contest to find a publishable author. That means if you win, you get $5000 from Gather.com, distribution at Border's guaranteed and a publisher (though I don't think they've named the publisher in particular).

All in all, this company attempting to turn around is making a valiant effort by embracing the new customer ecosystem, not running from it.

Good for them.

Okay, time for me to curl up with the E-Reader. Just kidding. A book. Really.

Technorati : Borders, communities, literature, social networks, web 2.0

So Where Does This Leave Brian Cashman: NetSuite Shows Coolness Once Again

I have to say it again. NetSuite is just an outright cool company that simply gets the world the way it should be gotten. Not only do they have an excellent product and great people working for them but they have STYLE. They are the epitome of Christina Aguilera's Basic To Basics "Ain't No Other Man" lyrics

"You got soul, you got class.
You got style, you bad ass..."

They got all that, and they are.

What makes me say such things?

Well, they went ahead and put Oakland A's General Manager, Billy Beane, he of "Moneyball" fame, on their Board of Directors. How cool is that? Though I personally would have put Brian Cashman, GM of the Yankees, (I tell this to all of you who reside on other planets or in other dimensions) on the NetSuite board and I hope then maybe that salesforce.com has the good sense to do it, but I have to admit, that NetSuite pulled off a good one here.

Not that they exactly had slouches on their Board of Directors before.

The management team that sits on the BoD now includes founder CEO Zach Nelson, who I think, no kidding here, one of the smartest CEOs of any company in the United States and one of the most vital personalities among them. Evan Goldberg, founder and CTO of the company who is a resident genius when technology is involved and, while quieter than Zach without a doubt, has a presence in the industry that is also good - and bigtime.

Additionally, they have a gaggle of others who I don't know well who are primarily tech guys and VC types who I presume are competent managers of the moneys they've invested in NetSuite - money that I trust when NetSuite goes public sometime this year, will be seen as very well invested. Though only the market will tell us the result of that later on.

But, Billy Beane is Billy Beane, a celebrity par excellence and a man who can make a genuine contribution beyond just being a really cool name added to the Board. He is one of the savviest baseball GMs around, much as I hate to admit it, keeping his spending down, getting good pitching and building contenders is a strong suit. NetSuite is a strong suite and I would imagine if they keep your spending down and build a contender, you'd be happy too, though I can't figure out how to bring in good pitching here (NetSuite sales people? To stretch the analogy beyond recognition....)

As I said, NetSuite is going public this year. In December, TechCrunch reported that NetSuite was looking for a $1 billion valuation which seemed premised on a BusinessWeek article that said that NetSuite was looking for $100 million for 10% of the company. Initially, I thought that this might be a high number but upon reflection realized that with $70 million in revenue and enormous promise including being highly savvy about what the business world wants, this is not an outrageous number by any means. Salesforce.com's current market cap is $4.5 billion on revenues in FY 2005 (ending on January 31, 2006) of $310 million. So this isn't a real stretch on NetSuite's part.

Adding Billy Beane to the Board at this time pre-IPO couldn't be smarter. NetSuite continues to drive up their sex appeal and that coupled with their top notch improvements with version 11.0 make them rock. Money Ball has a whole new meaning now.

Technorati : Billy Beane, NetSuite, Oakland As, Zach Nelson

2007; CRM 2.0 Gets Going

OK, neck out wide time. Cut me if I'm wrong. But here's my 2007 forecast interspersed with other 2007 forecasts I've found out there and my comments on their comments.

First Them for 2007....

Forrester Research - Their Forecast: CRM revenues will skyrocket to $74 billion (approximately $21 billion in applications sales, $53 billion in services sales. There will be a serious shortage of CRM skilled workers) My Thinking: While I'm not sure how whether they are calling CRM-related on demand subscriptions a service or an application, I can see strong numbers in 2007 for CRM without a doubt - though how anyone can forecast numbers that specifically is beyond me.

Gartner Group - Their Forecast - They see CRM continuing to grow with Microsoft & salesforce.com dominating the growth. They see blogging to peak at 100 million blogs in 2007 with the millions of others already out there just fading away. My Thinking:

While I certainly see CRM continuing to grow, the last two entries - both Forrester & Gartner make me wonder what they call CRM at this point. The old definitions are pretty much done (see below) and there is a CRM 2.0 that is now getting set to replace the Model T CRM that's been preeminent for so long. That said, if there is an acceptable 2.0 or at least 1.5 component to their thinking (more customer participation, prosumer business focus, etc.), then I would agree again that CRM will grow. Do I see salesforce.com and Microsoft dominating the growth? That's a lot bigger if. Salesforce, I think, will continue on its merry path to the kingdom keys. Microsoft could go either way. The reason I say that is that I don't see a few things that I need to so that I'm comfortable with Microsoft. First, a strategy that says, oops, on demand needs to be the top priority for the company as we move through 2007. Releasing it the 3rd or 4th quarter or whatever hazy release date its given, doesn't cut it. The days of overtaking Word Perfect & Netscape late in the race are over. Salesforce.com, NetSuite and even SAP aren't going to roll that easily. Oracle remains clueless right now, but that isn't necessarily either a permanent or terminal condition for them and they have the resources to make this a race again. However, Microsoft's Live initiative as villified as it has been (not by me though) is a sign that they are getting the idea that service oriented architectures and enterprise productivity from the prosumer's standpoint are dominant features of the 21st century customer's life - whether or not he's B2C or B2B. But that might not be enough.

As far as the 100 million blogs peaking goes - who cares? Tell me the difference between a red hot growth rate to 150 million and a stable 100 million blogs. None of us will ever know. Nor does it matter at this point. Barring something rather odd - like an asteroid strike on the earth - the blogosphere is now an established, credible influence on the thinking of millions of people. Whether there are 100 million or 250 million or 20 million of them. I mean, who REALLY cares about this number and what meaning does it have?

Sheryl Kingstone, Yankee Group - Her Forecast - Sheryl sees failed SFA being more frequently replaced with mobile CRM as costs come down and the market becomes more viable to business. My Thinking: I think that she's dead on, though perhaps a bit too conservative - though she's both smarter than I am and also knows more about the mobile market than I do. What I see in 2007 is a couple of things. Sprint leading a bandwidth charge that can make a huge difference by 2008-2009. First, they've upgraded much of their EVDO network to Rev A. which increases download and upload speeds by an order of magnitude which means that streaming multimedia becomes a stronger possibility. Verizon is following suit. Sprint also announced a $3 billion investment in the 4G-labed WiMax - a wide area network that will provide wireless services over a 30 mile radius, not just a Starbucks table and couch. Whole cities can be WiMax-enabled, meaning any time, any where at WiFi-like and faster speeds becomes a reality in a couple of years. Couple that with the hardware improvements. For example, we've seen the Blackberry enterprise powered for years now, but also Nokia is coming out with the N90- which is a really smartphone with so many both connectivity and prosumer features of quality that I can't list them here in the interests of space - and time. While not a Blackberry, it carries some hefty features - so many that its been labeled a mini-computer by some pundit sorts. We can't forget the lust factor either. We all saw the Blackberry Pearl and the-now-sued-by-RIM Cingular offered Samsung Blackjack (with easily the coolest commercial for any phone on TV)

All in all, a substantial number of vendors like Vaultus, salesforce.com, Microsoft, SAP, and many others are developing or having their partners develop mobile CRM apps. There is a mobile AppExchange from salesforce.com that came with the purchase of Sendia within the last 12-15 months. So the prospects are good. Sheryl Kingstone strikes again.

Denis Pombriant, Beagle Research Group - His Forecast - Dennis sees companies like salesforce.com, NetSuite, NeoCase and Five9 moving big time into overseas markets. He also forecasts the on demand platform starting to replace legacy internal IT infrastructure. My Thinking: I NEVER argue with Denis because its a silly thing to do. He's right too often. My differences with him are probably in nuance and style and he's a little more conservative than I am about the movement of things. But that's about it. I agree with him in spades here especially on the nearly untapped Asian market. The irony is that Asia is more "mobilely" advanced than the U.S. and culturally ready for a mobile CRM so the move by the on demand vendors into a part of the world that is thinking "web dominance" already makes perfect sense.

Steve Raye, EVP eVergance - His Forecast: - I'm going to let it speak for itself (from SearchCRM. There are many others who I also respect like Donna Fluss, but I'm addressing the ones of most interest to me immediately)

Open source business applications will challenge the value proposition of SaaS in the coming year. More affordable on-premise business application software will become available in 2007 in almost every category, but especially CRM. SaaS vendors will continue to customize their platforms. The pendulum may be swinging toward a preference for lower-cost packaged software. The continually developing market could bring a combination of open source and SaaS technologies. Talisma now delivers more applications on-premise than in a SaaS model. SaaS vendors may need to co-opt open source business applications to create offerings that can be deployed either in a hosted model or on-premise -- or some unique combination we haven't thought of yet. Something for companies to keep in mind is that they may want the flexibility to change between hosted and on-premise over time. Companies may think about demanding that option in 2007 and beyond.

My Thinking: This strikes me funny (funny peculiar, not comedic except in a Dantesque vision of Purgatory-sense) especially if you've seen my comment of just a few days ago in SearchCRM or my PGreenblog entry of December 21. I said the same thing in 2006 as he does in the first paragraph and I wasn't right - not entirely wrong - but not right. I don't see ANYTHING on the horizon that the open source business applications are doing that will challenge on demand in 2007 or beyond either. What Mr. Raye may be forgetting is that the pricing models, not just the "open source principle" have to be disruptive enough to change the market - as does the functionality and features and the quality of the application itself. Open source, certainly a challenge when the price of the software is free, is not much of one when their pricing models are traditional and on premise like. SugarCRM set the bar at the primarily traditional models, even with a free version.

Even worse, I'm not sure where he is coming from when he sees the "pendulum swinging toward a preference for lower-cost packaged software" either. The pendulum continues to swing to the on demand platform and will only move more to the web-based versions as the service oriented architectures get better and better. Also, his forecast says that "companies may want the flexibility to change between hosted and on premise over time." True, but that's not a forecast and not something that most companies will really be thinking about. Gartner is predicting a pendulum swing to "best of breed" as an alternative to SAP or Oracle in particular. But even this isn't anything to do with on premise vs. on demand. As Gartner's Sharon Metz says,

60% of all new CRM applications deployed within two years of purchase will be from best-of-breed vendors rather than from Oracle or SAP, according to recent research from Stamford, Conn.-based Gartner Inc. Much of that 60% will be smaller applications installed to enhance CRM deployments, often from SAP or Oracle. These "bolt-on" applications tend to come from smaller, best-of-breed vendors -- which feature a range of Web analytics, mobile computing, vertical-specific, and geographically specific functionality"

Meaning the increasingly individualized or localized or personalized "bolt-ons" that will enhance the platforms. This has little or nothing to do with "open source" at all. I can't say that I agree with Mr. Raye. I don't know him personally, but I wouldn't really think of what he's saying as a forecast, more like a marketing thing, frankly.

Now Me...2007....Look OUT!

Note that you'll see a number in color after the bullet and prior to the text. That's what I think my odds of being right are. (10) means I have total confidence that I'm going to be vindicated when this long trial is...I mean I'm going to be spot on when the year is done. (5) means, I'm right...no, I'm wrong...no, I'm right...no, I'm wrong...I'm.... (1) means I'm taking a really stupid shot here but ain't I brilliant if I turn out to be right? I'm the next Amazing Randy.

• (8) CRM 2.0 will become more than a buzzword in 2007 and the exorable march toward the death of "traditional" a.k.a. "classic" - Coke, okay, CRM in 2008 will continue. This will be done through partnerships and alliances rather than home grown "pure" CRM products. However, there will be a marriage of the "social web" products and services with the CRM technology vendors partnering with the blog producers, wiki wackers and especially social networking softwares/services (or acquiring them) to provide a more useful collaborative experience for customers and partners/suppliers/vendors. The framework for CRM will finally change to the point that the old META definition of operational, collaborative, analytic will be put to rest once and for all. Watch for a new feature-function-business rules-technological architecture CRM 2.0 framework by 4th quarter of 2007.
  
• (5) The customer experience will be the defining characteristic of 2007 corporate strategy and the old CRM formulation of People-Process-Technology will be replaced by a focus around mapping customer interactions and providing the tools to enhance the customer's experience with the company. This is already a work in progress with companies like Disney Destinations changing their approach through changing their acronym from CRM - customer relationship management to CMR - customer managed relationships. However, this doesn't mean that PPT will be entirely replaced. It does mean it will be subsumed to new strategic formulations built around the customer experience and experience mapping and design will be a major component of contemporary corporate activity. That is presuming both the CRM world and the experience design worlds which currently co-exist, can get over their arrogant attitudes to each other. With CRM trying to stuff the experience design/mapping into a convenient CRM pothole and the experience design guys trying to poo-poo CRM entirely. Why don't both of you big babies get over it and just work together (C'mon people now, smile on your brother, everybody get together, try to love one another right now...)
  
• (4) The 6Cs of the new customer will become the new business model that drives the era from 2007 beyond (if it were 2008, I'd make that a (7))
• 1. Collaborative - communities
  2. Contextual - Context driven advertising
  3. Content-driven - user generated content
  4. Connected - mobile & social networking
  5. Conversational - death of the 4Ps in marketing
  6. Creative - Co-creation of value
• What this means is that user generated content, experiential marketing, experiences as commodities and business as an aggregator of experiences that include products and services - among other things - will be more than just experimental but will break into the mainstream of both mindshare and market share. The Proctor & Gambles on the big boy enterprise side and the Threadlesses on the little guy disruptive side will become much more common than they have been. Because the customer is looking for it and wants it that way. AND it makes good business sense.

• (7) As I mentioned earlier, I don't think that open source CRM will be a disruptive element in any way or set any bars. However, I think there will be some impact on the enterprise from the free CRM programs that are entirely web-based. Companies like Zoho who put on social networking tools like ZohoWiki and CRM tools that are functionally pretty decent like ZohoCRM, or Zimbra who have a collaboration suite that can be utilized online or through the salesforce.com AppExchange, will start to make some headway into the small business market since their price is nearly free or free. The reason for their increased access will be the vacating of the SMB market that I think we'll see in 2007 by salesforce.com, NetSuite and several other CRM vendors as they move upmarket and start scaling up to the enterprise level deployments that will put them in league with SAP, Oracle and even Microsoft. I don't think this will be much more than a trickle in the coming year because they don't have the buzz yet nor do they have the functional chops that the companies vacating the space have, but they do have enough value to grab a foothold in the SMB space.

• (7) Companies like Rearden Commerce will begin to show up on the horizon as service oriented architectures begin to blossom more fully and become the foundation of the bulk of the enterprise IT architectures over the next three or four years. 2007 is the year that the companies that provide business/prosumer services attached to their offerings will begin to become a niche unto themselves. Rearden will continue to own the space - especially in light of their deal with American Express. Rearden Commerce itself will have a breakout year as its deal with American Express begins to generate both market share and buzz like crazy. Also, it doesn't hurt that Rearden has the first fully realized SOA on the IT side of the house. First to market is HUGE for Rearden and 2007 is their year.

• (9) Social networking and other forms of 2.0 driven applications and services will be integrated with CRM and enterprise applications. But not as I originally thought - through building or acquiring the companies that make the assets. Instead we'll see partnerships and OEM relationships etc. between the social networking companies and particularly, the on demand vendors to integrate the functionality of social networking and user collaboration, especially with CRM vendors. The on demand vendors like salesforce.com & NetSuite in particular are best positioned to do this but I also see SAP being savvy enough to do this kind of collaboration, though if any one company would build their own, it would be SAP. This may portend something of a revival for Lotus Notes as a collaboration platform and toolset. Though maybe not. That's going to be up to IBM - who have good people at the Lotus helm, but have been terrible about their marketing and positioning of Notes. We all might be surprised - and not unhappily.

• (2) Web 2.0 will finally get another name though 2.0 will remain the buzzword/cliche that drives us all to distraction when it comes to naming new technologies, applications, platform and ANYTHING that smacks of peer to peer. How about "the Social Web?" This works, n'est ce pas? After all, they have a name for Web 3.0 already - The Semantic Web - so why not 2.0? Come ON, papi.

• (7) I said this up top, so look to there for some of the rationale, but mobile CRM will become something to be reckoned with in 2007 with the Blackberry platform leading the way - especially as RIM continues to roll out successful Pearl-looking super-stylish phones that have their already heavy-duty and secure push functionality. Already significant numbers of vendors are developing mobile CRM applications/services and almost all are doing it for at least the Blackberry and then the Treo.

• (9) CRM and social customer related blogs, podcasts, and vlogs will continue to proliferate in 2007 in all kinds of interesting and unique ways that we have yet to "aha" about. This, despite Gartner's prediction that the blogosphere will level at 100,000,000. That's kind of a funny one actually. Because, what does it really matter whether it levels at 100,000,000 or 150,000,000 or 200,000,000? You or anyone you know gonna read most of them? Its a helluva lot of blogs no matter how you cut it and it also indicates the level of influence by sheer weight (not necessarily quality or originality) that the blogs carry. Speaking of which, there is a guy named Jesus Hoyos who runs a blog called "CRM En LatinoAmerica" that has a great listing of current CRM related blogs. Check it out here. This is the best compilation of CRM related blogs I've seen. The site is in Spanish and English but this is a universal set of links.

• (25) I'm not going to predict "consolidation in the industry" since that's a cliche and consolidation in all industries is going to always go on. To predict "continued consolidation" is to predict "the sun will come up - tomorrow. Bet your bottom dollar, that tomorrow, there'll be sun..." So screw it. I rank THAT one 25 on a scale of 10.

The Enterprise 2.0 growth will continue to proliferate as social tools like internal wikis, blogs, etc. will be increasingly adopted as business requirements. There was an absolutely great blog entry on ZDNet by Dion Hinchcliffe. Follow all the links that he refers to in the complete entry. It is just a great explanation of The Enterprise 2.0 Just great....Here's an excerpt:

Enterprise 2.0 year in review by ZDNet's Dion Hinchcliffe -- Though the eponymous title of this blog refers to the application of all aspects of Web 2.0 to the enterprise both large and small, the big story this year has really been about a collaborative subset of Web 2.0, something referred to as Enterprise 2.0. Though the definition has continued to expand in some circles, Enterprise 2.0 describes the use of the latest freeform, emergent, social software tools that hold the promise to significantly improve the ways that we work together and collaborate. As an example, the liberal use of internal blogs and wikis with discoverable content frequently forms the foundation of an Enterprise 2.0 software strategy.....

Okay, enough of this. I'm done for now. I may have another set of forecasts and we'll check back at the end of 2007 to see how bizarre I was on my forecasts.

Technorati : Blackberry Pearl, CRM, CRM 2.0, Denis Pombriant, Forrester, Gartner Group, NetSuite, Rearden Commerce, SaaS, blogs, business model, customer experience, salesforce.com, social networking

Okay, So I'm Not Perfect....

Barney Beal, a top flight reporter/editor for SearchCRM, wrote an article today that covered where open source CRM is currently sitting in the pantheon of good ideas done right. In that article, he (accurately) quotes me as saying,

With customers like Starbucks and Sterling PCU, SugarCRM has made some headway in the CRM market after its first release in September 2004 -- just not quite as much as some CRM experts predicted last year, as it competes with on-demand vendors.

"While I think open source is a credible alternative to on-demand, I've come to the conclusion that open source is only going to be an alternative and a continuous force -- not a fabulous business model for CRM," Paul Greenberg, president of the 56 Group LLC, a CRM consultancy, wrote in an email. "All in all, I think that while open source CRM gained some absolute ground when measured [against] where it was a year ago, it lost relative ground due to the speed and credibility that on-demand gained over the year, thanks primarily to the work of Salesforce.com and NetSuite -- both of whom did terrific things with their applications/services."

SugarCRM's pricing model -- which operates in a more traditional way and is less "open source-like," according to Greenberg -- will make it difficult to keep up with SaaS companies like Salesforce.com and San Mateo, Calif.-based NetSuite Inc., as it scales up.

You'll note inside the quote, he links back to what CRM experts said late 2005 as to what 2006 would be like, so I clicked on the link to see what I said (hey, the other guys can do this on their OWN blogs) and decided to review myself and see how well I did. Of course, meaning, I could turn it into a grade of some sort.

Here's what I said, and I'd like your feedback on how right and how wrong I was - my own feedback on me (the epitome of narcissism - me commenting on me and then me commenting on me commenting on me) will be in red next to the forecast from last year.

Say goodbye to CRM as we once knew it

By Paul Greenberg

• The customer experience with products, services and the company providing them will be the foundation for CRM going forward and will be increasingly a consideration for corporate strategies. Metrics will be developed to measure the success of the customer experience, and the idea that value resides with the customer will be critical in 2006 and beyond. CRM, as we knew it, will disappear by the end of the 2008. (RESULT: This was probably the closest to accurate of all of the 4 though of course the 2008 portion of isn't answerable yet - is it? The one weakness in my forecast here was that metrics will be developed to measure the success. As of right now, the only universally accepted metric for advocacy, for example is the Net Promoter Score that Fred Reichheld posits and develops in The Ultimate Question, but that's, at best and at least, only a beginning. However, the other aspects on the importance of the customer experience clearly entered the corporate consciousness, if not the conscience in 2006.
• "CRM On Demand" will become preeminent and though on-premise vendors will continue to survive, most companies considering IT investments and system investments will choose on-demand products for the enterprise and as a platform. However, the on-demand functionality will still not be as complete as on-premise by year's end, though that won't matter. (RESULT: Actually this one was 100% on the money. The only surprise here was that salesforce.com and NetSuite both created their programming tools and platforms, Apex (salesforece.com) and SuiteFlex (NetSuite) quickly and with a close-to-enterprise on-premise capabilities, if not full blown functionality, though on the latter, NetSuite came damned close)
• The open source movement and companies like SugarCRM will become a credible competition to the on-demand market. Open source CRM will establish itself as a solid alternative in 2006. (RESULT: You saw what I said above. I'd say I was about 60% right here, though I sound "righter" than that. The reality is that the open source CRM apps available are fine and good and cheaper to a point - but not a disruptive point and their pricing models, especially SugarCRM's tend to the traditional ranges. Plus, there is no indication that they can scale at the level of the on demand tools. Also the service oriented architectures evolved more quickly than I imagined (again, a fritzed circuit of my brain caused me to think linearly), which takes open source as a model to the ordinary and on demand and entirely web based models (see ZohoCRM for a pretty interesting SFA application that's the Live Web version or CRM 2.0 version or whatever you'd like to call it) to the potentially extraordinary.)
• CRM will increasingly be integrated with strategies for social networking and at the application level, with social networking tools like podcasting, blogs and wikis, in addition to the harder core social networking applications such as LinkedIn. (RESULT: I was linearly right here. Meaning CRM companies all got involved with their own podcasts, wikis, and blogs this year, but few of them integrated the tools into their actual applications - stupid lack-of-move by them. This peer-to-peer and collaboration tools integration should have been priority for CRM companies as should have been the integration with customer experience tools and measures, but it wasn't and thus most of the companies - even the best ones like salesforce.com, NetSuite, RightNow, and the old timers like SAP and Oracle ALL missed the boat and didn't do it. Which will eventually hurt them. Since the contemporary customer demands to be part of the value chain. Get with it, CRM vendors. WAAAAAAAAAAAAAKE UUUUUUUPP!!!)

I would say a solid B+ for the success/failure of my 2006 divinations. Would you agree? What do you guys think 2007 will bring? My forecast in the next day or two....

Technorati : CRM, CRM 2.0, CRM at the Speed of Light, NetSuite, ZohoCRM, blogs, customer experience, on demand, open source, podcasts, salesforce.com