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....
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