Forrester Gets It Big Time, Gartner, Not Quite

It always thrills me when I see analysts and, on the rarer occasion, larger analysts companies as a whole, who seem to get it. Then I lament when there are those who I think don't get it as much though are trying hard. Let's just get down to brass tacks or whatever tacks are made of these days - plastic or something.

Forrester gets it.

Gartner doesn't quite.

"It" is the evolution of CRM to something other than what it was.

Gartner Doesn't Quite...

It's interesting to see the report of the Gartner 2008 European CRM Summit that MyCustomer.com did last week. Mark Raskino, a Gartner VP made the point in his discussion of emerging technologies that Web 2.0 is between what he called the early days of "the peak of inflated expectation" and the more mature period when it provides returns a.k.a. "the plateau of productivity." This "inbetweenness" is a corporate blindspot that companies have to treat seriously. And, to Gartner's credit, he saw Web 2.0 as a great customer experience opportunity especially when it came to "far more open models of interaction."

Ed Thompson, another Gartner VP and along with Michael Maoz, the two that I think are topflight star CRM analysts, also made a number of extremely important points among them:

1. Act on feedback - don't ignore.
2. Design processes from outside in to improve customer experience not increase efficiencies (BRAVO!!).
3. Act as one organization to ensure consistency - and, I might add, to make sure that the customer sees the organization not as a soulless company that is process-driven, but as another point of peer interaction for him/her.
4. Be open - which goes to the point that Joe Pine makes on Authenticity and Peppers and Rogers (Don discussed this at the conference) make on trust. As do I. Ahem.
5. Personalize products and experiences - old stuff here. Been saying that one for a long time.
6. Alter attitudes and employee behaviors.
7. Design the complete customer experience. Again, not that new. But critical. Found that one in the Web 1.4929416618 era.

All in all, this is good stuff so far. But then comes this from another conference piece at MyCustomer.com:

"Hot areas of the main markets over the next three to five years will be:

• Sales: software as a service (SaaS) salesforce automation (SFA), lead management, Web 2.0, ecommerce, sales performance management, pricing management and social networking.
• Customer service: collaborative and community intelligence, knowledge-enabled service resolution, feedback management and web self service.
• Marketing: web analytics and advert management, word of mouth and communications, customer datamining, marketing resource management and marketing performance measurement."

See anything wrong with that?

The answer is "yes."

CRM is no longer an operational toolset and strategy. It is both operational and collaborative. It is both transactional and interactive. The model that's presented above talks about the collaborative pieces - for example, Web 2.0 in the sales part; collaborative & community intelligence in the customer service part; and word of mouth and communications (not sure what "communications" means that isn't totally generic) in the marketing part. But it treats them as subsets of "things" interwoven with the traditional operational silos of CRM 1.0. In other words, social CRM is just a set of other operational capabilities for the traditional CRM modes.

The fact is that the social tools - blogs, wikis, podcasts, social networks and communities are NOT SUBSETS of CRM operational capabilities - they are an entirely different layer with specific characteristics that are designed to, not manage customers as in the traditional model, but engage customers in a collaboration with the company that has the result of improving the customer's experience in a way that makes him/her see the company as his "friend" or "peer" - and, on the business side, makes them advocates - the same way you like a friend. As you'll see in just a minute or two (depending on your reading speed and your boredom level so far), Forrester gets that, while Gartner is showing its conflicted and still not quite there.

Forrester Does....

On the other hand, Bill Band, easily my favorite Forrester analyst and one of my world favorites, did a report on CRM 2.0 for Forrester that simply got the picture. If you want it, you'll have to buy it, but, as much as I think prices for analyst reports are incredibly pricey, this one is actually worth it.

First some truthiness. I was interviewed for this report and it does use in a couple of places and one key table (and attribute it too. Thank you sir) material from the several hundred member CRM 2.0 wiki, which you're all invited to join (contact me at [email protected] and give me a little background). But that is only one of the rich array of sources and the incredibly well thought out material contained in this report. Since I probably shouldn't talk about a lot that's in the report, let me give you the gist of it which can be found in the executive summary in two sentences:

"In this new world, traditional CRM solutions will continue to aggregate customer data, analyze that data, and automate workflows to optimize business processes. But CRM professionals must find innovative ways to engage with emerging "social consumers" enrich the customer experience through community based interactions and architect solutions that are flexible and foster strong intra-organization and customer collaboration."

Do you have any problem seeing why I like this guy so much? This is a succinct and absolutely MONEY description of what CRM 2.0 is actually. There is a lot to it and you'll see more on CRM 2.0 in the 4th edition (along with an essay by Bill Band among others) this winter. But I think you can see the difference between Gartner's thinking and Forrester's thinking here.

Gartner and Forrester and I all agree that traditional CRM (the operational version) will continue to exist and with the accession of service oriented architecture will make processes and technologies more effective than ever and transactions more accurate and data more complete. But where Gartner diverges from both Forrester and me is when it comes to how to view the Web 2.0 technologies and strategies.

Gartner is kind of interweaving the Web 2.0 "stuff" with the traditional CRM stuff, relegating the collaborative CRM layer to a subset of the operational CRM standard. This is NOT wise - and its wrong.

Forrester (and I) are treating the "social" side of CRM as a cohesive "peer component" with its operational side. In other words (though not really words).....look at this diagram - which is a pretty ugly piece of work (I did it and I ain't no artist) and yet, I think, it adequately (and only adequately) reflects the models' differences

The net result of the Forrester model is that customers are engaged with employees, operational and social technologies are integrated into a holistic (or if you long time readers remember back in the days of yore when Rome was still an empire, I called it "whole brained CRM") unit and the thinking of the company is about collaboration to create customer value.

The net result of the Gartner model is that you have some interesting improvements in the features and functions of the technology and you have some process improvements, but the relationships with the customers are not collaborative, they are more "push-friendly" (aggressively upbeat and positive but from the company to the customer and not necessarily reciprocated. To put it in human terms, if you've ever seen the musical/movie "Hairspray" (and just to be clear, I love this musical), the lead role is of that sunny kind of optimism that seems so forced it makes you grate your teeth because of its relentless "cheeriness." Its the kind of relationship that's out to prove that they are happy, dammit! That's what the Gartner model leads to. Not really collaborative, not really engaged, just the signs of engagement that are supposed to be there regardless of the human. Its a model of "company to customer object" rather than the company as a " peer to customer subject."

If ya know whaddyI mean.....

But There Is One Last Thing.....

What I see as the only omission in this important work is that while implied, it doesn't really give the biggest picture on how CRM 2.0 came to be - and that's an important omission.

The transformation we're undergoing is a social evolution (or revolution if you wish) in communications that was and is created by people (not customers - the people are customers among other things) and it affects all institutions - be they government, social, political, or business - or any other institutional category you can think of. So business is NOT driving this, nor are customers. People are acting as peers using technologies and ideas to "democratize" (a woeful word for this really, but the best we have in English) and personalize the experiences and expectations and interactions that these people are having - one at a time - as individuals. That means that business is as clueless as the government and as the garden club in how to deal with what people seem to want - especially those who are growing up with an entirely new set of expectations on how things are delivered to them and what level of interaction they can have with them. When successful like the Obama for President campaign, or Proctor & Gamble they can lead to enormous power. But only if its recognized that these are social changes first, and business changes second.

Beyond that, I can't find a thing wrong and there is a lot enlightening in the Band CRM 2.0 doc and that makes it a great read - because it provides real value.

And, did I mention already that the CRM 2.0 Wiki is in there prominently, especially in the table of differences between the current and next generation of CRM thinking. I'm so proud I'm kvelling.

Kvelling? Its Yiddish. Beyond that, I'll give you bupkas. Go look it up for yourself. You'll know what I mean.

Technorati : Bill Band, CRM 2.0, Forrester Group

Comments

[Jesus Hoyos]

Paul, here my article in Spanish about your blog: http://jesushoyos.typepad.com/crm_en_latinoamerica/2008/04/crm-ahora-es-colaborativo-contuaci%C3%B3n.html

Many organizations (including Latin America) are still mplementing CRM using the old Meta Group definition of CRM: operational, analytical & collaborative (which I preferred to use the term interactive) since the new CRM has to be collaborative ...

[Michael W Thomas]

Great blog Paul and the Gartner perception will steer companies in the wrong direction by not understanding and allowing the natural open collaboration of consumers instead of looking to "manage" it...in silos no doubt. It shows a lack of understanding and not truly getting their arms around who is really driving the bus.
Engaging, embracing and facilitating the collaboration will allow a natural understanding of the customer if what is truly gathered is used to grow and keep the relationship. To me it sounds like the old cart before the horse or the dog wagging the tail or vice versa analogy.

[Gregory Yankelovich]

Excellent post, Paul. It seem there are more and more technological opportunities to do better and more effective things, however most clients I see, decided to think that CRM is a contact management strategy - and even that is challenging for them to execute on. I have been focusing on managing CRM implementations since middle 90's, and it appears that many companies have lost a vision in a last few years, setting lower expectations in what they want to achieve. There are surely more projects around, but it is harder to find a meaningful and interesting one to engage.

However I do have a problem with your Yiddish transliterations - the only correct way to do it is - "babkes" :=)

[David Engel]

I agree with your last thought. My word - in place of "democratize," would be de-institutionalize, which is also a shaky word. In the sense that control is being given to the individual and then comparing that with political schemes, I think of it as almost anarchy in the libertarian sense.

[Jesus Hoyos]

Paul, I really like your blog entry, specially this: "CRM is no longer an operational toolset and strategy. It is both operational and collaborative. It is both transactional and interactive" ... Agree 100%.. I will be blogging in Spanish (for my Latam audience) about your blog in the next few days...