CRM, The Economy, Me, and You

Let me start by saying, I'm not an economist and I'm not going to do what I've seen thousands of other not-economists do, which is to speculate on what the right program for economic recovery. That would be the equivalent of an actor talking about his or her political answers to....oh wait.

What I am going to do is to both show you a survey of "literature" out there on CRM and enterprise applications, Web 2.0 - in other words, CRM-ish stuff, in the light of the financial conflagration we're undergoing and my thinking on how what the literature says. That thinking, as an FYI, will be constructed on a lot of reading, some thoughtful, errrr...thoughts and, of course, bullets fired straight from the hip in the direction of an unseen target. As part of the survey, I'm going to highlight what some of the vendors are doing to help you through the crisis - which is actually kind of interesting. What is also interesting is the absolutel lack of material out there -which you think would be substantial - given that there have been two weeks plus to think this through which, for softwre analysts with financial smarts to come up with some idea of what's going on and what to do. But there isn't that much.

Their Opinions (with Commentary Thrown In)

The first in line is the one that got me speculating and thinking to begin with.

1. Denis Pombriant, who has stronger economist chops than me, writes in CRM Buyer that one of the outcomes of this financial crisis will be that "consumers -- a species of human known for its high capacity for ingestion -- are being replaced by customers, a wary variety of marketplace denizen known for its ability to sniff out value." and that the leaner markets ahead will be prime territory for SaaS. PG NOTE: I can't help but entirely agree with Denis. While I think the consumer-to-customer transition will be slower than one would think, I think that companies will be acting as customers in the DP definition - which means they are going to place a primacy on controllable cost and customer retention - and thus, SaaS/on demand/"in the cloud" (take THAT, Larry Ellison) are going to be of real interest to companies looking to do something in an "era of sparsity."
2. Josh Greenbaum, in his ZDNet blog offers up some hope by hearkening back to 1990 and 1993 when IBM stock sunk to $10.50 and Oracle stock to, if you can fathom this, $0.13! So, Josh says, don't worry, there will be a recovery. PG NOTE: While that's all well and good, and I think there will be a recovery too, one thing that I constantly concern myself about (due to reading of far wiser economic pundits than me) is that despite the fact we get these stock market crashes every 8 years or so, each of them has a somewhat different character - and thus there is some uncertainty built in. But there is one certainty that seems to lend credence to Josh's perception which is we have a boom or a recovery after the bust every time too.
3. Peter Sondgaard, chief of Gartner analysts, at the Gartner IT Symposium today (via Twitter) says that " Unlike in dot com bubble, IT is now viewed as a way to transform business, not as wasteful." Sees a minimum growth of IT related products and services of 2.3% in 2009. That's minimum, folks, so buck up.
4. Don Peppers at the 1to1 Blog has a take that you probably won't see elsewhere on the 1to1 blog in an entry entitled, "The Financial Crisis: Short-Termism Coming Home to Roost." Worth a look see for a narrow lens view of the current economic rollercoaster.
5. Bruce Temkin, Forrester Group's leading customer experience senior analyst, did something on the impact of the customer experience called " Keep Customer Experience Momentum In A Recession " during an economic downtown back in May on his outstanding blog, Customer Experience Matters.

The vendors have a tricky road to walk in all this. They should take advantage of their relatively stable positions in this crisis and the desire that the more panicked rest of the business world has to find ways to stabilize their situations while the crisis continues to evolve while at the same time, they have to not be selling their software as the answer to the economic crisis.

For example, Tom Siebel, a person I have no love lost for, made a rather infamous comment that was actually not as crass sounding as you would think saying that 9/11 wouldn't have happened if law enforcement used Siebel. Here was the exact quote:

In terms of infringing on privacy, can computer-based monitoring and profiling be taken too far?
If we look at what we knew going into Sept. 11 about the backgrounds of these people--and for what it's worth, none of these people were citizens--our government knew that money had been transferred from al-Qaida operatives. They knew there were a number of people with visa violations. They knew these people had left abandoned aircraft running on runways in Miami. All the things we knew about these people--we had everything we needed to know to be able to stop the crisis of Sept. 11.

But basically because of the way that we're structured, it's very difficult for the FBI to communicate with themselves, even because they keep everything in manila files. We knew the day Mohammed Atta met with Iraqi agents in Prague. We knew the day he entered the country. We knew the day his roommate (Marwan) Al-Shehhi got a $100,000 wire transfer from an al-Qaida operative. We knew all these facts. If they had been able to associate these facts, people never would have blown up on Sept. 11. (Emphasis mine - PG) It's not a question of if we're going to share information across agencies about these things. The only question is how many people are going to die before we do it. The idea that the American people will incur some sort of intrusion or loss of privacy to live is ridiculous. How intrusive is an airport security check?

In context, you can see what he means and its not nearly as bad as it was interpreted back in May 2002 when he did the CNET interview. But it was indelicate to say the least and didn't walk the fine line of people feeling pain and commercial interest. (not terribly surprising in his case) You don't take advantage of people in pain, you try to help. If they do, they will remember. This doesn't mean don't run your business to your own advantage since it is your business, but it does mean that you have to walk the line between your commercial interest and your humanity which, while convergent most of the time, I would hope, aren't always that way - especially in crisis.

Vendors that are doing it kind of right so far are SAP on a large scale and Zoho on a small scale.

SAP is running a "Weathering the Economy" webinar series (one of which I'm a panelist on on October 22. Check on that one here) that is on what to do during the economic downturn, as part of their taking some business leadership, rather than following the easier path of technology sales, during the current crisis. They are using their ongoing business social networking site, MyVenturePad to sponsor webinars, discussions, blogging and subject matter expertise on topics like "Staying Lean and Leveraging More", "Recession-Proof Your Business" (something of a whimsical title actually, since I doubt that's possible), to "Kids, Money and Economic Chaos."

Zoho is doing some much more modest, as befitting their budget I would imagine with a low key but useful blog entry called "Surviving the Financial Crisis" which begins with a reference the popular GigaOm blog and their solution - nests within nests within nests......

I'm NOT seeing any of this kind of approach or leadership being taken by Oracle, salesforce.com, NetSuite, RightNow, Microsoft or Sage or CDC (like they'll ever do anything good for anyone) any other of the major players at a time that they should be not only primed and ready, but actively executing. If they are doing it, then they should send me the notices since I'm pretty much subscribed to everything they all do. But I can't find anything on their sites or otherwise. I'd love for one or all of these companies to get p.oed at me and prove me wrong and show me where they're taking BUSINESS leadership to help their customers and others, not just sell them software. They need to take some leadership in this area TODAY. They have resources - including in the case of some of them, lots of cash in the bank(s). Spend some of it for the general good. I promise. Some prospective customers will remember. Even write a blog entry or two.

Technorati : CRM, CRM 2.0, SaaS, economic crisis, social CRM
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Comments

[Don Peppers]

Paul, that Slate review doesn't tell you the REAL reason we didn't connect the dots with all the pre-Sept 11 activities. It had nothing to do with the FBI's and CIA's computer capabilities, although they certainly needed upgrading. But until the post-9/11 Patriot Act was passed, it was ILLEGAL for CIA to share information about domestic threats with the FBI! This law came down to us courtesy of Sen. Church's committee hearings in the 1970's. It was a well-intended effort to prevent the kind of domestic spying that characterized the Nixon Administration's efforts to undermine domestic resistance to the Vietnam War. Many well-intended laws, however, have unintended consequences.

The question now is whether we will also be scratching our heads in wonder at our own stupidity after the mushroom cloud dissipates over some US city in the future. We have the technical means now to monitor a wide range of telephone and internet-based communications, and to zero in on those that might indicate some type of threat like this. We have the technical means, but in the absence of an actual mushroom cloud, the question is whether we will ever have the will to do so.

[Rob Tyrie]

great article. When markets change, companies should shift there focus and help their customers. It's good for business all around. rt

[Glenn]

Right there with you on everything---except the remark about Mohammed Atta. The FBI and the CIA concluded that there was no evidence that he met with any Iraqi official. http://www.slate.com/id/2070410/

That said, it blows my mind that the FBI doesn't have a state of the art computer system. They might as well be using TRS-80's and Commodore 64's.

More importantly, I agree that we are evolving from consumer to customer.

Glenn