On this Side, Salesforce

Gwynne Young
Managing Editor, CRMGuru.com
Member

Posted 12-Oct-2005 10:32 AM
Do you think things are gelling into a battle between Oracle and salesforce.com?

The news that Craig Conway, PeopleSoft's ex-CEO was joining the salesforce.com Board of Directors, effective immediately, is being played by some as part of the escalating rivalry between the two firms. Conway spent a year of cooling his heels from CRM after his ouster from the PeopleSoft board, just before the hostile Oracle takeover.

Do you think this is a sign of things to come? Is salesforce going to keep adding Oracle "enemies" to go on the offense? Or is it really just the story of a guy who loves the industry and wants to have a stake in it? (After all, he's not going to join Oracle.)

---

Gwynne Young
Managing Editor, CRMGuru.com
Member

Posted 12-Oct-2005 10:42 AM

[Posted for Michael Lowenstein, Customer Management Center of Excellence, GfK NOP]

It's probably a little of everything. There are few CEOs sharper than Marc Benioff, and it's fairly certain that he doesn't mind "sticking it" to Larry Ellison and Oracle, especially if it means doing so with a high-visibility, high-capability individual in the world of CRM.

Makes you wonder—could George Shaheen, who's been with Siebel for only about six months, be in Benioff's sights somewhere down the road? Stay tuned. Film at 11.

---

Gwynne Young
Managing Editor, CRMGuru.com
Member

Posted 12-Oct-2005 10:56 AM

[Posted for Paul Greenberg, President, The 56 Group, LLC]

While it's convenient to see this as Benioff/Conway (ex-Oracle) vs. Ellison/Siebel (current-Oracle), I don't think that this is the actual nature of this battle as much as it would be the immature thing to do. I actually see Conway's appointment to the Board of Directors of salesforce.com in conjunction with the appointment of ex-Accenture CRM chieftain John Freeland as salesforce.com's President of Worldwide Operations—and it worries me.

I think that salesforce.com might be doing something that Apple thought it had to do a few years ago when they appointed John Scully and that is to make themselves more "corporate." That usually meant more "operational" and as Scully's Apple history bore out, a lot less innovative. I hope to any appropriate deity that this isn't the case, since whatever one thinks about salesforce.com (and I'm a big fan) and about grand schemes, they are an innovative and original company that transformed the industry because they are innovators. They lead that way. But if John Freeland + Craig Conway = John Scully, I will be so very, very sorry about salesforce.com. I'd love to hear them comment on this and tell me I am (I hope) wrong.

Ah, but one will say, we live in a world where when things get bigger they get more operational—they have to. Yes they do, but suppressing innovation isn't one of the consequences of operational improvement. During Craig Conway's tenure at PeopleSoft, the lovely culture that Dave Duffield built was destroyed as was the most innovative parts of PeopleSoft—its staff. It became just another big software vendor struggling mightily to survive.

Prove me wrong, my friends at salesforce.com. Prove me wrong.

Paul Greenberg
President, The 56 Group, LLC
Chief Customer Officer, BPT Partners
Author: CRM at the Speed of Light: Essential Customer Strategies for the 21st Century, 3rd Edition

Blog: http://www.the56group.typepad.com

---

Gwynne Young
Managing Editor, CRMGuru.com
Member

Posted 12-Oct-2005 12:39 PM

[Posted for Bruce Culbert, Managing Director, BPT Partners]

I, personally, think there is too much being read into this. Yes, with Craig, there is the Oracle connection, as with Mark; and everyone would like to think that Mark and Craig are lining up to do battle with Larry and Tom. And when it's all said and done, the world will explode and there will be one enterprise software god.

Don't worry, it won't happen.

If Mark Benioff thinks adding Craig Conway to the board is a good thing, I'm pretty sure he did it for reasons other than calling out Larry Ellison.

Besides, smaller and more nimble players are dreaming up ways to take it to Oracle and SFDC. The question I have is: Who is next on the stage of enterprise software?

---

Posted 13-Oct-2005 09:08 AM

I think the next CRM movement in the enterprise will be Open Source players like SugarCRM. I'm not sure that Sugar is the killer - it's a PHP application and there's just so far that a scripting language can take you. Whoever it is, the next big enterprise player will be Open Source and radically less expensive per seat.

The structure of CRM only occupying call center and salesforce desktops flies in the face of customer centricism. The next big thing in CRM needs to be flexible enough and sufficiently value oriented to become the customer communication corridor for the whole enterprise.

Oracle's problem will be that it has already decided what the enterprise looks like and it's not customer centric. Salesforce.com problem is that they have taken the Seibel route of deciding that Marketing, Sales and Support are the only necessary users. From the perspective of CRM each model treats the operations of the company as something to be queried and messaged.

I don't know about you but delivery and billing are the primary touchpoints of most of my personal interactions with companies and there is WAY more to be done in most companies to tie the HUMAN aspects of the chain together.

Oracle and SFDC are each uniquely unqualified for the real CRM challenge - a sincerely executed customer centric strategy.

---

Gwynne Young
Managing Editor, CRMGuru.com
Member

Posted 13-Oct-2005 10:19 AM

[Posted for Graham Hill, Independent CRM Consultant]

The business world is full of ex-CEOs whose vision was either too grand (Jacques Nasser at Ford), couldn't be implemented (Carly Fiorina at HP), just didn't work(George Shaheen at Webvan), was never a real solution (Jurgen Schremp at Daimler Chrysler), or who got bought (Tom Siebel at Siebel). Many of these CEOs destroyed shareholder value during tenure.

Occasionally, a real giant comes along like Jack Welsh at GE or Colin Marshall at British Airways in the mid '80s, who enable the companies at whose helms they sit to create extraordinary value. They do so by having a stretch vision that is right for the company, the market and the times, but mostly by motivating, enabling and supporting staff at al levels of the company to do part in achieving it over the longer-term.

Leadership is important, but it is only a small part of what drives success in business. It is not for nothing that Leadership only accounts for 12% of the Baldridge Award scoring.

And so to Craig Conway.

In the bravado world of high-tech CRM, that the CEOs of two of the largest companies are playing to the financial markets is hardly news. However, it is hard to believe that the appointment of Craig Conway to the board of Salesforce.com will make much of a difference. Salesforce is one company that is not short of stretch vision. And Marc Benioff's leadership style and support for what is likely to become the dominant software delivery approach is well known.

---

Gwynne Young
Managing Editor, CRMGuru.com
Member

Posted 14-Oct-2005 09:59 AM

[Posted for David Rance, Managing Director, Round]

Am I alone in not caring an owl's hoot about who works for which CRM software company? We seem to be obsessed with CRM software as if it is some kind of panacea. Choosing which CRM software is a bit like deciding which side of the Niagara River do you want to float down towards the falls!

David Rance
Managing Director
Round (UK) Ltd
Improving customer centricity by design

[URL=http://www.round.co.uk ]www.round.co.uk [/URL]

---

Gwynne Young
Managing Editor, CRMGuru.com
Member

Posted 14-Oct-2005 10:01 AM

[Posted for Simon Kriss, CEO and President, Sagatori]

Here Here...well said.

Studying software gets you about as close to being Customer Centric as standing outside McDonald's makes you a hamburger.

---

Gwynne Young
Managing Editor, CRMGuru.com
Member

Posted 14-Oct-2005 10:04 AM

[Posted for Jeremy Cox, Managing Director, The Wisdom Network]

Great point, David. Bit like being given a plane but with no flying lessons. I wouldn't want to be a passenger on that first trip!

As for Software Wars, I agree this is merely a distraction.

Jeremy W G Cox
Managing Director
The Wisdom Network Ltd

---

Gwynne Young
Managing Editor, CRMGuru.com
Member

Posted 14-Oct-2005 10:06 AM

[Posted for Jay Curry, President, Jay Curry Associates]

It appears to be politically correct to belittle CRM software pioneers' personalities and products. I, too, have been guilty of this myself.

But shouldn't we be thankful to these guys for getting our industry off the ground and for those early engagements helping companies evaluate products?

---

Gwynne Young
Managing Editor, CRMGuru.com
Member

Posted 14-Oct-2005 10:13 AM

[Posted for Paul Greenberg, President, The 56 Group, LLC]

I'm with you, Jay. Though it's not a matter of belittling someone for p.c. reasons, I don't think. We do write about the moves at the CRM software or hosted services companies, because, like it or not, they are part of the reason that CRM initiatives work (or don't), and they are the ones who, as you said, "got our industry off the ground."

It's no different than commenting on any company. We talk about United or Southwest with impunity, and we talk about leadership as innovators or pioneers or something more detracting. Meaning, we are seeing and commenting on them publicly, usually as companies that meet or don't meet some CRM standards that we have.

The CRM-related industry (which we are all in, whether it's on the strategic side or the technology side or whatever) has to meet particularly stringent standards—because CRM is what it DOES.

I don't think that we can ignore or belittle the idea of CRM technology. It DOES matter—it's just not the primary piece of the overall puzzle. Some of the products are great; some stink. Some of the service providers are great; some stink. CRM technology is part of the equation—because there is a misconception on what CRM is doesn't mean that technology is unnecessary. Just overemphasized.

So who runs the companies will matter—the same way that who runs GE, GM, or Merck Pharmaceuticals matter.

I'm curious. Is there any guru who develops CRM strategy for companies who makes sure that technology ISN'T a part of it? Again, a part of it, not the primary piece? If so, why not?

Paul Greenberg
President, The 56 Group, LLC
Chief Customer Officer, BPT Partners
Author: CRM at the Speed of Light: Essential Customer Strategies for the 21st Century, 3rd Edition

Blog: http://www.the56group.typepad.com

---

Gwynne Young
Managing Editor, CRMGuru.com
Member

Posted 14-Oct-2005 10:16 AM

[Posted for Jeremy Cox, General Manager, The Wisdom Network]

I wonder if we are talking at cross purposes here. Software can enable a more responsive company; however, knowledge of the personalities
running software companies is not a pre-requisite for success.

We, on the other hand, as people earning our money out of the industry may take a greater interest in these personalities. Investors, no doubt, would take an even greater one.

Personally, I have no interest or opinion about any of these captains of industry. I don't think that's 'pc,' though it might be myopic.

As for technology, I'd rather live with substandard technology applied intelligently with some fierce duck peddling under the waterline than best tech applied without much thought.

Warmest regards to all

Jeremy

Jeremy W G Cox
Managing Director
The Wisdom Network Ltd
Great Britain

---

Gwynne Young
Managing Editor, CRMGuru.com
Member

Posted 14-Oct-2005 11:32 AM

[Posted for David Rance, Round]

Way to go, Jeremy.

I took the extreme position to make the point that there is still a group of people who believe (or want to believe) that implementing software will fix the problem of managing companies in a way that is clearly not designed for customers.

(Adam Smith, who in 1851 defined the specialisation of labor that launched the industrial revolution in his The Wealth of Nations, certainly has a lot to answer for.)

Technology is just a part of the solution, but it is tantalizing to believe that it will solve all problems known to mankind—and I speak as a systems architect and software developer, as well as a former customer care VP who managed software programmes.

All innovation in this area is both welcomed and necessary. In my view, we need to be seen to be part of that innovation and pushing back the boundaries of thinking not engaging in discussions about CRM companies or executives, otherwise we perpetuate the perception that CRMGuru.com is just about CRM software.

David Rance
Managing Director
Round (UK) Ltd
Improving customer centricity by design
[URL=www.round.co.uk ]www.round.co.uk [/URL]

---

Graham Hill
Guru
Member

Posted 16-Oct-2005 03:53 AM

This is an interesting conversation.

I don't think anyone underestimates the role that the major software vendors have played in creating the dominant model of CRM today. And I think a growing number of people also understand that this dominant model - one that is largely dependent upon implementing complex, expensive, enterprise CRM systems - has for many companies been a very poor business choice. Their CRM projects have floundered and large amounts of value has been destroyed.

If you were to be charitable, you might say that the CEO's of the software vendors (and tame systems integration consultancies and software analysts) have fooled themselves into believing own hype. If you were uncharitable, you might say that they didn'r really care whilst the money was rolling in. Caveat emptor.

But if CRM software isn't the universal panacea, what is?

Some would put forward customer-centricity as the answer. Whilst it is pretty obvious that most companies are probably not customer-centric enough, the question still arises, just how customer-centric does a company need to be to create the most value? Sadly, at this moment in time, we just do not know how much customer-centricity is good for business.

So if customer-centricity is no panacea, what is? The sad answer is THERE IS NO UNIVERSAL PANACEA. We know that CRM is a combination of doing many things, but we just do not know how much CRM software should be combined with how much process reengineering, customer-centricity, information sharing, organisational collaboration, etc to create the most value. (Whether you measure value from the company, customer, or any other perspective.)

CRM is still very much work in progress. We are all involved in thousands of CRM experiments in the companies we work for or with. We will only understand CRM better once we start to share what we are doing with each other more directly than we are doing currently. Maybe someone needs to create a CRM WIKI where some of these experiments can be publically shared, looked at in more detail by many different CRM practitioners and common patterns of CRM success identified.

The right level at which to look at CRM is almost certainly the "capability" level. A capability is a unique combination of business process, supporting systems, information flows, work routines, employee skills and other resources and assets that together enable a company to create value, or to durectly support the creation of value. Examples might include, "having a 360 degree view of the customer" or "recruiting customer-centric staff". It is by understanding the at most 20-30 core CRM capabilities that are relevant to most companies that we will start to develop a robust foundation for CRM.

But having a capability isn't much use unless a company actually uses it to create value. This requires that they understand how the different capabilities develop over time and how they must be combined with different complementary capabilities to deliver value. It isn't much use in having a 360 degree view of the customer unless you can use it to develop insights usable at the many touchpoints along the customer experience. And it isn't much use in developing the insights unless you can actually get them to trained staff who know how to use them to create value at each touchpoint. You get the picture.

For me the strategic CRM questions still left largely unanswered are:

1. What CRM capabilities does a company need to develop to create the most value (and a long-term competitive advantage)?

2. How do the CRM capabilites interact with each other (and with other non-CRM capabilities) to create value?

3. How much of each capability should be implemented, together with which others, to create the most value at the lowest cost and risk?

4. What role should different stakeholders - including employees, partners and customers - play in CRM?

5. How do we organise these different stakeholders to enable CRM to deliver its true potential?

These are all fundamental questions about CRM that are still largely unanswered. But only by answering these questions can we build a robust strategic foundation for understanding how CRM works and more importantly, how to make it work in different companies.

And so back to the original discussion.

My own belief is that distributed CRM models will come to dominate the CRM software market in the future.

That means that what people like Marc Benioff think, do and say is important. But it also means that what open source CRM organisations like Sugar CRM do is equally important. Maybe even more important in the longer-term if many companies new found focus on customer-centricity, pushes them to try and meet the demands of the vast majority of potential customers who are either underserved today, or not served at all (what Prahalad calls the "Bottom of the Pyramid" or Anderson calls the "Long Tail").

Maybe it's time to start thinking about CRM afresh. And maybe it's time to start doing it in a more "open" environment.

Graham Hill
Independent CRM Consultant

---

Gwynne Young
Managing Editor, CRMGuru.com
Member

Posted 17-Oct-2005 03:37 PM

[Posted for Dick Lee, Principal, High-Yield Methods]

Gosh—I didn’t know whom to respond to. All so provocative! While I appreciate what Jay's saying, some of the very same folks that helped lift up CRM through innovative technology also wounded CRM dearly by spending bazillions of dollars broadcasting self-serving, technology-centric perspectives.

Further, Tom Siebel deliberately made himself a public figure and attempted to become the icon for the entire industry. Such narcissism not only deserves-but demands our attention and rebuttal as members of the trade media (which like it or not, we all are).

While Craig Conway has been quite restrained, by comparison with Mr. Siebel, he has a track record and a public perspective, and his addition to Salesforce.com's board says something about the company, and that does merit our attention, in my opinion.

Regards,

Dick

---

Gwynne Young
Managing Editor, CRMGuru.com
Member

Posted 19-Oct-2005 08:53 AM

[Posted for Bill Price, President and CEO, Driva Solutions]

Oracle-the-hungry vs. salesforce.com vs. RightNow is how we see the market evolving for hosted CRM services, with a number of smaller players (Talisma and SugarCRM, for example) opening different approaches as well.

Not surprising to see Craig Conway move over to salesforce.com. Expect to see other moves and shakes in the coming year as "CRM as service" becomes mainstream.

---

Gwynne Young
Managing Editor, CRMGuru.com
Member

Posted 20-Oct-2005 08:41 AM

[Posted for Bob Thompson, Founder, CRMGuru.com]

Our surveys the past three years confirm that the days of most business executives believing "technology = CRM" are over. There are pockets of ignorance, and technology still receives most of the "ink" in our industry (save for CRMGuru, I think), because software is fun and ad dollars are being spent.

And people care whether Jennifer Aniston is dating again (see http://insider.tv.yahoo.com/news/insdr20050919t081000003039/ ), but I don't think it's going change society much, do you?

While I don't agree with David's sweeping "conspiracy" generalization (for CRMGuru members, anyway), he's well within his rights to "not give a hoot." But some of our members do care about major industry developments, and commentary from our gurus is one way to bring some perspective to them. Even the perspective that it doesn't matter.

As for being PC, in my eight years in this industry, I've seen mostly fawning over the CRM software pioneers, so an alternate point of view may help balance things out. Personally, I've published positive and negative articles about vendors.

---

Posted 20-Oct-2005 10:03 PM

I agree with Tim Rohde when he says that Oracle seems to have a pre defined view of enterprises and the rest of the CRM vendors plug away at Sales, support and marketing departments as if businesses are cubby holed so neatly. In my experience over the last few years as a CRM solution designer for retail and wholesale banks, I see that crm really spans across departments: sales for sure but also service which in a service industry like banking is virtually every desk/employee. I tend to think that because there is so much fuss and noise about crm, there are not many calm, considered, well planned requirements specified by most buyers and most vendors still oversell or worse, sell all the wrong ideas. I think it will be a good 10 years before CRM settles down and truly comes into its own. Till then, there will a lot of hot air about CRM everywhere.

---

Gwynne Young
Managing Editor, CRMGuru.com
Member

Posted 25-Oct-2005 04:15 PM

[Posted for Silvana Buljan, Principal, Smartworxx]

Dear David,

You are not alone. You're speaking "out of my soul." As we know that technology is the enabler—whoever drives the IT company—it has no effect on understanding CRM right and setting the bases.

Regards,

Silvana

---

Graham Hill
Guru
Member

Posted 26-Oct-2005 02:41 AM

Whilst we all agree that IT/IS is not the be-all and end-all of CRM, I have this awful feeling that we have collectively gone too far in damning it.

Sure, the (only) three independent studies of CRM in action show quite clearly that IT/IS is not a critical success factor once a basic level of IT has been developed and that the choice of CRM vendor is even less significant. However, current best-practice in CRM strategy shows that the development of appropriate IT/IS is a critical building block of many of the CRM capabilities that all companies need to grow & prosper in today's competitive environment. The difficulty is in identifying just what IT/IS is required, how much of it is required and at what point in the development of the company's CRM capabilities it is required.

A lot of the difficulties CRM has had is because inappropriate CRM tools (that are too complex to use, too disruptive to the company and too damned expensive) were bought to enable management's grand visions, but the business processes, information flows, organisational structure, staff skills and change management required to use the tools effectively were not developed in parallel. It is a bit like buying a Porsche to go on a long journey, but neglecting to learn how to drive, to buy a map and to fill it up with fuel!

It is too easy to blame the inappropriate use of IT/IS for CRM's ills. But it is more complex than that. And it is not entirely fair. The buck should stop with the wrong management, not with the wrong IT/IS.

If you are interested in this important area, takea look at Nicholas Carr's influential article "IT Doesn't Matter" in HBR, the elegant rebuttal from John Seely Brown & John Hagel and the discussion that follows at http://www.johnseelybrown.com/Web_Letters.pdf.

Graham Hill
Independent CRM Consultant

Whenever people agree with me, I always feel I must be wrong.—Oscar Wilde