Using emerging technologies to foster more sustainable front office business processes.
Sustainability might be the next big thing in CRM. I’m betting it is and Beagle Research is initiating an award for sustainability in CRM. Today. Now.
Everywhere we look we see not just an industry but also a civilization straining under the demands of growth. Now, growth is generally a good thing for an economy but one of its hidden characteristics is that it periodically forces us to change the way we do things. What is affordable and practical one day can become expensive and cumbersome overnight. We’re living in one of those times. The solution to such challenges is to find ways to make what we do more sustainable, to substitute, change and innovate new and better ways of doing things. In business that means our processes and then some.
The things we take for granted in our business dealings are becoming less constant. Customers are tapped out, the new product engine has stalled and travel is becoming so expensive that it may soon squeeze margins and affect our ability to meet with people. Some of this is blowback from the recession but other aspects may be a long-term trend forming. Regardless of the causes, as business people we need to discover and develop solutions that mitigate these influences so that we can continue doing business.
We’ve given these issues considerable thought and in response, today, Beagle Research introduces a new award and report focusing on sustainability and the things that CRM can do to help every business to become more sustainable.
The award and report are called ThinkForwardä. We borrowed the idea of “think” from Thomas Watson, Sr. of IBM fame and from Steve Jobs each of whom asked us to think and then think differently at critical points in the evolution of our industry.
We believe it’s time to think again but this time we need to think ahead about a world that will be resource constrained in many dimensions. The conditions we watch and write about in the report show slower growth and rising transportation costs coupled with a customer-base that is growing less interested in absorbing more goods.
Just in time, we also see a market brimming with front office technologies that help vendors and customers to identify opportunities and satisfy them with maximum efficiency, using resources wisely. We think sustainability provides the organizing principle for the next phase of CRM, a phase filled with opportunity if we focus on crowdsourcing, social media and strategies for substituting intelligent technologies for travel.
We see numerous front office software companies bringing products to market that by themselves may not garner a great deal of attention from the mainstream market but we also see these solutions as keys to a more sustainable business environment.
The ThinkForward report identifies seven companies whose solutions typify the kinds of solutions that, in some cases, may not be core to CRM today but which will be essential in the future. In one way or another these companies evidence solutions that help vendors better understand and target opportunities, marshal resources and engage customers in new and more sustainable ways.
The award winners include Brainshark, Cloud9 Analytics, Communispace, iCentera, Kadient, Salesforce.com, Unisfair and Zuora. As our report documents, each of these vendors offers solutions that help their customers to do business in more sustainable ways either by treating customers more like renewable resources, reducing the travel and energy requirements of many front office processes, or by capturing and leveraging crowd wisdom to enable companies to better hone products and messages.
We salute these pioneers and encourage you to consider how making your businesses more sustainable can help drive new revenues and profits as the world continues to change around us.
Sant Corporation of Cincinnati, OH and Kadient of Lowell, MA announced a merger today. The two companies appear to have complementary offerings and I think the merger will be a good one for both parties and for the customer base.
Over the last couple of years, Kadient has been on a difficult quest made harder by a recalcitrant economy. CEO, Brian Zanghi who will remain on the board of directors, took Kadient (formerly Pragmatech) from a business that was not unlike Sant’s and competed with it, to reposition Kadient in the SaaS world. Sant and Pragmatech both offered products that automated, to the extent possible, the sales proposal process and managed relevant documents and components of documents.
Beginning a couple of years ago, Zanghi began taking Pragmatech on a journey that would rebrand the company and change its focus from on-premise to SaaS and from proposals to dynamic interaction with sales teams through the use of playbooks. Zanghi’s vision was essentially correct and I have written about it before. Playbooks are an invention that applies analytics to deal information captured throughout the normal course of doing business. When analytics are applied managers and sales people can discover which presentations, proposals or tactics work best in a variety of situations and use this knowledge for future deals. The idea makes sense and you can see it replicated in Salesforce.com and Oracle sales automation tools.
Kadient had some tough sledding changing its model and facing the recession but the company has been gaining traction in a market for sales enablement products that can be notoriously difficult. Sales people hate having their cheese moved as the long adoption curve for SFA amply describes. Sales enablement is another idea that makes sense but which has legions of doubters. I don’t know if adoption was an issue for Kadient as much as the tendency for sales to hunker down during recessions.
At any rate, Sant and Kadient are now together and I think one of the attractions of the merger for Sant was how far Kadient has come — a distance that Sant also had to travel prior to the merger. Sant will now have to quickly figure out the SaaS model and I look forward to better understanding their strategy for the balance of their product set.
Finally, this merger highlights the reality that the IPO market is still moribund and the path to a liquidity event does not go through Wall Street these days. In some ways that makes doing a deal easier but it also significantly reduces the value of a company.
While we’re on the subject of the customer relationship it’s important, even vital, that we do a better job of teasing apart customer types. It seems to me that the vast conversation about social CRM and the social customer has focused on the end consumer — the business-to-consumer (B2C) relationship — not the business-to-business (B2B) one. That’s probably a smart over reaction to the fact the about two-thirds of the economy consists of B2C transactions.
What might not be smart is assuming that the other third of the economy operates more or less like the consumer economy and that B2B customers are the same and can be addressed with the same tools and methods. The most popular business organization model is still some form of hierarchy and businesses often make decisions based on the consensus of people up the ladder. Other people have input in the decision but very often, final approval comes from people higher up who have budget responsibilities.
Businesses spend money for only two reasons, to make money or to save it. If a purchase, and the ongoing cost of repair, maintenance and upgrade, cannot be justified on these grounds, or if the purchase cannot flat out make more money than it costs, there is no reason for it. This reality puts a box around most B2B relationships, which prevents them from becoming emotional in a B2C sense. It also lets a business relationship operate more along operational lines where objective measures like price, on-time performance and quality standards dictate the health of the relationship.
Over the years, vendors have had varying degrees of difficulty dealing with the differences since they are often in B2B relationships with suppliers as well as B2C relationships with consumers.
There’s more room for bruised egos in a business-to-consumer (B2C) relationship than in a B2B one. A consumer can take offence at a vendor’s behavior while in a similar B2B situation a behavior might be shrugged of as “just doing business”.
With all that said, it ought to be easier to produce B2B CRM systems focused on operational standards yet deployment of good operational CRM systems seems to lag right now. Exceptions show up in customer service in companies like RightNow (kudos for the Magic Quadrant), Salesforce and others dedicated to building knowledge bases that are accessible and searchable from multiple channels.
In the best examples of B2B service, vendors are using social technologies to capture customer needs and collective solutions and then make them useful and available to others. This neat trick enables vendors to actually capture intellectual property (IP) from normal conversations. The IP is recycled through the cloud support infrastructure resulting in lower service costs and, presumably, customers that are happier because their issues are quickly resolved.
Salesforce, with its Sales Cloud, also applies social ideas to B2B selling with positive results. Here the company gathers social IP from all sales encounters and distills common ideas from numerous encounters that can be applied in the future.
What’s most interesting to me is the evolving realization that social ideas apply equally well to both kinds of relationships but in opposite directions. The B2C approach is to socialize the relationship with the customer by gathering data from the market and analyzing it for common trends. Understanding customer trends enables B2C vendors to extract information they can apply in future encounters. Sales Playbooks, a term popularized by Kadient and some others, are the distillation of customer reactions to vendor sales initiatives and materials. From a playbook a vendor can plot a sales strategy with confidence of being on the right track.
In comparison, B2B vendors are beginning to socialize the organizational, e.g. operational, response to the customer. Chatter, another Salesforce invention, socializes the vendor organization. In a B2B situation, a vendor organization knows that operational excellence is critical to most relationships. Socializing the customer relationship from within the vendor organization simply provides the necessary and immediate stimuli for personnel to take appropriate actions.
That may sound like a mouthful, and it is, but the net of all this is an easier take-away. The B2C and B2B relationships are fundamentally different and lately, we’ve given a lot of attention to the former and maybe not enough to the latter. The social approaches to each are diametrical opposites but once we get our heads around that essential idea, I think we’ll be more successful in the B2B world.
Finally, who drives the relationship — B2C or B2B? I think it’s a smart vendor who enables the customer to believe he or she is in the driver’s seat.