RightNow Right Now is Right On

I know that I'm known as a tough critic and truth be told, I revel in it at times. I like finding flaws but not because I want to be mean about it but because I want the industry that I participate in, and hope I represent honorably, to be better and to provide what at least I think they should to the customer.  So I look pretty deeply at the product claims and at the companies that are providing the products because I'm an ardent believer that the culture of a company needs to reflect what they are supposed to be providing to the customer when it comes to the aggregate of products, services, tools and most importantly to new business model paradigms, consumable experiences.

What that also means is that the company should be making efforts to align their culture and outlook with the contemporary mores of the customer's world too.

If you accept the fact that the business ecosystem is centered around the social customer now, there are implications for corporate culture, that in my mind can't be ignored by any company, and that would go for CRM vendors, as well as the practitioner companies who are trying to implement some sort of CRM strategy.

Those corporate implications for vendors (not just technology software companies, BTW) are pretty specific:

1.       The products you provide need to be at least conversant with

a.       the requirements that the social customer has - which in the current case of Social CRM, is something that allows the technology vendors' customers to engage their own customers through multiple channels inbound and outbound - that of course is what we mean by "social", isn't it?

b.      the idea that the customer wants to participate in their creation or, if not that (depends on the product), at least have enough real information, not just marketing collateral made available to them about the product to make an intelligent decision on how they are going to use the product.  That means an authentic (for the word du jour) look at the product, including its immaturity. True product transparency is everything. It also means, if it makes sense, invite the customer into the creation process for the products.  If it makes sense. Not if some pundit like me tells you that you should. At this stage, which is still early, it's an optimal thing to do, not a requirement for survival.

2.       The services and tools that you provide to the customer are what they ask you for, not just what you think that they should have. The voice of the customer, not just the one that is in your head, but the one that emerges from their actual larynx and vocal cords, needs to be engaged and listened to. "Listened to" means matched against your corporate plans and budgets and then implemented accordingly.

3.       The consumable experiences mean that the type of message that you are presenting to an audience of customers and prospects has to be consistent and true to the actual experiences that you are providing to that same audience. In other words, as I talked about in my blog posting on the nature of new competition, the customers expect what you are telling them to expect. It's truly eat your own dog food or, in my case, cat food.

This isn't complicated. In fact, it's pretty direct.  But the implications are far reaching because there are many companies producing products that are in the realm of Social CRM, which means they fall between purely social and purely CRM or as we are starting to see with things that I saw, for example, a couple of weeks ago at Oracle OpenWorld, are truly Social CRM. Many of those companies are really cool or have great CRM groups but few, very few, have institutionalized capabilities and practices that reflect a deep (and usually somewhat or badly painful) cultural transformation that truly is one that means they've chewed a lot of Friskies.

I have to say that I think RightNow is making that cultural transformation.

Let me tell you why I think this.

Where Is Paul-o?

Currently, I'm sitting on an airplane heading back to Washington Dulles airport and home (using American Airlines wi-fi for the fist time - very cool) after having left the Broadmoor Resort in Colorado Springs Colorado.  The place is stunning, the rooms are really well done, and the service level is beyond phenomenal. Since this isn't meant to be a travelogue, what does make this important is that I was there for the RightNow User Conference in the U.S. as a speaker (did that on Monday to the Executive Summit of roughly 35 C-level large corporation executives) and analyst or, as my badge says, "Influencer" which I think is a term for, "what does he actually do? I'm not really sure...."

While their array of new and improved products is extensive and interesting, what I find is even more important to their potential longer term success is that they're "releasing" a new culture and new set of consistent and authentic experiences that are associated with the way they do business.  While it's by no means perfect, it is one of the better and maybe the best (though that still has to be tested by time and results) alignment of a vendor culture with a message organized around collaboration with customers. However, I say that with caveats about the message (see below)

The History

Keep in mind, what makes what I'm about to describe even more incredible is that, as far as I'm concerned, RightNow has been struggling for the last few years to get their message right.  They have always had a good, well engineered product when it came to customer service.  It was solid; it was on demand; it was scalable. They pioneered the selective upgrade - meaning the customer got to choose what parts of the upgrade that they wanted to implement - if any - rather than the SaaS world's ordinary automatic upgrade procedure back in the day a few years ago. The standard was that the customer had no say in the upgrade process and it was immensely frustrating to those customers sometimes, when customizations based on a prior version were wiped out.  But RightNow changed the industry that way.

But about 3 years ago or so, they recognized that the customer experience was paramount and began to set up their messaging accordingly. They had always been a customer friendly company but understanding the customer experience which was step one wasn't necessarily automatically associated with aligning your corporate culture with that knowledge.

I didn't think then that they fully realized the fundamental truth about the customer experience - which was it was more the customer interactions than the customer transactions that would determine the customer's relationship to any given company.  The interactions were how the company and customer "got along" while many of the transactions were a reflection of that result.  Like many of the more customer-centric companies who were still organized with traditional thinking, they still saw the world from the standpoint of the corporate ecosystem.  That meant that transactions remained king. Improvements in the customer experience were still being seen as making internal business processes more efficient, or at best, effective, to free up more time to improve the customer experience. But the customer remained an arm's length away from the improvements.  This was best reflected in a statement I got from RightNow at that time that SalesNet had been purchased "to help improve the customer experience." That is emphatically not what sales force automation (SFA) applications do.

But it's a learning process, and to RightNow's enormous credit, what they released at this conference indicates that they now have begun to seriously align their culture to the actual customer experience as it relates to an ecosystem dominated by a social customer.   That's quite remarkable because it is an indicator of the possibility of long term success, not just short term growth - and they are one of the few companies who seem to have made the effort and investment in doing that.

What Did RightNow Do Exactly?

Don't get me wrong. This is a really healthy company - and given the recession, they've done very well despite it. They are now 800 employees; they are going to achieve around $150 million in revenue this year; they are cash flow positive; they are increasing 13%-15% year of year with their recurring revenues; and have around $100 million in the bank. That's a solid, successful company.

Their new mission is to "rid the world of bad experiences."  Needless to say, I publicly asked them to support the Yankees in the World Series, because a series loss would be a bad experience for me, so we'll see whether or not they truly mean what they say. You RightNow guys willing to stand by what you said? Go Yankees? YES!

While this is a lovely mission statement, it is more marketing than realizable obviously since that has been every single human reformer's goal since time began and we still have a lot of bad experiences to deal with.

What is significant is what's reflected by two announcements - one of which has a lot of fanfare and another which was not discussed all that much and got lost in the incredible volume of product releases and evolutions.

They also I think made one significant error and once again it's in the area that they've made much of their mistakes - in their messaging.  Plus they need to correct something or at least clarify something they said that I said.

But I'll get into all that in a sec.

The New Releases

The total number of new and improved products was staggering and far too extensive for me to cover in this posting.  I would generalize them in the following way.

First they made "experience improvements" which they structured around social, web and contact center (which I would personally call agent-centered) experiences.  For example, they added new capabilities and made significant improvements to their Customer Portal, which should be used for web and mobile self service interactions.  They added strong co-browsing capabilities (I'm not sure whether this was native or in partnership with LiveLook) and proactive chat for agents. This was part of their improvements in the "Web Experience."

For all areas, they added design tools that use graphic interfaces and drag and drop functionality to enable non-BPM people to develop their own web, social and contact center experiences. A good thing all in all.

Second, they added improvements to what I call "human contact" capabilities. Ultimately, what we're doing, even with the digitization of our interactions is still attempting to reproduce human contact.  That's why most of us love Amazon. It seems to be reflecting "human contact" though we aren't dealing with humans. Our need for validation and acknowledgement is all part of how we socialize as human beings and the power of the social web is that it gives us the tools to get that through these one-to-many interactions with "strangers like us."   What RightNow released are tools to manage that human contact - such as their phone and multi-channel interaction management; or to understand how the human contact works using RightNow Engage's analytics engine.  They claim it delivers insight, which is probably a bit too strong - even if as good as it seems - it delivers information that can be used for insight. Analytics engines can't deliver insight. Only humans can.

These are just a few highlights. I want to get into three more things - what I found to be the most important thing about what RightNow is doing now and into the future -then, their problem - and just a question or two that remains.

What's So Good...

Now on to the two announcements that I think bode well for their long term success.

First, their September acquisition of HiveLive, a malleable, very intelligently constructed social network platform led to the development of products like Support Community and Innovation Community.   What the community products do are exactly as you would expect. In the case of Support Community, they are providing a location for the customers of a company to interact with the company around customer service and support and are providing a forum for the customers to help solve each other's problems.  Innovation communities are places that are used are used for co-creation and product feedback and collaboration.  They tended to emphasize the feedback side; I would provide more on the collaboration front.

What makes these releases important are the significant growth in business' interest in communities because of the involvement of much of the population in some form of social network or another. About 74% of all connected adults participate in a social network of some kind - though, granted it leans more toward socnets of the Facebook variety - hell, not the Facebook "variety" - Facebook.  But what this is doing is seasoning the population to use social networks which will be more likely than not make them more amenable to using communities and social networks beyond the firewall.   In fact, Nielsen Global did a survey back in March that found that more people were communicating via social networks (66.1%) than via email (65.3%) for the first time. I may be off on the 10ths of a percent a little but you get the idea.

That makes the RightNow releases of support and innovation community building tools and actual communities significant and tuned into a growing trend.

But there is something far more important to the long term health, which was barely discussed at the conference. That would be the investment in hiring customer success managers.  These would be individuals not working off quotas who, separately from account managers, would be responsible for the healthy relationship between particular accounts and RightNow. These customer success managers would be assigned to support the customer in ways that helped them succeed.  I didn't hear what they thought criteria for success would be but all in all this was an extraordinary move - one that indicates a deep cultural commitment toward customer collaboration and communications in ways that acknowledge the changing customer demand.

This makes me happy to hear because it reflects what goes on in the in-between. RightNow is starting to make the appropriate investments in transforming their culture to align themselves with the 21^st century customer and what they require to satisfy their personal agendas - in a good way.

And Not So Good....

Despite all this goodness, I have a few concerns and caveats, though I will say, the positives outweigh the negatives.

First a correction.  I was reading some material that they produced for the press and the analysts on why they are now Cx and "not CRM."  That's one of my concerns but before we get there, the correction. In that piece they claim I said that CRM had a 70% failure rate.

I didn't claim that. In fact, what I have consistently said, is that Gartner back in 2002-03 claimed that there were 50%-70% failure rates, but I saw that due to the immaturity of the industry and the customers' buying into hype that led them to have dramatically escalated expectations about what CRM could do.  Now, the success rate is around 55% according to varying industry sources (they're in my book but I can't check on who it was here). That's due to - what else - the maturity of the industry and the leveled expectations that customers now have about its ROI.  So please, if you see that, it ain't me.

Now, Cx, Not CRM.  Cx is the overall approach, vision and tools that RightNow is calling their contemporary offering. Cx has nothing to do with Rx - it stands for customer experience.  But as Bob Thompson smartly pointed out in a Fireside chat with Greg Gianforte, the buying agents - c-level execs, etc. aren't buying customer experience, they're buying tools to increase their successful strategy.  RightNow also insists they aren't trying to create a new category with Cx. Yet the minute they said it "wasn't CRM" - which is a category, that's exactly what they were doing.

The problem isn't with Cx which is fine as their vision and platform/tools.  The problem is the "not CRM" part which is a no-win component and useless to say.  They aren't competing with CRM - or definitions of anything else.  They are providing a solution set, services and something of a strategic outlook to the customer in the name of Cx. This is their classic messaging problem.  They often put their foot up to their mouths - though not in it - and overextend or reach too far to fit something in that they really shouldn't do.  They did it in their earlier days with customer experience. They did it when they felt somewhat discomfited with the designation CRM and they are doing it with their approach to positioning Cx.  It only muddies the waters with another acronym and limits their market a bit more than they need to.   Just call it "Cx" and trash the "not CRM" part.

That isn't huge per se but it does reflect a problem they haven't gotten over yet.  They need to deal with it or customer misperception will cloud their otherwise bright future.

Finally a couple of other answers needed.  Estaban Kolsky  someone that you should be reading if you're not already, pointed out to me that there were no delivery schedules mentioned except 2010 - which doesn't qualify as a delivery schedule, only a year.  What is the delivery schedule for these services, and the customer success managers and the varying communities and their newer cloud product improvements?   Hats off to you, Mr. Kolsky.

Also, what's the VAR strategy? Is there one? What about a more open development model?   These aren't criticisms, just questions that are only either somewhat answered or still entirely open.

All in all, this is a HUGE leap forward for RightNow and what I think bodes well for them is that they take culture change very, very seriously - and seem to be doing what they have to do make it real - something we rarely have seen yet, in the era of the social customer.

Now, if they only eliminate the Phillies from the World Series to keep me from having any bad experiences....