Industry Giants -the New Adults on the Block
Most of these might not be surprising to you but they are to me. With maybe the exception of Sage...and NetSuite....and RightNow and.....ah well. I guess they aren't really all that surprising. But to some degree, IBM and Cisco are surprising. Remember, I write about CRM and Social CRM and really, in the past, when push comes to shove, neither of these two have been obvious CRM heavyweights. Oh, I suppose the case could be made that IBM was a significant player in the consulting world on CRM - that would be an easy thing to do - but then I'd have to talk about Cap Gemini Ernst & Young as a......hmmmmm. I think I....won't.
I'd rather just get moving on this one before I get any more confused.
- IBM - IBM has always been a player in CRM - but through IBM Global Business Services, their consulting arm, not their software or applications groups. Their CRM applications built on Lotus Notes, were, to be charitable, so-so. That's really charitable. But, I think we've pretty well established that CRM has changed dramatically - at least in my Hollywood-stricken eyes. We've moved from customer management to customer engagement as the means to provide the experiences that customers are now looking for from companies. That means when it comes to the supporting technology, IBM is in good position, because social software becomes increasingly important to the software schema that CRM applications should be providing. This is where IBM does itself pretty proud. They've innovated with the only social software full suite on the market - Lotus Connections and, with the release of version 2.0, got it right - notwithstanding an odd design decision or two (like for example, why they've chosen what I have to call a truncated wiki like collaboration space called activities when a wiki service would probably do what activities do and allow for more. Just because they used activities in their own work environment doesn't make it the commercially correct thing to do). But, honestly, a feature quibble isn't that big a deal - given how far IBM has come over the past two years as super-player in what is the new Social CRM/CRM 2.0 space. One of their greatest strengths has been a long standing one. A powerful global CRM consulting group stretching from the U.S. to India to Colombia to pretty much everywhere else on the planet. Their CRM practice is not only among the best in the consulting world, but has a voracious appetite to stay on top of trends and practices and on top of the market. Plus, IBM HQ has a number of corollary organizations devoted to innovation, change and thought leadership that make it a highly visible, outspoken institution. For example, they have the IBM Institute for Business Value or the Institute for Electronic Government. More germane to CRM and further proof that that IBM GBS gets it, in September 2008, IBM launched a CRM Center of Excellence for SaaS. Around the same time they launched the Center for Social Software. All of this is part of their Tomorrow at Work initiative - a brilliantly conceived look at how the future of business and work is going to look. A month later a Cloud Services Initiative was launched. Internally they use hundreds, maybe thousands, of blogs and wikis, communities and rich media to carry out their daily business on a collaborative basis. There is no stopping the institutionalization of thought leadership and innovation at IBM. But the development of a solid though a wee bit flawed social software suite in combination with their CRM consulting expertise, is what starts IBM catapulting to the top of the CRM pantheon. Is this a perfect scenario? No. The integration of CRM and social software at IBM is still in the hands of IBM partner iEnterprise who announced the integration between Connections and iEnterprise's CRM software in September. That has to be corrected. For them to lead the way in the concrete world of CRM 2.0, their internal integration of the social apps with the CRM offerings of their global consulting group - be it Siebel or SAP or Oracle or some new and better Lotus Notes-based CRM application - is a necessity. The theoretical foundation will be there in the new releases of Notes and Domino expected to be out in the near future which is supposedly will be fully integrated with Connections 2.0. But CRM will be the kicker for them, not the social tools. For IBM to play at the level they normally do elsewhere and be mentioned in the CRM-smelling breath with Oracle, SAP, Microsoft and salesforce.com, they have to take their usual lead and make sure they have those integrated tools to offer and to use. They have everything else.
- SAS - As large as the privately-held SAS is ($2.15 billion in revenue in 2007) and as great a place as they are to work (always among the lowest turnover rates in any industry and voted among best places to work by everyone), I had to hesitate before including them here - which might seem a little churlish. This is a company whose revenue went up 15% last year, more driven by partners than ever before. They increased their customer base by 1,100 - a great number. They consistently hit the quadrants in the Business Intelligence and in the Multichannel Campaign Management category as a leader, according to Gartner. So that would seem to be amazing right? But I still had to hesitate - though here they are. They To get into this list, I have to think that a company is going to play big time in 2009, and as much as I like these guys, I'm not 100% sure of that. But I am convinced enough to make them a tenuous choice. To their credit, They have three distinguished CRMish applications that are clearly excellent - their Marketing Automation application, which, while headlined by Campaign Management, is much larger than that. It additionally includes Marketing Mix Management (this is the former Veridiem, which had an office in an old warehouse with amazingly high ceilings in the Boston area, many moons ago) Marketing Performance Management, Web Analytics and a host of others; their Customer Experience Analytics are smart and capable While not terribly pretty, the interface is more than serviceable. They even have a whole series of products including marketing automation, marketing mix management and business intelligence that they offer on demand. They have staff members who are both incredibly smart and incredibly personable. Some of the more "radical" among them are making prodigious and good use of social tools like Twitter & Facebook for more than personal reasons - and doing their company a service. They have Better Management.com, a well organized highly practical site with "what to do's" everywhere including a Web TV show called Better Management Today that I've happily appeared on twice. But I have this nagging problem that I've had for years with them. I have heard for years that they are changing their marketing approach and positioning to suit the actual marketplace and not the imagined one they have - which seems to be one left over from ""=""> of the 1950s and maybe the early 60s. Watch Madmen on AMC if you're not old enough to remember the era. I just don't see the necessary changes in their marketing strategy or even creative work. About two years ago, I was in a meeting at SAS where I saw a highly original & creative product of planned changes to their marketing which only got crushed up the chain somewhere. This year I didn't see anything that told me that they're fully adopting to contemporary marketing requirements - which, when it comes to a technology company riding a wave that the customers control, can become a serious problem. That said, they still are a company that operates on the strength of its products and the viability of its environment - and for that alone, they make the list - this year.
- Cisco - This is the company that's the biggest surprise and the least surprise. For the last two years, the company positioning itself as "the human network" - and using one of my favorite songs in the world - Baba O'Riley by The Who (also used on CSI:NY) for the marketing - has been placing itself into position of being an all purpose end to end set of applications, hardware, software and process engines for engaging the social customer. Not only did they link up with Oracle CRM on demand via their WebEx organization in 2007, but they've been building and modifying a "Unified Call Connectors" for integration with Microsoft Dynamics CRM or salesforce.com since 2006. But it goes so much further than that. Oh so much further. In 2007, Cisco purchases two social networking properties - FiveAcross, a socnet platform and tribes.net - more of a community aggregation site. These acquisitions led to their announcement at the end of 2007 of Eos - an entertainment operating system - that's designed to deliver rich media experiences across communities. In February this year, The Sports Museum of America announced their use of Eos. Even better, the Yankees are using Cisco as the technology backbone to power the fan experience at their new stadium using some remarkable innovative future-looking fan friendly mobile, high def and interactive capabilities - which for me would be enough to declare them "king of the hill, top of the heap." (who can guess what this refers to? Be Yankees specific please. The first one to leave it as a comment will get a free copy of the 4th edition of CRM at the Speed of Light when it comes out in August) But of course, sigh, that isn't enough. But there is so much more to Cisco's play. They have succeeded quickly with Cisco Telepresence - a phenomenally well done holographic sort of technology that allows meetings between any groups in the world from any locations in what seems to be projection a la holodeck. It has been wildly successful. Check out this video for a mindblowing look at it. But Telepresence and the Yankees, while incredibly cool, isn't the reason they're included. Under the aegis of John Chambers, they've organized their company culture and structure to make sure that each employee not only has access to management but are empowered to present ideas and follow through on problem solving both internally and externally. They have a democratic culture that actually is organized around innovation. They emphasize organic leadership for that innovation and encourage the use of social media and social networking tools to facilitate that leadership. They understand their internal customer - the employee - as well as they understand their external customer. Their number 1 ranked internal blog is about collaboration. The combination of this open and democratic culture, the positioning as a leader in the "human network," the integration of Oracle CRM on on demand into their portfolio and their obvious interest in CRM via the Unified Call Connectors, their social networking acquisitions and how they've integrated them both into their portfolio and into their day to day corporate culture, and of course, we can never forget their dominance of the enterprise router business, position these guys as a company we could see emerge in 2009-2010 as a significant leader in social CRM. My only concerns in that regard are that as of now, these don't seem to be part of a coherent strategy to be a leader in world of the "customer engagement" infrastructure. They are just pieces of a puzzle that happen to fit. So perhaps, Cisco is content with doing all this to be the #1 player in the $50 billion router business - and that wouldn't be a bad thing. But if they seecan se how thewhole puzzle fits together (not just the pieces) and can present the vision - they could be a major surprise for the likes of SAP, Oracle, salesforce.com, Microsoft, etc. We'll see, but watch what they do in 2009. If not what I think, the ride will be really, really cool anyway.
- Sage - For years, Sage former Sage Software formerly Best Software formerly SalesLogix was perplexing. They had a good product in SalesLogix for the small and midsized world - especially the lower to mid -end of that. No one doubted its functionality. They had a strong partner program - in fact as far back as 2000, their partners drove 86% of their SalesLogix revenue. They were attempting to provide some thought leadership in the SMB world, though I can't say a lot. But some. All in all, they had been a player since the late 90s in CRM - and they've always been to some extent since. But there was something...off.... about them. It was never that hard to figure out what was wrong. Their strategies in the past had been somewhat pedestrian. They suffered an occasional serious misstep. They even attempted to play in the enterprise world at one point, though they dropped that and its architects within about a year of the idea. But at the high level, this ordinary strategies and a lack of vision - or at least, even an obvious vision - led them astray. For one, it kept them pitching ACT! as a CRM application. For another, it hurt their channel strategies because partners began to compete against themselves, actually pitting SalesLogix against their other CRM product, SageCRM in demos. Not only did I hear about this from others several times, but I actually saw it. It also kept their technology architectures a generation behind pretty much all the time. Not a good formula for success in a world where CRM was both rapidly maturing and then rapidly changing. As an example, when the world was moving to SaaS, they hung in there with client/server and threw up a sort-of on demand product that was clearly half-hearted. But something changed dramatically in the last two years or so with the emergence of innovators and visionaries like CRM General Manager Dave Van Toor. First, they made an really good architectural choice, that while different from the contemporary standard choice, a service oriented architecture, was still on the money for SMBs. That would be REST or what is now called WOA - Web Oriented Architecture. Their line of argument for that stinks - SOA is bad, use REST (see their otherwise very interesting Sage CRM 2010 Strategy doc) - but their choice is good. REST is the same architecture that its being used as you're viewing this web page. Its simple and familiar and standardized - and perfect for the SMBs. For a good detailed definition of REST, see this one. But just a good architectural choice is not the only reason I have them in this list. They've also seen the CRM 2.0 world and embraced it at multiple levels. In SalesLogix 7.5, they've built in significant wizards for handling multiple tasks such as the import of leads to make life easy; they've got the means to create and use mashups, and an interesting timeline visualization that can be customized to view both internal data/events and external events, among many other improved and Web 2.0 features. They've developed an attractive mobile SalesLogix for the Blackberry application that uses location in an interesting way, with "who's nearby" feature that allows you to find out which clients are in the same vicinity as you, in case you want to go visit them, I presume. I'm not sure of the actual value of that particular feature, which, while cool, doesn't really account for the fact that unplanned client visits of the "sure, drop by because you just called me up" nature, don't often happen, but the application as a whole is very good. Additionally, when they released the new versions of their CRM products earlier this year, they were able to offer something that is becoming increasingly important in the business world - anytime, anywhere connectedness - even if you're disconnected. This is is easily the best part of their current CRM applications strategy. The customer gets a choice of on premise or on demand (their other CRM product, SageCRM, has a hosted version SageCRM.com) The experience can be hybrid (on premise mixed with on demand) and can be connected, disconnected or mobile. What distinguishes this particular part of the strategy is their idea of Context Aware Services - which lead to their anytime, anywhere workforce awareness which when you break it down is device awareness, user awareness, network awareness. Finally, in a move to clarify vision and strategy, they've shed the idea that ACT! is CRM. That is LONG overdue. Dave Van Toor announced on his blog that he is no longer going to have ACT! as part of his portfolio - "just" SalesLogix and SageCRM. Rightfully. This is what I mean. No longer a generation behind, this is going to make the formidable Sage, with a total (including its accounting packages) of 5.5 million customers and 15,000 employees and $2.3 billion in revenue - even more formidable in 2009 in the CRM market space they've carved out. Finally, Sage is talking 'bout my generation. Its about time.
Been There...Now Starting to Do That
- SugarCRM - I have to presume you know who SugarCRM is. But if you don't, they are the most successful (by far) open source CRM platform. They have a lot going for them. They have a smart business model - one that engages a 30,000 plus developers community called the Sugar Network (which appropos of nothing, is also the name of a network of 16 entertainment and beauty properties for women) to develop on the core platform. They are open source but they are not free when it comes to licenses. There is a free basic edition, but if you want functionality and tools worth anything you will buy either their on premise or on demand versions - which are competitively priced, though not exceptionally so. In the past, I thought they were overpriced and in fact, with "The Cube," their standalone server solution - they were - though it seems to be a little better now. They have a savvy CEO in John Roberts, who while he isn't the best rock singer in the world (kidding, just kidding....) is a great CEO and very smart business dude. They've made some really great hires, for example, Martin Schneider, a former analyst for the 451 Group and a brilliant one at that, who ostensibly handles analyst relations for them but does so much more (and is a damn good rock guitar player). They have a rather fluid corporate culture that really lives the "open source" way and doesn't hassle too much about things yet is still accountable for success in business. With their recent release of the SugarCRM 5.2 platform, they overcame their glaring lack of social features by adding a small set of social feeds and what they call Portal Dashlets, which is basically a treacly name for enterprise mashup widgets - something being offered by SAP, Microsoft and many other vendors too. What's most interesting is that they are offering "cloud connectors" which are hooks to any feeds of a LinkedIn, Jigsaw or Hoovers nature - in other external data sources to provide what would be a richer look at competitive intelligence. These are the technical links, not the actual feeds to any one of them. Finally, they've added Sugar Feeds which is a Twitter like (really more Yammer-like or SAP ESME-ish) way of interacting inside SugarCRM applications - and provides status, alerts, and notifications. All in all, a good start, though, of course, a long way to go. These make SugarCRM a company to be watching with a more intense look in 2009 than you might have in 2008. Where I still have some concerns with SugarCRM are that they are competing now as much as a platform as they are a CRM application suite and which one is the focus they want to give is not entirely clear. Their market message gets mixed sometimes, though they seem to lean to flexible CRM suite. I think. Also they have a partner program, that while miles better than it was a year ago, is still not competitive with their competitors. They have a ways to go and they will have to expend a considerable effort in building that, now that they will be oh-so-much-more-appealing due to the economic downturn. Otherwise, I can't complain. Open source gets really interesting in economic downturns but I have to put a caveat here - its really interesting as a possible option, but it not only isn't free, its not that cheap either. Just reasonable. SugarCRM's competition? Maybe VTiger and Concursive....there are several others but I don't see them as all that competitive - at least not as of yet. VTiger comes to you from Zoho/Adventnet so they have some market smarts and reach. But no one outreaches SugarCRM in open source. This is a company that has made huge strides in the last two years and gone from me occasionally glancing at them during 2007 to, as 2009 begins, staring at them. Time to pay very, very serious attention.
- NetSuite - NetSuite has had a consistent strategy that is unlike any other of its ilk in the industry. Led by the charismatic and hip CEO Zach Nelson, and the uberbrilliant co-founder and CTO Evan Goldberg, NetSuite hasn't attacked the market with social features or been focused around innovation as its core. Its basic hardcore strategy has been to improve functionality so that you can do enterprise related operational work anywhere in the world in an on demand environment. They have been particularly focused on the upper end of the midmarket and have succeeded there very well. They have developed their One World edition that handles globalization and localization in one fell swoop in a rather effective way with a single interface. They went public at at time they should and even though they are of course affected by the recession, they are still in a strong financial position. They've fallen in the business platform pot like all their competitors. Unlike their competitors, though, their platform, NS-BOS is narrowly focused around developing industry specific applications - not just anything. Their pragmatic strategy has been historically part of their CRM applications, NetSuite CRM+, since day one with a core focus that extends back to their early days as financial software company NetLedger. They build their CRM applications around order management at the center. They are aimed at the upper end of the midmarket and squarely at SAP. They've even recently announced a "BusinessbyNetSuite" program for SAP customers to capture those customers who are exposed by the SAP Business by Design glitch. SAP needs to be concerned about NetSuite in this market. NetSuite is pragmatic and sound in their approach, they've had steady growth over the years and they try to not overstep their planned strategic boundaries. They are solid as a rock when it comes to their functionality. Finally, this is a company that knows how to market and communicate with the analyst community and press exceptionally well. Zach is a terrific speaker and a marvelous spokesperson in general for NetSuite - and a very, very cool, good natured guy. Mei Li, their SVP of Corporate Communications is not only known throughout the industry but extraordinarily well liked throughout the industry - not easy when it comes to cynical analysts and press and keeps the press and analysts well informed. I like this company and have for a long, long time. Yet, this doesn't exempt them from what I see as some things they they need to do to become the breakout company they could, and I think it will take them until 2010 to do it. They still have some known customer service issues, though, commendably, they are working to fix them, from everything I've seen and heard. Additionally, I've always considered their channel program far too lean. Even with the excellent win of HP as a strategic partner, I don't see rapid enough improvement here. This is an area, especially since they have a strong industry-specific focus to their strategy, that is absolutely vital to their future and its something I'd be jumping on right away and spending (their) money on. That said, they have some interesting partners - like Apple, CastIron and of course, the aforementioned HP. Finally, I think that they are going to need to start adding 2.0 functionality and I know from the horse's mouth, that this is going to be the case for 2009. I have only one real complaint with them on the marketing side which I've always had - and this might just be me. I wish that they would stop their competitor attacks and competitive "we just won customer x from vendor competitor y" press releases and emails. Personally, I couldn't care less who they took from whom, since I'm just as sure that the same vendor who lost the customer to them has taken one from them too. Win on your merits, NetSuite, which are formidable. I really have high hopes for them, but the things they need to do will take some time. They are a solid choice already, and always will be, but to get to the next level, they've got a busy year plus worth of work to do. But they are worthy of watching right now.
- RightNow - This company is a company that's there and yet...almost there and have been that way for several years. I think 2009 is their breakout year if certain initiatives they've undertaken fall into place and they make sure that they manage their positioning around these initiatives well. They have been long established as the go-to guys foron demand customer service for quite some time. In fact, two months ago, Gartner positioned them as leaders in the E-Services Magic Quadrant, rightfully so. Unlike many of their on demand brethren, with perhaps the exception of Aplicor, they've penetrated the public sector deeply, an incredibly smart move. They've spent a good deal of time trying to position themselves and direct and redirect strategy. Sometimes too much and with odd glitches. For example, they bought the highly functional SalesNet in 2006 for $9 million (see this Phil Wainewright ZDNET 2006 entry for some solid analysis of the deal) and then tried to call it something that "improved the customer experience." Not one of their better moves. Yet, they've moved to keep a focus, one better directed on customer experience as a core requirement of customer service. More recently, they've wisely begun to integrate some social CRM thinking and a bit of the functionality into their offering. For example, they have a tight partnership with Lithium since 2006 - which gives them the capability to provide threaded discussions inside of company-produced forums and communities. No longer just operational, they are beginning to integrate some quasi-social functionality - especially with the August 08 release of their on demand service (Their November 08 release is more geared to large scale contact center improvements and consolidated services). They have a pro-active chat function that tracks customer activity and when a pre-determined threshold is reached, a chat window pops up for the customer's use if they so choose - based on the conditions of the activity. Additionally, they have a co-browsing function that pretty much sounds like GotoMyPC for tech folks. They added a single sign on customer portal that is primarily built around creating highly personalized services offerings that can be sculpted by the user themselves. The access is classic single sign-on. All in all, quasi-social and a great start. But Its only a start. But with CEO Greg Gianforte, who knows how to operate lean and VERY smart in lean times at the helm, RightNow could be a strong established up and coming (odd juxtaposition there, eh wot?) leader this coming year but like NetSuite need another year to mount up.
- Zoho - I've been a long standing fan of Zoho and saw their potential back in 2006 when they were first coming on the market. Before I get into them a little, I need to myth bust. They are viewed constantly as this startup making good. In truth, they are part of Adventnet, a nothing-like-a-startup and there are 600 engineers devoted to Adventnet products. This is a highly skilled company with a smart contemporary culture and a transparent, honest and responsive CEO, Sridhar Vembu, who, while I have some disagreements with when it comes to his public pronouncements, is, all in all, a refreshing change in his willingness to be actually accessible beyond a press conference or formal call and genuinely transparent regardless of the heat it might generate. Zoho has always provided a widespread and nearly complete collaboration suite. Originally consumer-strength and mostly free of charge, at the end of 2007, they announced their first "Business Edition" applications. They are web-based, not on demand per se, though they have a subscription model. Germane to us in these here parts, they have a CRM application - in reality, a sales force automation application. I have to tell you, it is functionally pretty solid. Its weakness, as with most Zoho collaboration and operational tools also, is that they don't integrate that well with each other or with any other applications. The lack of integration issue seems to have been an issue that I fanned the flames of - though actually that isn't entirely true. It was actually re-ignited by a comment from a reader of my blog Phil Hodgin in the above linked blog entry of mine - though I agree with him wholeheartedly. In any case, their lack of integration is addressed by Sridhar in this Zoho blog entry if you want to read about it. Shortly after the not-very-controversial controversy, Zoho announced Zoho CloudSQL, a first step really. It is middleware for developers that allows the use of SQL to access Zoho data in the cloud and is compatible with MySQL and Oracle's, IBM's and Informix' flavors of SQL. A start at least. They have a staggering array of applications - enough to take up several more "pages" of a blog entry like this. What is important is that they get the social customer's thinking and are geared to a future of "social customer behavior. Their combination of collaboration tools and operational applications is broad enough and now functionally deep enough and organized enough (See Zoho Creator and Zoho Notebook), lack of thorough integration notwithstanding, to provide a genuinely useful set of apps that small and midsized businesses can understand. While they are an astonishing open company and an honest one, they are not the greatest marketers on the planet and that is painful because they are up against the best in the software world in some cases. Beyond Sridhar, they don't have a lot of traction when it comes to thought leadership and they need to invest in doing that or they will lose some ground. That said, they've graduated from the new kid on the block to the young adult making their way in the world successfully early on. They are currently an SMB player, to be sure; not an enterprise threat, but I wouldn't put that past them someday.
One last note for this:
You're probably wondering why Google isn't included in this list since they're included in every other list, are tied deeply into salesforce.com and are out for world domination -attempting to take over the universe, in fact. The world isn't enough. I think that Google Earth is just their view of their perceived fiefdom.
The reason you don't see them here is that this is, just a gentle reminder, a CRM-related companies watch list and this is not an area that Google shines. Where it gets very murky is that Google does have a series of collaboration and social applications and cloud computing is a major focus for them so that by next year, given the way that CRM 2.0 is evolving into a social customer strategy, I very well might, not all that surprisingly, include Google. But it is there lack of operational applications - even the back end ERP type apps - that eliminates them from this watch list. Though that doesn't mean that you shouldn't watch them. They are hard to not watch, now, aren't they? Google Google and you get 2,712,000,000 (that's billion) references. Google "Paul Greenberg", CRM and you get 216,000 references.
I know where I stand.
Next up: Companies you probably don't know but really should and a few I'll look at in the mid part of the year but want to mention now (some hints: HA! No way! These are cool up and coming companies. You'll have to wait.)