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CRM buyer's top selection criteria

No longer are features and functions the one and only criteria when it comes to purchasing CRM systems. Veteran CRM implementers tell Forrester what is most important.

Analysts and CRM vendors have declared that the feature/function war is now over, and a recent report from Forrester Research Inc. backs that up.

After surveying 119 global organizations across a broad array of industries, the Cambridge, Mass.-based research firm found that while functionality is still important, it is by no means the only criteria when selecting CRM technology and not even the most important one.

"The CRM software market has been driven primarily by product innovation, and companies spend a tremendous amount of time comparing features and functionality," said William Band, consulting analyst at Forrester. "But the primary players have reached parity, especially at a high level. Features and functions are something buyers consider, but it's not the most important."

Rather, the firms surveyed, including well-known companies such as Cisco Systems Inc., British Telecommunications, Pitney Bowes and DHL International, have learned from the massive CRM implementation failures of the past. With user adoption proving to be a primary factor in the success of a CRM initiative, buyers are now focused on an application's ease of use. When evaluating a vendor's existing offering, buyers identified usability as one of the most important factors.

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Additionally, organizations consider an application's ability to provide advanced analytics capabilities to better understand customer behavior and make insightful decisions as a key factor in buying decisions. Third, organizations want a system that supports a centralized master customer data management system. Companies experienced with CRM have realized that getting customer data correct in the first place is crucial to CRM success.

There were also a few criterion that rated surprisingly low in the survey.

"A make-or-break criteria is industry-specific approaches," Band said. "That was rated low, but that's because no vendor even makes the shortlist unless they have a vertical offering. That's a change from three to four years ago."

Additionally, change management wasn't highly rated in the study, but in follow-up interviews it was found to be an important issue, Band said. It's something companies said they struggled with and would pay a lot more attention to in purchasing.

Another emerging criterion for CRM buyers, and a bit of a surprise to Band, was the importance of a vendor's system integrators partnerships.

"It's not just the vendor, but the ecosystem that buyers are evaluating," Band said. "One thing we are seeing emerge is a lot more pressure by buyers on integrators and vendors to offer a global development option."

Organizations recognize the importance of bringing new software into production smoothly and depend on system integrators to provide that expertise.

Finally, when it comes to evaluating a vendor's long-term strategy, buyers place high importance on an application's flexibility to support new business requirements in the future. The application must improve user output and integrate with existing systems.

The total cost of ownership (TCO) of a system was important but not actually at the top of buyer's minds.

"In the minds of buyers, TCO is very hard to deal with," Band said. "It's hard to compare apples and oranges."

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