What are the payoffs of this integration? Can you give me a practical example of how a company would benefit?
A CEO looks at a metric like calls into the call center and thinks they should be selling customers something during these calls. The CEO falls in love with the notion that CRM will offer the ability to cross-sell or up-sell at the service center. The problem is call centers have been built on a time-per-call basis. Two metrics measure success -- customer satisfaction and cost per call. Now you want to cross-sell and up-sell and it tips the apple cart.
When you figure out costs of fielding extra minutes to take the time and add sales to a service call against the yield you're going to get, it's going to be a big loser. So what's missing? You have to do the analytic marketing piece to make the numbers work here. You've got to differentiate between the types of call and the types of callers. The people calling to change their address maybe aren't a high yield to offer a new product. If you say there's something else that I know about their behavior that gets a higher yield, the numbers start to work. Have you seen companies apply that integrated operations-analytics approach and achieve success?
A financial services institution that wanted to offer certificates of deposit to callers found the yield was low but by classical database marketing segmentation found that of people between 60 and 69 years old who previously owned a CD, 11% would buy [a new] one -- no matter what they were calling the service center about. With integration between the two [CRM components], data from an E.piphany system can pop up as a window in a Siebel System, so the call center rep knows to offer the customer a CD. What's the difference between operational and analytical components of CRM?
The first stream consists of touchpoint systems, the operations systems that manage customer contact -- call centers, SFA, channel management., e-mail marketing. That set of technology comes from vendors like Clarify, BEA and Broadvision. Those systems were the first to get adopted. They're oriented and organized toward operational efficiency. This whole other stream that came from the direct mail/direct marketing arena is analytics and databases -- [I'm talking about] companies that build data warehouses and customer data marts, like SAS, Oracle, E.piphany. Those systems came along later.
What people have discovered is that neither the touch-point system nor the analytic system in a vacuum is capable of delivering results that CRM is promising. You have to deliver the two together to get the bang for the buck. What's the biggest hurdle when it comes to hooking these systems together and getting the right people access to the right data?
History. The reality is that systems built in most large corporations have not had the customer at the center. The classic example is that I have five phone lines at my house, but I get five separate bills. If I pay them all with one check, the phone company may end up turning off the other four lines. The phone company is organized around phone lines and not customers.
The dispersion of customer information and process is complicated by two factors. The information in these different systems has different quality. The issue of who is the authoritative source on a data item turns out to be a big one. The second issue is the very definition of the data winds up differing substantially and subtly among all the systems. The word customer shows up everywhere but means very different things depending upon where you are in the company. How many Fortune 1000 companies are doing this today?
Gartner has it right. They said about 50% to 60% of U.S. corporations have some touch-point system but only 5% to 15% of those same corporations have done anything serious in making the enterprise CRM vision come true. As Gartner points out, it's because of the issues of data integration and process integration. A lot of assets have been created. These Siebel call centers are important tools to use in developing a customer relationship but these assets have to be connected to other systems in the company. That awareness is skyrocketing in the Fortune 1000. Will Web services help this integration?
I think Web services have an extremely important role to play. Web services provide the framework for delivery. What we're building provides the context to make sure we're delivering the right stuff. The issue [with Web services] is when. We're in an environment with reduced experimentation budgets. Pressure on this market from the slowdown is greater on new technologies. If it were five years ago, Web services would be far farther along than they are today. They are being adopted now in places where there's an undeniable ROI, where it's clear and easy to see how Web services plays. But being rolled out where Web services competes with the Informaticas of the world, boy that's a ways off.
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