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I believe " Successful CRM/CXM " is about competing in the relationship dimension. Not as an alternative to having a competitive product or reasonable price- but as a differentiator. If your competitors are doing the same thing you are (as they generally are), product and price won't give you a long-term, sustainable competitive advantage. But if you can get an edge based on how customers feel about your company, it's a much stickier--sustainable--relationship over the long haul.
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Dinesh Chandrasekar DC*

Thursday, September 16, 2010

Picking a needle in the Haystack: Criteria to Reduce your CRM Vendor Selection Risk

Dear,
We frequently meet the top executives from high profile companies in different parts of the world for the discussion around CRM technology solution selection. The vast majority of these discussions are around process of trying to select the right CRM technology solution to support their business strategy. From these conversations, I have filtered a set of decision criteria to help you quickly cut through the CRM Vendors and make the right decision.



  • Ability to meet your specific business requirements. You have to know what business outcomes you are trying to achieve, and define the business capabilities that you need to support, before you seriously consider investing in a CRM software solution. Although the core capabilities of leading CRM software vendors are quite similar, the companies I hear from still place a very high importance on the solution meeting the functional and technology criteria that are specific to their needs. Can the vendor meet your use-case requirements?


  • Ease of use for front-line workers. My clients expect CRM software to demonstrate the capability to make people more fruitful in their work, and this is predicated on how easy the solution is to use. Good usability encourages user adoption. Is the solution UI modern and adaptable to diverse role-based requirements?


  • Capability to provide advanced analytic abilities. My clients place a high value on CRM vendors' ability to provide analytic tools to better understand customer behavior and make insightful customer-facing decisions using the myriad customer data collected. Analytics are the key to unlocking the value in CRM applications. Does the vendor have powerful and easy-to-use business intelligence capabilities?


  • Capability to adequately manage customer data. The hope of a “360-degree view” of the customer is often dashed on seemingly lowly customer data issues. Therefore, the ability to support a robust customer master data management approach is vital and the companies I speak with increasingly recognize this is a critical requirement. How does the vendor support data acquisition, cleansing, and governance?


  • Means to enhance the service function, particularly the contact center. Improving customer service via improved contact center capabilities is vital. Many of I the executives that I speak to report that they started with CRM by working on contact center improvement initiatives, then moved on to focus on sales, and then marketing. They tell me "CRM is never done" and continuously work on efforts to improve customer engagement. Does the solution have strong capabilities to support customer interaction management?


  • Strong workflow capabilities. My clients are looking for applications that help to better define and automate workflow. Therefore, look for applications with strong and flexible process management competence. Does the solution have native business process management capability?


  • Ease of use of development and customization tools. The clients seek to achieve improved business results quickly and want new technologies that can be readily adapted to their business environments. Challenge your vendor to show you that that their solution is easy to customize. Does the vendor offer a robust set of development tools?


  • Robust scalability. Large organizations want solutions that are scalable to accommodate large numbers of users and can support the business globally if required. What evidence can the vendor provide about the scalability and responsiveness of the system?


  • Capabilities tailored to specific industries. Today’s organizations rate industry-customized CRM solutions as relatively unimportant to their selection decision, I see this criterion emerge as very important in the actual vendor evaluations in which I participate. Does the vendor have systems in production at other organizations like yours?


  • Flexibility to meet changing user needs. Buyers tell me they are on long-term "CRM journeys" and expect to be rolling out new capabilities on a regular basis in response to new business challenges. Therefore, they place very high importance on the flexibility of a CRM application to support requirements that will arise in the future. Is the solution flexible and easy to change?


  • Ability to improve the productivity of end users. My own studies have shown that less than 50% of buyers “fully agree” that their CRM initiatives met their expectations for achieving planned business outcomes. Can the vendor provide evidence of user productivity improvement?


  • Capability to integrate with existing technology systems. The companies I talk with usually have heterogeneous application infrastructures and cannot tolerate a CRM application that would operate as an "island" within their organizations. Does the solution have a robust integration approach?


  • Acceptable total cost of ownership. Not surprisingly, my clients are concerned about the total cost of ownership for business solutions. These costs include not only application licenses (typically 25% of total costs) but also the capital costs of hardware and software integration, ongoing maintenance costs, and the administrative expenses for managing new IT assets. This criterion is driving up the interest in software-as-a-service (SaaS), solutions as companies look for ways to avoid infrastructure costs. Can the vendor provide an estimate of the TCO (not just license and maintenance costs) for the solution installed at your organization?


  • Quick and accurate vendor response to support issues. Organizations expect to be well-supported by their CRM vendors after the software is purchased and in production. They evaluate carefully how CRM vendors are organized to provide application support and response to technical issues. Can the vendor provide references attesting to their track record to living up service promises?


  • Methods to support change management to increase user adoption. Virtually every organization I talk with identifies that cultural transformation necessary to become a more customer-centric organization. Promoting rapid user adoption of CRM technologies is one of be their biggest challenges. Can the vendor support and train your employees to use new procedures and tools?


  • Financial resources sufficient to ensure long-term viability. The CRM vendor market has been consolidating in recent years, and I am continually asked about the long-term prospects of individual CRM vendors. What is the evidence vendor will be around to support your organization in the future?

    When you run through these criteria your choice among the large group of vendors will be certainly reduced to few numbers may be maximum 3 to 5 . This will give you enough leg room to manage the vendor selection process and also to reduce the high risk of falling prey to a wrong vendor.

    All the best for your CRM product Vendor Selection.

    Your Partner and Companion ( P&C)
    DC*

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