Integrated Data Technology Blog

Stick-to-itiveness: 3 Steps to Continually Refine Your CRM

Christopher J. Bucholtz — Thu, 01 Dec 2011 13:00:00 +0000

Each dollar spent on CRM yields $5.60 in benefits, according to a recent report. Though the findings are interesting, the methodology is questionable. The 70 participating companies were customers of a firm that had been profiled in case studies, meaning that they were not necessarily typical CRM users. Still, it's worth noting that the companies that contributed to the numbers were embodying a trait of successful CRM users simply by engaging with the firm and seeking an outsider's viewpoint of their CRM activities. That trait could be described colloquially as "stick-to-itiveness."

The 4 Laws of Conservation in CRM

Denis Pombriant — Wed, 30 Nov 2011 13:00:00 +0000

Economics is a social science, much to the chagrin of neoclassical economists who prefer to think of it as a hard science, like physics, full of equations and certainty. I think of myself as a Keynesian, and while I can see the equations, the certainty eludes me. What I see mostly are people, all of us, with our reptile brains wrapped in a layer of mammalian sensibility trying to satisfy our needs. Economists refer to us as "rational actors," but we are hardly that.

Want to Future-Proof Your CRM? Get Flexible

Christopher J. Bucholtz — Thu, 17 Nov 2011 13:00:00 +0000

When the so-called experts dispense advice about CRM implementations, whether they're first-timers or replacements of old systems, they always include a caveat about the future. You need to solve today's problems with the new system, but you also need a way to "future-proof" your investment so that the next set of problems to present themselves don't force you back into the CRM selection process. The key, as I've heard it from one undoubtedly Canadian consultant, is to do as Wayne Gretzky suggested: Don't skate to the puck, skate to where the puck is going to be.

Cloud ERP helps CFOs Get Involved

djohnson — Mon, 14 Nov 2011 15:52:36 +0000

CFO Involvement

Thirty years ago, managers didn’t need to know how to operate a keyboard. There were secretaries to type letters and agreements that formalized phone conversations. Times have changed. In addition to understanding business, today’s managers need to develop a working knowledge of the software tools that are designed to make their job easier. The CFO is not exempt. Over a quarter (27%) of CFOs say they’ve become more involved in their company’s operations over the past three years, and 15% say specifically that they’ve become more involved in IT according to a recent report by Robert Half Management Resources survey of 1,400 CFOs. There has been plenty of information and hype about cloud computing with a strong shot of technical jargon thrown in.

Cloud Software, IT, and the CFO

Some IT professionals are threatened by the perceived notion that the cloud will make their jobs obsolete. The reality is that IT jobs will change, but will not be eliminated. IT personnel will become more involved in the business and less involved in the day-to-day management of servers and software updates. Some CFOs are worried that the Cloud limit the control they have over data. As the steward of the organization’s financial well-being, the CFO has the responsibility to understand the current transformation in IT and provide guidance. With a predicted increase in IT spending of 7.1 percent over 2010 (worldwide IT spending is forecast to total $3.67 trillion in 2011) according to Gartner’s 2011 Q2 update, there is a lot at stake. Just as IT needs to understand more about the business, CFOs and COOs need to understand more about software options available to them. Getting smart about the cloud is becoming easier with a proliferation of objective articles and white papers. Some ERP Cloud News articles discuss ERP cost comparisons, security issues, and 2011 predictions.

More Information for CFOs

Recently the ERP Software Blog published a white paper targeting CFOs who want to get smart about the cloud. This paper gives CFOs the foundation ask educated questions and lead discussions about moving ERP software to the cloud. You can read the white paper on the ERP Software Blog at www.erpsoftwareblog.com/cloud-erp.

The data helps the relationship, but the relationship drives the sale

cbucholtz — Fri, 11 Nov 2011 03:30:20 +0000

By Chris Bucholtz A few years ago, I did a webinar with some respected thought leaders in the area of sales about the impact data was having on selling. No one was willing to use the term “data-driven selling” – that was too much for sales people’s sensibilities. But the guests were willing and able to admit that the new way of selling revolved around relationships and the only way to increase sales productivity while at the same time building stronger relationships was to rely on data – and, more specifically, rely on data that was organized and ready to use. Fast forward to the deja vu I experienced in August this year, when I had a chance to moderate another webinar, this time with Tony Hughes, SugarCRM’s country manager for Australia and New Zealand. Tony’s an author – he’s written a couple of books on selling topics, including the well-reviewed the Joshua Principle: Leadership Secrets of RSVPselling. Tony is all about the relationship in sales and so it was no surprise to hear Tony say that the key to selling still resides in the sales person and the need to establish trust and value in the prospect’s mind. But, with my CRM hat still perched atop my head, my mind keeps drifting back to the data. The information you know about a customer is the secret weapon that helps you build rapport and leapfrog ahead of your competition (who are also desperate to gain that relationship advantage). Sales departments are really in a data arms race, based not around who has spent the most but around who has spent the best on technology to arm their sales staff with that precious data. But it’s not just about the technology and the data. As my Me!other writing specialty has demonstrated, it’s not the plane but the pilot who wins the fight – selling skill plays a major role. The sales person is still the make-or-break variable in the sales equation. Tony made that point eminently clear in tracing how sales has evolved into what it is today. The relationship and the sales person’s need to cultivate it is one of the few constants. Before the webinar, Tony wrote up his thoughts in a white paper that we were proud to publish under the CRM Outsiders banner. It’s called “The Evolution of Professional Selling;” you can get a copy of it here and, once you’ve downloaded it, you can participate in our brief survey to determine just how exactly sales pros are selling today. Not only will your participation be helpful (we’ll publish the results, so you can get a feel for where you are along the evolutionary curve) but the first 200 to take the survey will get a copy of Tony’s book in the quickly-becoming-quaint print format. Selling will always be more an art than a science, but it’s a poor artist who doesn’t take advantage of the science around him to create better art. Check out Tony’s white paper (and webinar, and book while you’re at it) to see how neatly technology and sales talent can dovetail together.

Cloud ERP – Efficient, Innovative, or Both?

djohnson — Wed, 02 Nov 2011 14:13:37 +0000

In a recent article in Forbes, David Yarnold explains that SAP ERP system rigidity has squelched creativity and contributed to the loss of manufacturing jobs in the US economy. He further postulates that Cloud ERP systems will replace SAP and restore creativity to the universe.

“It’s time for companies to move on. To eliminate these massive shackling on-premise systems that have been inhibiting growth and creativity for so long. Stop pushing aside innovative projects because they simply can’t be done under SAP. It’s time to get creative again, fuel growth and create the jobs that our country and others desperately need. SAP’s efficiency allowed companies to cut jobs and costs. The cloud will maintain that efficiency but re-integrate the level of creativity that these great companies once thrived on.”

The Cloud delivers many benefits to ERP software designers. Access from anywhere, scalability, reduced IT costs, pay-as-you-go, and elimination of client software are among many benefits. Building Cloud ERP systems as web-based applications, delivers even more benefits as discussed in a previous ERP Cloud News posting. However, the claims made in the aforementioned article are exaggerated and require some clarification.

A Rebuttal, a Clarification, and Support for Cloud ERP

ERP and Innovation Accounting and ERP software is designed to drive efficiencies. Sometimes innovation competes with efficiency. For example, if you sell 1 million widgets/year and you can reduce the cost of sales by $1/widget by automating your ordering process, then paying $500,000 to customize your ERP system is a good business decision. If you are a small business and plan to sell 1,000 better widgets your first year, then a large upfront customization fee to SAP, Oracle, or any other vendor is not advisable. The example above shows that the cost/benefit analysis stifles innovation more than the system itself. That said, if the cost of the customization can be reduced, then the business case is easier to prove and companies can innovate faster. Modern ERP systems can accomplish this by eliminating client software, providing modern web-services APIs, and delivering web-based customization tools.

Rebuttal: SAP in the Cloud

Although not mentioned in the article, SAP has demonstrated that it is taking the cloud seriously through the launch of Business ByDesign as well as their work on a cloud-based platform. SAP might be too expensive. SAP might be too big for mid-sized businesses. SAP might be process driven. But I wouldn’t call SAP inflexible. If your business has a healthy budget (read millions) and large volumes of transactions to automate, then you can make SAP do just about anything. See sidebar “ERP and innovation.”

Clarification: Some Clouds are More Rigid than On-Premise

The his article, Mr. Yarnold states “the dominant rigidity of on-premise ERP systems appears to be evaporating with the advent of more flexible cloud-based applications.” Clarification: Multi-tenant cloud-based systems can be more rigid than on-premise deployments. With multi-tenancy, you gain some efficiency, but you lose control of the source code because it is shared by many users. I’ve worked with many multi-tenant applications (ERP, CRM, marketing automation) that allow you to define variables, parameters, and custom work flows – so I would not call them inflexible. If you can accomplish what’s needed with configuration (not customization), then the cloud will save you time and money. The key is knowing what you can accomplish with configuration. If your process requires core logic changes, then you will get faster results with an on-premise vendor.

Flexible Cloud ERP

The best of both worlds is an on-premise cloud implementation. On-premise clouds are more flexible and much less expensive than a client-server deployment. Modern development tools with web-based APIs eliminate client software and deliver robust applications to a web-browser. Since these applications are managed centrally, they can be designed and deployed faster and cheaper than client-server software. Unlike multi-tenant cloud applications, on-premise clouds provide access to source code. Before starting your customization, make sure that the vendor protects your customizations during software upgrades. Otherwise, you will have to reinstall or redevelop your customized code during each upgrade cycle. A single tenant application will also allow you to upgrade your application at a time that is convenient for you. The multi-tenant upgrade will occur automatically, but at a time specified by the vendor.

Conclusion: Cloud ERP helps drive Efficiency and Innovation

David Yarnold’s article endorses modern cloud ERP software. But the article goes too far by saying all cloud systems are more flexible than on-premise systems and misses the fact that SAP is pursuing cloud strategies. I would not blame job loss, lack of creativity, and the demise of some US manufacturing sectors on ERP software. ERP software is designed to make business processes (sales, orders, manufacturing, accounting, invoicing, etc.) more efficient. The cloud accomplishes this by offering rapid scalability, pay-as-you-go pricing, and eliminating the burden of client-software. When choosing a cloud solution, the ability to customize and connect with other systems is critical. Core accounting processes are rules-based and need to be flexible and open, but not innovative. ‘Creative accounting’ usually leads to big problems and falling stock prices. However, inaccessible and unconnected accounting systems are just as dangerous. Innovative manufacturing processes, line-of-business applications, support processes, and other business advantages need to be easy to plug-in to the core accounting, ordering, inventory, and management processes offered by the ERP system. ERP systems should make businesses more efficient and provide them with the tools to innovate. Cloud and web-based systems offering SaaS and on-premise deployments provide the flexibility and efficiency required to reduce the cost of innovation. This allows new ideas to be implemented faster and sooner than legacy software solutions – making Cloud ERP systems both efficient and innovative.

20 ERP implementation tips

Roger Hoyte — Thu, 18 Aug 2011 03:33:13 +0000

This is an old blog but all tips are still relevant today.
Source: http://www.erpsystems-news.co.uk

Planning

1. Know your goals for your ERP implementation. Choose the product that promises to meet those goals and put measurement tools and processes in place to gauge your success, advises Lance Williamson, engineer, Engenio Information Technologies, Inc., Wichita, Kan. In particular, he said, set goals for performance, response time and downtime.

2. Don’t do any project without a plan, particularly an ERP project which touches almost every part of your organization, said Bernard Golden, CEO, Navica Inc., a consulting firm in San Carlos, Calif. Create process with regular milestones and participation from affected organizations. And be sure to test, test, test, all the way through. “All of these things seem like ‘nice-to-haves’ rather than critical elements in a project, but can make the overall project much more successful,” Golden explained.

3. Involve users in your ERP project planning phase, said Andy Klee, president of Klee Associates, Inc., a consulting firm in Cedaredge, Colo. “The software is not going to do you much good if you don’t have employee buy-in,” he added.

4. Don’t do the planning and implementation alone if you don’t have the in-house skills to make it happen, said Jorg Janke, president of open source ERP vendor Compiere Inc. in Portland, Ore. “Determining which options and features to use requires experience,” he said. If the in-house team doesn’t have that experience, Janke advises, find a local ERP expert who is trustworthy and who collaborates well with your team.

5. Be realistic in your cost projections. Double the consulting firm’s estimate, Klee said. “I hardly ever hear of these projects coming in under the estimate,” he explained. Also, be realistic about training costs. “Even at the largest level, companies underestimate the training costs,” he said.

6. Don’t keep adding to your project. In the planning and evaluation stage, people see the capabilities of products and want to use each new one they discover. “Commit to what you want to do initially,” said Jon Reed, a Klee Associates consultant. “Get your return on investment and then expand. Otherwise, you’ll have a never-ending and unsuccessful project.”

To host or not to host?

7. If you’d prefer the hosting model for your ERP, then scrutinize your application service provider (ASP) well, says Janke. First of all, you must be able to trust this ASP with your data. “Find out if that hosting company provides cookie cutter solutions or can customize the ERP suite to fit your needs,” he advises. “Many outsourcers don’t know enough about ERP to customize it. Then again, if a cookie cutter solution is okay for you, then fine, use an outsourcer and you don’t have to take care of your ERP.”

8. Follow the money. “Hosting should take out a lot of internal costs of labor,” says Frank Prestipino, vice president of Oracle’s global enterprise applications strategy.. “It should save you money…by spreading payments over a period of time. You should be paying less over a period of time for hosting than you would do it yourself.” The hoster should provide this analysis. If you’re not paying less, don’t use an ASP, he said.

Evaluation

9. Choose an ERP package that is industry-standards based. “You don’t want to find yourself out on a limb with customers who can’t interact with your proprietary, out-of-standard implementation,” says Oracle’s Prestipino.

10. Look closely at maintenance costs. “You can pay a great purchase price and find that it costs a fortune to maintain,” Prestipino said.

11. Evaluate your processes and decide if changing them to fit a particular ERP suite would be beneficial, Klee suggested. “Either you’re looking for customization or going for out-of-the-box,” he says. “With the latter, people have to change how they do things in order to conform to the package. That may work for a company that needs to make changes anyway. Often, however, it’s better to choose a suite that can conform to your needs.”

12. Discuss a vendor’s stability with the vendor reps and outside experts. Find out if the company is losing market share, which might make it a candidate for a takeover or failure, Pestipino said.

13. “Whenever a company and its ERP package are acquired, it’s not usually good news for the customer,” Klee said. “Often, the vendor is buying the client base and is not that interested in the software itself. Instead, they’ll try to get clients to move to their own platform.” In this situation, customers may have to migrate without good business reasons.

14. Get the numbers. “Get empirical evidence of return on investment from the vendor and/or a consultant,” Prestipino said. Also, simulate the ERP suite in your company and make your own calculations.

15. Get vendors to come clean about their upgrade cycles. “Once they get you as a customer, their goal is to sell you new features and upgrades,” Klee said. “You want a company that upgrades and adds necessary features and doesn’t lock you into an expensive upgrade cycle.”

16. Find out how much customization assistance the vendor will offer, Reed said. “If you customize the ERP package to fit your business scenarios without vendor support, you can limit your support options from that vendor down the road.”

17. Be efficient in contract negotiations. “Don’t spend too much time analyzing details to the Nth degree,” Klee said. “If vendor can answer 25 critical questions and give most of what you want, you’re going to be in good shape. Focus more on critical items to get through negotiations more quickly.”

18. You can’t get everything you want. “Do accept that there is always going to be a functionality gap,” Reed said. “Usually, you have to let 10% go. If the gap is more than 10%, keep shopping.”

After the implementation

19. Pay attention to the quality of your data and the daily workflow, Golden said. This is especially important during the transition time after implementation and during periods when your business is changing or growing. Watch for seasonal variations, too. For example, Christmas can cause big jumps in data volume for a retail company.

20. Don’t sign up for long training sessions. Instead, do some initial, condensed training on your own site, and then set up a regular class schedule that gives users time to learn before they move on. “Vendors want to sell customers, say, 40 days of training over six weeks,” Klee said. “By the time the class is over, the trainees have forgotten the first half of the lessons.”

The Virtual Workforce Is Here, Now and Everywhere

PJ Weyforth — Mon, 20 Jun 2011 12:00:00 +0000

Customer experience can make or break a company. The pressure to manage costs has never been greater, but it's a fatal mistake to view customer service channels as a cost center. The solution? An at-home workforce that delivers excellent results: 10 percent higher customer satisfaction; 30 percent more flexibility -- or even greater; 20 percent lower cost to serve customers; highly educated employees with significant work experience; geographic distribution of workforce, which minimizes disruption; and greater business continuity.

Let Users Tell You Where Your CRM Is Broken

Christopher J. Bucholtz — Thu, 16 Jun 2011 12:00:00 +0000

It's often said that CRM is always a work in progress. Never mind the fact that I'm the one who's often saying it -- it's true, if you're doing it right. You should always be looking for areas where you can coach your people, adjust your processes, and fine-tune your technology. However, thinking about such a monumental set of factors can be extremely daunting. It's a lot of work putting CRM into place in a green-field situation; conducting a performance audit of an existing CRM program is even more taxing.

Tackling Business Model Innovation

Denis Pombriant — Wed, 15 Jun 2011 12:00:00 +0000

I heard a phrase the other day that resonated with things I've been thinking about and talking about on the stump recently, but I had never heard it so succinctly. I was taking a briefing from Zuora, a company involved in providing on-demand billing solutions for companies that deliver on-demand services. The phrase is "business model innovation," and it means what you think it does, but that's particularly hard to do. On the stump, I've been talking about how we've transitioned within the economy from innovating at the category level to innovating within the category.