Michael Fauscette

Five Technologies that are Changing CRM, Comments on CRM's Next 5 in 5

The other day I was pointed to an interesting post on the Software Advice web site called CRM's Next 5 in 5, 5 technologies that will change CRM over the next 5 years. The post was written by CRM analyst Lauren Carlson, and was based on a format that IBM uses for predictions each year. In addition to Lauren's 5 in 5 predictions, she arranged to have a few of my analyst colleagues,  Paul Greenberg, Ray Wang, Brent Leary, Esteban Kolsky, Denis Pombriant and  Brian Solis add their comments.  I like the format and of course I found it hard not to add my opinion as well, so here are a few comments on Lauren's predictions:

1. Context services will provide a clearer picture of customers - Context is an extremely important concept across many areas in software and customer insight is no exception. The customer profile continues to be the center piece of businesses' CRM efforts, and the addition of location data, behavioral data and a view of a customers' social graph can enrich that profile significantly. Context services are a key input to the emerging category of applications we call socialytics as well. The richer the social profile of a customer the greater the insight and the more likely that the profile will yield data that can turn reactive efforts into efforts based on behavioral models and predictive insights. Mobile of course is adding a rich set of context data, particularly when combined with social data and with transaction historical data.

There are also other ways that I see context becoming important, taking more of a work / system view. Applications in general must become context aware. This is particularly true of systems that provide data for decision support. The next generation of software will be process aware and provide the right information at the time of need, including bringing the "right" experts together in the work context. This is one of the key productivity enhancements that I see evolving in the next generation of enterprise applications.

2. Real time customer intelligence becomes a reality - There's a lot of discussion over big data and the rapidly growing mountain of data that's created every year. IDC estimates that 1.8 zettabytes of data were created in 2011 and that data volume doubles ~every 2 years. There is work at every level to figure out how to manage and use this data. Today the problem is getting business value out of the data, and this is particularly true around customer data. While I see significant progress we're still in the early days of building systems that can provide real time, actionable customer insight. It's important to think of moving from systems of  analysis to systems of decision. Analysis is something that happens among a few highly trained people, using highly specialized systems. Systems that enable data driven decisions that are embedded in every business process are the future. The road from data to insight is one that is, today anyway, difficult to travel. There is some new thought emerging around insight as a service, here's a post from Evanlegos Simoudis that talks about this concept.

3. TV will become the next big channel in customer engagement - TVs seem like a logical extension to current channels, especially as they get more connected first through smart set top add-ons and eventually through a new generation of connected device. It seem to me though, that the evolution of the connected TV could actually converge with other devices so that there would be a seamless experience across devices from smartphone, notebook, desktop and tablet to TV or even auto. All of these channels need to be activated in the CRM system on the backend, I think, which would start to create this consistent customer experience that is device agnostic. Identity, presence, and context all interact in a way that opens up many new opportunities for providing exceptional customer experience across all connected devices. We're already seeing the evolution of the connected device expand to TV and auto, the next step is to link the experience across devices and them connect the channels to the CRM solutions.

4. Virtual meetings will change the way people do business - The tough economy has accelerated the business trend of reducing travel and interacting in virtual meetings powered by technologies that have improved significantly over the last few years. Connectivity in general is rapidly changing the way we interact online and providing ever richer experiences in both consumer tools like Skype, Facetime, ooVoo and in business tools like Webex, Go-to-Meeting and LotusLive. Mobile is also changing virtual meetings by becoming a viable alternative to desktop and laptop. I often participate in online meetings on my iPad or iPhone with Go-to-Meeting and Webex with excellent results.  The addition of mobile clients to the connection options is increasing the rate of adoption. In addition there seems to be a new (or renewed I guess) focus on UC which should provide the development of better virtual enterprise tools and thus aid adoption.

5. Gamification will go from buzz to business strategy - Gamification is already turning into a useful and effective marketing tool on the consumer side. There are some good examples of networks like Foursquare that embedded games as a part of its basic business strategy. In BtoB and the enterprise in general there has been much less "buzz" and more of an attitude of wait and see, but that should start to change. Interestingly enough the place I'm starting to see the use of gamification in business is internally in some supporting HR systems, for things like motivation and reward and recognition, and also in decision support with the use of predictive market techniques. I'd think that communities, both internal networks and external customer networks would see a growth in use cases particularly to drive engagement.

That's my take on CRM's next 5 in 5, what do you think?

Tags: CRM, socbiz, social, mobile, gamification, collaboration, context

Business Model Disruption and Dealing with Change

A couple of recent events and some commentary around them got me thinking about the current state of business, the pressure to change and how companies respond to the need to change. Change impacts people and organizations in many different ways, depending on how the person or organization is "wired". Some resistance is natural but sometimes, at least at the strategic level, companies have to face the fact that they must change to stay healthy. That applies to people too I guess, but that's altogether  a different subject.

If you've heard me speak on social business you probably have heard me talk about what I believe are the fundamental change drivers in today's deep business change cycle. Those factors are at the intersection of changing culture and changing technology, and I'm not sure one exists without the other. I think that our current change cycle, the move to an information based economy, is as large as the cycle that moved our world from agrarian to industrial and will have the same far reaching effect. The Internet or at least the open, nearly free connectivity it provides. is, of course, at the root of most of the changes, It's the information super highway that facilitates new business models and new ways of interacting.

Anyway, back to the events that started this thought process.  First was the recent fight to stop some bad IP protection legislation called SOPA / PIPA, or actually the extreme efforts of the movie industry lobby to try and force them through. The second event was the appointment of the new CEO at RIM, Thorsten Heins. Both of these events tie directly to companies or industries that appear to be in extreme denial over their current business models or product direction and come across as a fairly severe case of change aversion.

In the case of RIM, first I should say that I'm very much outside looking in and like many analyst have been pretty critical of the fact that they squandered such a lead in the smartphone market by not listening to what customer's wanted and by assuming that they knew better than those customers. What makes it so sad, I think, is that the company was truly innovative and led the way in wireless communications, and eventually the smartphone market.  Anyway, I hope that I'm wrong but it seems to me that taking an internal candidate, particularly the one person who oversaw the failing product portfolio over the last five years (his former title was Chief Operating Officer, Product Engineering and was responsible for the Blackberry product portfolio worldwide), might not be the best way to reinvigorate RIM. Now that may be harsh but give this video a viewing and see what you think. This may just be a new CEO trying to rally the troops, but if these quotes are any indication of his real feeling about RIM and the job, well: "At the very core of RIM is the innovation. We always think ahead. We always think forward. We sometimes think the unthinkable. And that is fantastic" and this "If we continue doing well what we're doing, I see no problems with us being in the top three players worldwide in the next years in wireless". I'm reminded of the famous quote: "insanity is doing the things the way you've always done them and expecting the results to be different".

Now for the movie industry. Last night I went to see a movie with my daughters. I'll be the first to admit that the outing associated with going to a movie at a theater is a part of the experience, along with the big screen, snacks, etc. But for some reason last night the whole experience irritated me. The ticket price for the three of us, $36 (my youngest is now 13 so no more children's tickets). Snacks, about $23. While getting said snacks the counter person insistently tried to up sell me from my small soda and small popcorn to a much better "deal" for only a little more....yeah, about that, I really don't need a 64 oz medium soda and a medium popcorn in a grocery bag. On top of the up sell (his job, so no hard feeling, except maybe for the attitude for the sacrilege of not wanting his "deal") he won't shut up about the new movie loyalty card. It seems for the mere price of $12 a year I could have true movie bliss, discounted movie tickets and all...really, a loyalty program you charge for? So, finally in the theater, I settle in for my movie. Over 35 minutes later I finally get through snack bar ads, mobile phone ads, have your next meeting here ads, etc. and we finally can enjoy the coming attractions...no, slip in one more snack ad and then on with the show (>45 minutes after sitting down, and no, we were only 5 minutes early for the advertised start time). So let's see, I drove to the theater, paid $49 and spent over 45 minutes watching commercials to see a pretty good movie 9 months before I could have rented it on iTunes for $4.99 in high def...hmm. Or maybe it would have been on Netflix, where I pay $8 a month for unlimited streaming, of course who knows how long a wait it is for the movie to be available. So basically I'm paying $50 + gas to see a movie sooner and with commercials that wouldn't be there if I had waited and watched it in the comfort of my own home?

The Internet changed so much, and particularly for content distribution it is causing a huge disruption. You see, using a nearly free medium that is increasingly available to anyone as the distribution vehicle is working out very well for many businesses. Now the ugly downside to digital distribution is, of course piracy. I've spent so long in the IP business (software) that I can't bring myself to download pirated movies and music but they are out there. You have to wonder though, particularly when it comes to movies, is the business model largely at fault? Are studios creating an  abnormal environment of scarcity that makes pirating more attractive? You also have to wonder if they are not, themselves, missing a huge business opportunity to leverage the disruption to their advantage. Using a new distribution model that allowed individual choice of when, where and how a new movie is viewed, seems to me like a way to increase revenue, not decrease it. I realize that it might (or probably would) disrupt the current distribution model, but that's what happens when business models are pressured into change. It would also make movie theaters focus more on the customer experience and less on extracting every last cent. I'd pay $4.99 (I already do) to rent movies, actually I'd probably be willing to pay a small premium on new releases for some reasonable period of time, if I could choose to watch it on iTunes, Netflix, cable on demand, Roku, Amazon or any other channel that might become available on the Internet. Fred Wilson wrote about this idea here.

As an interesting case study, take a look at comedian Louis CK's recent experiment with his Live at Beacon Theater special. In a bold move by an artist, he decided to produce and distribute his performance himself, rather than go the direct to HBO or some other corporate controlled route. Louis' distribution model, simple, make it available online for $5 paid via Paypal (and now Amazon as well). No DRM, no restrictions, just pay, download and do whatever you like with it after that. The results, well, after the release in December he made over $1M in 12 days. The site and video are still up and presumably he's still making money from it. Did it get pirated, of course, but in fact in the Torrent comments many people attributed buying the download to watching the pirated version first. Louis was very satisfied, he more than covered his production costs, kept some for himself and gave a good portion of the proceeds to charity. If he had gone the direct to HBO route would that have prevented piracy? We all know the answer to that. Perhaps he would have made more money with the broader promotion efforts of a big studio, who knows; but as long as the artist and his fans are happy, who cares? New business models for changing times.

 Business is in a change cycle and how businesses deal with that change will determine the next round of winners and losers. Ignoring the changes around you is not a business strategy (or at least not a good one). Four major tech trends, cloud, mobile, social and big data, are having a widely felt impact, accompanied by cultural and business model changes. The Internet itself provides much of the underlying foundation for many of these changes. It can connect people to people and information, and provide a new distribution and sales channel that extends a businesses' reach well beyond geographic boundaries. In the case of all digital content (movies, books, music, performances, etc.) the Internet opens up a wide variety of business model options, if only companies look outside of the past.

Tags: disruption, change, business models, socbiz, social, cloud, big data, mobile, RIM, Internet

Lotusphere 2012

It's been almost exactly 12 months since IBM first announced its social business initiative during Lotusphere 2011. In tech a lot can happen in a year and I have to say the folks at IBM have been quite busy. When IBM set out on this journey it did so with quite a few assets in communications, social software and analytics. While the assets provided a wide range of features and functions they did not provide an "integrated" suite of social tools. The roadmap of course, showed that this was the direction that IBM would take, but it was unproven. Fast forward a year and now we can see just how much integration and improvement IBM could accomplish.

Before I dig into the announcements though, just a short bit about Lotusphere itself. The conference was again held at the Dolphin and the Swan on the Disney Orlando Resort. I look forward to the opening session, IBM usually puts on a great show with some entertainment to wake up the crowd, and a surprise guest celebrity keynote. This year the session was opened by alt rock band OK Go, who put on an excellent multi-media show, something they're known for (actually I should say the music was backed up by an entertaining selection of videos, including OK Go's signature "treadmill" videos). The guest celebrity keynote, actor Michael J Fox, exceeded expectations and provided an interesting look at the power of community and the value that the social web can deliver in connecting people with like causes and issues. The final speaker for the opening session though, Dr Jeffery Burns of Children's Hospital Boston, was the real surprise. The case study he provided might be the best example of the power of the social web and the three C's of social business; content, collaboration and community, that I've heard. Dr Burns, working with IBM, championed and built out a community of experts scattered around the globe, with a method to provide real time collaboration for dealing with unique illnesses and a way to collect content for reuse by other physicians for learning new techniques for treating their patients. The real time community links doctors and hospitals around the world and makes the "right" expertise available at the right place and time, virtually. The end result, saving children's lives by sharing knowledge and skill through community.

Now for the product announcements... The Lotus Connections product, with its activity stream UI, is the center piece of the IBM social business offering and becomes one of the key integration points in its next release, version 4, or Connections Next as it is now called. In Connections Next IBM used the OpenSocial 2.0 standard for integration and provides the capability to pull people, data, content and applications into a single collaboration environment. The ability to integrate Connections with other applications is a key feature that moves Connections to what I'm calling the new UI for the social enterprise, putting a modern UI on aging core systems. Connections Next also ties together other Lotus offerings including email (supporting Lotus Notes of course, but adding MS Exchange support as well, an important addition as, according to IBM, over 60% of its Connections customers use Exchange), calendaring and IM. Also key for adoption and success in today's business environment, Connections adds native support for the major mobile OS's, iOS, Android, and Blackberry and includes both smartphone and tablet support. In fact many of the onstage demos were conducted on an iPad. These new mobile offerings include many business focused features including iOS remote partial wipe and Cloud-based meetings for Android using LotusLive Meeting,

Analytics, or as we like to call it, socialytics, was also featured prominently in the IBM social business story. Building on its acquired portfolio of analytics products that includes Cognos, IBM has embedded a broad range of analytics into IBM Connections Next including social media monitoring. Analytics are a key benefit and driver for companies to adopt social tools, and with these new capabilities IBM is putting a serious stake in the ground.

Lotus Notes, not to be left out, also gets a social facelift. Acknowledging the fact that many employees are more comfortable working in an email client, Notes adds the ability to integrate Connections into the Notes email client including the OpenSocial application integration capability. In effect Notes becomes IBM's second choice for a social business integrated client alongside Connections Next. From a culture standpoint, this is an important capability and should help companies encourage more employees into using and being involved in the internal social collaboration network. It's a well known fact that the more employees you can get actively participating in a social network, the more value everyone gets out of its use, which in turn drives more and broader adoption. Notes also continues its mobile offering with a next release of Lotus Notes Traveler that includes social capabilities. Mobile in general gets more integrated into a unified communications structure through Lotus SameTime, which adds presence, click to call from calendar for Android, Online meeting support for Blackberry, and even text-to-speech for Android.

IBM Symphony also wasn't left out of the social business portfolio. Later this year IBM will offer a cloud version (which also includes an on premise option) of Symphony Docs that provides browser based doc creation and editing features. It appears that IBM is planning this offering as a Google Docs competitor, which will be released as a part of its new IBM Social Cloud offerings.

Not only did IBM announce an abundance of its own social products / solutions, but it also involved several key partner announcements. On the social customer front IBM is continuing to evolve its relationship with SugarCRM as its go to market partner for CRM. The solutions are integrated and the IBM sales force is ramping up on including the SugarCRM products as a part of its own portfolio of offerings. For video collaboration / UC Polycom REalPresence video solutions are now integrated into the IBM SameTime environment. Video is an important enterprise capability and the new offering showed well.

One additional note of IBM's commitment to the social business initiative, IBM Labs. Once again this year I went on a journey into the future through the lens of IBM Labs and a broad range of social projects that ranged from using social data to more effectively assign sales executives to territories (through integration with SugarCRM I should add) to finding the real expert inside companies for knowledge sharing. These projects, a dozen or so on display / demo, are an exciting example of why IBM can provide leading edge social tools now and into the future. The use of analytics on the growing mountain of social data offers a nearly unlimited range of projects that could provide significant benefit to businesses.

All in all it was a busy week between meetings, demos and even presenting a session for IBM on IDC's perspective on social business. Always a fun week, and this year most interesting for its window into the next generation of social business solutions from IBM.

Tags: social, socbiz, IBM, Lotus, Connections, Notes, SameTime, SugarCRM, Polycom, SCRM

Social Solution Maturity

Last Summer I published a Social Business Maturity Model that we developed to help companies understand their level of adoption of social business. The idea is that you can identify a set of criteria to use to evaluate the progress a company is making on it's rollout and adoption of social tools and the accompanying process and culture change that enable the business transformation. Companies could then take that criteria and use it to benchmark their own progress and also plan out a strategy to accelerate adoption and build more momentum. We looked at culture, organization, technology and barriers to change across five maturity levels, and built criteria out for each intersection that could help identify where the company would fall and help with planning future projects. The whole model is based on the results of our semi-annual social business adoption surveys and our interaction with a wide set of companies that were evaluating and using social tools both internally for employee collaboration and externally to engage customers and create more effective partnerships. We have published a series of case studies that relate some of the specific company stories over the past year. The model, just to refresh you, looks like this:

We're now in the middle of an IDC marketscape on social solutions that focuses on tools for use in social collaboration. The marketscape is a fairly exhaustive examination of each vendor and the solutions along two axis, strategy and capabilities. Strategy is focused on the future and reflects the vendor's 3 - 5 year plan. Capabilities is focused on the here and now and is an assessment of what the company and its products do currently. This process involves direct interviews with the vendors and also collection of feedback data from customers using the solutions against a set of predefined criteria. The social solutions marketscape will be released in the Spring of this year.

Because we're in the process of the vendor interviews I started thinking of the maturity model for end users and the idea of maturity of both solutions vendor and the actual solutions. Now I wouldn't suggest that you could really do a maturity model in the same way you can for user adoption, and really in some ways the marketscape will infer maturity anyway. Still though, are there criteria that could be applied to at least start to think about the maturity or sophistication of a solution? In fact, those criteria would look similar to the criteria we're using to look at the vendors and solutions in the ongoing marketscape process. So while I don't offer a true solution maturity model today, I will provide a list of some of the criteria that I think are important in evaluating a social collaborative solution:

• Single, consolidated UI that is built to current, modern standards and aggregates access to all features and functions in one place.
• The ability to interact and consolidate interaction between employees and all supporting content, data, communication channels (email, video conferencing, IM, etc.), enterprise systems, external social networks and media into a single UI.
• Ability to define personal and role based information filters to make information streams useful.
• Connectivity that extends outside of the firewall in a controlled and secure way to bring in partners, customers, suppliers, etc. into the conversation when desirable.
• Ability to maintain enterprise profiles for each employee and access from the consolidated environment.
• Ability to embed the activity stream into other enterprise applications, particularly email clients.
• Mobile support for at least the 3 major OS, IOS, Android and Blackberry. Support for tablets and smartphone form factors.
• Configurable and granular security to protect the intersection with public social properties.
• Ability to deploy in the cloud (at least public cloud, although private cloud support is a plus).
• A full socialytics suite of capabilities as a part of the solution or through a partnership.
• Provide operational transparency and provide an agree service level.
• Continued investment in product enhancements on a regular basis.
• Subscription and/or pay for use pricing.
• Pre-packaged API / integration to common 3rd party systems.
• An SDK for extensions to meet vertical and specific customer needs.
• Open standards support
• Product support that incorporate the use of social support through peer to peer communities and public social channels.
• Published product roadmap available to prospects and customers.
• Partnerships to provide complementary technologies. Providing a partner marketplace is a good method for helping customers find solutions.
• Services / consulting partnerships that help foster customer success.
• A method for collecting, prioritizing and using customer and partner feedback to increase innovation and improve products (innovation management process).

So there's my list, what do you think? If I missed some please add them to the comments.

Tags: socbiz, social, solutions, maturity, vendor, software, technology, cloud, UI, UX, roadmap

A Look Back at Our 2011 Predictions

We're putting the finishing touches on our 2012 predictions, so look for that post in the next week or so, but in the mean time, and in the spirit of accountability and openness, I decided to take a few minutes to look back at our predictions for 2011 and see how we did. Here's the original post, if you want to refer to it, but I'll go through each one here again:

1. Social profiles become the Internet fingerprint - I'd say we get a B+ on this one. While profiles are an essential part of your online persona, the proliferation of profiles is still something of a problem. Certainly more sites are using Facebook connect or Twitter as a de facto "standard" to help relieve the pain of initial sign up, but that's as far as we've gotten. There's still a need for some way to manage all of the profiles centrally. This stretches into the enterprise as well, where we're just starting to see some ways to establish internal business profiles. Many enterprise social systems provide profiles of course, but in only a few instances are they linked to HCM systems. It's a hard problem to solve, but I'd have thought we would have made more progress.

2. The resurgence of eCommerce, increasing importance of providing a social customer experience, proliferation of context aware mobile apps and emergence of new social tools will lead to an innovative commerce experience that is a hybrid of social, mobile, online and brick and mortar. - I'd say we get a solid A- on this one. Commerce, or as we've started to refer to it, digital commerce, is a hot topic and all of the elements, mobile, social, multi-channel, etc. are top of mind with businesses. New digital commerce platforms from major software vendors like IBM and Oracle are coming together nicely. On the public social web side, both facebook and FourSquare have made some progress towards integrating into commerce platforms, particularly through a partnership with AMEX last Summer.

3. Cloud and the economic impact of new subscription models is reshaping the software channel model for vendors and their partners. - With cloud apps / SaaS reaching the tipping point last year and the rapid emergence of new PaaS, IaaS, etc. offerings + the increased availability of subscription licensing in general, it's impossible for software channel partners to ignore the impact to their current economic models. The transitions will take a long time of course, but we're well on our way...I'd give us an A here.

4. The enterprise gets serious about mobile applications, moving to more open and secure mobile platforms that provide multi-device management and much broader mobile apps deployment. - Mobile apps development  saw rapid development and adoption last year. More and more software vendors are making their apps accessible on multi-OS smartphones and tablets. The proliferation of tablets only served to accelerate mobile adoption. Enterprise IT is under tremendous pressure to support multi-device architectures and move away from the corporate mandated single device support approach of the past. Mobile platforms and virtual mobile platforms like Citrix Receiver are experiencing tremendous growth as more organizations look for ways to tame the growing number of devices choices. I'd give us an A on this one.

5. Hyper connectivity and cloud computing leads the social business to the next generation business model based on organic business networks. - The networked business model is gaining more acceptance as more businesses start to use social solutions both internally and externally. The transition will take quite a while of course, but it has started in earnest. I'd say we deserve a B+, change takes a while, but more and more businesses are looking to social solutions.

6. Social collaboration and networking tools bring new life - not death - to email. - I'm more convinced now than last year that social collaboration tools are not a substitute for email, instead they off load functions that were never appropriate for email. There's still nothing better for 1:1/few private communications, while other functions like file sharing, real time sharing, collaborative work coordination and facilitation, etc. are moving to social tools that are designed to support those functions. I'd give us an A on this one. The next step is to push all of these tools into an integrated communication and collaboration environment with context awareness, better filtering, and more user control over the "inbox".

7. Socialytics moves from enterprise experiment to core business intelligence tool in support of critical executive decision making. - Last year saw a significant move forward in socialytic capabilities and an increase in adoption of these solutions. Consolidation, which started with socialytic vendors a couple of years ago, continued as well, with major vendors adding to solution portfolios. In our recent social business surveys decision support is obviously moving up in importance as one of the key benefits of social solutions. I'd give us an A in this one as well.

8. The growth of social media and meteoric expansion of  content causes a data glut that can only be made relevant through people-centric curation, leading to an explosion of tools and methods to facilitate the process.  - Data continues to grow at a staggering pace but I have to say that systems have yet to catch up. There's a need for more effective filtering, context aware information, and a broader set of curation tools to help companies and individuals make sense out of the noise. The problem is certainly getting wore but we seem to have a gap in system capabilities that is not closing as fast as we thought. I say we get a C at best.

9. The AppStore software distribution model and subsequent disruption of pricing models leads to lower software costs and more transparent software pricing. - The App store model continues to grow and is moving into more business situations. The model is disruptive on pricing, as we've seen from the Apple stores and the subsequent effect on mobile and desktop pricing. That said, the impact on enterprise software in general has been very small to date. I think we get a C- for now.

10. The changing nature of work drives new solutions for collaboration, project management, and managing a distributed and often indirect (contract) workforce (the Human Cloud). - The trend for distributed and contact labor forces has continued as the economy has slowed again. The solutions like oDesk and Elance are very popular and growing at a rapid pace. There's a need for better tools to manage some types of projects and particularly improved collaboration, but in general there's been improvement. I say we get a B+ with some room for new solutions to tie things the new workforce to gather more effectively.

So that's it for last year. I think we did pretty good, but I guess you're the judge of that really. Anyway, look for this years predictions shortly.

Tags: predictions, 2011, mobile, social, socbiz, enterprise, collaboration, social media