CRM - July 2008 - (Page 34)

ON-DEMAND CRM look to tighten purse strings, putting down hundreds of thousands of dollars for licensing costs for on-premise software is unappealing and impractical. The on-demand solution becomes more attractive than ever. “I think that the economy will, in fact, be a major driver for greater growth in SaaS. The pay-as-you-go subscription pricing is perfectly suited for companies trying to put greater cost savings in place,” says Thinkstrategies’ Kaplan.“Large enterprises are trying to hold down capital expenditures—[what] they would normally use to spend on software, [they can] shift to [the] operating line where they have greater flexibility,” Kaplan says. “In fact,” adds Nucleus’ Wettemann, “what we’ve seen is that users of ondemand CRM tend to upgrade more quickly, deploy more users, [and] get greater incremental benefits at less cost than what on-premise would require.” enterprises, analysts list Salesforce.com. “[Salesforce.com] demonstrated the viability of SaaS in the large-scale enterprise by winning a number of brandname companies over to SaaS,” Kaplan points out. “Internally, it is changing its sales model to appeal to the large scale. Traditionally, [Salesforce.com] relied on Web telesales to provide to SMBs but also the [large] enterprises; they have recently been hiring traditional software salespeople to sell SaaS solutions directly to executive decision-makers.” Honorable mentions include RightNow Technologies, Oracle On Demand (formerly called Siebel OnDemand), and, now, Microsoft’s Dynamics CRM Online (renamed and released in mid-April). [For more on Microsoft’s presence in this space, see our cover story on page 20, “Is Microsoft Winning the CRM Race?”] Kaplan advises the following three strategic steps for an enterprise considering going on-demand: 1. Have an open mind about it. Know that there are now a great number of vendors and on-demand software to choose from. 2. Take a careful self-assessment of the current on-premise application. Have a well-rounded understanding of what it has taken not only to get the applications up and running but also to maintain them. Take into account all management costs. Once obtaining a handle on current cost of ownership, evaluate cost savings presented by a SaaS model. 3. Start by looking at the basic functionality of an on-demand model, but also look at any special features. A true SaaS option should improve ease of use, productivity, and maybe even collaboration between dispersed workers. Look for specific tailoring to your market. And see if SaaS provides greater reporting capabilities or greater audit ability. In the end, you may find the water’s just right for your company’s dive into SaaS. Contact Editorial Assistant Lauren McKay at lmckay@destinationCRM.com. www.destinationCRM.com Swimming with and against the current Perhaps getting the best of both worlds—jumping seamlessly from on-premise to on-demand and back again—is an option after all. The hybrid solution, or what some refer to as a “mixmod” solution, is gaining in popularity, especially among enterprises that feel more comfortable with data held internally. Being able to switch between the two solutions is also appealing for an enterprise not quite ready to place its faith in the vastness of the Web. The new reality is “very much going to force software vendors to supply both onpremise and SaaS as a suite to allow companies to choose and mix depending on what’s critical,” says Bruce McIntyre, vice president for CRM at CDC Software. “That choice has to be fluid. Companies will need to move from one to the other and back.” “I think there will still be value for on-premise where companies want distinct, tailored selling premises,” McIntyre says. “We believe that those will tend more to on-premise than SaaS and will want more control over [applications]. There will be a strong trend toward SaaS but a core of on-premise deployment where control is desired.” 34 NO MYTH: THE ENTERPRISE IS A FISH OF A DIFFERENT COLOR Roy, of eGain, says that one of the main differentiators between a large enterprise and an SMB is that large enterprises look at CRM solutions through a long-term lens—often a five-year horizon—and at implementation costs. This long-term commitment requires a knitted relationship between the vendor and the large enterprise, a relationship that just isn’t the same with the SMB. Harrick of SugarCRM lists the top three needs of an enterprise SaaS initiative as data backup, control over software versions, and performance intelligence. Others suggest considering the following for on-demand enterprise CRM efforts: • the benefits of a complete suite versus individual capabilities; • mobility; • the freedom of customization and adding applications; • the benefits of tailoring the application for a specific vertical market; and • social-networking capabilities. So, who’s leading the space? Without hesitation when asked about the leader in the on-demand CRM space for CUSTOMER RELATIONSHIP MANAGEMENT | JULY 2008 http://Salesforce.com http://Salesforce.com http://Salesforce.com http://www.destinationCRM.com

Table of Contents Feed for the Digital Edition of CRM - July 2008

CRM - July 2008 Contents Front Office Reality Check Customer Centricity The Tipping Point CRM’s a Social Animal SAP Looks to ‘Change the Game' CRM on Twitter CRM to the Max A Prescription for Satisfaction Required Reading Cover Story: Is Microsoft Winning the CRM Race? Jumping into the SaaS Pool Say What? Another Bright Idea Out of Edison A Small Biz Blossoms Biting Off the Right Amount Something for a Rainy Day Connect Re:Tooling Pint of View

CRM - July 2008

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