InformationWeek

Even those who have spent considerable time and money installing CRM and sales-automation software say they would prefer subscription ASP services. Even if a company successfully implements CRM in-house, maintaining and upgrading applications still involves additional IT staff and support costs. Although most companies and E-marketplaces are using internal IT resources to customize and install CRM solutions, many will rely on ASPs for ongoing hosting, maintenance, and support.

But ASP offerings often fall short of user expectations, too. Westburne's Lyske wants his ASP to offer integrated CRM and back-end services. "What we ultimately need from ASPs is a total end-to-end IT software solution that offers and integrates 17 different software, ranging from ERP to E-commerce, CRM, and asset and order management," Lyske says.

While Lyske's dream of services nirvana might not be at hand, CRM vendors such as Onyx Software have developed hosted versions of their products and have extensive arrangements with ASPs. Onyx this month launched two portals and forged channel partner agreements with seven software vendors to augment its Front Office 2000 suite. A majority of others vendors are either developing or plan to create CRM software for ASPs.

If CRM offerings were online and used the Extensible Markup Language as an interoperable way to tightly tie together disparate products, they would come closer to users' needs. Standards-based Java business objects and Microsoft's Component Object Model for distributed objects are among tools that would help synchronize customer communication over the phone, E-mail, wireless devices, and the Internet.

So far, Octane has developed what it calls an Internet-relationship management product--CRM for the Internet--that uses XML. Onyx, Pivotal, and SalesLogix are also adding communications and business-process capabilities, while Epiphany, Kana, and Silknet are creating functions through acquisitions and mergers. Traditional CRM vendors, including BroadVision and Siebel, plan to add XML marketing and buy-side capabilities in the next few quarters.

Equipp.com, a Web intermediary that facilitates sales of industrial machinery, launched its site in January using Octane's 2000 CRM software as a sales-automation tool. Octane gives Equipp.com's salespeople the latest information about customers' buying habits and serves as a business tool for managing marketing promotions. Equipp.com can then figure out which machines should be sold at what price and create pertinent marketing promotions.

In less than two months, the sales-automation software eliminated manual processing of 2,300 call-center, E-mail, and Web inquiries. As a result, 10 fewer customer-service agents were needed, saving $500,000 on the annual payroll budget. "We are a support marketplace that facilitates transactions between suppliers and buyers," says Doug Hegebarth, Equipp .com's chief technology officer. As such, "customer records are the heart and soul of our business."

Online businesses know that keeping their internal sales, marketing, and customer-service groups on the same page about customers' purchase preferences and requirements is key to success. "Customer information is the single most important asset we have," says James Chilton, VP of IT at Project Software Development Inc. and its subsidiary MRO.com Inc. PSDI is a $140 million vendor of enterprise asset and maintenance solutions with 6,000 business customers. MRO.com is an E-marketplace that offers maintenance, repair, and operations supplies, launched in July; it has 10 suppliers and targets PSDI's 6,000 customers.

PSDI and MRO.com are using Siebel 99 CRM software to "provide real-time support internationally" to sales teams and to forecast potential revenue, Chilton says. Recently, the system proved its value when PSDI's chief operating officer resolved within minutes a problem from an unhappy Australian customer calling at midnight. He used Siebel's real-time information about the customer, including orders and history of support calls. Chilton says it would have taken several hours, if not days, using the Lotus Notes software the company previously used for CRM and sales activities.

But PSDI also had to face implementation costs of $6 million over five years, plus the hassle of deploying skilled IT staff to manage the CRM system, so instead it's considering an ASP to manage it for the same amount.

It's frustrating for companies that want to implement systems but are stymied by the offerings. "We want integrated CRM solutions now, not later," ChemConnect's Bhargava says. For many online businesses, integrated CRM solutions are the linchpin that links E-commerce transactions and customer communications. And if the market doesn't provide the solutions, they will have to do it themselves. No less than their business depends on it.

return to page 1, 2