thinking: relating- celebrating :-)

What is important in the numbers is the overall upwards trend and growth curve.      Support from customers for “software as a service” is certainly there in a big way. The details come from a company press release dated August 16 and are for the period ended July 31, 2006. Some accounting gibberish has been edited out so this excerpt is not complete and is only to illustrate the big picture.

That is web based services (especially for CRM) are here to stay.

Revenue: Total revenue was $118 million, an increase of 64% on a year-over-year basis and an increase of 13% on a quarter-to-quarter basis. Subscription and support revenues were $106.7 million, an increase of 63% on a year-over-year basis and an increase of 13% on a quarter-toquarter basis. Professional services and other revenues were $11.5 million, an increase of 82% on a year-over-year basis and an increase of 13% on a quarter-to-quarter basis. 

Customers and Paying Subscribers: Net paying subscribers rose approximately 57,000 during Q2 to exit the quarter at approximately 501,000 total subscribers. This ending total represents an increase of 63% from Q2 of the prior year, and an increase of 13% from the prior quarter. Customers rose approximately 2,100 during the quarter and totaled approximately 24,800, an increase of 47% from Q2 of the prior year, and an increase of 9% from the prior quarter.
 
Full Year FY07: The company today is raising its revenue outlook for its fiscal year 2007, and now expects full year revenue of approximately $488 million to approximately $493

Customer relationship management (CRM for short) is all about treating different customers differently.

To have any chance of being able to understand those differences and then have a system that backs up your house standards and makes it easy for staff to do their best for customers requires a commitment to service and thinking about what matters to each customer.

When a customer calls it is usually a “moment of truth” for them and a test for you and your team. Effective CRM practice requires effective CRM thinking.

This category is more about the thinking and methodologies around CRM regardless of the application that is actually used. So in this context strategy is more of a description and a mind map of the “territory” so that businesses have a starting point.

Some examples would be:

• Classical CRM is about moving from unstructured activities and ad hoc private towards public and shared spaces. Centralising all data in one location might be the key objective.
• Unstructured information is transformed by mapping & applying templates and other structured system views to support all sales, services and marketing activities.
• Each key process is modeled as an activity and managers try to standardise workflows for operations (to capture content.) Ultimately this results in large scale “to do” lists that are sorted by role and person. When you log in to the CRM – it already knows what activities have been scheduled for you based on past promises and commitments made to customers, colleauges and suppliers. So the strategic objective is to make work easier by making it easier to sort work by types and priorities.
• A CRM is primarily relationship (people) based as opposed to transaction centred – although ultimately a transaction is usually the objective. So a CRM would be often used for new business development and help find out whether the people you are talking with are interested in your products and services.

This is not a comprehensive list but it does mention some of the key elements common to all CRM systems. Exactly how this plays out depends on how well the system (application) is used and how well setup that system is.

If a CRM is designed to support a process then it needs to be a kind of living, working document that can be tweaked and tuned on the fly – preferably by your on site team.

Apparently the coach at a local NRL* team used to say “small disciplines lead to great accomplishments”. I haven’t been able to find the quote but I like it.

Many times when there is a change in business, it is the small things that show up first. As someone who spends a lot of time around business software and development teams I’ve noticed many companies beginning to try out open source applications and systems.

The reasons they do this are many and varied. One reason is that the budget is not available for more traditional licensing models. Anyway the people in the company who need to supply a service may well be providing you with s/w that is open source because it fits the need and they can trial it easily.

This won’t probably show up in management at first as it is “off the radar” because it didn’t use any obvious budget. Bootstrapping is the other reason  many small disciplines get adopted and cast a much larger shadow. Bootstrapping is an innovation practice where you use whatever you can to make do.

So in the context of business software it is not unusual to find small sub systems being used. The reason they stay there is that they often work better than the obvious vendor system.

The other key reason is that expectations are much lower so if the IT department or another team installs something to try out then the emphasis is on the actual results rather than the sales pitch.

The management team will then get to hear only about the success of the software because if it doesn’t work then its gone and no one will mention it.

As with anything – small steps all add up. So when we say small disciplines lead to great accomplishments we are really talking about the results of innovation and experiementation at some level. That is; people trying things out and as long as the company has flexibility and freedom to do this when it works we can all share in the success of the idea.

Note: *NRL stands for National Rugby League and I’ve been told the coach was John Lang at Penrith Panthers but happy to be corrected if someone has a more accurate source.