Business Benefits of CRM in the Cloud for Midsize Companies
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1 AMI-Partners Whitepaper Sponsored by Business Benefits of CRM in the Cloud for Midsize Companies December 2011 AMI-Partners 546 Fifth Avenue Suite 22 New York, NY Copyright AMI-Partners, 2011
2 Table of Contents Introduction... 3 Core Benefits of Cloud Applications... 3 CRM in the Cloud for Midsize Businesses... 4 Global Midsize Business Climate... 5 Midsize Business CRM Drivers... 6 Midsize Business Requirements for CRM... 6 Driving Value across the Organization: Oracle CRM On Demand... 7 Integrate Sales and Marketing... 8 Consistent, Continuous Experience... 9 Mobile Support... 9 Actionable and Insightful Business Analytics Conclusion About AMI-Partners AMI-Partners, 2011 Page 2
3 Introduction Today, midsize companies face two fundamental challenges; they must nurture and expand business opportunities under dynamic market conditions, and achieve sustainable growth in an increasingly competitive environment. Like large enterprises, midsize companies need enterprise-class solutions to support day-to-day operations and maintain business efficiencies. Enterprise applications in particular, align strategically with midsize companies looking to fuel growth using automated business processes or company-wide intelligence. An AMI-Partners study shows that nearly 80 percent of midsize companies worldwide regard enterprise applications (e.g., ERP, CRM, etc.) as essential to their organization s continued success. Compared to large enterprises, however, many midsize companies do not have a wellestablished IT infrastructure to benefit from economies of scale. Limited financial capital often restricts their capabilities, while IT demands may steadily outgrow immediate IT resources including staff, budgets, and systems. Managing the core technologies necessary to run the business (e.g., IT security, data storage, IT networks) thinly stretches resources, leaving little time for more strategic IT initiatives like customer relationship management (CRM) implementations which are critical for business expansion. Core Benefits of Cloud Applications Midsize companies across the globe, nonetheless, are increasingly recognizing the benefits of cloud computing, including software-as-a-service (SaaS) or, cloud applications. Nearly 2-in-5 already deploys one or more cloud applications, and interest level across various business management applications is just as significant. Cloud applications represent a cost-effective and highly adaptable solution for midsize companies particularly with limited budgets, small IT staff and varying business requirements to consider. The overall cost, flexible commitment, and simpler deployment and maintenance are some of the main advantages of a cloud-based model. Specifically, deploying cloud applications is chiefly an operating expense, as opposed to the typical capital outlay associated with enterprise-scale software deployments. The pay-as-yougo structure allows companies to procure (or terminate) additional capacity, seats, components or features, as business requires. Having a flexible service delivery model impacts midsize companies ability to react to changes in the market, enabling them to remain competitive and sustain profitability. AMI-Partners, 2011 Page 3
4 In addition, modern cloud applications are optimized for a browser-based environment, which improves manageability, upgrades and troubleshooting, and ultimately frees up IT staff to focus on the organization s strategic needs of growing top line revenue while positively impacting the bottom line profitability. IT departments significantly benefit from this type of architecture, which depending on the vendor, is typically housed in a world-class data center and provides superior performance and high availability. With all of these factors combined, an increasing proportion of midsize companies worldwide are deploying various business management applications in the cloud. One of the most valuable is CRM. By 2015, AMI-Partners expects that 45 percent of all SaaS users within this segment will deploy a CRM cloud application. CRM in the Cloud for Midsize Businesses With the mindset of midsize companies shifting to growth, businesses are taking steps to implement solutions to enhance organizational intelligence in an effort to drive greater performance in the market. Along with gains in productivity, attracting and retaining customers have become strategic priorities to improve competitive positioning and bottom-line results. As these strategic goals must be achieved in a cost-effective manner, cloud services are garnering increased acceptance among midsize companies. In particular, CRM has been a prime driver in the cloud market as basic CRM functions apply to many types of businesses and rapid deployment is attractive to companies seeking an immediate sales impact. For midsize companies, there are four key business requirements for successful implementation of CRM cloud applications: Integration of sales and marketing for increased ROI Consistent, continuous experience from a customer perspective Mobile support for an increasingly flexible workforce Actionable and insightful business analytics In this paper, we examine in particular, how Oracle s CRM cloud solution, Oracle CRM On Demand, meets these requirements and enables midsize companies to realize their growth aspirations. But first, we gain a perspective of the global business climate for midsize companies worldwide and drivers for CRM adoption. AMI-Partners, 2011 Page 4
5 Global Midsize Business Climate AMI-Partners global research confirms the expansionist mindset of midsize companies. Average 2010 revenue for this market has increased considerably compared to that of the prior year. Over 60 percent of midsize companies worldwide expect a further rise in revenue this year, which falls in line with their more optimistic perceptions toward future business conditions (see Figure 1 below). Moreover, over 80 percent of midsize companies generated sales from large enterprises, which is a major motive for adopting advanced technology. In many instances, smaller companies need to extend their IT infrastructures to large customers and/or suppliers, in order to effectively respond to and manage these business dealings. Top-tier business applications help midsize companies implement efficient business processes and meet the higher demands of their large enterprise customer base. Cloud solutions have become a key means in building an enterprise-level IT network, more quickly and economically. Worldwide Midsize Companies Expectations About Upcoming Business Conditions Get better 39% Not sure 6% Get worse 9% Stay the same 45% Figure 1: Worldwide midsize firm outlook on upcoming business conditions, AMI-Partners, 2011 Another strong indicator of growth plans is that more than a quarter of these companies are planning to expand their footprint by adding new business locations and nearly half plan to enlarge their staff in the next 12 months. Midsize companies tend to have employees that work outside of the office, with 4-in-5 managing a mobile workforce (or, employees travelling for business at least 20 percent of the time) and 3-in-5 supporting telecommuters. With this, enabling out-of-office or remote workers to seamlessly and securely connect to the company s IT network and resources is essential to supporting their productivity levels. AMI-Partners, 2011 Page 5
6 Midsize Business CRM Drivers Given the current business climate, the fundamental business driver for any size firm small, midsize or enterprise is the need for efficient and effective customer interaction management. From a global perspective, more midsize companies are becoming customer-centric businesses and implementing CRM strategies that involve systems to retain existing customers and acquire new ones, while streamlining processes for a direct impact on sales, service and marketing costs (see Figure 2 below). Improve existing customer experiences and retention Worlwide Midsize Companies Top 5 Initiatives to Increase Revenue Improve processes/invest in training to increase productivity Invest in new customer acquisition activities and methods Expand into new markets/opportunities Launch new products/services The implementation of CRM is sought-after by businesses given the resulting benefits of these strategies, which include greater customer loyalty and increased revenue opportunities. However, taking into account the costs associated with maintaining or attracting customers, midsize companies need to protect their profitability by deploying a CRM solution that offers a manageable price, a lower total cost of ownership (TCO) and is high scalability. All of which are possible with a cloud solution. 0% 50% 100% Figure 2: Worldwide Midsize Companies Top Five Initiatives to Increase Revenue, AMI-Partners, 2010 Midsize Business Requirements for CRM One of the biggest reasons for the failure of a new system is the lack of understanding of how employees go about doing their jobs. By and large, business processes are driven across the organization. A CRM cloud solution must be flexible enough to adapt to existing workflows; and managers should get their arms around these workflows before considering CRM applications. AMI-Partners, 2011 Page 6
7 When the time comes to evaluate a CRM solution, executives at midsize companies should keep the following four criteria in mind, previously introduced in the beginning of this white paper: Figure 3: Key Business Requirements of CRM Cloud Solutions for Midsize Companies Business Requirements Integration of sales and marketing for increased ROI Consistent, continuous experience from a customer perspective Mobile support Actionable and insightful business analytics Business Benefits Deliver an integrated end-to-end process from campaign recipients to leads to opportunities to net customers. Provide ability to analyze and optimize the entire holistic process rather than focusing on marketing and sales as two independent silos. Enhance efficiency of the marketing and sales process one version of the truth (underlying data) and everyone on the same page. Provide a consistent multi-channel experience regardless of whether the customer chooses to interact via phone, web, chat, , etc. Enhance customer intimacy and stickiness by demonstrating knowledge of customer needs, preferences and interaction history. Provide employees with real-time information on smart phones and tablets as well as traditional browser-based UI. Integrity of CRM information is vastly improved as employees can work on-line or off-line when the information is current, rather than entering information at a later date, when in the office. By addressing customer issues in real-time/close to real-time, firms stand to be perceived as highly customer focused. Define, measure and analyze key performance indicators (KPIs). Access an immediate and ongoing view of business from integrating, analyzing and leveraging customer metrics. Conduct analytic activities such as market segmentation, sales analysis, forecasting, and optimization without having to constantly rely on limited IT resources. Track customers engagements, measure campaign effectiveness, and identify the most valuable customers to increase revenue and profits as well as contain costs. Driving Value across the Organization: Oracle CRM On Demand Oracle CRM On Demand is helping growing midsize companies make smarter decisions, enhance operations and productivity, and realize the best value from a single CRM solution. Oracle CRM On Demand offers a broad and deep set of capabilities to help organizations drive sales, marketing, loyalty, and service effectiveness. CRM cloud applications that narrowly focus on specific tasks or business roles only prove to result in performance constraints and impede AMI-Partners, 2011 Page 7
8 organizations in effectively responding to customer demands or dynamic conditions in the marketplace. CRM cannot be truly transformative unless customer data flows across multiple operations within the organization. In this regard, Oracle CRM On Demand offers a best in class solution for midsize companies, delivering a broader measure of ROI and quantifiable business value across the organization. Here is how Oracle CRM On Demand exceeds business requirements for a successful deployment of CRM in the cloud: Integrate Sales and Marketing Oracle CRM On Demand offers a complete, integrated set of enterprise-marketing capabilities from early stage prospecting through lead management to closed revenue. As a result, organizations no longer need to endure silo-ed and disconnected sales and marketing pipelines. Instead, they can improve collaboration between sales and marketing, automate nurturing of leads and measure performance of a unified revenue funnel. Capabilities include: Improved Collaboration Between Sales and Marketing: Sales and marketing can better collaborate on critical business processes like lead definition, acceptance criteria, and automated feedback to marketing throughout the sales process. Automated Nurture of Leads: Marketing can now automate multi-stage multi-channel campaigns. Marketing organizations can start with simple, visual drag-drop campaign design options and can scale to robust, rules based adaptive workflows that can support 100 s of offers and personalization. Customer Perspective: With Oracle CRM On Demand Marketing, we now have a unified solution to consolidate our sales and marketing processes," said Allan Murphy Bruun at Ambu. "The system has significantly improved our marketing productivity and has provided new capabilities to demonstrate ROI. We have observed a 20% improvement in lead quality within 4 weeks of deploying the solution." Oracle CRM on Demand made it possible for our sales, marketing, and management teams to have a complete view of our customers across the world. It has enabled us to act quickly on sales opportunities and increase our sales conversion rate by 15%. Aper Yuan, Associate Director of Development, HanStar Hardware Co., Ltd. Robust Profile and Response Management: Marketers can build personalized landing pages, microsites, and intelligent web forms using a self-service, rules based solution. Progressive profiling ensures the capture valid, clean data while minimizing irrelevant questions. A builtin recommendation engine ensures delivery of the right offer. AMI-Partners, 2011 Page 8
9 Lead Scoring & Routing: An automated lead management process ensures valid, high quality leads are scored and routed to the appropriate sales channel. Marketers can automate lead delivery to their direct sales organization and channel partners. Consistent Experience Oracle CRM On Demand offers a hosted call center to drive productivity, reduce costs and improve the customer experience. Oracle Contact On Demand is the only hosted multichannel support application that can be deployed in days without up-front capital expenditures or integration costs. Agents can work efficiently from anywhere in the world with 360-degree views into customer interactions and real-time business intelligence. Customers gain from rapid and personalized sales and service, while organizations can dramatically reduce costs and increase revenues. Capabilities include: Customer Perspective: Before implementing Oracle Contact On Demand, we lacked important sales call metrics, including the ability to map calls to outcomes. Now, we have clear visibility into the complete call lifecycle. As important, we accelerated time to value with a hosted solution that was easy to roll out in just six weeks and easy to use with our representatives getting up to speed on the system in just days. Michael Bell, Inside Sales Manager Hosted Contact Center: Hosted voice, voic , and customizable IVR and ACD capabilities that were recently augmented with chat, co-browsing, response libraries, and multi-party conferencing. Integrated Solution: The hosted contact center creates a cutting-edge dynamic for sales and service agents to quickly and efficiently deliver answers to customer questions, within the same system and without additional investments. Mobility Oracle CRM On Demand offers a complete set of next generation mobile and desktop solutions that improve productivity by enabling reps to access and update information anywhere, anytime. Capabilities include: Oracle CRM On Demand Connected Mobile Sales. This add-on mobile service provides a configurable mobile solution on iphone and BlackBerry devices. Salespeople can access data from CRM On Demand in real time with a rich, native user experience, which will be comfortable and familiar to current iphone and BlackBerry users. AMI-Partners, 2011 Page 9
10 Oracle CRM On Demand Desktop: This application centralizes essential CRM information in the familiar Microsoft Outlook environment, increasing user adoption and decreasing training costs. Users can manage CRM data while disconnected, then synchronize bi-directionally when they are back on the network. Apple ipad Support: Complete CRM On Demand functionality, including administration features, is supported on the Apple ipad with a few minor restrictions. Customer Perspective: With Oracle CRM On Demand, we have a full visibility model into our sales activities. It has increased efficiency, communication, and collaboration in a way that was simply not possible before. Laura Waltrup, Vice President of Sales Operations, Structural Group, Inc. Actionable Insight Oracle CRM On Demand successfully offers a comprehensive range of hosted customer management tools and analytical capabilities that allow midsize companies to maximize the benefits of CRM across multiple business processes. The enterprise-class solution provides employees with query and analysis functionalities, real-time insights, sales tracking and customized reporting from a single, easy-to-administer web interface. Much of the advantage of Oracle CRM On Demand is the depth of functionalities enabling midsize business executives to better address complex business issues and drive company-wide efficiencies. As such, organizations can effectively provide intelligence to a broader audience, gain deeper insights into sales and marketing activities, and uncover potential revenue streams. Customer Perspective: We implemented Oracle CRM On Demand for its functionality and ease of use, which has allowed us to transform the knowledge of individuals into organizational intelligence. This intelligence is now available anywhere and at any time through the cloud, ensuring we can efficiently manage longterm sales cycles. Masakatsu Asai, General Manager, Management Information Systems Department, JATCO Ltd AMI-Partners, 2011 Page 10
11 Conclusion Midsize business executives will find that Oracle CRM On Demand delivers unprecedented value with the broadest set of capabilities from a single-provider solution. The solution proves to have the industry s lowest total cost of ownership, the most on-demand deployment options, the deepest CRM expertise and experience of any CRM provider, and the most secure CRM in the cloud. The flexible, scalable, and feature-rich CRM solution also has industry-specific features to support the unique requirements of many businesses including Wealth Management, Life Sciences, Automotive, Insurance, and more. Midsize companies across the globe are successfully leveraging Oracle CRM On Demand to positively impact sales, marketing and service, thereby growing the top line while positively impacting the bottom line as well. For more information on Oracle CRM On Demand, please visit oracle.com/crm. AMI-Partners, 2011 Page 11
12 About Access Markets International (AMI) Partners, Inc. AMI-Partners specializes in IT, Internet, telecommunications and business services strategy, venture capital, and actionable market intelligence with a strong focus on global small and medium businesses (SMBs), and extending into large enterprises and home-based businesses. The AMI-Partners mission is to empower clients for success with the highest quality data, business strategy perspectives and go-to-market solutions. AMI was founded in Since its inception, the firm has built a world-class management team, each with ten to fifteen years experience in IT, telecom, online communications or multimedia. AMI-Partners has helped shape the go-to-market SMB strategies of more than 150 leading IT, internet, telecommunications and business services companies. The firm is well known for its IT and internet adoption-based segmentation of the SMB markets; its annual retainership services based on global SMB tracking surveys in more than 30 countries; and its proprietary database of SMBs, Cloud services studies and SMB channel partners in the Americas, Europe and Asia- Pacific. The firm invests significantly in collecting survey-based information from several thousand SMBs annually, and is considered the premier source for global SMB trends and analysis. AMI-Partners, 2011 Page 12
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