CRM is not Dead; Anyone Who Says Differently is Brain Dead (or at Least Slightly Inebriated or Intoxicated)
“The whole point of being alive is to evolve into the complete person [or thing] you were intended to be.” — Oprah Winfrey
If you think about it, this wonderful quote from Oprah applies not just to humans, but to any “living” organism or ecosystem, (yes, including CRM) that continues to steadily evolve and progress toward something better, greater, and more magnificent. That's right; I used the words “magnificent” and “CRM” in the same sentence. Perhaps we're not quite there yet — but we are definitely (back) on the right track.
My blog today is actually inspired by a great post from a fellow blogger Tatyana Kanzaveli entitled “SAP: Why CRM is dead, NRM is alive”. I left a short comment on her blog offering my opinion that CRM is more alive than ever, and that the term NRM “Network Relationship Management” might already be DOA. (Dead on Arrival). Another reader, Eric Ehrmann, suggested that we all explore the question further with, “a couple of substantive posts on this theme to expand the conversation.” So, let's get this party started. I'll bring the guacamole, you bring beer.
The trouble all began back in 2002, when an analyst firm called Butler Group was attributed as having said that 70 percent of CRM implementations fail. Gartner published a similar (though not quite as drastic) report around this time mentioning that 55% of CRM projects, “failed to meet software customers' expectations.” So there it was, out in the open for everyone to read — CRM had failed.
Now to be fair, there was perhaps a degree of truth to claims — at least at the time.
Many high-profile CRM project failures were making headlines. And to make matters worse, no one seemed willing to accept accountability. The companies where CRM had failed blamed software vendors for overselling and for delivering incomplete software; the software vendors blamed consulting firms for not being up to speed with product knowledge; and the consulting firms pointed the finger back at the companies where CRM had failed — accusing senior management of not being fully committed.
That was almost a decade ago. As we enter 2010, Customer Relationship Management is in much better shape. Companies, vendors, and consultants seem to have finally figured out (for the most part) how to get it right. And rather than resting on our laurels, we are exploring exciting new technologies (ahem, strategies) such as Social CRM and Enterprise 2.0. However, there are still a few people who question the value of CRM (just as there are still people who still believe the earth is flat). So for all those people who have trouble seeing past the horizon — and who apparently have never flown from San Francisco to Japan — here are my top signs that CRM is healthier (and happier) than ever.
- Continued growth: The CRM market is said to have actually grown between 2% and 3% in the last 18 months, whereas the rest of the enterprise market had gone down 6-10%. Despite financial market volatility, the worldwide CRM market enjoyed 5 years of consecutive year of double-digit growth from 2004 through 2008. And worldwide CRM market revenue totaled US $9.15 billion in 2008, a 12.5% increase from 2007, according to Gartner.
- Jobs, jobs, jobs! CRM is hiring! If you visit the online job search sites, you will notice that there are currently over 2,000 open jobs positions in the CRM industry on Monster.com alone. Companies are struggling to find enough skilled CRM resources to staff their CRM projects and initiatives. And it's not as if there are only a handful of CRM practitioners. Doing a search for “CRM” on LinkedIn returns 273,273 people. That's more than for either “television” or “publishing” (which I suppose one can argue could potentially be examples of dying industries).
- $11 billion more reasons: Depending on whom you ask, the estimated market size of the CRM industry for 2010 is around $11 billion USD. And that's eleven million reasons why CRM is healthier than ever. But even if you think the estimate is on the high side, the conservative estimates start off around $9 billion — and that's not too shabby either.
- CRM toddlers enter college: Even the small, niche CRM start-up companies are growing into powerhouses. Take Salesforce.com for example, who became famous for their salesforce automation (SFA) software and ASP (application service provider) delivery model. The upstart software company, who continues to fervently experiment with various chic marketing slogans (e.g., Software as a Service, Platform as a Service, Cloud Computing, etc.), recently reached the $1 billion dollar annual sales revenue milestone. Welcome to the big league.
- More popular than pepperoni pizza?: Despites occasional random claims that CRM is dead, CRM actually continues to grow, evolve, and gain support within organizations. Sure, there have been — and continue to be — attempts to re-brand CRM as something else, whether it be CRM 2.0, Social CRM, Customer Managed Relationships, Customer Experience Management, or Network Relationship Management. But whatever we want to call it, CRM is clearly still alive and well. In fact, Paul Greenberg — often called the Godfather of CRM — just published a fourth edition of his best-selling book, “CRM at the Speed of Light” which has been translated into 8 different languages. And, if you still need any more proof, just do a quick Google search; “CRM” produces 40 million hits while “pepperoni pizza” only results in 400,000. So, CRM is 10 times more popular than America's favorite comfort food? Well, if that doesn't convince you, I don't know what will.
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