Gartner Blog Network

CRM: Back to 1999?

by Scott Nelson  |  July 19, 2011  |  11 Comments

First off, I have to apologize for my absence from my blog. I promise to do better going forward. Just need to do a better job of prioritizing this activity.

But that being said, something has come to my attention in the CRM space. I was recently talking to several members of the Gartner CRM team, including Michael Maoz. He commented that he was noticing a return to 1999 in the CRM space. I asked him what he meant, and he indicated that the questions he was getting were very reminiscent of that time. Examples:

“How do I get funding?”
“How do I build a business case?”
“Where should it be housed?”
“Build vs buy?”

See what I mean? Very much the same questions we were getting 10-12 years ago. And these are not small companies. Or industries that are late to the CRM game. These are major companies, that in many cases have even tried CRM initiatives before. Yet here they are, asking the same questions that they asked a decade ago.

Is that bad? I don’t think so. I mean, they are all good questions. Ones that firms should be asking. I am more curious as to why it is happening. New blood in the CRM game? Not learning from the past? Something else?

Curious what you guys think. Any ideas as to why we are having a Back to the Future moment in CRM?

Category: crm-strategy  

Scott D. Nelson
Managing VP
12 years at Gartner
18 years IT industry

Scott Nelson is a managing vice president in Gartner Research. He is responsible for managing research in the area of CRM. His particular research focuses on CRM vision and strategy.

Thoughts on CRM: Back to 1999?

  1. Since I am having the same discussions for the past 3-4 months (including twice today), I will add what I see from my perch.

    The lack of investment in past years, due to the economy, made it 1999. We have organizations that have not done much for 3-4 even 5 or more years, and now they are slowly getting their toes wet. Combine that with management not being convinced that the worse is over, being stringent with business cases and you have people who 1) probably did not have to do this work before (justify), and 2) managers that expect more concrete plans (i.e. fuzzy metrics and intangibles don’t apply).

    You will see, if my spidey sense is correct, spending dramatically pick up after the summer and on through the end of 2012 – and these questions will begin to disappear towards the end of this year.

    Also, you are not yet getting even the early questions about cloud – that is what comes after this spending spree — how do i embrace the cloud in my CRM? that will be far more fun to answer.

  2. Scott Nelson says:

    Interesting points. Thanks for the insight. Although I want to comment that we are indeed getting Cloud CRM questions. Some, but not all, clients are thinking about it. Really turned the build vs buy into a build vs buy vs source discussion

  3. Vijay says:

    From what I see – this is not isolated to CRM. I see this for ERP, BI etc.

    I recently had this discussion with a client CIO, and his point was \CRM, BI etc have changed fundamentally – or atleast that is how analysts and vendors are making us believe. So we are hesitant to open our purses without having a clear idea of where a given initiative is headed. We believe our knowledge of these disciplines is outdated, and till we come up to speed – we won’t spend.\

    Of course there is the economy aspect too – cash continues to be king.

  4. Scott,

    I agree with Esteban, what I see here in Europe is that most large enterprises have been focussing on Operational Excellence for the last two years, trying to make their way through the economic downturn whereas the public sector in Europe has been spending heavily in CRM and becoming citizen centric. This is something I’ve seen quite a bit in the Financial Services sector, where companies have spent a lot of time and money on reorganizing, consolidating and restructuring to prevent negative effects from the debt crisis. Now the time has come to rediscover focussing on the customer and coming to terms with the innovations in the CRM space over the past couple of year and focus on creating competitive advantage by offering a better customer experience. Funds are still limited however, so creating a business case is key. Creating a business case is the solution to making sure they get a bigger bang for their buck and focussing your limited resources where it counts. I believe we’ll see spending on CRM and customer focussed initiatives move from the European Public Sector towards commercial enterprises, starting with the Financial Services Industry, moving on through Telco’s, Pharmaceuticals, the manufacturing industry and then on to retail. One of the biggest trends in these customer focussed initiatives will be less traditional software, more SaaS and the advent of business rule engines and flexible, business rule driven CRM solutions where the business owner is in control (instead of the IT guys).

  5. Scott Nelson says:

    Good point. Cash is indeed king. But does this mean this is a whole new group of practitioners? Or did we not learn anything the last time around?

  6. Scott Nelson says:

    That’s an interesting take. Think that is Europe specific or applicable in other geographies as well?

  7. […] CRM: Back to 1999? Added my comment to a post by Scott Nelson, VP of CRM research at Gartner. I do believe that the CRM market is kind of like it was in 1999. After the economic downturn companies have been focussing on operational excellence (whereas governments have been focussing on Citizen Relationship management and are now starting to focus on operational excellence). Now that part of the economy is starting to improve it’s time for companies to reshift their focus to revenue enhancement and the customer! […]

  8. Scott,

    good to hear that cloud is starting to show up – it is going to be fun. as for this being a new crop of practitioners – the answers is mostly yes (but cannot make a blanket statement) since it has been long enough for the previous ones to move into higher positions or other positions elsewhere (or, even in worse cases, no positions right now).

    we learned, but the lessons remain locked with analyst, influencers, consultants, and other providers. we need to put them out there more.

    i am seeing different things in LatAm and AP than in Europe – not worse, just different.

  9. Scott Nelson says:

    Different in other regions? In what way?

  10. I was hoping yo would not ask that :-) then again…

    LatAm, they have been “living” and “testing” cloud for the past few years (in different ways, mostly through hosted models) so there is no rush there (besides, the ones that are not in the cloud, cannot make it there due to legal and compliance restrictions), but cloud rang an interesting bell. Mostly geared to sales and marketing, service continues to be a 3rd class citizen, the money is going to social right now and will probably continue to do so for 12-24 months. infrastructure is being revamped, slowly, and local vendors (a lot of them) are making good inroads. what we call small vendors here, but they make a good business over there. they are getting past the idea that we know what we are doing, and they politely listen and then do what they need to do. cheap, flexible, and piecemeal is the way to sell and implement software down there – led by consultants who perform many duties, from analysts to integrator to advisers.

    AP is a bit more constrained right now, spending is very low (except for china, but that is a whole other ball of wax that I cannot even try to get into right now) and behind the US and EMEA (well, E-parts-of-ME-and-parts-of-A) by a considerable amount. home grown and Hodgepodge solutions are far preferred down there, but the investment is too small to justify vendors to deploy massive resources. Users, same in LatAm, do what they need and leverage technology as necessary to assist. piecemeal definitely a good way to buy and deploy down there.

    there is more, but that should give you a good flavor of how different it is.

  11. […] Original post: CRM: Back to 1999? […]

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