R. Garland - November 2, 2001
The Lexicon is divided into three parts, this being the second of three. This third section covers the alphabet from R to Z. For A to I, see Part One. For J to Q, see Part Two.
R
RDBMS - Relational DataBase Management System. The typical, standard database, with both data models, data definitions, and data storage capabilities. Examples include Oracle's 9i database, Microsoft's SQLServer 2000, and IBM's DB2 and Informix.
RFI - Request For Information. A formal document sent by a customer to a vendor asking for specific information about their product or line of products. It's usually the first salvo in several rounds of information gathering by customers in the vendor selection process.
RFQ - Request For Quote. A formal document sent by a customer to a vendor asking them to put together a product and service package, with prices, for the customer to consider accepting and ultimately buying.
RMA - Returned Materials Authorization. Most companies require that customers contact them before returning previously-purchased product, to receive authorization to return the product. The customer is usually given an RMA number, for tracking purposes.
ROI - A calculation of how much money will be saved or earned as the result of an investment. When evaluating CRM packages, be sure to factor in investments of both time and capital in your ROI analysis.
Rollback Capability - The ability of an RDBMS, in the case of a catastrophic failure, to be able to return to, or roll back to, a set point in time when the database was known to be stable. This is less preferred than the ability for an RDBMS to "fail-over" to a hot spare server, losing no data and suffering no down time in the process.
S
Sales Pipeline - This is the list of potential customers that the sales department is currently trying to convert into paying customers. Typically, customer deals in the pipeline are assigned dollar values and "percentages likely to convert", and from that, sales forecasts can be approximated.
SFA - Sales Force Automation. One of the lynchpins of CRM. This enables the Sales team to capture and maintain lead and other contact information in one data store, conduct team selling, view pipeline reports, and other tasks. This is still the first objective of most companies implementing CRM solutions.
SLA - Service Level Agreement. This is the agreed-upon level of service that will be provided by the vendor to the customer upon purchase of product. Variables include: channels supported, hours of the day, days of the week, response times, and on-site support.
SMBs - Small to Medium Businesses. A segment of the market in general that tends to be the target of enterprise application and database vendors these days who have "already gone after the big fish," namely, large, Fortune 500 companies, and are trolling the waters for smaller catch. Sometimes called SMEs, or Small to Medium Enterprises, though that could be confused with Subject Matter Expert.
SOAP - Simple Object Access Protocol. SOAP is a lightweight protocol for exchange of information in a decentralized, distributed environment. It is an XML-based protocol that consists of three parts: an envelope that defines a framework for describing what is in a message and how to process it; a set of encoding rules for expressing data types, and; a convention for representing remote procedure calls and responses.
SR - Service Request. The latest term for support case, problem ticket, work order, or other terms previously used. A Service Request is established in CRM software to track a customer contact through to its conclusion. It contains contact information, details about the issue or problem at hand, and usually concludes with a summary of how the problem was solved.
Stinger - Microsoft's code name for its OS that will run on a family of smart phones, which are a class of wireless phones with oversized displays and color screens--designed for wireless Web access and conventional phone calls. The first hardware product is reported to have been in the works for two to three years and will be marketed by Samsung in the United States and Europe.
T & U
TCO - Total Cost of Ownership. When evaluating software for possible implementation in your company, you can't just consider the costs of the software licenses, on-going maintenance fees, and support costs. You also need to consider how much time, and in turn, how much money, it will cost to own the software over the long term. Is the software very buggy and in need of constant bug updates and enhancements? Is the software difficult to use and therefore requires higher training costs and ramp-up times? TCO considers ALL the costs that might be associated with a piece of software over its lifespan in the company.
TCP/IP - Transmission Control Protocol / Internet Protocol. TCP/IP is the method by which data on the Internet is divided into packets of bytes. Information is divided into packets of information, with each packet delimited with header information that includes the destination address to where the packet is to be routed when it is transmitted over the Internet, and how it is to be re-assembled with the other packets containing the coherent data on the other end. Packets may take very different routes across the Internet, arrive at a destination, be re-assembled in the same order in which they were disassembled, and presented to the user on the other end.
Technically, IP is responsible for moving packets of data from node to node. IP forwards each packet based on a four-byte destination address (the IP number). TCP is responsible for verifying the correct delivery of data from client to server. Data can be lost in the intermediate network. TCP adds support to detect errors or lost data and to trigger retransmission until the data is correctly and completely received.
Thin Client - Another term for web browser. When an application vendor says that they have support for thin client, they mean that the majority of processing happens on back-end servers, and the display mechanism is the web browser, which conducts minimal (though, with Java or ActiveX plug-ins, possibly more substantial) processing of data.
TSBs - Technical Service Bulletins. Information distributed to the customer base of a product to inform them of some technical news bit that would be relevant to their implementation, such as the discovery of a new bug, the availability of a patch, or the availability of a new version of software.
Unicode - A standard for representing characters, such as numbers, letters, and symbols, as integers. Unlike ASCII, which uses 7 bits for each character, Unicode uses 16 bits, which means it can represent more than 65,000 unique characters. This covers the requirements for not only languages such as English and the Western-European languages, but also for other languages, such as Greek, Latin, and Japanese. As the software industry becomes increasingly global, there is a push on for software vendors to enable their software to use the Unicode coding format.
Unified Message Queuing - This represents the ability to take inbound requests from multiple channels (see Multi-Channel Support in Part 2 of this series), funnel them into one logical processing point, and then to be able to send out the requests to user queues for work. It represents the blending of such items as email, phone calls, and faxes, into the same queues.
Up-sell, Cross-sell - The sales practice of analyzing a user purchase, and recommending additional items that the user might be interested in purchasing based on the initial purchase. Up-selling is the process of adding on pieces to the original purchase; Cross-selling is selling similar or similarly appealing items to the customer.
V - Z
VAR - Value-Added Reseller. This is a company, independent of an OEM, that takes an OEM product, adds some sort of customer-perceived value to it, repackages it, and sells it to customers on its own. The ways in which value might be added include the addition of new product functionality, or the wrapping of implementation services around the original product.
V-Commerce - Voice Commerce, or Voice-enabled Commerce. The ability to use simple voice commands over phone lines to transact business directly between customer and application. V-Commerce is still years away from true value-add for companies, though several companies are playing around with voice commands today.
Vertical Applications - Applications that are tailored to specific industries. For example, Siebel Systems might take their core application and tailor the screens, fields, and database structures to support the automotive industry (both sales and service). Their Siebel Automotive application would be an example of a vertical application.
VoIP - Voice over IP. The ability to carry on a conversation over the Internet, while still browsing the Internet. Typically requires broadband (e.g., DSL, cable, or LAN-based connections), which right now have fairly limited penetration into consumer households. Hence, VoIP is not yet broadly implemented by web sites creators.
WAP/WML - Wireless Application Protocol and Wireless Markup Language. These are syntax used to program content for wireless phones using languages that allow the text portions of Web pages to be presented.
White Paper - A lengthy, often technical, article on a topic that provides background information on corporate products, industries, or industry trends.
WIP bins - Work In Process bins. Can also be thought of as personal To-Do lists. They represent personal queues, to which only one user has access. When an item is in an individuals WIP bin, they "own" that Service Request and are responsible for solving the problem or answering the question, unless they pass the SR to another employee's WIP bin.
XML - eXtensible Markup Language. A superset of the ubiquitous HTML (HyperText Markup Language) that is the common language of the web. HTML is really good at defining how elements should be laid out on a page, but terrible at transmitting data. XML solves the problem, by defining both elements for data, and elements for data about data, or metadata, to explain what kind of data is being passed (see the example provided in Part 2, under the definition for Metadata). It is being heralded as the "EDI of the Internet," and the future of inter-database, inter-application, and inter-company communications.
ZLE - Zero Latency Enterprise. The latest, new-fangled term to come from the consulting world. It represents the Enterprise that is so technologically enabled that information is instantly accessible to anyone who needs it (or has need of it) at any time. Zero latency, or zero slowness, of information flow across an enterprise.
This concludes Part 3, the last part, of the series on the Lexicon of CRM.
SOURCE:
http://www.technologyevaluation.com/research/articles/the-lexicon-of-crm-part-3-from-r-to-z-16506/
Wednesday, August 18, 2010
Knowledge Management: The Core of Service Resolution Management
Knowledge Management: The Core of Service Resolution Management
Today's businesses are faced with the reality of customers expecting and demanding more multichannel information and better service from call centers than ever before. Integrating call center service resolution management (SRM) into customer relationship management (CRM) can help companies retain both their call center agents and their customers.
For more background, please see Integrating Customer Relationship Management and Service Resolution Management.
Knowledge management (KM) is at the core of integrating CRM and SRM. KM software aims at helping to unlock the power of a company's knowledge to improve efficiency, competency, and profitability. It does so by providing an environment in which companies can, more quickly and cost-effectively, create a company-wide knowledge base to store and index documents and to more accurately search for the answers to user questions.
Currently, the key trends in KM tools enable companies to perform the following: 1) target their online information to reflect what is most likely to interest customers, and 2) maintain online forums where customers can share amongst themselves what they know about the company's products.
Hence, KM products typically fulfill two functions. KM accommodates self-service, meaning a customer can access a pool of public information that a company accumulates about itself, without the need for live assistance, to have his or her questions answered. Second, KM software helps call center agents to retrieve information from a repository that is often, obviously, larger than what is available to the public (since the aim of live assistance is the same as self-service—to answer customers' inquiries quickly and accurately, but with the preferred human touch).
The above considerations have marked a fundamental shift away from the time when any company could claim to perform a valuable service to customers simply by displaying information on its web site, without having to take into account who the customers were. Today however, virtually all companies must demonstrate their value to customers by segmenting information that is directly relevant to them.
Customer segmentation is not a new idea, since segmentation was supposed to be the way that—with the help of CRM tools—companies would offer the best possible service to their best customers. The problem with applying overt segmentation to customer service was that it then revealed a hierarchy that placed most customers at the bottom. This was so because, by definition, elite customers represent a small minority (the proverbial Pareto's 80/20 Rule). The premise of segmenting customers reinforced the idea that customers existed to create value for companies, rather than the other way around. Using this logic, most (up to 80 percent) customers were of little value to the companies that they bought products and services from.
By contrast, the practice of KM helps companies establish a bidirectional relationship with customers that rewards them for sharing knowledge (their product and service use experience), and not only for spending money. The latest generation of KM software makes this possible by enabling the company to combine what it knows about customers and what customers know about the company, and to offer this information as part of the resources available on its web site.
As discussed in Making the First Call Count by Greg McFarlane, an astute KM software has to make it easier for agents to author new knowledge when new services, products, or upgrades are in place. This reduces the need for agents (especially novice agents) to escalate calls to the upper service tier. This decreases the costs and the lengths of calls, but more importantly, it gets calls answered more quickly. In addition, the diagnostic search functionality helps resolve customers' issues quickly and accurately with its ability to pull answers from any data source an agent can connect it to, thereby giving agents the right information at the right time. Lastly, the automation of key resolution processes enables new agents to get up to speed more quickly. By pre-populating case notes and pre-establishing workflows and other techniques, the companies can create an environment that allows agents to operate as effectively as possible, regardless of their experience.
With the addition of multiple channels and new technologies to support them, call center agents' job descriptions should become more interesting and diverse. When this occurs, several of the major barriers to call center agent job satisfaction, such as stress, repetition, and dullness, can be eliminated, thus resulting in greater retention. The customer service representative (CSR) might start to feel like a problem-solver rather than a mere document reader.
Agents might also feel more accountable for problem resolution, as they begin to follow problems from start to finish. For instance, a CSR can access and present solutions to problems from a knowledge base; create a service ticket; request repair services; note a complaint; process returned materials; issue a rebate, coupon, or refund; and escalate issues to other responsible parties, such as tier (level) two support, development, quality assurance (QA), or even third parties.
Customer satisfaction should, in turn, increase, as the number of disconnected handoffs between agents, customers, and channels are reduced. On the other hand, increased agent retention should improve the organization's domain knowledge, and as a result, the number of first-call closures should rise.
The Impact of Online Customer Service
Online customers are becoming increasingly demanding, since they want answers to queries quicker than ever before, and they want to be able to access services when it suits them—around the clock. No customer wants to be put (seemingly endlessly) on hold or escalated, or to attempt several different solutions over the next hour, only to be called back the next day. He or she wants the issue resolved as quickly as possible, either through self-service or by a knowledgeable agent at the other end of the telephone.
At the same time, web site design is maturing, and the average customer is becoming more computer literate, which means that customers are ready to be introduced to online self-service solutions. Many customers indeed want to be able to solve their own problems through self-support on the Web, since we are all “too darn busy, and who has time for lengthy phone calls.” Companies, too, are ready to embrace the benefits of self-help solutions, which offer the dual advantage of cutting the cost of support while improving the quality of the service delivered to users.
In the early 2000s, Forrester Research reported that it costs, in US dollars, about $33.00 to handle a customer inquiry by telephone, $10.00 to handle it by e-mail, and about $1.00 to deal with the question through an online self-service system. Furthermore, by 2010, Gartner projects that self-service interactions will account for 58 percent of all service interactions, up from 35 percent in 2005. Thus, the goal of self-service has been to drive as many inquiries as possible away from the telephone to the Web, which is less difficult than it might seem, because organizations usually find that about 12 questions will account for half the calls made.
An effective self-help system should allow users or customers to resolve most common queries on their own, but it should also make it easy to escalate inquiries to an operator through telephone, Web chat, or e-mail if users get stuck or their questions are more complex. Also, call center representatives can sometimes handle problems more productively over live chat than on the phone, since an agent can deal with only one customer at a time over the phone, but it is quite possible to simultaneously juggle a few live chat sessions with customers.
One should note, however, that different users have different levels of tolerance for the length of time they are willing to commit to self-service, which means the availability of live support is still a necessary option companies must offer. On the other hand, in a corporate setting, the company may want to discourage highly paid staff from using self-help for more than a few minutes, because it does not want these employees to be unproductive.
In summary, enterprises can provide customer self-service that reduces service costs, improves customer satisfaction, and facilitates the sales and marketing of products and services. Moreover, IT organizations can increase the effectiveness of employee help desk operations while decreasing internal technical support costs.
SOURCE:
http://www.technologyevaluation.com/research/articles/knowledge-management-the-core-of-service-resolution-management-19189/
Today's businesses are faced with the reality of customers expecting and demanding more multichannel information and better service from call centers than ever before. Integrating call center service resolution management (SRM) into customer relationship management (CRM) can help companies retain both their call center agents and their customers.
For more background, please see Integrating Customer Relationship Management and Service Resolution Management.
Knowledge management (KM) is at the core of integrating CRM and SRM. KM software aims at helping to unlock the power of a company's knowledge to improve efficiency, competency, and profitability. It does so by providing an environment in which companies can, more quickly and cost-effectively, create a company-wide knowledge base to store and index documents and to more accurately search for the answers to user questions.
Currently, the key trends in KM tools enable companies to perform the following: 1) target their online information to reflect what is most likely to interest customers, and 2) maintain online forums where customers can share amongst themselves what they know about the company's products.
Hence, KM products typically fulfill two functions. KM accommodates self-service, meaning a customer can access a pool of public information that a company accumulates about itself, without the need for live assistance, to have his or her questions answered. Second, KM software helps call center agents to retrieve information from a repository that is often, obviously, larger than what is available to the public (since the aim of live assistance is the same as self-service—to answer customers' inquiries quickly and accurately, but with the preferred human touch).
The above considerations have marked a fundamental shift away from the time when any company could claim to perform a valuable service to customers simply by displaying information on its web site, without having to take into account who the customers were. Today however, virtually all companies must demonstrate their value to customers by segmenting information that is directly relevant to them.
Customer segmentation is not a new idea, since segmentation was supposed to be the way that—with the help of CRM tools—companies would offer the best possible service to their best customers. The problem with applying overt segmentation to customer service was that it then revealed a hierarchy that placed most customers at the bottom. This was so because, by definition, elite customers represent a small minority (the proverbial Pareto's 80/20 Rule). The premise of segmenting customers reinforced the idea that customers existed to create value for companies, rather than the other way around. Using this logic, most (up to 80 percent) customers were of little value to the companies that they bought products and services from.
By contrast, the practice of KM helps companies establish a bidirectional relationship with customers that rewards them for sharing knowledge (their product and service use experience), and not only for spending money. The latest generation of KM software makes this possible by enabling the company to combine what it knows about customers and what customers know about the company, and to offer this information as part of the resources available on its web site.
As discussed in Making the First Call Count by Greg McFarlane, an astute KM software has to make it easier for agents to author new knowledge when new services, products, or upgrades are in place. This reduces the need for agents (especially novice agents) to escalate calls to the upper service tier. This decreases the costs and the lengths of calls, but more importantly, it gets calls answered more quickly. In addition, the diagnostic search functionality helps resolve customers' issues quickly and accurately with its ability to pull answers from any data source an agent can connect it to, thereby giving agents the right information at the right time. Lastly, the automation of key resolution processes enables new agents to get up to speed more quickly. By pre-populating case notes and pre-establishing workflows and other techniques, the companies can create an environment that allows agents to operate as effectively as possible, regardless of their experience.
With the addition of multiple channels and new technologies to support them, call center agents' job descriptions should become more interesting and diverse. When this occurs, several of the major barriers to call center agent job satisfaction, such as stress, repetition, and dullness, can be eliminated, thus resulting in greater retention. The customer service representative (CSR) might start to feel like a problem-solver rather than a mere document reader.
Agents might also feel more accountable for problem resolution, as they begin to follow problems from start to finish. For instance, a CSR can access and present solutions to problems from a knowledge base; create a service ticket; request repair services; note a complaint; process returned materials; issue a rebate, coupon, or refund; and escalate issues to other responsible parties, such as tier (level) two support, development, quality assurance (QA), or even third parties.
Customer satisfaction should, in turn, increase, as the number of disconnected handoffs between agents, customers, and channels are reduced. On the other hand, increased agent retention should improve the organization's domain knowledge, and as a result, the number of first-call closures should rise.
The Impact of Online Customer Service
Online customers are becoming increasingly demanding, since they want answers to queries quicker than ever before, and they want to be able to access services when it suits them—around the clock. No customer wants to be put (seemingly endlessly) on hold or escalated, or to attempt several different solutions over the next hour, only to be called back the next day. He or she wants the issue resolved as quickly as possible, either through self-service or by a knowledgeable agent at the other end of the telephone.
At the same time, web site design is maturing, and the average customer is becoming more computer literate, which means that customers are ready to be introduced to online self-service solutions. Many customers indeed want to be able to solve their own problems through self-support on the Web, since we are all “too darn busy, and who has time for lengthy phone calls.” Companies, too, are ready to embrace the benefits of self-help solutions, which offer the dual advantage of cutting the cost of support while improving the quality of the service delivered to users.
In the early 2000s, Forrester Research reported that it costs, in US dollars, about $33.00 to handle a customer inquiry by telephone, $10.00 to handle it by e-mail, and about $1.00 to deal with the question through an online self-service system. Furthermore, by 2010, Gartner projects that self-service interactions will account for 58 percent of all service interactions, up from 35 percent in 2005. Thus, the goal of self-service has been to drive as many inquiries as possible away from the telephone to the Web, which is less difficult than it might seem, because organizations usually find that about 12 questions will account for half the calls made.
An effective self-help system should allow users or customers to resolve most common queries on their own, but it should also make it easy to escalate inquiries to an operator through telephone, Web chat, or e-mail if users get stuck or their questions are more complex. Also, call center representatives can sometimes handle problems more productively over live chat than on the phone, since an agent can deal with only one customer at a time over the phone, but it is quite possible to simultaneously juggle a few live chat sessions with customers.
One should note, however, that different users have different levels of tolerance for the length of time they are willing to commit to self-service, which means the availability of live support is still a necessary option companies must offer. On the other hand, in a corporate setting, the company may want to discourage highly paid staff from using self-help for more than a few minutes, because it does not want these employees to be unproductive.
In summary, enterprises can provide customer self-service that reduces service costs, improves customer satisfaction, and facilitates the sales and marketing of products and services. Moreover, IT organizations can increase the effectiveness of employee help desk operations while decreasing internal technical support costs.
SOURCE:
http://www.technologyevaluation.com/research/articles/knowledge-management-the-core-of-service-resolution-management-19189/
Appointment Scheduling - Achieving the Positive Ripple Effect Part 1
At some point in time, almost everyone has experienced the following situation You arrive on time for a scheduled appointment only to find that you will be delayed for an indeterminate length of time, generally without reason. The longer you wait, the more you realize that the rest of your day will be behind schedule but you see no apparent recourse other than frustration.
Such is the situation encountered on the job everyday by freight carriers when confronted with delays caused by inefficient appointment scheduling. The Washington Post says it best, "Miserable hours, low pay, lonely existence. Why would anyone want to make a living this way?"1 Frustratingly long waits at docks result in a shrinking supply of assets, often leading to increased rates for shippers. Because carriers are paid only when their wheels are turning, wait time at the dock has a serious impact on earning power. In turn, this causes increased dissatisfaction and results in higher turnover.
The appointment scheduling process is no less frustrating for shippers than receivers as both are forced to juggle numerous demands from multiple parties, generally with out-dated or incomplete information. In addition, the increasing reliance on just-in-time logistics practices have put even more stress on dock operations; thus, magnifying the effect of late arrivals and loading/unloading delays.
Inefficient performance of shipping and receiving activities affects more than just the schedules as it negatively impacts many parties in the supply chain, from the purchaser of the product to the end customer. For this reason, the importance of effective appointment scheduling practices cannot be underestimated. Addressing and alleviating problems with scheduling will gain notable efficiency in visibility, resource and capacity utilization, compliance, and product flow. Accurate appointment scheduling can provide a great benefit to all parties in the supply chain, forming a positive ripple effect that equates to a competitive advantage.
This is Part One of a three-part article. Part Two will discuss achieving a solution and the resultant benefits. Part Three will be a case study illustration.
1. Wells Tower, "The Long Haul", The Washington Post, August 2001
Problems With Current Appoinment Scheduling
There are numerous problems resulting from the methods currently in use for appointment scheduling. The most notable is that the majority of all scheduling is a highly manual and labor-intensive process. Of the dozen Fortune 500 retailers and grocers interviewed on this subject, only one has any automation built into their system. The remaining continue to use paper, phone and fax. Shippers and consignees spend upward of 40% of their time2 on the phone with carriers or vendors, trying to meet their requests for appointment times while still complying with the needs of purchasing. Carriers are forced to either spend hours on hold to make appointments or to leave messages for future callbacks. In addition, appointments may only be scheduled during set business hours. Consequently, when problems arise during off hours the receiver cannot be notified, resulting in out-of-date information in receiving, and often leading to schedule disruptions and mismatched resources-to-volume in the warehouse.
The process of rescheduling appointments is also a significant drain on resources. One large grocery retailer estimates that approximately 20% of the appointments made every week have to be rescheduled, creating approximately 950 total reschedules for an average week. Bob Johnson, Inbound Logistics Manager for Harris Teeter grocery stores, cites rescheduling as the largest problem in scheduling today. In an attempt to offset costs, Harris Teeter has instituted a policy of charge backs for any appointment that is rescheduled more than twice. Currently, between $7,000-$12,000 is collected each month in rescheduling fines. These figures clearly illustrate the depth of the problem. Because carriers and vendors do not personally have access to the schedules, they must rely on contacting the scheduler each time that the situation changes.
Problems with appointment scheduling result in delays at the dock; delays that carry a price tag for shippers, receivers and carriers. A study conducted by Mercer Management Consulting estimates that there is a large cost to shippers for unloading delays at receivers, up to 8% of the total transportation budget.3 For carriers, the excessive wait time contributes to lost revenue, driver dissatisfaction and turnover. The results of the National Refrigerated Drivers Survey, performed by the Truckload Carriers Association, lists the average wait time to load as 3.39 hours per stop and wait time to unload as 3.20 hours per stop.4 A similar survey of dry van drivers found the average wait time for a driver in a particular week to be 33.5 hours, adding up to a $1.5 billion loss per year for carriers.5 Wait time causes a reduction in the earning power of drivers which increases turnover. Driver turnover can range from 50% to 80% for motor carriers per year, with the cost of replacing a single driver estimated as high as $10,000.6
1. "Martin Labbe Associates Study for Truckload Carrier Association", Overdriveonline, August 1999
2. Mercer Management Consulting, "Just in Time to Wait": An Examination of Best Practices for Streamlining Loading/Unloading Functions, July 2000
3. Truckload Carrier Association, National Refrigerated Drivers Survey, 1998
4. Truckload Carrier Association, Dry Van Drivers Survey, June 1999
5. Alan Robinson, "Fleet Management Handbook", Food Logistics, July-August 1999
Far Reaching Effects
Inefficiencies resulting from the current manual appointment scheduling practices affect not only the scheduling department, but extend farther to other parts of the supply chain; Shipping, Receiving, Distribution, Purchasing, and finally to the end customer. Generally, product is ordered with respect to a particular delivery date so that acceptable inventory levels and/or a fluid production schedule can be maintained. The shipping schedule of the supplier must be set in advance of this required date in order to deliver on time and keep inventory on track. However, due to frequent delays at the pickup point, delivery appointments often cannot be made until after the pickup has been physically performed. By the time the driver contacts the receiver, they might not be able to match the delivery appointment with the transit time. Consequently, any delay in the shipping schedule may translate to a delay of delivery and a shortage of inventory, resulting in an unavailability of product for the end customer.
It becomes evident that a problem in one area of the process easily and quickly fingers out to affect countless others in the process. Inaccuracy and inefficiency in the communication of scheduling requirements of the buyers, sellers, shippers, and receivers result in the requirements of the end customer not being met.
Inaccurate appointment schedules may also cause chaos in the warehouse. Arrivals occurring out of sequence cause major congestion when too many pieces/pallets arrive at the same time, producing a back up in the receiving lanes and marshalling areas. This congestion results in carriers who arrived on time for their appointments being delayed.7 The delays to a carrier at one warehouse affect their ability to arrive at subsequent appointments on time, extending the problem to other companies down the line. "The warehouses are most affected if we have problems," says Kim Apodaca of the Ralph's grocery chain. "If our scheduling system goes down and we can't produce schedules, there is chaos. The receiving mode becomes, First Come-First Served'. Marketing begins to receive complaints and phone calls from panicky vendors. Some truck drivers or vendors refuse to even move the loads without acquiring a delivery appointment first."
7. Michael Docherty, "Scheduling Receiving", Managing Logistics, Winter 1997
Possible Improvements
It is evident that scheduling practices must be addressed and improved in order to minimize wait time, improve communication and ensure more on-time delivery of goods. Allowing access to information by all parties involved, expanding hours during which appointments can be made and limiting the amount of manual contact between handoffs are three points that would drastically improve scheduling practices.
Access to Information
Of all companies interviewed, approximately 85% feel that communication between carriers, vendors and receivers is the area most in need for improvement in scheduling. Often, appointments are made by a broker or a vendor and never communicated to the carrier, leaving the carrier with no knowledge of expected arrival time. Another prevalent problem is that the amount of product expected by the receiver frequently does not equate to the amount of product being shipped by the vendor. Only if the receiver has access to the shipping information of the vendor can an accurate volume estimate be made. Carriers and vendors need adequate information about the scheduling requirements and business rules of the receiver in order to schedule appointments on their own, without relying on calling the scheduler each time to confirm an appointment. Enabling access to the same information by all parties in real-time allows for the creation of an accurate scheduling plan.
24/7 Scheduling
The limited hours during which appointments can be made present another barrier in the way of a productive scheduling plan. Unfortunately, delays such as weather, traffic congestion and mechanical failure do not always occur during normal business hours. Consequently, there is often a significant time lag between the data given to the warehouse for resource planning and the actual state of the schedule. Resources allocated based on a project plan for the next business day may have been done so as determined by information available at close of business the day prior. In other words, the actual deliveries made the next morning may vary widely due to events that occurred after the close of business.
By allowing vendors, carriers and shippers to update appointments as events occur, the warehouse can get a clear picture of the day ahead. Accurate information on potential scheduling problems can allow the warehouse to be proactive in avoiding potential backups. "The ideal situation is one that allows carrier to arrive and unload 24/7," says Greg Smith, Vice President of Sales and Marketing with Landair Transport. "However, few receivers can offer this level of flexibility so the next best solution is a 24/7 delivery appointment system that is real-time and offers greater flexibility than current methods of scheduling appointments." This way, as appointments are updated, the buyer, receiver, shipper, and carrier should receive immediate notification of all changes, via email or mobile device, keeping all parties up to date.
Limited Manual Contact
More seamless handoff of data between shippers, receivers and carriers results in fewer undue delays in scheduling and fewer communication mistakes. It is the opinion of Richard Kochersperger, Director of the Center for Food Marketing at St. Joseph's University, that "To get goods to the distribution center correctly and on time, a centralized system needs to be in place. Purchase orders should go to the centralized traffic system where opportunities can be identified to reduce costs and streamline operations."8 Purchase order data can then be transmitted to shippers to create loads. Loads can be transmitted directly to carriers from which appointments can be made. In this way, consistent and timely data is made available to all parties.
This concludes Part One of a three-part article. Part Two will discuss achieving a solution and the resultant benefits. Part Three will be a case study illustration.
About The Author
Rachel Nemecek
Ms. Nemecek is a Senior Business Analyst at Elogex, Inc. a collaborative logistics software provider (www.elogex.com) and has several years of industry experience in supply chain operations and application development. Her background includes supervisor positions in export operations and international trade logistics at Schenker International and E.Boyd & Associates. Nemecek has a deep operational knowledge in all forms of transportation - road, rail, ocean, and air and several software methodologies including the Rational Unified Process. Nemecek graduated with Honors from the University of North Carolina at Chapel Hill.
8. Mina Williams, "Distribution Dogma", Supermarket News, February 2001
SOURCE:
http://www.technologyevaluation.com/research/articles/appointment-scheduling-achieving-the-positive-ripple-effect-part-1-16690/
Such is the situation encountered on the job everyday by freight carriers when confronted with delays caused by inefficient appointment scheduling. The Washington Post says it best, "Miserable hours, low pay, lonely existence. Why would anyone want to make a living this way?"1 Frustratingly long waits at docks result in a shrinking supply of assets, often leading to increased rates for shippers. Because carriers are paid only when their wheels are turning, wait time at the dock has a serious impact on earning power. In turn, this causes increased dissatisfaction and results in higher turnover.
The appointment scheduling process is no less frustrating for shippers than receivers as both are forced to juggle numerous demands from multiple parties, generally with out-dated or incomplete information. In addition, the increasing reliance on just-in-time logistics practices have put even more stress on dock operations; thus, magnifying the effect of late arrivals and loading/unloading delays.
Inefficient performance of shipping and receiving activities affects more than just the schedules as it negatively impacts many parties in the supply chain, from the purchaser of the product to the end customer. For this reason, the importance of effective appointment scheduling practices cannot be underestimated. Addressing and alleviating problems with scheduling will gain notable efficiency in visibility, resource and capacity utilization, compliance, and product flow. Accurate appointment scheduling can provide a great benefit to all parties in the supply chain, forming a positive ripple effect that equates to a competitive advantage.
This is Part One of a three-part article. Part Two will discuss achieving a solution and the resultant benefits. Part Three will be a case study illustration.
1. Wells Tower, "The Long Haul", The Washington Post, August 2001
Problems With Current Appoinment Scheduling
There are numerous problems resulting from the methods currently in use for appointment scheduling. The most notable is that the majority of all scheduling is a highly manual and labor-intensive process. Of the dozen Fortune 500 retailers and grocers interviewed on this subject, only one has any automation built into their system. The remaining continue to use paper, phone and fax. Shippers and consignees spend upward of 40% of their time2 on the phone with carriers or vendors, trying to meet their requests for appointment times while still complying with the needs of purchasing. Carriers are forced to either spend hours on hold to make appointments or to leave messages for future callbacks. In addition, appointments may only be scheduled during set business hours. Consequently, when problems arise during off hours the receiver cannot be notified, resulting in out-of-date information in receiving, and often leading to schedule disruptions and mismatched resources-to-volume in the warehouse.
The process of rescheduling appointments is also a significant drain on resources. One large grocery retailer estimates that approximately 20% of the appointments made every week have to be rescheduled, creating approximately 950 total reschedules for an average week. Bob Johnson, Inbound Logistics Manager for Harris Teeter grocery stores, cites rescheduling as the largest problem in scheduling today. In an attempt to offset costs, Harris Teeter has instituted a policy of charge backs for any appointment that is rescheduled more than twice. Currently, between $7,000-$12,000 is collected each month in rescheduling fines. These figures clearly illustrate the depth of the problem. Because carriers and vendors do not personally have access to the schedules, they must rely on contacting the scheduler each time that the situation changes.
Problems with appointment scheduling result in delays at the dock; delays that carry a price tag for shippers, receivers and carriers. A study conducted by Mercer Management Consulting estimates that there is a large cost to shippers for unloading delays at receivers, up to 8% of the total transportation budget.3 For carriers, the excessive wait time contributes to lost revenue, driver dissatisfaction and turnover. The results of the National Refrigerated Drivers Survey, performed by the Truckload Carriers Association, lists the average wait time to load as 3.39 hours per stop and wait time to unload as 3.20 hours per stop.4 A similar survey of dry van drivers found the average wait time for a driver in a particular week to be 33.5 hours, adding up to a $1.5 billion loss per year for carriers.5 Wait time causes a reduction in the earning power of drivers which increases turnover. Driver turnover can range from 50% to 80% for motor carriers per year, with the cost of replacing a single driver estimated as high as $10,000.6
1. "Martin Labbe Associates Study for Truckload Carrier Association", Overdriveonline, August 1999
2. Mercer Management Consulting, "Just in Time to Wait": An Examination of Best Practices for Streamlining Loading/Unloading Functions, July 2000
3. Truckload Carrier Association, National Refrigerated Drivers Survey, 1998
4. Truckload Carrier Association, Dry Van Drivers Survey, June 1999
5. Alan Robinson, "Fleet Management Handbook", Food Logistics, July-August 1999
Far Reaching Effects
Inefficiencies resulting from the current manual appointment scheduling practices affect not only the scheduling department, but extend farther to other parts of the supply chain; Shipping, Receiving, Distribution, Purchasing, and finally to the end customer. Generally, product is ordered with respect to a particular delivery date so that acceptable inventory levels and/or a fluid production schedule can be maintained. The shipping schedule of the supplier must be set in advance of this required date in order to deliver on time and keep inventory on track. However, due to frequent delays at the pickup point, delivery appointments often cannot be made until after the pickup has been physically performed. By the time the driver contacts the receiver, they might not be able to match the delivery appointment with the transit time. Consequently, any delay in the shipping schedule may translate to a delay of delivery and a shortage of inventory, resulting in an unavailability of product for the end customer.
It becomes evident that a problem in one area of the process easily and quickly fingers out to affect countless others in the process. Inaccuracy and inefficiency in the communication of scheduling requirements of the buyers, sellers, shippers, and receivers result in the requirements of the end customer not being met.
Inaccurate appointment schedules may also cause chaos in the warehouse. Arrivals occurring out of sequence cause major congestion when too many pieces/pallets arrive at the same time, producing a back up in the receiving lanes and marshalling areas. This congestion results in carriers who arrived on time for their appointments being delayed.7 The delays to a carrier at one warehouse affect their ability to arrive at subsequent appointments on time, extending the problem to other companies down the line. "The warehouses are most affected if we have problems," says Kim Apodaca of the Ralph's grocery chain. "If our scheduling system goes down and we can't produce schedules, there is chaos. The receiving mode becomes, First Come-First Served'. Marketing begins to receive complaints and phone calls from panicky vendors. Some truck drivers or vendors refuse to even move the loads without acquiring a delivery appointment first."
7. Michael Docherty, "Scheduling Receiving", Managing Logistics, Winter 1997
Possible Improvements
It is evident that scheduling practices must be addressed and improved in order to minimize wait time, improve communication and ensure more on-time delivery of goods. Allowing access to information by all parties involved, expanding hours during which appointments can be made and limiting the amount of manual contact between handoffs are three points that would drastically improve scheduling practices.
Access to Information
Of all companies interviewed, approximately 85% feel that communication between carriers, vendors and receivers is the area most in need for improvement in scheduling. Often, appointments are made by a broker or a vendor and never communicated to the carrier, leaving the carrier with no knowledge of expected arrival time. Another prevalent problem is that the amount of product expected by the receiver frequently does not equate to the amount of product being shipped by the vendor. Only if the receiver has access to the shipping information of the vendor can an accurate volume estimate be made. Carriers and vendors need adequate information about the scheduling requirements and business rules of the receiver in order to schedule appointments on their own, without relying on calling the scheduler each time to confirm an appointment. Enabling access to the same information by all parties in real-time allows for the creation of an accurate scheduling plan.
24/7 Scheduling
The limited hours during which appointments can be made present another barrier in the way of a productive scheduling plan. Unfortunately, delays such as weather, traffic congestion and mechanical failure do not always occur during normal business hours. Consequently, there is often a significant time lag between the data given to the warehouse for resource planning and the actual state of the schedule. Resources allocated based on a project plan for the next business day may have been done so as determined by information available at close of business the day prior. In other words, the actual deliveries made the next morning may vary widely due to events that occurred after the close of business.
By allowing vendors, carriers and shippers to update appointments as events occur, the warehouse can get a clear picture of the day ahead. Accurate information on potential scheduling problems can allow the warehouse to be proactive in avoiding potential backups. "The ideal situation is one that allows carrier to arrive and unload 24/7," says Greg Smith, Vice President of Sales and Marketing with Landair Transport. "However, few receivers can offer this level of flexibility so the next best solution is a 24/7 delivery appointment system that is real-time and offers greater flexibility than current methods of scheduling appointments." This way, as appointments are updated, the buyer, receiver, shipper, and carrier should receive immediate notification of all changes, via email or mobile device, keeping all parties up to date.
Limited Manual Contact
More seamless handoff of data between shippers, receivers and carriers results in fewer undue delays in scheduling and fewer communication mistakes. It is the opinion of Richard Kochersperger, Director of the Center for Food Marketing at St. Joseph's University, that "To get goods to the distribution center correctly and on time, a centralized system needs to be in place. Purchase orders should go to the centralized traffic system where opportunities can be identified to reduce costs and streamline operations."8 Purchase order data can then be transmitted to shippers to create loads. Loads can be transmitted directly to carriers from which appointments can be made. In this way, consistent and timely data is made available to all parties.
This concludes Part One of a three-part article. Part Two will discuss achieving a solution and the resultant benefits. Part Three will be a case study illustration.
About The Author
Rachel Nemecek
Ms. Nemecek is a Senior Business Analyst at Elogex, Inc. a collaborative logistics software provider (www.elogex.com) and has several years of industry experience in supply chain operations and application development. Her background includes supervisor positions in export operations and international trade logistics at Schenker International and E.Boyd & Associates. Nemecek has a deep operational knowledge in all forms of transportation - road, rail, ocean, and air and several software methodologies including the Rational Unified Process. Nemecek graduated with Honors from the University of North Carolina at Chapel Hill.
8. Mina Williams, "Distribution Dogma", Supermarket News, February 2001
SOURCE:
http://www.technologyevaluation.com/research/articles/appointment-scheduling-achieving-the-positive-ripple-effect-part-1-16690/
Integrating Customer Relationship Management and Service Resolution Management
Integrating Customer Relationship Management and Service Resolution Management
A customer relationship management (CRM) system that accommodates complex customer-facing processes requires four key factors to give the system a competitive advantage.
The first key factor lies in the application's ability to develop a complete customer profile that supports multiple business units and products. Service organizations need a wide range of customer data, including demographics, financial status, and current and anticipated lifestyle changes (for example, college-age children, retirement concerns, newborn kids, house or condo purchase, changing insurance requirements, etc). To gain a true understanding of customers' needs and wants, any interaction with them must be captured and analyzed.
For example, when a customer with a savings account inquires about a home loan, a full-service financial services company would want the customer-facing employee, whether in the branch or contact center (if not even an intelligent online software agent), to recognize that here lies an opportunity to cross-sell a home insurance policy to the client as well.
Having a complete customer profile enables users to quickly identify key attributes about a customer, such as whether the customer has multiple accounts with the bank, and therefore is a customer the bank would not want to lose. Naturally, customers are highly sensitive to how they are treated; they notice such things as whether their service institutions answer the phone quickly and recognize the customer when he or she calls, or whether the establishments answer questions astutely or resolve issues promptly. Also of importance is whether the institution provides rapid turnaround for specific offerings, such as new account origination, new loan origination, refinancing a home, and so on.
Most customer-serving institutions need software solutions that can deliver services that are personalized to the customer's needs. Take, for example, an insurance company that has many distinct lines of insurance products but no common customer database, leading to the disastrous result of several agents calling on the same accounts. Such disorganization is not only costly and inefficient, but it also creates a great deal of customer dissatisfaction, annoyance, and ultimately, defection. By implementing a unified solution to market more than one product to the right customers, the service company should be able to improve revenues while driving down the costs—and retaining customers.
The second key factor is that the CRM application should provide companies with the ability to customize their solution to address their unique business needs and evolving external requirements. In a dynamic business environment, the service enterprise must be able to sense and react, almost instantly, to changing market conditions. These conditions vary depending on whether they are caused by shifts in market structure, new competitive threats, micro- or macro-economic changes, or other factors. A company must also adapt to its users' needs, since not all users are alike; an adaptable system should provide a personalized interface for the user, based on his or her specific information needs. Ideally, the system should also be able to dynamically modify its behavior, depending on what the user is doing.
Financial industry enterprises—especially those competing with larger organizations—claim that they win and keep customers because they leverage their in-depth knowledge about the client to offer more personalized service. These clients do not want a cut-and-dried solution that looks and acts like the same CRM system that their next-door competitor uses. Rather, they want a flexible solution that they can tailor to their products, services, and business operations.
The third essential factor of a CRM system that accommodates customer-facing processes is that it should offer organizations the ability to adapt to customer and market changes, since most traditional enterprise CRM offerings require users to write lots of expensive, time-consuming custom code as part of their deployment. This often creates many problems, starting with most customers finding that by the time they have completed the development cycle and are ready to roll out the software, something in their business has yet again changed (such as a new, fierce competitor has entered the market; new legislation has been passed; the company is involved in a merger; management has decided to add or drop a new product line, etc.). Thus, these firms may find themselves stuck using their old model and needing to go through another long, expensive software development cycle to add the changes they need. On the other hand, customized environments can be very difficult to upgrade when the vendor comes out with a new release of its software.
The fourth factor is the CRM application's ability to integrate, in near real time, with other complex systems, and its adaptability to users' existing infrastructure. It is not at all uncommon to find dozens of systems in the service firm's back offices, all of which have data that needs to be integrated with the new CRM system. Some of these systems can even go back a decade or more. Many of these systems, although ancient in the IT timescale, still deliver mission-critical services reliably and effectively, day in and day out. Thus, a modern CRM solution must easily and seamlessly share data bi-directionally with these systems, using open industry standards.
As the first factor indicates, an adaptive service enterprise must be sensitive to ever changing customer requirements, and must foster an optimal customer experience by creating and delivering incremental services that customers want and are willing to pay for. This requires an IT infrastructure capable of seamlessly tracking and managing interactions across all customer touch points, such as the retail store, the Internet, e-mail, fax, the call center, etc.
Though CRM mega-vendors often want users to rip and replace their entire IT infrastructure with the mega-vendor's software stack, many clients view their legacy systems as mission-critical, and might prefer a CRM solution that will protect their investment by plugging into their existing infrastructure.
To be sure, services institutions live and die by the services and products they provide to fickle and demanding customers, and they need to be able to change direction quickly in order to meet competitive challenges or to take advantage of emerging opportunities. Only by deploying astute CRM technology will they be able to capture customer and market data, sense and understand how their customer segments want to be served, and be able to analyze and respond to changes in customer needs and wants.
Because CRM processes touch so many parts of a business, they can have a major impact on both cost and revenue. The improvement of sales and marketing processes can bring in new revenue, while call center productivity can drive down the costs of servicing customers, as well as present up-sell and cross-sell opportunities (and maintain customer satisfaction).
The business case for call center applications is becoming increasingly obvious, especially given the recently established National Do Not Call Registry in the US. The revenue driver will thus become inbound customer calls rather than companies trying to generate leads via outbound telemarketing efforts, which have too often proved to be annoying to customers, and ultimately counterproductive.
Contact and Call Centers Close the CRM Loop
Virtually all firms, therefore, have a strong need to share customer data across multiple business units, which can then enable them to deliver a wide variety of services to customers and enhance their ability to cross-sell or up-sell. Another driver is the need to enforce consistency across the enterprise. When a customer is talking with a bank, for example, the customer expects similar, consistent treatment, regardless of who he or she is interacting with (i.e., a call center person on the phone, via a Web chat, or face to face with a teller ), and regardless whether it is about a service complaint or a mere inquiry. The combination of customer information, dynamic scripting, and built-in process management must help to ensure this consistent customer treatment.
The contact or call center is constantly changing, and businesses need ever more powerful and flexible CRM tools that continually provide greater productivity, decreased costs, and enhanced service. Also, as many research and surveys report, companies have traditionally focused too heavily on technology in their contact centers, and have not paid enough attention to key customer service processes and performance measurement changes.
Service companies have been realizing more and more lately that there is a need to properly evaluate their customer-facing processes and to provide call center representatives with supporting technologies that allow them to execute processes that improve operational effectiveness. Only in this way can these companies increase customer satisfaction and generate new business opportunities. The integrated CRM and call center solutions have reportedly helped some service companies realize a remarkable return on investment (ROI), including a 45 percent increase in case volume (without increasing staff), a 35 percent decrease in time to resolve cases, and a 40 percent decrease in backlogged cases—all ultimately resulting in an 18 percent increase in overall customer satisfaction.
However, for various reasons, but especially because of the challenge of human resources, most call centers have yet to achieve this goal in earnest, and universally. This is because contact center agents' working conditions have traditionally been a far cry from ideal, as these employees typically need to “do more with less.” As the job requirements for agents increase, the challenge in meeting their performance goals also increases. To achieve these performance goals, call centers are increasingly harnessing technologies that have to track customer workflow, thereby providing more consistent and accurate answers to customer inquiries, seamlessly across all the channels.
Almost anyone reading this article has experienced frustration when an automated voice response system to which he or she has just dictated a lengthy account number (and plethora of other sensitive information) fails to transfer that information directly to the agent, who finally picks up the phone and asks the customer to repeat the information once again. This is not to mention the case of when a customer is (at long last) transferred to a specialist who, of course, wants to know the account number "before we get started." Also common is the case of the customer asking an agent to confirm if the information he or she has just read on the web site is correct, only to hear “Sorry, that's not right,” or worse yet, “Hmm … I am not sure. Sorry.” The chances of the agent solving the problem on the spot, and perhaps even upgrading the customer to a product or service that meets his or her needs, are then indeed slim.
Traditionally, agent turnover rates at call centers are fairly high, due in part to having to listen to customers' (justifiable or not) rants, complaints, and displeasure. As a result, call centers are constantly bringing new agents on board who need training before they are able to serve clients satisfactorily, creating a vicious circle of frustrated customers and frustrated agents. The pressures of dealing with furious customers, the need to do more with less, and dealing with rigid systems that are not even scalable or accurate, make the call center agent's life difficult. All these elements also impact the agent's ability to deliver on the call center's desired performance goals.
Implementing appropriate knowledge-based and intelligent search–backed solutions should enable the staff to share information more interactively. Such solutions can also allow staff to rank problem resolutions so that agents share not only knowledge, but experience too. The application should do this by itself, leaving agents the ability to effortlessly help one another and maintain a relevant, highly fluid body of information. When the root causes of problems change daily (for example, if a particular service application is down versus an entire server being down), an agent can see that several other agents have used one solution within the last hour that was the correct solution, which should increase the chances that it is the right answer for their customer call too.
SOURCE:
http://www.technologyevaluation.com/research/articles/integrating-customer-relationship-management-and-service-resolution-management-19184/
A customer relationship management (CRM) system that accommodates complex customer-facing processes requires four key factors to give the system a competitive advantage.
The first key factor lies in the application's ability to develop a complete customer profile that supports multiple business units and products. Service organizations need a wide range of customer data, including demographics, financial status, and current and anticipated lifestyle changes (for example, college-age children, retirement concerns, newborn kids, house or condo purchase, changing insurance requirements, etc). To gain a true understanding of customers' needs and wants, any interaction with them must be captured and analyzed.
For example, when a customer with a savings account inquires about a home loan, a full-service financial services company would want the customer-facing employee, whether in the branch or contact center (if not even an intelligent online software agent), to recognize that here lies an opportunity to cross-sell a home insurance policy to the client as well.
Having a complete customer profile enables users to quickly identify key attributes about a customer, such as whether the customer has multiple accounts with the bank, and therefore is a customer the bank would not want to lose. Naturally, customers are highly sensitive to how they are treated; they notice such things as whether their service institutions answer the phone quickly and recognize the customer when he or she calls, or whether the establishments answer questions astutely or resolve issues promptly. Also of importance is whether the institution provides rapid turnaround for specific offerings, such as new account origination, new loan origination, refinancing a home, and so on.
Most customer-serving institutions need software solutions that can deliver services that are personalized to the customer's needs. Take, for example, an insurance company that has many distinct lines of insurance products but no common customer database, leading to the disastrous result of several agents calling on the same accounts. Such disorganization is not only costly and inefficient, but it also creates a great deal of customer dissatisfaction, annoyance, and ultimately, defection. By implementing a unified solution to market more than one product to the right customers, the service company should be able to improve revenues while driving down the costs—and retaining customers.
The second key factor is that the CRM application should provide companies with the ability to customize their solution to address their unique business needs and evolving external requirements. In a dynamic business environment, the service enterprise must be able to sense and react, almost instantly, to changing market conditions. These conditions vary depending on whether they are caused by shifts in market structure, new competitive threats, micro- or macro-economic changes, or other factors. A company must also adapt to its users' needs, since not all users are alike; an adaptable system should provide a personalized interface for the user, based on his or her specific information needs. Ideally, the system should also be able to dynamically modify its behavior, depending on what the user is doing.
Financial industry enterprises—especially those competing with larger organizations—claim that they win and keep customers because they leverage their in-depth knowledge about the client to offer more personalized service. These clients do not want a cut-and-dried solution that looks and acts like the same CRM system that their next-door competitor uses. Rather, they want a flexible solution that they can tailor to their products, services, and business operations.
The third essential factor of a CRM system that accommodates customer-facing processes is that it should offer organizations the ability to adapt to customer and market changes, since most traditional enterprise CRM offerings require users to write lots of expensive, time-consuming custom code as part of their deployment. This often creates many problems, starting with most customers finding that by the time they have completed the development cycle and are ready to roll out the software, something in their business has yet again changed (such as a new, fierce competitor has entered the market; new legislation has been passed; the company is involved in a merger; management has decided to add or drop a new product line, etc.). Thus, these firms may find themselves stuck using their old model and needing to go through another long, expensive software development cycle to add the changes they need. On the other hand, customized environments can be very difficult to upgrade when the vendor comes out with a new release of its software.
The fourth factor is the CRM application's ability to integrate, in near real time, with other complex systems, and its adaptability to users' existing infrastructure. It is not at all uncommon to find dozens of systems in the service firm's back offices, all of which have data that needs to be integrated with the new CRM system. Some of these systems can even go back a decade or more. Many of these systems, although ancient in the IT timescale, still deliver mission-critical services reliably and effectively, day in and day out. Thus, a modern CRM solution must easily and seamlessly share data bi-directionally with these systems, using open industry standards.
As the first factor indicates, an adaptive service enterprise must be sensitive to ever changing customer requirements, and must foster an optimal customer experience by creating and delivering incremental services that customers want and are willing to pay for. This requires an IT infrastructure capable of seamlessly tracking and managing interactions across all customer touch points, such as the retail store, the Internet, e-mail, fax, the call center, etc.
Though CRM mega-vendors often want users to rip and replace their entire IT infrastructure with the mega-vendor's software stack, many clients view their legacy systems as mission-critical, and might prefer a CRM solution that will protect their investment by plugging into their existing infrastructure.
To be sure, services institutions live and die by the services and products they provide to fickle and demanding customers, and they need to be able to change direction quickly in order to meet competitive challenges or to take advantage of emerging opportunities. Only by deploying astute CRM technology will they be able to capture customer and market data, sense and understand how their customer segments want to be served, and be able to analyze and respond to changes in customer needs and wants.
Because CRM processes touch so many parts of a business, they can have a major impact on both cost and revenue. The improvement of sales and marketing processes can bring in new revenue, while call center productivity can drive down the costs of servicing customers, as well as present up-sell and cross-sell opportunities (and maintain customer satisfaction).
The business case for call center applications is becoming increasingly obvious, especially given the recently established National Do Not Call Registry in the US. The revenue driver will thus become inbound customer calls rather than companies trying to generate leads via outbound telemarketing efforts, which have too often proved to be annoying to customers, and ultimately counterproductive.
Contact and Call Centers Close the CRM Loop
Virtually all firms, therefore, have a strong need to share customer data across multiple business units, which can then enable them to deliver a wide variety of services to customers and enhance their ability to cross-sell or up-sell. Another driver is the need to enforce consistency across the enterprise. When a customer is talking with a bank, for example, the customer expects similar, consistent treatment, regardless of who he or she is interacting with (i.e., a call center person on the phone, via a Web chat, or face to face with a teller ), and regardless whether it is about a service complaint or a mere inquiry. The combination of customer information, dynamic scripting, and built-in process management must help to ensure this consistent customer treatment.
The contact or call center is constantly changing, and businesses need ever more powerful and flexible CRM tools that continually provide greater productivity, decreased costs, and enhanced service. Also, as many research and surveys report, companies have traditionally focused too heavily on technology in their contact centers, and have not paid enough attention to key customer service processes and performance measurement changes.
Service companies have been realizing more and more lately that there is a need to properly evaluate their customer-facing processes and to provide call center representatives with supporting technologies that allow them to execute processes that improve operational effectiveness. Only in this way can these companies increase customer satisfaction and generate new business opportunities. The integrated CRM and call center solutions have reportedly helped some service companies realize a remarkable return on investment (ROI), including a 45 percent increase in case volume (without increasing staff), a 35 percent decrease in time to resolve cases, and a 40 percent decrease in backlogged cases—all ultimately resulting in an 18 percent increase in overall customer satisfaction.
However, for various reasons, but especially because of the challenge of human resources, most call centers have yet to achieve this goal in earnest, and universally. This is because contact center agents' working conditions have traditionally been a far cry from ideal, as these employees typically need to “do more with less.” As the job requirements for agents increase, the challenge in meeting their performance goals also increases. To achieve these performance goals, call centers are increasingly harnessing technologies that have to track customer workflow, thereby providing more consistent and accurate answers to customer inquiries, seamlessly across all the channels.
Almost anyone reading this article has experienced frustration when an automated voice response system to which he or she has just dictated a lengthy account number (and plethora of other sensitive information) fails to transfer that information directly to the agent, who finally picks up the phone and asks the customer to repeat the information once again. This is not to mention the case of when a customer is (at long last) transferred to a specialist who, of course, wants to know the account number "before we get started." Also common is the case of the customer asking an agent to confirm if the information he or she has just read on the web site is correct, only to hear “Sorry, that's not right,” or worse yet, “Hmm … I am not sure. Sorry.” The chances of the agent solving the problem on the spot, and perhaps even upgrading the customer to a product or service that meets his or her needs, are then indeed slim.
Traditionally, agent turnover rates at call centers are fairly high, due in part to having to listen to customers' (justifiable or not) rants, complaints, and displeasure. As a result, call centers are constantly bringing new agents on board who need training before they are able to serve clients satisfactorily, creating a vicious circle of frustrated customers and frustrated agents. The pressures of dealing with furious customers, the need to do more with less, and dealing with rigid systems that are not even scalable or accurate, make the call center agent's life difficult. All these elements also impact the agent's ability to deliver on the call center's desired performance goals.
Implementing appropriate knowledge-based and intelligent search–backed solutions should enable the staff to share information more interactively. Such solutions can also allow staff to rank problem resolutions so that agents share not only knowledge, but experience too. The application should do this by itself, leaving agents the ability to effortlessly help one another and maintain a relevant, highly fluid body of information. When the root causes of problems change daily (for example, if a particular service application is down versus an entire server being down), an agent can see that several other agents have used one solution within the last hour that was the correct solution, which should increase the chances that it is the right answer for their customer call too.
SOURCE:
http://www.technologyevaluation.com/research/articles/integrating-customer-relationship-management-and-service-resolution-management-19184/
Channels to the Hearts and Minds--On-line 2005
The physical, e, and wireless world continues to grow!
The e-channel for shoppers continues to grow, with so many nay-sayers and doubters. You'd think this issue would die, with more and more shoppers buying from far flung vendors: Boston to the Nanga Tribes for buying original crafts; Dallas to Huangshan City, China, etc.
In spite of nasty spam, more activities go on-line—games, travel, research, etc. On-line is now part of the total life experience. The challenge will be to make it even better for users; build capacity (again), making the various channels (wireless, cellular, fiber to the home, etc.) work well together.
First, on-line is now part of the information technology component of the enterprise. This aspect is slowly but surely destroying many industries that rely on providing "content and information as part of a paid service or subscription", such as magazines, research firms, etc. In fact, most of these leading edge firms have found value-added service on top of "free information", and the old timers are struggling to add some pizzazz to their service model. There are great strategies for bringing people closer together here!
Competitive analysis is a major beneficiary of the on-line revolution. The advice to product firms is to make sure you use this channel well. If your competitors put a solid footprint of their product on-line, it would behoove you to do likewise. In spite of the risk of imitation, shoppers for software, electronics, even jewelry really are doing their research. One person of over 200 executives in a room did not do on-line research for products before they bought. So both business and consumer have come to rely on this channel. It's hard to level an investment dollar, which is the big question as executives deal with ROIs for efforts to enhance their business. Where did they buy? In the store. So we build more stores, when in reality it was the web that "sold the deal". Learning more about our customers is key.
n addition, this channel will only get more pervasive with all the wired and wireless channels to the hearts and minds of the buyers being served. Globally, the Telco industry continues to consolidate: AT&T with SBC, Sprint and Nextel (there is a strange history), MCI and Qwest or Verizon;, France, Japan, US, Canada, etc. And part of the strategy in doing so is to provide a totally integrated service. We hope that these will bring net value to customers. At my roost here in Canada this week, Rogers covers the wireless Internet, cable TV, etc., as well as my own cell phone. One firm provides it all. The customer's needs become the focal point. Poweredcom of Japan sees the broad context-seeing content as part of the picture (no pun here) as well as the mobility of the customer. Sam Nakane, CEO of Poweredcom, said that his "ultimate goal was to become 'a ubiquitous Internet service provider' that would become a window for users to stay connected wherever they are through one phone number and one bill."
As convergence continues at all levels—devices, carriers, and content/retailers—, the question still remains. What will be the impact to these various businesses? Consider
* Retailers need to provide a way to make their customers more loyal—this takes some imagination, like creating and improving the experience for customers and also creating real loyalty programs (Will Amazon's Prime be one of those?).
* Content-information services, games, and other services—being a destination site is key, as well as managing relationships with channel partners.
* Carriers should make it easy for customers, or they will defect and put up with multichannel challenges until they get everything they want from that one carrier (consumer configurations like: T-Mobile, Comcast, Cingular, AOL, or Verizon, RCN, Yahoo, etc.). And these methods simultaneously service their work and play!
The money is clearly there for the winning providers! But you have to listen to your customers and serve their needs!
This article is from Parallax View, ChainLink Research's on-line magazine, read by over 150,000 supply chain and IT professionals each month. Thought-provoking and actionable articles from ChainLink's analysts, top industry executives, researchers, and fellow practitioners. To view the entire magazine, click here.
SOURCE:
http://www.technologyevaluation.com/research/articles/channels-to-the-hearts-and-minds-on-line-2005-17848/
The e-channel for shoppers continues to grow, with so many nay-sayers and doubters. You'd think this issue would die, with more and more shoppers buying from far flung vendors: Boston to the Nanga Tribes for buying original crafts; Dallas to Huangshan City, China, etc.
In spite of nasty spam, more activities go on-line—games, travel, research, etc. On-line is now part of the total life experience. The challenge will be to make it even better for users; build capacity (again), making the various channels (wireless, cellular, fiber to the home, etc.) work well together.
First, on-line is now part of the information technology component of the enterprise. This aspect is slowly but surely destroying many industries that rely on providing "content and information as part of a paid service or subscription", such as magazines, research firms, etc. In fact, most of these leading edge firms have found value-added service on top of "free information", and the old timers are struggling to add some pizzazz to their service model. There are great strategies for bringing people closer together here!
Competitive analysis is a major beneficiary of the on-line revolution. The advice to product firms is to make sure you use this channel well. If your competitors put a solid footprint of their product on-line, it would behoove you to do likewise. In spite of the risk of imitation, shoppers for software, electronics, even jewelry really are doing their research. One person of over 200 executives in a room did not do on-line research for products before they bought. So both business and consumer have come to rely on this channel. It's hard to level an investment dollar, which is the big question as executives deal with ROIs for efforts to enhance their business. Where did they buy? In the store. So we build more stores, when in reality it was the web that "sold the deal". Learning more about our customers is key.
n addition, this channel will only get more pervasive with all the wired and wireless channels to the hearts and minds of the buyers being served. Globally, the Telco industry continues to consolidate: AT&T with SBC, Sprint and Nextel (there is a strange history), MCI and Qwest or Verizon;, France, Japan, US, Canada, etc. And part of the strategy in doing so is to provide a totally integrated service. We hope that these will bring net value to customers. At my roost here in Canada this week, Rogers covers the wireless Internet, cable TV, etc., as well as my own cell phone. One firm provides it all. The customer's needs become the focal point. Poweredcom of Japan sees the broad context-seeing content as part of the picture (no pun here) as well as the mobility of the customer. Sam Nakane, CEO of Poweredcom, said that his "ultimate goal was to become 'a ubiquitous Internet service provider' that would become a window for users to stay connected wherever they are through one phone number and one bill."
As convergence continues at all levels—devices, carriers, and content/retailers—, the question still remains. What will be the impact to these various businesses? Consider
* Retailers need to provide a way to make their customers more loyal—this takes some imagination, like creating and improving the experience for customers and also creating real loyalty programs (Will Amazon's Prime be one of those?).
* Content-information services, games, and other services—being a destination site is key, as well as managing relationships with channel partners.
* Carriers should make it easy for customers, or they will defect and put up with multichannel challenges until they get everything they want from that one carrier (consumer configurations like: T-Mobile, Comcast, Cingular, AOL, or Verizon, RCN, Yahoo, etc.). And these methods simultaneously service their work and play!
The money is clearly there for the winning providers! But you have to listen to your customers and serve their needs!
This article is from Parallax View, ChainLink Research's on-line magazine, read by over 150,000 supply chain and IT professionals each month. Thought-provoking and actionable articles from ChainLink's analysts, top industry executives, researchers, and fellow practitioners. To view the entire magazine, click here.
SOURCE:
http://www.technologyevaluation.com/research/articles/channels-to-the-hearts-and-minds-on-line-2005-17848/
Learning Management Systems (LMS) Showdown: Saba vs. Sumtotal
The overall rankings you see above are based on the vendor's most recent responses to the 730 criteria in our LMS request for information (RFI). As you can see, Saba edges out SumTotal 88.93 to 87.94 in the overall scoring. The chart below shows you how each vendor performed in the 17 modules that make up the LMS RFI.
Below are the individual LMS module rankings. As indicated, SumTotal finished first in 8 of the 17 modules, but it must be emphasized that in many of the modules, the scores were extremely close. Saba finished first in six modules, and three were a dead heat.
If there were two vendors that couldn't be more similar, it's these two. While both vendors primarily deal with the same types of solutions (learning, collaboration, performance, and talent management), Saba managed to edge out its competition (SumTotal) by a narrow margin (a mere 0.99 rating points) in the main module rankings.
It is important to note that the graphs above represent purely a quantitative evaluation (based on TEC's decision model). They are not based on a qualitative evaluation. The quantitative evaluation looks strictly at the product's capability (e.g., whether it is supported, not supported, third party, etc.) and creates the “performance ratings” based on the percentage of functionality supported by the product.
As the functionality graphs show, Classroom Training, E-learning, Custom Content Authoring, Performance Support, Competency and Performance Management, Reporting, and Product Technology modules all scored similarly (with a three point or less rating margin), but SumTotal fell behind in the areas of E-commerce support (due to its weak ratings in shopping cart and mobile user support areas) and Analytics (due to weak ratings in its financial measures and tools and links to its financial systems).
Saba showed similar difficulties with and Language Support (where Arabic, Hebrew, Thai, and a few other languages were not supported).
The vendors' ratings in Course Content Authoring, Communication and Collaboration, Assessment and Evaluation, Blended Learning, Usability, and Support modules were very close. Saba, however, was a clear winner in the area of Virtual Classrooms due to the fact that these capabilities are offered by SumTotal through third party support.
Do Your Own Quick, Custom LMS Evaluation
Now that you've had an overall look at a couple of LMS vendors and solutions, how do you determine which LMS solutions are the best fit for your company's unique needs? We recommend you do a quick comparison using TEC's LMS Evaluation Center .
TEC's LMS Evaluation Center allows you to set priorities that reflect your organization's business model and special needs at every level of functionality. At the modular and submodular levels—even down to the individual criteria—you can tell the system which business processes are critical, less important, or not important to your organization. The system then compares your priorities against the vendor responses to produce a shortlist of solutions. You get a custom comparison—one that ranks vendor solutions on how well their functionality matches the business requirements of your organization.
It's the best way we know of to evaluate LMS solutions, and we invite you to give it a run-through. Plus, you'll get your results in mere minutes. Simply click the link below to visit our LMS Evaluation Center and conduct your fast, free custom LMS comparison. After all, there's no other organization quite like yours.
SOURCE:
http://www.technologyevaluation.com/research/articles/learning-management-systems-lms-showdown-saba-vs-sumtotal-19450/
Below are the individual LMS module rankings. As indicated, SumTotal finished first in 8 of the 17 modules, but it must be emphasized that in many of the modules, the scores were extremely close. Saba finished first in six modules, and three were a dead heat.
If there were two vendors that couldn't be more similar, it's these two. While both vendors primarily deal with the same types of solutions (learning, collaboration, performance, and talent management), Saba managed to edge out its competition (SumTotal) by a narrow margin (a mere 0.99 rating points) in the main module rankings.
It is important to note that the graphs above represent purely a quantitative evaluation (based on TEC's decision model). They are not based on a qualitative evaluation. The quantitative evaluation looks strictly at the product's capability (e.g., whether it is supported, not supported, third party, etc.) and creates the “performance ratings” based on the percentage of functionality supported by the product.
As the functionality graphs show, Classroom Training, E-learning, Custom Content Authoring, Performance Support, Competency and Performance Management, Reporting, and Product Technology modules all scored similarly (with a three point or less rating margin), but SumTotal fell behind in the areas of E-commerce support (due to its weak ratings in shopping cart and mobile user support areas) and Analytics (due to weak ratings in its financial measures and tools and links to its financial systems).
Saba showed similar difficulties with and Language Support (where Arabic, Hebrew, Thai, and a few other languages were not supported).
The vendors' ratings in Course Content Authoring, Communication and Collaboration, Assessment and Evaluation, Blended Learning, Usability, and Support modules were very close. Saba, however, was a clear winner in the area of Virtual Classrooms due to the fact that these capabilities are offered by SumTotal through third party support.
Do Your Own Quick, Custom LMS Evaluation
Now that you've had an overall look at a couple of LMS vendors and solutions, how do you determine which LMS solutions are the best fit for your company's unique needs? We recommend you do a quick comparison using TEC's LMS Evaluation Center .
TEC's LMS Evaluation Center allows you to set priorities that reflect your organization's business model and special needs at every level of functionality. At the modular and submodular levels—even down to the individual criteria—you can tell the system which business processes are critical, less important, or not important to your organization. The system then compares your priorities against the vendor responses to produce a shortlist of solutions. You get a custom comparison—one that ranks vendor solutions on how well their functionality matches the business requirements of your organization.
It's the best way we know of to evaluate LMS solutions, and we invite you to give it a run-through. Plus, you'll get your results in mere minutes. Simply click the link below to visit our LMS Evaluation Center and conduct your fast, free custom LMS comparison. After all, there's no other organization quite like yours.
SOURCE:
http://www.technologyevaluation.com/research/articles/learning-management-systems-lms-showdown-saba-vs-sumtotal-19450/
Remedy Welcomes You To Your New Office. Now Get To Work!
Bob Keane, Remedy Corporation's Senior Product Manager for the Remedy SetUp@Work product started work only four days after he was hired. Although his own desktop machine hadn't been delivered yet, he was set up with a loaner, and all permissions and links were in place so that he could start to work. In addition, he could easily check the status of his PC, desk blotter, trash basket, and other yet-to-be-delivered items from a browser. Andrew Pritchard, Remedy's Director of Solutions Marketing, remembers the first employee he hired once the precursor of SetUp@Work had been deployed internally. "Not only was he all set up with a computer and a phone and phone number, and ready to go the minute he walked in the door, he already had 55 e-mails!" (It turns out that many of the 55 e-mails were confirmations of service setups and orientation meetings that Mr. Pritchard had specified for him.)
Remedy SetUp@Work is a tool that lets managers define the full range of services needed by an employee. Beyond its use for new employees it is also targeted as a tool to support groups or whole companies during moves to new quarters. Companies can also use it to speed the integration of new employees after an acquisition. Remedy calls this an Employee Transition Management product.
The tool works with Remedy's Strategic Service Suite to transfer a manager's request for hardware, software, permissions, and services to the groups responsible for meeting them and to track and report status. Behind the scenes are Remedy's powerful workflow tool, the Action Request System (see Remedy Corporation: Poised for a Comeback?) and a newer tool, an approval engine that manages the potentially complex hierarchy of approvals needed to unlock the goods and services the employee needs.
Remedy offers the following prototype ROI calculation to help justify the product. The claim is that to set up or move an employee without automated assistance costs $750, assuming a total of 8 hours spent by the IT, HR and Facilities departments. Using SetUp@Work reduces the cost to $200. In a 2,000 person company, with an expected 300 new employees, 300 employee moves and 200 replacement hires due to attrition each year, the savings from SetUp@Work is $440,000. This takes into account the employees' lost productivity, although perhaps not the cost of the hiring manager's Grecian Formula 14, needed to hide all those newly grayed hairs.
The product has been newly released with a number of features, including integration with other Remedy applications, interface enhancements that make the product more useful in multi-site organizations, and intelligent task assignment. With intelligent task assignment the system will automatically make task assignments that are consistent with the particular new employee. In practice, this means that a hiring manager in Boston can use a template to kick off setting up the new employee without bothering to specify that the assigned service technician should be one based in Eastern Massachusetts rather than one in Southern France. To the user SetUp@Work appears to manipulate a family of objects with inheritance and instantiation; however the implementation is not based on object oriented technologies.
Product Strategy and Trajectory
SetUp@Work is one piece of the larger Remedy@Work suite of workplace automation solutions, which also includes Remedy Purchasing@Work and a soon to be released travel and expense product (see Remedy Plots A Course To Travel And Expense Capabilities).
All of Remedy's products are compatible through the Action Request System and their Enterprise Integration Engine, which provides connectivity to back-end ERP, HR and database systems. As an example, the SetUp@Work product can be fully integrated with Remedy's Help Desk, Change Management and Purchasing@Work products. Thus, if a new employee needs a desktop computer or desk that can't be found in inventory the order can be generated and sent for approval automatically.
This puts SetUp@Work on two strategic growth paths. First, as a member of the Remedy@Work suite it will be joined by other complementary applications. Among possible new products would be collaboration and task management tools. It seems likely that evolution will move in the direction of a portal solution, in the sense that Remedy may find ways to integrate other standard employee functions, such as e-mail and schedule management from Microsoft or Lotus, under the common Remedy@Work interface. Second, SetUp@Work also is part of a "vertical" application suite targeted to IT asset management, working in tandem with such applications as Remedy Change Management and Remedy Service Level Agreements.
That said, we don't foresee any major changes to this product in the next two years. Unless (and we think this unlikely) it turns out not to meet customer needs, we think Remedy will treat it as a well-defined product eligible for only minor enhancements, and turn its attention to rolling out new Remedy@Work products.
Remedy is looking for its early adopters among mid-level companies, especially those meeting one of more of these conditions:
* Large contingent work force
* Completing an acquisition
* Member of an industry undergoing deregulation.
Remedy believes that the product is fully scaleable to the largest enterprises.
At this time Remedy expects most sales to be to existing customers, but has already had new customers come to the company because of SetUp@Work. Remedy believes that this interest validates its assumption that there is a significant market for Employee Transition Management, and expects to be the leading vendor.
Product Strengths
Sometimes we see complex products and wonder whether they have yet found the problem that will justify them. SetUp@Work is exactly the opposite kind of product. You only have to hear about it to say, "Of course. How obvious." It's an elegant idea that almost every growing company can see an immediate need for. Certainly, anyone who's had a new job or a new desk since about 1988 knows why this product was created.
Simplicity is its hallmark, but some serious infrastructure is needed to make it work well. Remedy's Action Request System and its Approval Server engine provide that infrastructure. As noted above, Remedy can offer out-of-the-box integration. This is an obvious advantage that will be increasingly leveraged with future products.
Product Challenges
The major weakness of the product may be only that it is not conceptually difficult to replicate. While it is true that Remedy has a lead both in terms of timing and in terms of the sophistication of its AR System, its competitors could easily announce products that have the same general description. This would tend to fragment and confuse the market. Remedy's best protection is to develop its marketing to new customers quickly; the existing customers who might add SetUp@Work shouldn't be ignored, but are not likely to go away. Of course, most B2B markets are fragmented anyway, so this is hardly a major concern.
BOTTOM LINE
Vendor Recommendations
Frankly, we don't see too much to change here. This is a simple product that meets a significant need and promises substantial ROI, if not in terms of the time of the newly hired employee then certainly for the time it saves the hiring manager.
In some sense, though, that simplicity and high value create a problem for Remedy when selling to customers who do not have Remedy's infrastructure in place. Such customers must in effect have a number of Remedy infrastructure products to get full value, which we define so as to imply full integration with back-end systems. These are provided with the purchase of SetUp@Work, so cost isn't an issue. But the additional pieces do add some complexity to the IT department's life. Having a version of this product that could make use of other components could be of value. Since Remedy already has begun to build partnerships with integration and middleware vendors, so as to provide alternatives to their own Enterprise Integration Engine, this is probably an easy path to follow.
The downside is that this move might reduce the product's ability to leverage sales of other Remedy products to such customers. Our guess is that Remedy would be better off with a more inclusive strategy, but we recommend only that they make the call as soon as they can. Certainly, the early announcement of a "standalone" version, if that is the decision, could inhibit some potential competitors.
User Recommendations
How much would you give if, on your next job, you could be ready to do real work on the first day? How much time has it cost you to have your office moved? How much would you give if, as a hiring manager, you could reduce the administrative headache of launching a new employee, or of moving a group, by fifty or sixty percent? Add these together and multiply by the number of new or moved employees. Even if the value doesn't quite satisfy ROI requirements, it will be clear that investigating SetUp@Work is the humane thing to do for the other people in your company.
We believe that existing Remedy customers will have no trouble justifying this product. For customers who are not already Remedy users there will be questions to answer about integration with back-end systems or with other workplace products.
SOURCE:
http://www.technologyevaluation.com/research/articles/remedy-welcomes-you-to-your-new-office-now-get-to-work-16075/
Remedy SetUp@Work is a tool that lets managers define the full range of services needed by an employee. Beyond its use for new employees it is also targeted as a tool to support groups or whole companies during moves to new quarters. Companies can also use it to speed the integration of new employees after an acquisition. Remedy calls this an Employee Transition Management product.
The tool works with Remedy's Strategic Service Suite to transfer a manager's request for hardware, software, permissions, and services to the groups responsible for meeting them and to track and report status. Behind the scenes are Remedy's powerful workflow tool, the Action Request System (see Remedy Corporation: Poised for a Comeback?) and a newer tool, an approval engine that manages the potentially complex hierarchy of approvals needed to unlock the goods and services the employee needs.
Remedy offers the following prototype ROI calculation to help justify the product. The claim is that to set up or move an employee without automated assistance costs $750, assuming a total of 8 hours spent by the IT, HR and Facilities departments. Using SetUp@Work reduces the cost to $200. In a 2,000 person company, with an expected 300 new employees, 300 employee moves and 200 replacement hires due to attrition each year, the savings from SetUp@Work is $440,000. This takes into account the employees' lost productivity, although perhaps not the cost of the hiring manager's Grecian Formula 14, needed to hide all those newly grayed hairs.
The product has been newly released with a number of features, including integration with other Remedy applications, interface enhancements that make the product more useful in multi-site organizations, and intelligent task assignment. With intelligent task assignment the system will automatically make task assignments that are consistent with the particular new employee. In practice, this means that a hiring manager in Boston can use a template to kick off setting up the new employee without bothering to specify that the assigned service technician should be one based in Eastern Massachusetts rather than one in Southern France. To the user SetUp@Work appears to manipulate a family of objects with inheritance and instantiation; however the implementation is not based on object oriented technologies.
Product Strategy and Trajectory
SetUp@Work is one piece of the larger Remedy@Work suite of workplace automation solutions, which also includes Remedy Purchasing@Work and a soon to be released travel and expense product (see Remedy Plots A Course To Travel And Expense Capabilities).
All of Remedy's products are compatible through the Action Request System and their Enterprise Integration Engine, which provides connectivity to back-end ERP, HR and database systems. As an example, the SetUp@Work product can be fully integrated with Remedy's Help Desk, Change Management and Purchasing@Work products. Thus, if a new employee needs a desktop computer or desk that can't be found in inventory the order can be generated and sent for approval automatically.
This puts SetUp@Work on two strategic growth paths. First, as a member of the Remedy@Work suite it will be joined by other complementary applications. Among possible new products would be collaboration and task management tools. It seems likely that evolution will move in the direction of a portal solution, in the sense that Remedy may find ways to integrate other standard employee functions, such as e-mail and schedule management from Microsoft or Lotus, under the common Remedy@Work interface. Second, SetUp@Work also is part of a "vertical" application suite targeted to IT asset management, working in tandem with such applications as Remedy Change Management and Remedy Service Level Agreements.
That said, we don't foresee any major changes to this product in the next two years. Unless (and we think this unlikely) it turns out not to meet customer needs, we think Remedy will treat it as a well-defined product eligible for only minor enhancements, and turn its attention to rolling out new Remedy@Work products.
Remedy is looking for its early adopters among mid-level companies, especially those meeting one of more of these conditions:
* Large contingent work force
* Completing an acquisition
* Member of an industry undergoing deregulation.
Remedy believes that the product is fully scaleable to the largest enterprises.
At this time Remedy expects most sales to be to existing customers, but has already had new customers come to the company because of SetUp@Work. Remedy believes that this interest validates its assumption that there is a significant market for Employee Transition Management, and expects to be the leading vendor.
Product Strengths
Sometimes we see complex products and wonder whether they have yet found the problem that will justify them. SetUp@Work is exactly the opposite kind of product. You only have to hear about it to say, "Of course. How obvious." It's an elegant idea that almost every growing company can see an immediate need for. Certainly, anyone who's had a new job or a new desk since about 1988 knows why this product was created.
Simplicity is its hallmark, but some serious infrastructure is needed to make it work well. Remedy's Action Request System and its Approval Server engine provide that infrastructure. As noted above, Remedy can offer out-of-the-box integration. This is an obvious advantage that will be increasingly leveraged with future products.
Product Challenges
The major weakness of the product may be only that it is not conceptually difficult to replicate. While it is true that Remedy has a lead both in terms of timing and in terms of the sophistication of its AR System, its competitors could easily announce products that have the same general description. This would tend to fragment and confuse the market. Remedy's best protection is to develop its marketing to new customers quickly; the existing customers who might add SetUp@Work shouldn't be ignored, but are not likely to go away. Of course, most B2B markets are fragmented anyway, so this is hardly a major concern.
BOTTOM LINE
Vendor Recommendations
Frankly, we don't see too much to change here. This is a simple product that meets a significant need and promises substantial ROI, if not in terms of the time of the newly hired employee then certainly for the time it saves the hiring manager.
In some sense, though, that simplicity and high value create a problem for Remedy when selling to customers who do not have Remedy's infrastructure in place. Such customers must in effect have a number of Remedy infrastructure products to get full value, which we define so as to imply full integration with back-end systems. These are provided with the purchase of SetUp@Work, so cost isn't an issue. But the additional pieces do add some complexity to the IT department's life. Having a version of this product that could make use of other components could be of value. Since Remedy already has begun to build partnerships with integration and middleware vendors, so as to provide alternatives to their own Enterprise Integration Engine, this is probably an easy path to follow.
The downside is that this move might reduce the product's ability to leverage sales of other Remedy products to such customers. Our guess is that Remedy would be better off with a more inclusive strategy, but we recommend only that they make the call as soon as they can. Certainly, the early announcement of a "standalone" version, if that is the decision, could inhibit some potential competitors.
User Recommendations
How much would you give if, on your next job, you could be ready to do real work on the first day? How much time has it cost you to have your office moved? How much would you give if, as a hiring manager, you could reduce the administrative headache of launching a new employee, or of moving a group, by fifty or sixty percent? Add these together and multiply by the number of new or moved employees. Even if the value doesn't quite satisfy ROI requirements, it will be clear that investigating SetUp@Work is the humane thing to do for the other people in your company.
We believe that existing Remedy customers will have no trouble justifying this product. For customers who are not already Remedy users there will be questions to answer about integration with back-end systems or with other workplace products.
SOURCE:
http://www.technologyevaluation.com/research/articles/remedy-welcomes-you-to-your-new-office-now-get-to-work-16075/
The Data Explosion
Traffic on the World Wide Web continues to grow. Traffic on your SmallSmartFast devices continues to grow.
Ok, I admit it. I bought the cell phone that takes pictures. I didn't know if it was useful; but being a technophile, I went for it. And rapidly it all came to me! I tried on a new cool jacket ... I crooned over it ... but for that much money, I wasn't sure. Should I really buy this? Enter the pic in my cell phone! We chicks have our honor guard. You know those close friends who will tell you the truth—eyes roll- what did you do to your hair- friend. So I took my picture and sent it. Hey take a look at me in this—what do you think? Real time feedback! And that got me to thinking about my business. Do you like this location, equipment, etc.? Attach you message, the pictures, pricing, etc. ... we are on our way.
The network is alive with the sound of convergence ... not a new song, but it got us thinking about the explosion of traffic on these various platforms across GPS and the Internet.
These patterns we are quite familiar with—but wireless seems to be spinning out around the world.
A modest estimate of traffic in voice, video, and data—wired or wireless—will increase ten times over the next five years. And why? Both business and personal use of these platforms is exploding, driven by cell phones and other personal devices, business use of GPS, the Internet, and of course RFID. RFID transactions will grow in number and dimension.
* Number of transactions
* Depth of detail—items on up
* Type of transactions
* Size of transactions
It's hard to separate these out; they kind of go together. But we'll explore a few thoughts around this data explosion.
Global trade is increasing the number of shipments by 7 to 8 percent each year. Embedded within this process is also the need to trace, track, and secure these shipments. Hybrid devices are already in use and their deployment is growing. Containers in Hong Kong, Oakland bound, are bonded with active RFID and GPS devices that secure and track the shipment all the way to the customer. Smart Secure Trade Lanes has over one hundred global participants with all the major ports participating. This initiative is enabled by Savi's global RFID-enabled network, which can read both passive and active data and is already deployed around the world.
From item to containers for a lifetime, the first waves of RFID are delivering with shipment level data, mostly cartons, containers, and pallets. But retailers already put devices on most high-end goods. Today, of course, these devices have a short life—from unpacking and stocking the shelf to the cash register and no real recoding transaction is done. But once RFID tags become part of the floor-ready merchandize process, or more brand firms embed them in their products, the number of collection points goes up exponentially. Firms like GenuOne already have a leadership position in the brand protection (Genuine-get it?) and these unobtrusive little devices ship at an item level, from the manufacturer. Their serial number and lot is collected, tracked, and validated upon receiving by the merchant. The point is, naysayers who think item level is far off are, well, uninformed.
Size and More Transactions!
The DoD is moving toward standardizing product serial numbers and ultimately expects these on not only the items, but also the tags. And this is only the beginning. Many products have lifetime histories to trace (pedigrees already in practice in many industries like aerospace and defense, medical devices, and pharmaceuticals). It is debatable where all the histories will be stored—on the network or on the device—, but the ability for device level services (code or functions) to communicate with the application is clear, sending data back and forth to validate, instruct the operator, etc. All those little applets zinging data back and forth between items, devices, and the mother ship! Tags can and will carry significantly more data—and will have significantly more power to do more stuff.
SmallerSmarterFaster devices that can do hybrid work—like Intermec's barcode and RFID enabled devices—are already in use in firms like Bayer, and applications that sit on these devices are vertical specific, driving intelligence in the hand. These devices are converged already—RFID enabled—and support personal wireless, aka Bluetooth, as well as LAN and WAN, the people, the devices, the IT systems across the enterprise, and the Internet. Think small and really smart devices running complex queries and data management—not just dumb readers!
Where Are We?
Exodus. We are striking out for the core inventions and concepts into a creative land where everyone is in the act. With all these opportunities, we will get more tags and applications to use these tags. More demand will drive the creation of new processes and technologies to scale the manufacturing processes. Matrics just announced their new parallel integrated chip assembly (PICA), a methodology which significantly increases chip assembly production, about ten fold. Think of one machine producing in the range of (depending on the product being produced) 20,000 to 100,000 chips per hour versus the old method of maximum 1,000 to 8,000 chips per hour.
Of course, this is the beginning of chip technologies, which will radically change. With manufacturing processes driving up capacity, as well as producing a more powerful chip, prices will come down. Nanotechnologies get introduced about three to four years from now, which will be truly powerful and cheaper! Moore's Law still applies here with the price/performance ratios careening ever higher!
So, where are we? On CNN, ABC, and MSNBC. If you think of previous technology shifts, Prime Time came way later. ERP, as a term, was mentioned for the first time on Prime Time about ten years ago. Here, the impact transcends most walks of life! So across many markets—consumer, manufacturing, defense, etc.—there are new adopters of the technology; and thinking of new ways to get access to the data. Right now we have the IP backbone to support this early stage, but with these increases—and what we have talked about here is just a sliver of supply chain—it is bound to require a readdressing of the wireless infrastructure. Who knows, Cisco could be a hot stock again!
This article is from Parallax View, ChainLink Research's on-line magazine, read by over 150,000 supply chain and IT professionals each month. Thought-provoking and actionable articles from ChainLink's analysts, top industry executives, researchers, and fellow practitioners. To view the entire magazine, click here.
About the Author
For more than two decades, Ann Grackin, Chief Executive Officer, has been on the frontlines of the Supply Chain Management technology and e-commerce frontier, leading global strategy and technology implementations in the high technology, semiconductor, automotive, textile, and apparel industries.
SOURCE:
http://www.technologyevaluation.com/research/articles/the-data-explosion-17567/
Ok, I admit it. I bought the cell phone that takes pictures. I didn't know if it was useful; but being a technophile, I went for it. And rapidly it all came to me! I tried on a new cool jacket ... I crooned over it ... but for that much money, I wasn't sure. Should I really buy this? Enter the pic in my cell phone! We chicks have our honor guard. You know those close friends who will tell you the truth—eyes roll- what did you do to your hair- friend. So I took my picture and sent it. Hey take a look at me in this—what do you think? Real time feedback! And that got me to thinking about my business. Do you like this location, equipment, etc.? Attach you message, the pictures, pricing, etc. ... we are on our way.
The network is alive with the sound of convergence ... not a new song, but it got us thinking about the explosion of traffic on these various platforms across GPS and the Internet.
These patterns we are quite familiar with—but wireless seems to be spinning out around the world.
A modest estimate of traffic in voice, video, and data—wired or wireless—will increase ten times over the next five years. And why? Both business and personal use of these platforms is exploding, driven by cell phones and other personal devices, business use of GPS, the Internet, and of course RFID. RFID transactions will grow in number and dimension.
* Number of transactions
* Depth of detail—items on up
* Type of transactions
* Size of transactions
It's hard to separate these out; they kind of go together. But we'll explore a few thoughts around this data explosion.
Global trade is increasing the number of shipments by 7 to 8 percent each year. Embedded within this process is also the need to trace, track, and secure these shipments. Hybrid devices are already in use and their deployment is growing. Containers in Hong Kong, Oakland bound, are bonded with active RFID and GPS devices that secure and track the shipment all the way to the customer. Smart Secure Trade Lanes has over one hundred global participants with all the major ports participating. This initiative is enabled by Savi's global RFID-enabled network, which can read both passive and active data and is already deployed around the world.
From item to containers for a lifetime, the first waves of RFID are delivering with shipment level data, mostly cartons, containers, and pallets. But retailers already put devices on most high-end goods. Today, of course, these devices have a short life—from unpacking and stocking the shelf to the cash register and no real recoding transaction is done. But once RFID tags become part of the floor-ready merchandize process, or more brand firms embed them in their products, the number of collection points goes up exponentially. Firms like GenuOne already have a leadership position in the brand protection (Genuine-get it?) and these unobtrusive little devices ship at an item level, from the manufacturer. Their serial number and lot is collected, tracked, and validated upon receiving by the merchant. The point is, naysayers who think item level is far off are, well, uninformed.
Size and More Transactions!
The DoD is moving toward standardizing product serial numbers and ultimately expects these on not only the items, but also the tags. And this is only the beginning. Many products have lifetime histories to trace (pedigrees already in practice in many industries like aerospace and defense, medical devices, and pharmaceuticals). It is debatable where all the histories will be stored—on the network or on the device—, but the ability for device level services (code or functions) to communicate with the application is clear, sending data back and forth to validate, instruct the operator, etc. All those little applets zinging data back and forth between items, devices, and the mother ship! Tags can and will carry significantly more data—and will have significantly more power to do more stuff.
SmallerSmarterFaster devices that can do hybrid work—like Intermec's barcode and RFID enabled devices—are already in use in firms like Bayer, and applications that sit on these devices are vertical specific, driving intelligence in the hand. These devices are converged already—RFID enabled—and support personal wireless, aka Bluetooth, as well as LAN and WAN, the people, the devices, the IT systems across the enterprise, and the Internet. Think small and really smart devices running complex queries and data management—not just dumb readers!
Where Are We?
Exodus. We are striking out for the core inventions and concepts into a creative land where everyone is in the act. With all these opportunities, we will get more tags and applications to use these tags. More demand will drive the creation of new processes and technologies to scale the manufacturing processes. Matrics just announced their new parallel integrated chip assembly (PICA), a methodology which significantly increases chip assembly production, about ten fold. Think of one machine producing in the range of (depending on the product being produced) 20,000 to 100,000 chips per hour versus the old method of maximum 1,000 to 8,000 chips per hour.
Of course, this is the beginning of chip technologies, which will radically change. With manufacturing processes driving up capacity, as well as producing a more powerful chip, prices will come down. Nanotechnologies get introduced about three to four years from now, which will be truly powerful and cheaper! Moore's Law still applies here with the price/performance ratios careening ever higher!
So, where are we? On CNN, ABC, and MSNBC. If you think of previous technology shifts, Prime Time came way later. ERP, as a term, was mentioned for the first time on Prime Time about ten years ago. Here, the impact transcends most walks of life! So across many markets—consumer, manufacturing, defense, etc.—there are new adopters of the technology; and thinking of new ways to get access to the data. Right now we have the IP backbone to support this early stage, but with these increases—and what we have talked about here is just a sliver of supply chain—it is bound to require a readdressing of the wireless infrastructure. Who knows, Cisco could be a hot stock again!
This article is from Parallax View, ChainLink Research's on-line magazine, read by over 150,000 supply chain and IT professionals each month. Thought-provoking and actionable articles from ChainLink's analysts, top industry executives, researchers, and fellow practitioners. To view the entire magazine, click here.
About the Author
For more than two decades, Ann Grackin, Chief Executive Officer, has been on the frontlines of the Supply Chain Management technology and e-commerce frontier, leading global strategy and technology implementations in the high technology, semiconductor, automotive, textile, and apparel industries.
SOURCE:
http://www.technologyevaluation.com/research/articles/the-data-explosion-17567/
6 Immediate Business Improvements Offered by an Online SRM System: Part 2: Online SRM
Referencing the activities from the inverted triangle' in Part One (Duane link to Part One), the following is an explanation of how online SRM helps to reduce the time spent on transactional details and put more emphasis on strategic activities.
1. Faster and more accurate document transmittal
A result of: Transaction Automation
An inherent problem with traditional procurement processes is that they are manual. To conduct business with suppliers, buyers must print documents such as forecast reports, RFQs, notes, messages, quote responses and POs, and then transmit them using fax or post. Both time consuming and expensive, activities such as these very quickly eat away at the profitability of the procurement department.
Online SRM provides a way to automate these processes. Documents are now accessible by buyers and suppliers in electronic format, and they can be quickly and efficiently transmitted via the Internet. All documents are located outside of both users' firewalls, so there are no security concerns. And transactions that take place through the online SRM system can be easily integrated with back end enterprise systems, ensuring consistency and accuracy throughout the organization.
2. More efficient and reliable buyer-supplier communication
A result of: Online Collaboration
Seldom is a procurement document sent and then immediately closed. More often than not, collaboration must take place between buyers and suppliers to ensure that both parties agree on the terms and expectations relating to the document. A supplier, for instance, may need to adjust quantities, price levels or delivery dates on a purchase order. When this collaboration takes place using paper or phone-based means, important details are often lost.
Using an online SRM system, these details are easily maintained. All transactions and communications take place within the Internet-based system, and historical information is stored in a central location that is easily accessible by both buyers and suppliers. Users are able to verify details regarding each transaction by performing a simple electronic query an action that takes seconds not hours, which is often the case with a search involving an overstuffed filing cabinet.
This is Part Two of a three-part article.
Part One presented the supplier relationship activities.
Part Three discusses other points to consider when choosing an online SRM system.
Less time spent checking details
3. Less time spent checking details
A result of: SCEM (Supply Chain Event Management)
Because information is not available electronically, manual monitoring of exceptions can be cumbersome, requiring users to constantly create lists of transactions and related conditions and scan them on a regular basis for inconsistencies. Errors are introduced when lists are incomplete or out of date and when participants simply forget to check for overdue or out of parameter situations.
An online SRM system is able to sort through the data and provide the buyer only with information that they must review at once. Users have the option to program alerts and reminders for events that are important to them, such as overdue responses to quotes or an impending missed ship date; these alerts may show up within the system, on an e-mail application, or on a wireless device such as a mobile phone or PDA. In addition, the system provides continuous real time document status updates (read, responded, WIP, etc) and easily viewable highlights of sections that have been changed within a document.
4. Better contract terms and supplier performance
A result of: Reporting and Analysis Tools
The reporting and analysis-related benefits of an online SRM system are two-fold. The first is the reallocation of time: buyers who traditionally used non-electronic means to transmit documents, collaborate with suppliers and monitor exceptions are now able to perform these tasks in half the time, giving them the opportunity to focus their efforts on more strategic, analytical activities.
The second are the actual reporting and analysis functions provided within the system. Using the data gathered from the transactions that have taken place within the system, buyers are able to quickly and easily generate reports. These reports provide valuable supply data, including purchasing patterns (which, how many and from whom items are being purchased), and the measurement of supplier performance (including contract compliance, delivery schedules and pricing).
Some online SRM systems also have the ability to analyze the data and make recommendations based on results found. Using these recommendations, buyers are able to strategize how to negotiate optimal contract terms or place orders that keep inventory levels at optimal levels.
Optimal contract terms and inventory management
5. Optimal contract terms and inventory management
A result of: Multiple site collaboration
For companies that operate multiple plants or locations, particularly those that have grown through mergers and acquisitions, consolidating the data from disparate systems and making sense of it is a difficult, if not impossible, task. As a result, each plant tends to manage its own inventory and place orders with its own suppliers.
Having the ability to consolidate purchasing and manage inventory centrally provides tremendous leveraging power, and some online SRM systems provide the tools necessary to do this. Acting as a central translating' device, the online SRM system maps the procurement data from each location and consolidates it into one language that can be easily analyzed. From here, central commodity managers are able to view purchasing activities across plants, share inventory to maintain optimal levels, and perform centralized quote gathering and consolidated sourcing enabling better leverage and, in turn, better contract terms.
6. Suppliers take on the cost of managing the inventory
A result of: VMI (Vendor Managed Inventory)
Vendor Managed Inventory, or VMI, has become an effective method to vastly improve supply chain performance. Using VMI, the supplier has access to some subset of the buyer's inventory, planning, and order history data and is responsible for replenishing the buyer's inventory, based on mutually agreed upon criteria and replenishment rules.
Some online SRM systems offer this capability a tremendous benefit because, in most cases, integrating VMI into an ERP application is time consuming and cost prohibitive. Using VMI through an online SRM solution, however, is relatively straightforward; it is simply a matter of exchanging VMI data through the already existing import/export function of the enterprise system. Using VMI through a hosted Online SRM system, users can perform functions such as forecast aggregates, blanket POs, release orders and advanced shipping notices through a browser, outside of the corporate firewall. Working through a Web browser alleviates security concerns, because suppliers are not required to enter the network to access VMI information.
This concludes Part Two of a three-part article.
Part One presented supplier relationship management.
Part Three discusses other points to consider when choosing an online SRM system.
About the Author
Sunil Pande, with over 20 years of experience in the high tech industry, is a co-founder and President of Entomo, Inc. He has conceived, developed and brought to market integrated Supply Chain/ERP products for "to-order" manufacturing, an Offline Transaction Processing (OFTP) product, network management, and videoconferencing products. Mr. Pande holds a MS in Computer Science from the University of Oregon and a BS/MS in Computer Engineering from BITS, Pilani, India.
About Entomo, Inc.
Entomo, Inc. offers Online SRM and strategic sourcing applications that electronically link manufacturers with their direct materials supply chain. Its Web-based application, Entomo SmartHub/SRM, delivers transaction automation, online collaboration, exception management, supplier performance measurement, and supply chain analytics. Advanced capabilities support aggregation of inventory and purchasing data from multiple sites delivering cross-plant visibility, consolidated sourcing, centralized commodity management, and inventory sharing. For additional information, please visit www.entomo.com or call 1.877.936.8666
SOURCE:
http://www.technologyevaluation.com/research/articles/6-immediate-business-improvements-offered-by-an-online-srm-system-part-2-online-srm-16783/
1. Faster and more accurate document transmittal
A result of: Transaction Automation
An inherent problem with traditional procurement processes is that they are manual. To conduct business with suppliers, buyers must print documents such as forecast reports, RFQs, notes, messages, quote responses and POs, and then transmit them using fax or post. Both time consuming and expensive, activities such as these very quickly eat away at the profitability of the procurement department.
Online SRM provides a way to automate these processes. Documents are now accessible by buyers and suppliers in electronic format, and they can be quickly and efficiently transmitted via the Internet. All documents are located outside of both users' firewalls, so there are no security concerns. And transactions that take place through the online SRM system can be easily integrated with back end enterprise systems, ensuring consistency and accuracy throughout the organization.
2. More efficient and reliable buyer-supplier communication
A result of: Online Collaboration
Seldom is a procurement document sent and then immediately closed. More often than not, collaboration must take place between buyers and suppliers to ensure that both parties agree on the terms and expectations relating to the document. A supplier, for instance, may need to adjust quantities, price levels or delivery dates on a purchase order. When this collaboration takes place using paper or phone-based means, important details are often lost.
Using an online SRM system, these details are easily maintained. All transactions and communications take place within the Internet-based system, and historical information is stored in a central location that is easily accessible by both buyers and suppliers. Users are able to verify details regarding each transaction by performing a simple electronic query an action that takes seconds not hours, which is often the case with a search involving an overstuffed filing cabinet.
This is Part Two of a three-part article.
Part One presented the supplier relationship activities.
Part Three discusses other points to consider when choosing an online SRM system.
Less time spent checking details
3. Less time spent checking details
A result of: SCEM (Supply Chain Event Management)
Because information is not available electronically, manual monitoring of exceptions can be cumbersome, requiring users to constantly create lists of transactions and related conditions and scan them on a regular basis for inconsistencies. Errors are introduced when lists are incomplete or out of date and when participants simply forget to check for overdue or out of parameter situations.
An online SRM system is able to sort through the data and provide the buyer only with information that they must review at once. Users have the option to program alerts and reminders for events that are important to them, such as overdue responses to quotes or an impending missed ship date; these alerts may show up within the system, on an e-mail application, or on a wireless device such as a mobile phone or PDA. In addition, the system provides continuous real time document status updates (read, responded, WIP, etc) and easily viewable highlights of sections that have been changed within a document.
4. Better contract terms and supplier performance
A result of: Reporting and Analysis Tools
The reporting and analysis-related benefits of an online SRM system are two-fold. The first is the reallocation of time: buyers who traditionally used non-electronic means to transmit documents, collaborate with suppliers and monitor exceptions are now able to perform these tasks in half the time, giving them the opportunity to focus their efforts on more strategic, analytical activities.
The second are the actual reporting and analysis functions provided within the system. Using the data gathered from the transactions that have taken place within the system, buyers are able to quickly and easily generate reports. These reports provide valuable supply data, including purchasing patterns (which, how many and from whom items are being purchased), and the measurement of supplier performance (including contract compliance, delivery schedules and pricing).
Some online SRM systems also have the ability to analyze the data and make recommendations based on results found. Using these recommendations, buyers are able to strategize how to negotiate optimal contract terms or place orders that keep inventory levels at optimal levels.
Optimal contract terms and inventory management
5. Optimal contract terms and inventory management
A result of: Multiple site collaboration
For companies that operate multiple plants or locations, particularly those that have grown through mergers and acquisitions, consolidating the data from disparate systems and making sense of it is a difficult, if not impossible, task. As a result, each plant tends to manage its own inventory and place orders with its own suppliers.
Having the ability to consolidate purchasing and manage inventory centrally provides tremendous leveraging power, and some online SRM systems provide the tools necessary to do this. Acting as a central translating' device, the online SRM system maps the procurement data from each location and consolidates it into one language that can be easily analyzed. From here, central commodity managers are able to view purchasing activities across plants, share inventory to maintain optimal levels, and perform centralized quote gathering and consolidated sourcing enabling better leverage and, in turn, better contract terms.
6. Suppliers take on the cost of managing the inventory
A result of: VMI (Vendor Managed Inventory)
Vendor Managed Inventory, or VMI, has become an effective method to vastly improve supply chain performance. Using VMI, the supplier has access to some subset of the buyer's inventory, planning, and order history data and is responsible for replenishing the buyer's inventory, based on mutually agreed upon criteria and replenishment rules.
Some online SRM systems offer this capability a tremendous benefit because, in most cases, integrating VMI into an ERP application is time consuming and cost prohibitive. Using VMI through an online SRM solution, however, is relatively straightforward; it is simply a matter of exchanging VMI data through the already existing import/export function of the enterprise system. Using VMI through a hosted Online SRM system, users can perform functions such as forecast aggregates, blanket POs, release orders and advanced shipping notices through a browser, outside of the corporate firewall. Working through a Web browser alleviates security concerns, because suppliers are not required to enter the network to access VMI information.
This concludes Part Two of a three-part article.
Part One presented supplier relationship management.
Part Three discusses other points to consider when choosing an online SRM system.
About the Author
Sunil Pande, with over 20 years of experience in the high tech industry, is a co-founder and President of Entomo, Inc. He has conceived, developed and brought to market integrated Supply Chain/ERP products for "to-order" manufacturing, an Offline Transaction Processing (OFTP) product, network management, and videoconferencing products. Mr. Pande holds a MS in Computer Science from the University of Oregon and a BS/MS in Computer Engineering from BITS, Pilani, India.
About Entomo, Inc.
Entomo, Inc. offers Online SRM and strategic sourcing applications that electronically link manufacturers with their direct materials supply chain. Its Web-based application, Entomo SmartHub/SRM, delivers transaction automation, online collaboration, exception management, supplier performance measurement, and supply chain analytics. Advanced capabilities support aggregation of inventory and purchasing data from multiple sites delivering cross-plant visibility, consolidated sourcing, centralized commodity management, and inventory sharing. For additional information, please visit www.entomo.com or call 1.877.936.8666
SOURCE:
http://www.technologyevaluation.com/research/articles/6-immediate-business-improvements-offered-by-an-online-srm-system-part-2-online-srm-16783/
Teloquent To e.t.: Now You Can Call Or Use The Web
Teloquent Communications Corporation has its roots in telephony, as an enabler of call centers. Their Web ContactServer 2.1 integrates traditional telephone routing with Web-based customer service tools to provide a consistent experience for both customers and agents. Customers browsing a website are given multiple options for seeking assistance, including requesting immediate callback, real-time chat and page push.
Market Impact
Unlike the Web, working in the telephony space is difficult, and by integrating the two Teloquent believes it offers real value. While there are other companies, from Lucent on down, that also combine the Web with telephony, Teloquent claims that its scalability provides it with a unique niche. They suggest that systems like Nortel's and Lucent's do not scale down well, while other smaller competitors have not yet acquired the knack of scaling up to support help centers with as many as 1800 agents.
Together with some of its other products Teloquent can enable a company to build a very functional combined media call center, and should have no trouble establishing a strong niche within the overall CRM market.
User Recommendations
The users most interested in Teloquent's solution will be those bricks-and-mortar or direct merchants who already have existing call centers, and existing call center management companies that want to break into e-commerce. A dot-com that believes phone service is necessary to its success should also be interested, but may be better off outsourcing its call center operations to a vendor that uses Teloquent's system or one like it.
SOURCE:
http://www.technologyevaluation.com/research/articles/teloquent-to-e-t-now-you-can-call-or-use-the-web-15684/
Market Impact
Unlike the Web, working in the telephony space is difficult, and by integrating the two Teloquent believes it offers real value. While there are other companies, from Lucent on down, that also combine the Web with telephony, Teloquent claims that its scalability provides it with a unique niche. They suggest that systems like Nortel's and Lucent's do not scale down well, while other smaller competitors have not yet acquired the knack of scaling up to support help centers with as many as 1800 agents.
Together with some of its other products Teloquent can enable a company to build a very functional combined media call center, and should have no trouble establishing a strong niche within the overall CRM market.
User Recommendations
The users most interested in Teloquent's solution will be those bricks-and-mortar or direct merchants who already have existing call centers, and existing call center management companies that want to break into e-commerce. A dot-com that believes phone service is necessary to its success should also be interested, but may be better off outsourcing its call center operations to a vendor that uses Teloquent's system or one like it.
SOURCE:
http://www.technologyevaluation.com/research/articles/teloquent-to-e-t-now-you-can-call-or-use-the-web-15684/
Microsoft New Online Messenger ~ Dope Slaps AOL’s Instant Messenger
REDMOND, Wash. (Reuters) - Microsoft Corp. on Thursday, July 20 debuted a new version of its online messenger software beefed up with free long-distance Internet phone service that turns up the heat on messaging arch-rival America Online Inc.
Market Impact
In the inevitable leapfrog race of instant messaging, Microsoft has thrown down a straight flush with the debut of MSN Instant Messenger 3.0, incorporating free Net2Phone. We are certain that interoperability with any version of AOL's Instant Messenger client is about as likely as the immediate emergence of flying cars. So why would users switch from AOL's Instant Messaging client to Microsoft's? Quite simple really, throw in free long distance phone service, offer a comparable and competitive set of base features, and then to make sure you succeed, give it away for free. And just to add injury to insult Microsoft wirelessly enabled the release to embrace the interaction of WAP enabled devices with its user base.
The only real question here is, how far behind is AOL? Given the combined resources of AOL and Time Warner we would imagine not long. In fact the probability of a beta release containing a competitive version with free voice communication by the end of the 3rd quarter is approximately 85%. Given that AOL has an Instant Messenger user population of greater than 20 Million, no one expects a max exodus, and neither does Microsoft. Both clients can be run on an Internet connected multi-media PC simultaneously, negating the need to choose one client over the other.
Microsoft is expecting, and rightfully so, to attract millions of users to their Online Messenger client. Both companies generate tremendous revenue from Internet advertising displayed within the client, in addition to commercial product sales.
User Recommendations
Stated very simply, go get it, download it, and use it to save yourself money. Whether you are a small business or a home based computer user or flat out computing enthusiast, get it! The technology found in Microsoft's Online Messenger 3.0 is good, functional and proven (not to mention 'way cool').
As previously mentioned, the application does not force you to give up your AOL Instant Messenger, allowing both clients to be run simultaneously. AOL will offer the comparable technological advancements in Instant Messenger, its not there now, so why wait?
SOURCE:
http://www.technologyevaluation.com/research/articles/microsoft-new-online-messenger-dope-slaps-aol-s-instant-messenger-15969/
Market Impact
In the inevitable leapfrog race of instant messaging, Microsoft has thrown down a straight flush with the debut of MSN Instant Messenger 3.0, incorporating free Net2Phone. We are certain that interoperability with any version of AOL's Instant Messenger client is about as likely as the immediate emergence of flying cars. So why would users switch from AOL's Instant Messaging client to Microsoft's? Quite simple really, throw in free long distance phone service, offer a comparable and competitive set of base features, and then to make sure you succeed, give it away for free. And just to add injury to insult Microsoft wirelessly enabled the release to embrace the interaction of WAP enabled devices with its user base.
The only real question here is, how far behind is AOL? Given the combined resources of AOL and Time Warner we would imagine not long. In fact the probability of a beta release containing a competitive version with free voice communication by the end of the 3rd quarter is approximately 85%. Given that AOL has an Instant Messenger user population of greater than 20 Million, no one expects a max exodus, and neither does Microsoft. Both clients can be run on an Internet connected multi-media PC simultaneously, negating the need to choose one client over the other.
Microsoft is expecting, and rightfully so, to attract millions of users to their Online Messenger client. Both companies generate tremendous revenue from Internet advertising displayed within the client, in addition to commercial product sales.
User Recommendations
Stated very simply, go get it, download it, and use it to save yourself money. Whether you are a small business or a home based computer user or flat out computing enthusiast, get it! The technology found in Microsoft's Online Messenger 3.0 is good, functional and proven (not to mention 'way cool').
As previously mentioned, the application does not force you to give up your AOL Instant Messenger, allowing both clients to be run simultaneously. AOL will offer the comparable technological advancements in Instant Messenger, its not there now, so why wait?
SOURCE:
http://www.technologyevaluation.com/research/articles/microsoft-new-online-messenger-dope-slaps-aol-s-instant-messenger-15969/
The Web-Enabled Sales Process
Today, nearly every business to business (B2B) information technology company I talk to is mad that its attempts to increase new account sales have failed. This has grown into a huge problem—to the point where a significant number of companies have decided that they are not going to take it any more, and have totally abandoned new account growth strategies. However, by leveraging new technology, understanding the buy cycle value chain and enabling today's self-directed buyer, sales organizations can significantly increase revenue and reduce costs.
Since the tech bust that followed Y2K, technology companies have become more and more frustrated by their attempts to win new business. Sales departments across the industry have tried all the traditional sales strategies: improving the quality of the sales force by replacing non-performers with proven professionals; improving staff knowledge by conducting sales training programs; and reorganizing into specialized industry verticals. They have expanded market coverage through reseller programs; created dedicated telemarketing teams to generate more leads; and implemented customer relationship management (CRM) systems to improve relationships with prospects and customers. Yet with each initiative, the cost of sales has escalated, and with each quarter end new account revenue results have been more and more disappointing.
Consequently, sales management teams have been under intense pressure to keep their attention focused on the final act of closing the deal. The problem is that the sales department has spent too much time repairing the symptoms of the sales problem and has avoided dealing with its root cause: regaining the ability to influence the purchasing decision process. To effectively influence the purchasing process, sales must find new ways to identify buyers earlier; to collect buyer information; to gain buyer access; and to provide added value. Yet, this task is particularly daunting for business to business (B2B) enterprise system providers where decision processes span months. Sales tactics that worked well in the past to identify, access, and influence decision makers are no longer effective.
Early Access via the On-line Channel
In the past, salespeople controlled the sales cycle by managing the flow of information. Today the information available on the Internet has empowered buyers to structure their own buying cycle. This shift is comparable to the days when the automobile engine replaced the horse as our primary source of transportation power. The horse couldn't compete with the speed, convenience and low cost of the automobile. The same can be said for the Internet, which has given buyers shopping tools and conveniences that didn't exist a few years ago. The time has come to completely reengineer the go-to-market strategy to make it compatible with the buyer's preferred mode of communication. Buyers will always be attracted to the least risky, most convenient, and lowest cost information outlet. The Internet fits these criteria and has become the primary channel that buyers use to complete many of their early stage buying tasks, and it continues to be an important channel of influence throughout the entire process. As a result, yesterday's successful consultative salesperson is being excluded from much of today's buying process.
I'm not suggesting that the Internet will make the salesperson obsolete. Personal selling will always play a vital role in managing the overall enterprise relationship whether it is conducted via the mail, on the phone, in person or across the Internet. What I am suggesting is that sales department personnel should think twice before they dial the phone or pack their bags to visit a client, and instead should consider clicking a mouse to deliver more effective support to prospects evaluating solutions on-line.
The prominence of the Internet has grown exponentially in a few short years. According to the PEW Internet & American Life Project, between 1999 and 2000 the Web became the "new normal" way of life. Back then few of us realized how easy it would be to shop on-line. Now we can simply log-on, search a few ideas, review product features, compare prices, select a vendor, and have a product arrive at our door the next day. As we enter 2006 over 70 percent of us enjoy a rich media experience from our home, which is driving an on-line shopping growth rate of over 30 percent a year. Life in the on-demand world, as characterized by the iPod, allows us to tune-in to our interests and tune-out everything else. We have all learned to screen phone calls, to skip commercials, and to block spam so we can tune-in to exactly what we want, when we want it.
Each morning when we arrive at work we bring these newly acquired habits and expectations with us. Is buying big, complex enterprise level systems really that different from personal shopping? It can be compared to the process of buying a major capital item, such as a house or a car. There is an old auto industry adage that the busiest day of the week on a car dealer's lot was Sunday, the day the dealership was closed. Has the Internet become the modern equivalent of visiting the dealer's lot on Sunday? According to a ZDNet Research statistic "in 2003, 94% of US consumers shopping for a car went on-line to do research, get quotes from dealers and to order brochures. This compared to 67% who actually visited a dealership when making a decision on which car to buy." While eventually the buyer will go to the car lot to test drive and buy the car, the preliminary research to create a shortlist is being done on-line.
Buyers Avoid Sales Contact
It's human nature to avoid unsolicited sales contact. People are very uncomfortable with the emotional aspect of the buyer-salesperson relationship. It is not high-pressure sales tactics that are the source of this anxiety. The problem is that a person's sense of obligation grows as a personal relationship develops, and so to does the pending dread that all but one of these relationships will have to be broken. As the song goes, "breaking-up is hard to do", and we know that salespeople don't accept no easily. In the past, buyers sacrificed service and drove to the dealer's lot on Sunday to avoid these awkward situations. Today, buyers are avoiding the fear of relationships by simply going on-line, and are getting access to better information than what salespeople ever provided. In nearly a third of car buying situations the buyer's decision is already made before he or she arrives at the dealership. The same applies for decision-makers who are seeking enterprise level solutions. As a result, many salespeople will never get the opportunity to position their solution, and a lucky few will not get their opportunity until much later in the buying process.
So who's qualifying who these days? When salespeople get a lead, they instinctively make the qualifying phone call to determine the prospect's pain, power, vision, value, and control. Qualification is the first step in the old sales cycle because a time consuming and expensive discovery or needs assessment engagement is assumed to be next. However, today's buyers don't want a vendor's assistance at this early stage. With the help of on-line information sources, buyers would rather research and complete their own unbiased needs assessment study. The irony with the old qualifying call is that by the time a salesperson qualifies an opportunity, he or she will be too late to have a significant influence on the purchasing process. According to a 2004 lead qualification study by KnowledgeStorm, traditional qualification parameters are missing a significant market opportunity. The study estimated that 40 percent of early stage buyers were disqualified by sales because they hadn't determined the answers to the qualifying questions yet, and the study estimated that another 40 percent refused to answer these questions just to avoid sales contact. As a result, salespeople are missing the opportunity to influence 80 percent of today's buyers during the most impressionable stage of a project. Would salespeople dare consider the possibility that they can do more selling without being there? The eureka moment struck me, when I realized that the more a buyer can do without personal sales assistance the better.
The Buy Cycle Value Chain
Many marketing and sales departments think in terms of the "end game" of the value proposition of their solution. All too often they forget that the winner is always the team that scores the most points at each play of the game. A selling approach designed around the buyer's information consumption process keeps salespeople focused on earning value points throughout the buy cycle. For example, a buyer's end game problem may be solved by your supply chain optimization product, but right now, the buyer just needs to schedule a realistic project plan. If your competition has a better plan to offer than you do, then it just scored an influence point. As the saying goes, "it takes a lot more than a better mouse trap to win a deal". In other words, salespeople need to follow the buy cycle and fulfill the buyer's needs at each consumption point along the way.
The decision process for an enterprise level system is defined by the corporate project life cycle within which the purchase falls. As with any business initiative, these projects can germinate from a variety of sources, but once sponsored as an official project it follows a relatively predictable decision process. To stay focused on the customer's buy cycle we use the PURCHASE acronym to designate eight separate purchase decision-making stages. The following is a brief description of each stage along with a few appropriate value offers that sales can provide:
1. Problem. In a pre-contemplation mode individuals search the Web to gain an awareness of the latest problem solving innovations, industry issues and business trends. These education seekers are willing to register an e-mail address to gain access to interesting on-line information. Marketing departments are currently doing a good job of providing business issue white papers, customer case studies, and product brochures. However, sales qualification resources are being wasted on the inquiry registrations that are generated from this segment. Automated follow-up offers should be sent to these inquiries to determine their interest level with an option to subscribe to a newsletter or register for preferred access to additional information.
2. Understanding. In this contemplation mode, a group of individuals unite within an organization to understand a specific problem in an effort to propose a possible solution strategy. They continue to search and gather the information necessary to build the business case required to establish an official corporate initiative with executive sponsorship. The sales strategy for this stage is similar to the problem stage with an additional element. Data mining will analyze buyer web site activity by organization to identify suspect accounts with increased activity levels for sales to research and possibly target offline as a high probability suspect.
3. Research. In a preparation mode a project team works to formalize a project structure to deliver a solution to the organization. The group's psychology immediately transitions to that of a more pragmatic early adopter mindset. The focus shifts from understanding the problem to creating the vision and charting a path to a solution. Since this is new ground for the organization, the team searches the Internet for project enablers such as evaluation roadmaps, third party reviews, budget calculators, needs assessment templates, and project plans. While today's self-directed buyer may be keeping the salesperson physically out of the process, they are happy to use their project-enabling resource downloads. Smart sales organizations are transferring their value propositions into the working documents of project teams in the form of needs assessment spread sheets, return on investment (ROI) calculators, and other project templates. High quality project enabling materials can provide a valid business opportunity to engage earlier than the competition to begin building a trusted personal relationship.
4. Comparison. The project team transitions into the evaluation phase with a clear vision, and a shortlist of qualified vendor organizations. Salespeople are engaged to visit for the first time to continue selling where their on-line sales collateral ended. At this point the buying team knows exactly what they want to see to complete their final evaluation. The concept of a "non-disclosure level" evaluation portal should be introduced by the salesperson at this stage. Salespeople should empower the project team with access to a standard array of high quality e-collateral portal content (presentation, demonstration, and testimonials) designed to address the standard evaluation issues so they can focus on solving the prospect's higher value business problems. By creating a collaborative environment with an empowered project team, project members can become an inside sales force motivated to get the organization's buy-in for their project. By monitoring portal activity, sales can evaluate its competitive position based on each contact's individual activity level.
5. Homework. Preparation for authorization is a very active internal stage when key project team members work to justify a recommended action plan and preferred solution. They prepare the detailed capital authorization documents, and begin planning the implementation. Often the salesperson is told he or she is one of two finalists, just to keep them honest through negotiation. But truth be known, there is a third alternative, a "no-decision." A delay or no-decision is the typical outcome when the project team submits a weak business case to management. By offering expert help with the use of the project enablers transferred in the Research stage, the sales team can earn the opportunity to collaborate on the internal business case.
6. Authorization. This is an internal sales activity where the project team has to sell its business case to a very conservative, risk-adverse executive group that is emotionally disconnected from the project. Given the amount of senior management scrutiny, project team members are highly motivated to win approval for their project. While this phase may drag on longer that expected, sales organizations have three primary objectives; to monitor their competitive position, to maintain team member enthusiasm, and to defend against competitive attacks. By linking the business case to portal based e-collateral, sales can monitor approval activity levels. By offering pre-implementation e-learning materials an enthusiastic project team can get a head start on the next phase of the project which will also distract members from having the time to listen to competitive attaches.
7. Signing. This stage begins as the buyer prepares to negotiate the deal and continues until the first payment is received. Pre-negotiation posturing has been going on for a while as buyers focus on mitigating risk issues and threaten sellers with the other viable alternative. Buyer information is invaluable at this stage. The project team members are instructed to be very vague as the buying negotiator "holds his cards very close to his chest". By maintaining engaging installation and pre-implementation content in the evaluation portal, sales can monitor buyer usage activity to determine their level of commitment. Nice words from the buyer that is not accompanied with corresponding activity is an early indication of a serious sales problem, while tough talk and a high activity level are indicators of a strong position.
8. Expansion. Once the solution is successfully implemented the organization looks to leverage the solution's success across other areas of the business. At this point the new customer is transferred to a customer support portal which would include an evaluation capability for additional products and services.
Understanding the different stages of the buy cycle and finding the appropriate value offers is only half the job. The next challenge is getting access to the right people and collecting the right information to deliver the best value. Let's think about this for a minute. The people you want to access are those visiting your web site. They are right there registering for exactly what they want. The golden opportunity lies with the visitor on your web site: you have the access, they have the need, and they are willing to provide information, if you can deliver immediate value.
Tomorrow: A more detailed review of the early stages of a web-enabled sales process; new qualification metrics, give-to-get communication, and how to capitalize on each golden opportunity to influence the buying process.
2006 The Holt Group
About the Author
Emmett Holt founded The Holt Group as an interactive sales consulting collaborative based in Boston. The Holt Group advises enterprise technology clients on how to integrate an on-line and off-line sales strategy to improve business results by delivering superior customer focused experience at every point of contact. He has over twenty-five years of experience in the enterprise software industry as an executive responsible for both the sales and marketing performance. He can be reached at Emmett.Holt@HoltGrp.net
SOURCE:
http://www.technologyevaluation.com/research/articles/the-web-enabled-sales-process-18476/
Since the tech bust that followed Y2K, technology companies have become more and more frustrated by their attempts to win new business. Sales departments across the industry have tried all the traditional sales strategies: improving the quality of the sales force by replacing non-performers with proven professionals; improving staff knowledge by conducting sales training programs; and reorganizing into specialized industry verticals. They have expanded market coverage through reseller programs; created dedicated telemarketing teams to generate more leads; and implemented customer relationship management (CRM) systems to improve relationships with prospects and customers. Yet with each initiative, the cost of sales has escalated, and with each quarter end new account revenue results have been more and more disappointing.
Consequently, sales management teams have been under intense pressure to keep their attention focused on the final act of closing the deal. The problem is that the sales department has spent too much time repairing the symptoms of the sales problem and has avoided dealing with its root cause: regaining the ability to influence the purchasing decision process. To effectively influence the purchasing process, sales must find new ways to identify buyers earlier; to collect buyer information; to gain buyer access; and to provide added value. Yet, this task is particularly daunting for business to business (B2B) enterprise system providers where decision processes span months. Sales tactics that worked well in the past to identify, access, and influence decision makers are no longer effective.
Early Access via the On-line Channel
In the past, salespeople controlled the sales cycle by managing the flow of information. Today the information available on the Internet has empowered buyers to structure their own buying cycle. This shift is comparable to the days when the automobile engine replaced the horse as our primary source of transportation power. The horse couldn't compete with the speed, convenience and low cost of the automobile. The same can be said for the Internet, which has given buyers shopping tools and conveniences that didn't exist a few years ago. The time has come to completely reengineer the go-to-market strategy to make it compatible with the buyer's preferred mode of communication. Buyers will always be attracted to the least risky, most convenient, and lowest cost information outlet. The Internet fits these criteria and has become the primary channel that buyers use to complete many of their early stage buying tasks, and it continues to be an important channel of influence throughout the entire process. As a result, yesterday's successful consultative salesperson is being excluded from much of today's buying process.
I'm not suggesting that the Internet will make the salesperson obsolete. Personal selling will always play a vital role in managing the overall enterprise relationship whether it is conducted via the mail, on the phone, in person or across the Internet. What I am suggesting is that sales department personnel should think twice before they dial the phone or pack their bags to visit a client, and instead should consider clicking a mouse to deliver more effective support to prospects evaluating solutions on-line.
The prominence of the Internet has grown exponentially in a few short years. According to the PEW Internet & American Life Project, between 1999 and 2000 the Web became the "new normal" way of life. Back then few of us realized how easy it would be to shop on-line. Now we can simply log-on, search a few ideas, review product features, compare prices, select a vendor, and have a product arrive at our door the next day. As we enter 2006 over 70 percent of us enjoy a rich media experience from our home, which is driving an on-line shopping growth rate of over 30 percent a year. Life in the on-demand world, as characterized by the iPod, allows us to tune-in to our interests and tune-out everything else. We have all learned to screen phone calls, to skip commercials, and to block spam so we can tune-in to exactly what we want, when we want it.
Each morning when we arrive at work we bring these newly acquired habits and expectations with us. Is buying big, complex enterprise level systems really that different from personal shopping? It can be compared to the process of buying a major capital item, such as a house or a car. There is an old auto industry adage that the busiest day of the week on a car dealer's lot was Sunday, the day the dealership was closed. Has the Internet become the modern equivalent of visiting the dealer's lot on Sunday? According to a ZDNet Research statistic "in 2003, 94% of US consumers shopping for a car went on-line to do research, get quotes from dealers and to order brochures. This compared to 67% who actually visited a dealership when making a decision on which car to buy." While eventually the buyer will go to the car lot to test drive and buy the car, the preliminary research to create a shortlist is being done on-line.
Buyers Avoid Sales Contact
It's human nature to avoid unsolicited sales contact. People are very uncomfortable with the emotional aspect of the buyer-salesperson relationship. It is not high-pressure sales tactics that are the source of this anxiety. The problem is that a person's sense of obligation grows as a personal relationship develops, and so to does the pending dread that all but one of these relationships will have to be broken. As the song goes, "breaking-up is hard to do", and we know that salespeople don't accept no easily. In the past, buyers sacrificed service and drove to the dealer's lot on Sunday to avoid these awkward situations. Today, buyers are avoiding the fear of relationships by simply going on-line, and are getting access to better information than what salespeople ever provided. In nearly a third of car buying situations the buyer's decision is already made before he or she arrives at the dealership. The same applies for decision-makers who are seeking enterprise level solutions. As a result, many salespeople will never get the opportunity to position their solution, and a lucky few will not get their opportunity until much later in the buying process.
So who's qualifying who these days? When salespeople get a lead, they instinctively make the qualifying phone call to determine the prospect's pain, power, vision, value, and control. Qualification is the first step in the old sales cycle because a time consuming and expensive discovery or needs assessment engagement is assumed to be next. However, today's buyers don't want a vendor's assistance at this early stage. With the help of on-line information sources, buyers would rather research and complete their own unbiased needs assessment study. The irony with the old qualifying call is that by the time a salesperson qualifies an opportunity, he or she will be too late to have a significant influence on the purchasing process. According to a 2004 lead qualification study by KnowledgeStorm, traditional qualification parameters are missing a significant market opportunity. The study estimated that 40 percent of early stage buyers were disqualified by sales because they hadn't determined the answers to the qualifying questions yet, and the study estimated that another 40 percent refused to answer these questions just to avoid sales contact. As a result, salespeople are missing the opportunity to influence 80 percent of today's buyers during the most impressionable stage of a project. Would salespeople dare consider the possibility that they can do more selling without being there? The eureka moment struck me, when I realized that the more a buyer can do without personal sales assistance the better.
The Buy Cycle Value Chain
Many marketing and sales departments think in terms of the "end game" of the value proposition of their solution. All too often they forget that the winner is always the team that scores the most points at each play of the game. A selling approach designed around the buyer's information consumption process keeps salespeople focused on earning value points throughout the buy cycle. For example, a buyer's end game problem may be solved by your supply chain optimization product, but right now, the buyer just needs to schedule a realistic project plan. If your competition has a better plan to offer than you do, then it just scored an influence point. As the saying goes, "it takes a lot more than a better mouse trap to win a deal". In other words, salespeople need to follow the buy cycle and fulfill the buyer's needs at each consumption point along the way.
The decision process for an enterprise level system is defined by the corporate project life cycle within which the purchase falls. As with any business initiative, these projects can germinate from a variety of sources, but once sponsored as an official project it follows a relatively predictable decision process. To stay focused on the customer's buy cycle we use the PURCHASE acronym to designate eight separate purchase decision-making stages. The following is a brief description of each stage along with a few appropriate value offers that sales can provide:
1. Problem. In a pre-contemplation mode individuals search the Web to gain an awareness of the latest problem solving innovations, industry issues and business trends. These education seekers are willing to register an e-mail address to gain access to interesting on-line information. Marketing departments are currently doing a good job of providing business issue white papers, customer case studies, and product brochures. However, sales qualification resources are being wasted on the inquiry registrations that are generated from this segment. Automated follow-up offers should be sent to these inquiries to determine their interest level with an option to subscribe to a newsletter or register for preferred access to additional information.
2. Understanding. In this contemplation mode, a group of individuals unite within an organization to understand a specific problem in an effort to propose a possible solution strategy. They continue to search and gather the information necessary to build the business case required to establish an official corporate initiative with executive sponsorship. The sales strategy for this stage is similar to the problem stage with an additional element. Data mining will analyze buyer web site activity by organization to identify suspect accounts with increased activity levels for sales to research and possibly target offline as a high probability suspect.
3. Research. In a preparation mode a project team works to formalize a project structure to deliver a solution to the organization. The group's psychology immediately transitions to that of a more pragmatic early adopter mindset. The focus shifts from understanding the problem to creating the vision and charting a path to a solution. Since this is new ground for the organization, the team searches the Internet for project enablers such as evaluation roadmaps, third party reviews, budget calculators, needs assessment templates, and project plans. While today's self-directed buyer may be keeping the salesperson physically out of the process, they are happy to use their project-enabling resource downloads. Smart sales organizations are transferring their value propositions into the working documents of project teams in the form of needs assessment spread sheets, return on investment (ROI) calculators, and other project templates. High quality project enabling materials can provide a valid business opportunity to engage earlier than the competition to begin building a trusted personal relationship.
4. Comparison. The project team transitions into the evaluation phase with a clear vision, and a shortlist of qualified vendor organizations. Salespeople are engaged to visit for the first time to continue selling where their on-line sales collateral ended. At this point the buying team knows exactly what they want to see to complete their final evaluation. The concept of a "non-disclosure level" evaluation portal should be introduced by the salesperson at this stage. Salespeople should empower the project team with access to a standard array of high quality e-collateral portal content (presentation, demonstration, and testimonials) designed to address the standard evaluation issues so they can focus on solving the prospect's higher value business problems. By creating a collaborative environment with an empowered project team, project members can become an inside sales force motivated to get the organization's buy-in for their project. By monitoring portal activity, sales can evaluate its competitive position based on each contact's individual activity level.
5. Homework. Preparation for authorization is a very active internal stage when key project team members work to justify a recommended action plan and preferred solution. They prepare the detailed capital authorization documents, and begin planning the implementation. Often the salesperson is told he or she is one of two finalists, just to keep them honest through negotiation. But truth be known, there is a third alternative, a "no-decision." A delay or no-decision is the typical outcome when the project team submits a weak business case to management. By offering expert help with the use of the project enablers transferred in the Research stage, the sales team can earn the opportunity to collaborate on the internal business case.
6. Authorization. This is an internal sales activity where the project team has to sell its business case to a very conservative, risk-adverse executive group that is emotionally disconnected from the project. Given the amount of senior management scrutiny, project team members are highly motivated to win approval for their project. While this phase may drag on longer that expected, sales organizations have three primary objectives; to monitor their competitive position, to maintain team member enthusiasm, and to defend against competitive attacks. By linking the business case to portal based e-collateral, sales can monitor approval activity levels. By offering pre-implementation e-learning materials an enthusiastic project team can get a head start on the next phase of the project which will also distract members from having the time to listen to competitive attaches.
7. Signing. This stage begins as the buyer prepares to negotiate the deal and continues until the first payment is received. Pre-negotiation posturing has been going on for a while as buyers focus on mitigating risk issues and threaten sellers with the other viable alternative. Buyer information is invaluable at this stage. The project team members are instructed to be very vague as the buying negotiator "holds his cards very close to his chest". By maintaining engaging installation and pre-implementation content in the evaluation portal, sales can monitor buyer usage activity to determine their level of commitment. Nice words from the buyer that is not accompanied with corresponding activity is an early indication of a serious sales problem, while tough talk and a high activity level are indicators of a strong position.
8. Expansion. Once the solution is successfully implemented the organization looks to leverage the solution's success across other areas of the business. At this point the new customer is transferred to a customer support portal which would include an evaluation capability for additional products and services.
Understanding the different stages of the buy cycle and finding the appropriate value offers is only half the job. The next challenge is getting access to the right people and collecting the right information to deliver the best value. Let's think about this for a minute. The people you want to access are those visiting your web site. They are right there registering for exactly what they want. The golden opportunity lies with the visitor on your web site: you have the access, they have the need, and they are willing to provide information, if you can deliver immediate value.
Tomorrow: A more detailed review of the early stages of a web-enabled sales process; new qualification metrics, give-to-get communication, and how to capitalize on each golden opportunity to influence the buying process.
2006 The Holt Group
About the Author
Emmett Holt founded The Holt Group as an interactive sales consulting collaborative based in Boston. The Holt Group advises enterprise technology clients on how to integrate an on-line and off-line sales strategy to improve business results by delivering superior customer focused experience at every point of contact. He has over twenty-five years of experience in the enterprise software industry as an executive responsible for both the sales and marketing performance. He can be reached at Emmett.Holt@HoltGrp.net
SOURCE:
http://www.technologyevaluation.com/research/articles/the-web-enabled-sales-process-18476/
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