From the Top
From the Top
- Executive to Executive -
Microsoft is busy preparing for the formal launch of their CRM suite. The solution set takes advantage of recent acquisitions, .NET technology and is focused on the needs of mid-sized companies. Microsoft’s CRM leader, David Thacher shares his insights and vision for the products and how it will change CRM, as we know it today.
David Thacher, General Manager, CRM; Microsoft
RealMarket: What are your goals for the Microsoft CRM program?
Thacher: The goal we have is to address the mid-market CRM needs today and going forward. This is a market that is underserved and has its own set of unique challenges. Our goal is to meet those needs today and over the next decade. The Internet is an extended system and people expect business systems to work together across the Internet. So we will work to tie those systems together with their eco-systems. We are thinking about how that integrates with the broader business issues they have.
RealMarket: Why the focus on mid-market companies?
Thacher: The design principles, the functionality and the go-to-market strategies, like choosing your partners, are different for mid-market companies than they are for large enterprise companies. There is great demand for CRM among these companies but they demand broad functionality that does not have massive integration requirements. So many of the existing CRM solutions on the market today are hard to implement and hard to use. We see the mid-market as a very large, underserved group of companies.
| "So many of the existing CRM solutions on the market today are hard to implement and hard to use. We see the mid-market as a very large, underserved group of companies." |
RealMarket: How does CRM fit in the bigger Microsoft strategy?
Thacher: The way to think about it is a three-part fit. First and foremost, we are creating a business solutions suite. We have acquired two very large mid-market players - Navision and Great Plains. That gives us a tremendous set of products. Microsoft CRM gives us another set of products that allows us to bring a more complete solution.
On a second level, it fits in the productivity area for knowledge workers that already use a wide range of Microsoft solutions. When you tie the knowledge tools together with a system that is optimized for CRM, you get the full structured system for standardized business practices.
The third area is to leverage the platform work in the .NET arena. Right away this opens up new possibilities for easier systems integration, and over time will enable the use of exciting web services to integrate and enhance the solution.
RealMarket: Tell us what we can expect in version 1. Is this Outlook on steroids?
Thacher: No, it is not Outlook on steroids. This is a full-fledged, server-based CRM solution but it does tie with Outlook so the end user might think of it as an extension of Outlook. This is not a widget based on Outlook; it is a full application suite offered in both a standard version and a professional version. Feedback from our channel partners working with pre-release versions confirms that the product has awesome sales force automation, great customer service functionality and the most important marketing automation. They especially like the low cost of ownership and how it ties front office with back office.
RealMarket: How do I decide if I should use the standard version or the professional version?
Thacher: Decisions like these are best made working with one’s channel partner, on the basis of a full needs analysis. However, there are some basic differences. The standard version contains a complete set of sales and service functions. With the professional version, you add two major things - more sophisticated functionality and workflow automation to enable business process automation and standardization. For example, incoming leads can be routed based on workflow rules. You are able to kick-off information based actions depending on the type of leads. For instance, this might include notifications or up selling. The other thing that comes with the professional version is the back-office integration with functionality like pricing and contract management.
RealMarket: I assume the integration is with Microsoft solutions. What about integration with non-Microsoft back-office solutions?
Thacher: We are making the same SDK our internal developers use available to our partners and customers so there can be integration with other ERP solutions. I expect somewhere between one-third and one-half of our CRM solutions will be integrated with our ERP products.
RealMarket: What won’t be in version 1? Tell us more about the Microsoft roadmap to providing better ROI and a more complete solution offering.
Thacher: You can think about this along two axes. One axis is pure CRM and the other is business application. We will need to keep working on improving a very complete solution. We will deepen the analytics and collaboration to allow customers to mine their customer data so they can work with their customers in much richer ways. That is the pure CRM axis. The other axis is integration with business solutions based around the business ecosystem and .NET and that’s an area where there is great room to deliver rich, integrated solutions that help customers grow their businesses.
RealMarket: Will the Microsoft CRM solutions be tailored to address the specific needs of vertical industries?
Thacher: There is great value with addressing the needs of vertical markets. That is an opportunity for our partners who have that domain expertise. At our big partner event in September, we demonstrated some of the vertical customizations our partners are creating.
| "What holds back success? Unrealistic expectations. It has to do with the challenge of implementation within cost." |
RealMarket: As a relative newcomer to CRM in a crowded market, how does Microsoft differentiate itself in the world of CRM?
Thacher: We differentiate in a few ways. We are exclusively building for the mid-market. It is not a slimmed down enterprise solution burdened with enterprise complexity. We designed our solutions from the bottom up from day one rather than a bunch of pieces cobbled together. The solutions are built on the framework of integration. We thought through customer requirements of wanting to use CRM systems the way a sales force uses CRM with office tools. That is why it works with Outlook and the back office products so a sales rep can work more effectively whether online or disconnected, even to the extent of creating quotes using up-to-date product guides with latest pricing and even with insights to available inventory.
RealMarket: How do you position your CRM offering with the CRM offerings from many of your partners like Onyx, Pivotal and FrontRange?
Thacher: First and foremost, the big difference is our mid-market focus. Most of the companies that you named are aimed at bigger companies. We are thinking about companies with up to about 500 employees. There are some companies in this space that have been partners for years. Those partnerships remain around the platform and around the .NET technologies. The bottom line is that cooperation and competition is not always avoidable when you are dealing with a company the size of Microsoft.
RealMarket: When Microsoft acquired Great Plains, you acquired a relationship with Siebel. What’s the status of that relationship today and moving forward?
Thacher: We agreed with Siebel to discontinue our reselling of the mid-market Siebel solution but we’ll continue to support our mutual customers and to build the integration systems to connect Siebel CRM to Microsoft ERP solutions.
RealMarket: There has been quite a bit of press in the last year about CRM failure rates. How do you balance delivery versus expectations?
Thacher: That is a great question. That is one of the core issues of success. What holds back success? Unrealistic expectations. It has to do with the challenge of implementation within cost. It’s our challenge to equip our channel and our partners with the tools and the end-user education to talk about business when we talk about business software.
There are business process issues and organization issues that will need to be addressed. It’s not about getting bits on the server. It’s about implementation, training and the evolution of the running the business. I think we have a product that makes it easier to do that with the implementer’s tool kit but it will always comes down to good work on the part of the customer and partner. Ask me next year and I might tell you we need to help them with even more tools. It is something we need to continually watch.
RealMarket: Looking to the future, what is the biggest change you see on the CRM horizon?
Thacher: I’ll go with two enormous changes. First, the mid-market will now start using CRM. They have not done CRM before but they are ready to find ways to increase sales and customer satisfaction. Partner resources are now available with new product.
Further out, CRM solutions will evolve with the Internet to create richer, interactive experiences with collaboration in real time. There will be the integration of business solutions between companies. Stand-alone CRM will not have as much significance. ERP was manufacturing and financials that came together. With the merging of CRM, perhaps there will be a new category that includes it all. That may not happen on the enterprise side because they have the resources to stitch it all together but the mid-market doesn’t have that luxury. They’re looking for solutions built to work together, and that’s our mid-market focus.
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