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Hi Paul A great post that challenges us all to move beyond talking about SocCRM, to experimenting with it. I agree with you wholeheartedly when you say that CRM is not dead. Far from it. I see no sign of a reduction in interest in CRM despite the recent advances in potential alternative ‘logics’ to spend limited post-recessinary budgets, such as CExM and SocCRM. If anything, the recent upturn in market sentiment has already started to find its way into increased CRM spending. CRM provides a robust backbone of customer of management capabilities upon which other logics can sit. Whether the logic is CExM, with its emphasis on knitting together all the separate CRM touchpoints into a coherent, end-to-end experience, or SocCRM, with its emphasis on engaging customers in the co-creation of value throughout the experience. We will have to see how VRM fits into this larger picture. I would like to take you up on a couple of points: 1. Is today’s customer really all that different? It is no surprise that customers needs, wants and expectations are continuously increasing. This has always been the case. At least for as long as I can remember. But that doesn’t make the customer fundamentally different. Most of the many customers of client organisations I talk to as part of my consulting work want pretty much the same things they wanted before; they want stuff that does what it says on the tin, they want it at a fair price and they want help when things go a bit awry. What has changed are the tools they hire to help them do these things. Whereas yesterday they relied upon traditional media and friends & family, today they increasingly rely upon social media and, let’s just say, people they ‘follow’. But as Christakis & Fowler’s research suggests, customers are still much more likely to be influenced by the first three degrees of separation of real friends, than by the hundreds of ephemeral people they follow. Perhaps surprisingly I don’t meet that many ‘real’ customers who are particularly interested in becoming engaged with companies, in having a conversation with companies or even in providing all that much feedback. They just want stuff that works. And they have pretty low expectations of most companies service too. Why this big gap between what we read and what I see talking to real customers. Perhaps we make the mistake of thinking that real customers are like us; people who make a living from being at the edge of developments in customer management. When in fact most customers are just trying to get on with their lives and pick the best tools that can help them do that. 2. Is the networked customers really all that influential? We have all used the United Breaks Guitars as a clarion cry to heed the voice of disgruntled networked customers. Indeed, it has been a staple of my own conference presentations for the last couple of years. It is a great story of how not to handle an irritated customer, it is a great video and everybody likes faceless corporate bullies to get their come-uppance. The London Times ran a story that the Guitar Affair had cost United over USD 100 million in lost value. Yet when Laurence Buchanan checked longer-term share price movements for United he didn’t find any effect whatsoever. Some SocMed disasters really do move the corporate value needle. Sprint’s absolutely insane firing of 1,000 customers for being not profitable enough is a case in point. Not only did Sprint’s calculations omit that it was its own grossly inefficient processes that caused customers to be unprofitable, but it also picked on US servicemen serving their country in the Middle East. It was only fit and proper that Sprint’s CMO and the CEO were booted out shortly afterwards. Not just for this, but for the fact that Sprint’s Net Adds were far below expectations in a rapidly expanding mobile telecoms market. Why this big gap between what we read and what is happening to corporate value. Perhaps we really want to believe that SocMed or SocCRM are different. Perhaps we have started to believe our own hype. Hence my recent comments (which you picked up) about needing to show the value of SocCRM in moving the corporate value needle. And preferably in moving the customer value needle as well. Where I do agree with you is in your prognisis for Mobile SocCRM. There are actually now over 5 Billion mobile devices in the world; a whole order of magnitude bigger than the number of Facebook users. But paradoxically, the majority of phones out there are not high-end smartphones like the iPhone4 (itself pretty low-end when it comes to telecoms technology) but earlier generations. The killer app at the moment is not Facebook on the iPhone, or even the apps infrastructure, but good old SMS. Maybe that will change as smartphones increase their penetration rate. But for the time being although it is sexy and cool to develop corporate iPhone apps, the real opportunity is probably still in making the corporate SMS interface easier to use. Just go look at what dirt poor Africans are doing if you want to see the future of Mobile Money. All in all a great post. It was a real pleasure to read it. And a privilege to comment on it. Graham Hill Customer-driven Innovator @grahamhill
Hi Paul I had a 'twittversation' with Ray this morning. He made exactly the same points you make. The Altimeter report did exactly what he and Jeremiah set out to do; to describe 18 use cases for SocCRM tools. Credit where credit is due; the report did that very well. It is nice to see new faces with new ideas in the somewhat tired CRM community. The last blog I posted - the Manifesto for SocBiz - was in November 2009. I have been busy researching value co-creation, developing some simple design tools to help companies manage the process of co-creating value with their customers and trying them out with a friendly client. Maybe I should get my blogging and writing act together again. There's certainly plenty to write about. Best regards from Köln & Amsterdam PS. Thanks for the compliment. I would never claim to be smarter and more versatile than your good self. But I am going to continue to research new ideas, to try things out and to learn what really works.
Hi Paul Another great piece of polemic. It does us all a service by reminding us that vendors are not bad but they are profit-driven companies, that we should concentrate on what we can do rather than what our competitors can't and that it is ideas that count, not personalities. Having said that, I feel that your praise of the Altimeter paper which I have read (and by implication the Forrester and IDC papers which I haven't) is somewhat overdone. We can safely ignore the Accenture paper. The Altimeter problem has a number of significant flaws. Firstly, it is almost entirely written from the company's perspective. And is largely focussed on the traditional inside-out CRM disciplines of marketing, sales and service. A large part of why CRM has not delivered the goods for companies in the past is that it has been focussed solely on companies and not on their customers. CRM treated customers as little more than targets to be relieved of their money. Customers, of course, resented being treated as walking wallets. Wouldn’t you? The Altimeter report is conspicuous by its silence over what jobs customers use social media to do and what outcomes they are looking for by using it, and thus, how companies should look to engage with customers. It is engagement, as you said yourself recently, that is the key here, not business functions or SocCRM tools. Secondly, it ignores what caused CRM to fail and thus perpetuates the same old problems. As is widely recognised today, one of the big reasons why CRM failed was because it only pulled some of the levers of successful business change. Many companies simply bought and implemented CRM software without any real thought about: how processes should change to leverage it, what new data would be required, how new roles and responsibilities should be structured, how business performance should be measured and so on. These companies lived out the old dictum: Old Organisation + New Technology = Expensive Old Organisation. The Altimeter report perpetuates this problem by treating SocCRM as just a more networked form of bad old CRM; CRM + Social = SocCRM. Finally, it doesn't tackle the fundamental problems that have caused customers to reach out to each other for help and assistance through their social networks. Most of the leading social customer 'solutions' have been created by customers for each other. Whether to complain at crap companies and their shoddy products, to seek advanced product support or just to swap success stories, these solutions have been created because of the failure of companies to provide reliable products, honest sales pitches, decent after-sales support or even somewhere to be a fan. Necessity is the mother of invention as the old saying goes. By not recognising how companies are failing customers - often in easy to remedy ways - the Altimeter report sets the barrier too low for companies to jump over. I originally wrote my Manifesto for SocBiz in response to these types of report. I was, and am fed up of SocCRM been positioned as just CRM with Social tools tacked on. This is a gross simplification. SocCRM can and should be about much more than just Marketing, Sales and Service. Or even collaboration and innovation. It should be about engaging customers in a meaningful dialogue around what jobs customers are trying to do, what sort of solutions they would benefit from, which resources need to be brought together to provide them and how to do this so that companies can make a profit too. The Altimeter report is great for what it does - provides a number of easy use cases around SocCRM tools - and congratulations to Ray and Jeremiah for producing it. But it is the larger omissions that should give us all cause for concern. It is these omissions that will cause companies to fail at SocCRM in the future, just as so many have at CRM in the past. Maybe it is time for the traditional CRM types to stop sniping at SocCRM 'interlopers' like Ray and Jeremiah, and produce the definitive report about SocCRM themselves. Until they do, Ray, Jeremiah and the other SocCRM interlopers will be at the top of my reading list. Graham Hill Customer-centric Innovator @grahamhill PS. I know what you are thinking: Sorry, but I am too busy doing SocCRM for my clients to write about it these days.
Hi Ken Working together with customes to create innovation is what James' former employer might have called Co-Creation and what his current employer calls Co-Production. There is a considerable amount of research, experimentation and leaning going on in private and public organisations around how to make co-creation/co-production work. Take a look at the following for an overview: Promise Co-creation: New Pathways to Value UK Govt. Cabinet Office Co­production in Public Services: A New Partnership with Citizens Graham Hill Customer-centric Innovator @grahamhill
Toggle Commented Jan 9, 2010 on The innovation economy at BankerVision
Hi James I understand that Experian is a user of the BrightIdea suite of open innovation management tools. See the following Computerworld article on Experian and BrightIdea Graham Hill Customer-centric Innovator @grahamhill
Toggle Commented Jan 9, 2010 on The innovation economy at BankerVision
Hi James Peter Drucker famously said that "Because the purpose of business is to create and keep a customer, the business enterprise has two -- and only two -- basic functions: marketing and innovation. Marketing and innovation produce results; all the rest are costs." Perhaps the problem with organisations that hoard both tangible and intangible assets is not their lack of innovation per se, but a lack of balance between marketing and innovation. This works both ways. Many organisations are not so good at creating desirable new products but are very good at commercialising what they already have. Mobile telcos come to mind. They are not particularly good at innovation (which please note, is rather different to technological invention) but are very good at packaging their current products into every more complicated bundles. Have you seen the small print attached to even the simplest of Deutsche Telekom bundles? It took partners like Nokia and Palm, and complete outsiders like Google and in particular, Apple, to really drive innovation forward in the mobile telecoms industry, to the point where mobile telcos may become just the owners of the low-value-added pipe that carries our bits & bytes, if they are not very careful. On the other hand, a few organisations are great at creating desirable new products but are not very good at commercialising these new products. Universities come to mind. They are particularly good at technological invention, can see how the inventions could potentially revolutionise customers lives for the better (and make a profit in the process; my definition of an innovation), but to be frank, are rubbish at commercialising these innovations. John Hagel in an excellent blog post on Unbundling Dell’s Business suggests that organisations should decide whether to compete on creating winning new products and commercialising them, on operating high-volume infrastructure, or on building strong relationships with customers. It may be that even those organisations that want to focus on the first of the three must still work hard get the balance right between innovation and commercialisation. Looking around me I don’t see any signs of an emerging innovation economy. Everyone is talking about innovation, but few really know what it is and even fewer are doing it. And looking deep inside innovation at its foundations in the resource-based theory of the firm, dynamic capabilities and their associated micro-foundations, I see that knowledge and innovation are inextricably linked together. Having knowledge doesn’t automatically lead to innovation, but without knowledge there can be no real innovation. There is clearly still a long way to go in understanding the knowledge economy before we can even start to think about the innovation economy. Graham Hill Customer-centric Innovator @grahamhill
Toggle Commented Jan 9, 2010 on The innovation economy at BankerVision
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Jan 9, 2010