For those unaware, KANA Software announced Tuesday, that it has acquired Ciboodle.  The technological components are a great fit; the vision, framework and solution are excellent. As with any merger, there is work ahead required to execute on the vision. One of the most challenging elements, as identified by some of the industries finest minds, is going to be the merging of the cultures. The cultural elements will have a direct and large impact on the ability to execute against the vision, so we better get it right. Culture is the sum total of personalities, driven by the leadership driving towards common goals.

Prologue

While I am sure many of you have been part of an M&A process, my personal perspective comes from the following: In 1997, when I was a wee lad, Kenan Systems (a 250 person private company) was acquired by Lucent technology (>100,000 people) for $1.4B. Having matured considerably by 1999 I was part of Octane, who were acquired by Epiphany for $3.2B (Monopoly money). While I do live in Vermont, I have worked for both Silicon Valley tech companies and a Scottish software company, come on, how many people can say that!

Let’s get to it!

Bain and Co published ” Building a winning culture ” (link below) where they outline the key attributes of a winning culture; high aspirations and a desire to win, external focus, ‘think like owners’ attitude, bias to action, individuals who team finally, passion and energy. These seems completely logical, obvious even, but how do two companies 5000 miles apart, an 11 hour flight (if connections are on time, but I digress) and 8 time zones different realize these attributes within the logical 4 walls?

Let’s start with some words from Mike Hughes, CEO of Ciboodle (For effect, please use your very best strong Glaswegian accent as your internal voice when you read this):

“I think that the folks from both organisation’s have the same can do attitude and are keen to capitalise on the opportunity ahead. We clearly have an excellent stack and the motivation of the people will drive this into a real integrated suite in a very short period of time. That will happen because the folks in the business are stoked to make it happen. It’s not often that a opportunity of this magnitude and significance comes along, we understand that and collectively we will deliver.”

From my perspective, this hits 2 of the attributes pretty directly, as well as one that is missing from Bain; executive desire to live the message. Adding my own perspective here, even within the first week the teams have allowed, encouraged even, participation from both sides of the deal to speak with influencers, analysts and press. This might seem like a small thing, but it is quite big. I am personally very encouraged by these actions – and most appreciative.This illustrates that the days of command and control are numbered. Both the KANA team and the Ciboodle teams have been active in person, on the phone, through WebEx sessions, email and social channels.

External Focus, Bias to action

These two are absolutely critical, my opinion, especially given the industry we live in; Customer Experience and Customer Service Excellence. Both KANA and Ciboodle have a passion for excellence and delighting customers, which should be quite obvious from the posts by Clare Dorrian and Vikas Nehru (Links below). They are words, so we cannot lose focus and must prove ourselves with action; to our current customer base and the current in-flight projects. Here is the kicker and the single biggest risk factor identified by Bain: “Do not get caught-up in internal politics or navel-gazing”. The energy drain from internal politics (which I witnessed during the Kenan / Lucent acquisition) can be very damaging from many perspectives.

The ‘bias to action’ describes me personally pretty well and from early indications my new counterparts in Sunnyvale. I am a bit impatient and I want to get things done. I can see the value that the marriage can bring to customers. I can be a little over-the-top sometimes, but as I have said on a few analyst calls and briefings with industry folks, there are more toys in the toy chest. To the broader ecosystem, I would say that what KANA adds to the Ciboodle Agent Desktop can help our customers to realize the vision I have been putting out here for a while (I suppose I should say what Ciboodle brings to KANA, oh well, sorry). I do realize that it is not only about technology, it is about helping people to get their jobs done.

“The strongest cultures bind people together across both hierarchy and geography, guiding them to make the right decisions and advance the business without explicit direction.”

Action Items:

Here is what the leadership team need to do and I have confidence that it will be done. Can I commit to time frames? Probably not, because if I did I would likely have a very short tenure at my new home. The leadership team need to set expectations about the importance of culture issues within the new organization. The leadership team itself need need to have the common vision which can be shared with the rest of the organization. Everyone needs to have a sense of ownership and accountability. Within large organizations it is too easy to ‘ride and glide’. Everyone needs to pull their own weight. Clarity, communications and ‘walking the talk’ by the leadership will go along way to setting the proper tone. My reflection of week one suggests exactly that, and we need it to continue, even accelerate.

Finally, the winning culture is about the performance values, behaviors added to the personality of the resulting organization. To be fair, I only have a one sided view on this one, but will say that the Ciboodle side has been known for our sometimes quirky personality. We have done things a bit differently (for longer than I have been around). I am not too familiar with the KANA ‘personality’ and I am looking forward to seeing what the proper blend will be – and I will try hard to influence it, I see that as one of my jobs (I am physically half-way between Sunnyvale and Glasgow).

Personality

I mentioned above that the culture of an organization is the sum total of the personalities within the organizations. Where this merger is very different from previous mergers I have been a part of is the enabling technologies which are available. No, technology cannot solve this problem but it should be leveraged to make things easier. Proper collaboration can be used to effectively reduce the timezones, shorten the distance and allow for real 21st century productivity. The resulting culture, driven by individual personalities, will drive a new corporate personality; some combination of KANA and Ciboodle, and I am looking forward to being part of the process.

Articles and related material

• Press Release
• Clare Dorrian (Ciboodle)
• Vikas Nehru (KANA)
• Esteban Kolsky (ThinkJar)
• Kate Leggett (Forrester)
• MyCustomer.com (With insights from Paul Greenberg and Ray Wang)
• Build a Winning Culture (Bain & Co.)
• Image source

As a company, it goes without saying that we’ve realized incredibly valuable growth under Sword: we now have a sturdy foothold in North America and an enviable client roster that includes Nicor National, Admiral, Bally Total Fitness and Domestic & General; our product team has grown by more than a third and our solutions expanded to address social customer engagement as we’ve worked shoulder to shoulder with extraordinary flagship customers to develop exactly what the market required. Long nights and weekends, many trips to Chicago and the East Coast, frustrated spouses, missed families and the promise of making a critical impact on the Customer Service industry.  Not bad for just less than four years…It has been an important and valuable chapter, to be sure, but we now need to move up a gear.

Why? Because the truth is, us ‘Ciboodlers’ are ready for more.  Our vision to be the world’s most trusted and leading customer service software company can only be realised by continually growing the functionality and value of our products and services to significantly expand the way in which we help our customers. To get there, we need to be part of an organisation that can help us reach our limitless potential—a company who like us, lives and breathes Customer Service, who is committed to helping its customers deliver on-point and lasting relationships, who is driven by the belief that their technology solutions need to stay cutting edge, and who invests in R & D and constant contact with customers and the market, knowing that searching for top-flight customer service ideas produces bottom line results.

And that match making process is hard. Finding a partner who had similar ambitions and similar credentials is not something that happens overnight. BUT I’m delighted to say we’ve found our match in KANA.

This is a critical step in the build-out of Ciboodle’s Customer Service vision and a decision I’m excited about for us as a company, and on behalf of Ciboodle and KANA’s joint customers. We’ve both been successful in our own space but have approached it from two different positions of strength: Ciboodle focusing on the Contact Center, Agent Desktop, Business Process Management and Case Management solutions  and Social Community, KANA meanwhile has focused on Email Response Management, Knowledge Management, Web Self-Service and Chat, and more recently Social Listening. By combining the two, not only does Ciboodle gain greater scale in terms of global presence, resources and expanded offerings, we will together, accelerate both companies’ product roadmaps by 12-18 months, allowing a sharper focus on strategic initiatives like cloud computing, mobile and big data analytics – areas that you, our customers, industry analysts, our partners and fellow Ciboodler’s have told us are important to our success. Not forgetting to continue to invest in those existing awesome areas of both products sets you have come to know and rely on.

Over the coming months, we will be working around the clock to fine tune and unveil more detail on where we are headed, applying the same innovation and same commitment you’ve come to associate with the Ciboodler’s you know.  And the more I tap into KANA’s employees’ ideas, passions, and aspirations for our company’s future, the more I realise that all of us agree, that our combined brand, KANA,  will continue to stand firmly behind all of the qualities that you trust us to be:

Forward thinking
Honest
Tireless
Fiercely responsible
Diligent
And fun.

Stay tuned…

Its time to reduce complexity and focus energy on projects that will help businesses innovate, adapt to the needs of the hyper-connected customer and focus on their jobs to be done; it always needs to be about the customer, no? With this in mind, Ciboodle are partnering with IBM, as the PureSystems initiative does just that, helps you to turn the focus to the customer.

”Sword Ciboodle is now working with IBM as a certified IBM PureSystem Business Partner to introduce a new category of computing,” said Bruce Maule, director business partner programs, IBM systems and technology group. ”This category incorporates expert integrated systems to fundamentally change the experience and economics of IT.”

Sword Ciboodle is excited to participate along side IBM,  pioneering a new era of computing that will help simplify the complexity and fundamentally transform the internal experience and economics of enterprise information technology. Your IT team is worth thinking about because everyone plays a role in regards to enhancing customer experience. The IBM Expert Integrated Systems is a new category of smarter computing that combines the flexibility of a general purpose system, the elasticity of cloud and the simplicity of an appliance – Ciboodle expertise is part of the solution.

In case you are wondering, IBM PureSystems is a new family of expert integrated systems offered by IBM that combines hardware, software and expertise into one solution. The cool thing here is that this new system will simplify IT infrastructure by tackling the biggest, consistent IT pain points. Ciboodle bought into the idea early, and we excited to be taking part.

“Congratulations to Sword Ciboodle for being among the early adopters of IBM PureSystems,” said  Michael Riegel, vice president of global ISVs, IBM  “This will enable them to offer an industry leading solution to clients in a way that cannot be matched by competitors.”

The Ciboodle Platform provides a powerful framework for deploying and managing an integrated, multi-channel Contact Center Solution. Built and proven to scale in high volume multi-channel customer implementations, the platform conforms to all common non-functional standards and enterprise best practices.

The Ciboodle Platform  is enabled on both IBM PureFlex™ System and IBM PureApplication™ System.  The IBM PureFlex™ System combines compute, storage, networking, virtualization and management into a single infrastructure system that is expert at sensing and anticipating resource needs to optimize your infrastructure. The IBM PureApplication™ System is specifically designed and tuned for transactional web and database applications. Solutions enabled on the PureApplication System are packaged into patterns of expertise built for a cloud environment and easy deployment.

Sword Ciboodle 3.x Application Pattern for IBM PureApplication System and the virtual appliance pattern for IBM PureFlex System will soon be available for download.

Built to provide a solution for today, with a close eye on tomorrow’s challenges.

Learn more about the IBM PureSystems

What is really being described here is a maturity model; on BOTH sides of the equation, this is new. If Social CRM is about a companies programmatic response, then engagement on the customer’s terms defines the format of the response. Therefore, Social CRM is different for every type of business. In order for it to work, both sides need to mature and be willing to invest emotionally and intellectually.  Since the customer will mature at his or her own pace, we <company> are often left to guess where they are along the maturation curve. It is also important that a distinction be made between engagement and involvement. For the sake of this discussion (ie, no primary research references) I will draw the distinction along a continuum, where involvement occurs first and then by the addition of an emotional element engagement happens. Engagement is a deeper level of involvement, by being ongoing (As Paul notes) or emotional, possibly even intent driven.

A Bit of Research

Looking at Wikipedia as a starting point, as I remembered friend Prem Kumar referencing Employee Engagement in a post a while back. The Employee engagement Wikipedia entry is rather nice, while the Customer version is utter crap.
First the Customer side:

“Customer engagement (CE) refers to the engagement of customers with one another, with a company or a brand. The initiative for engagement can be either consumer- or company-led and the medium of engagement can be on or offline.”

Feel free to look for yourself. It misses the mark totally.  Friend Graham Hill had some thoughts on the topic as well -  Graham challenges the Inside-out marketing team only approach, and I agree. That said, what if the customer is able to define (control, augment) the rules of engagement, then maybe something has changed in the past 5 years, no? Conclusion; the maturation of the Social part of CRM part of the equation is to carefully manage actual engagement. Actual engagement is an actual bi-directional conversational flow/dynamic, input and involvement.

What if we tried to adapt the Employee engagement model for the customer? There would need to be some very obvious changes, but it is a much better place to start – and if after you take a look at this and then take another look at Paul’s post, you can see he is onto something. Take a look at the below and think about whether it is possible to alter some of the words, replace a few and begin to change the poor Customer Engagement definition above.

“Employee Engagement is the extent to which employee commitment, both emotional and intellectual, exists relative to accomplishing the work, mission, and vision of the organization. Engagement can be seen as a heightened level of ownership where each employee wants to do whatever they can for the benefit of their internal and external customers, and for the success of the organization as a whole.”

Employee Engagement impacts Customer Experience
There are lots of people writing about engagement, a term that is becoming as nebulous as social itself; but at least there is some history to work with here. Respected analyst/researcher Bruce Temkin has published a report regarding Employee Engagement as well. Bruce has spent many years thinking about Customer Experience. In the report, he draws a strong link between Employee Engagement and Customer Experience:

“The analysis uncovers a strong connection between employee engagement and customer experience as well as between employee engagement and productivity.”

Great, but…Where is the link between Employee engagement and Customer Engagement? Does strong Customer Engagement lead to a more positive Customer Experience? I am not going to speak for Bruce, but I am going to hazard a guess that the link is not there because Customer Engagement is nebulous at best and as I have stated very poorly defined with competing agendas. Employees have, in theory, a specific mission: do a job and help the company grow, right? According to Gallup, 86% of engaged employees say they very often feel happy at work, compared to 11% of the disengaged. There is also a direct link to the bottom line according to research.

In the end, being Social about being human. Social Media and Networking are really just some new channels that we are all trying to figure out how to use a bit better. ie. How can we be as human as possible using electronic means. The technology is new, we are just trying to figure it out. As we become better at the usage of the channel, then we can move from demands to requests, from hyperconnectivity to right connectivity and from being social to being engaging. Engagement in this context is not like the picture above, because it can end at any time, quite easily. While technology is only a part, it is still an important part.

Working in the customer care space for a number of years, I understand why companies implement IVR solutions. It reduces costs, filters out the most basic of inquiries, provides 24/7 coverage and identifies customers upfront and, in theory, allows calls to be routed more effectively. The last point assumes businesses are using the technology correctly, but on several occasions I’ve navigated an IVR for the CSR to repeatedly ask me the same questions over and over again. However, even with these benefits, I genuinely feel IVR technology doesn’t improve customer satisfaction levels and its use is becoming obsolete in the age of mobile technology. If I want to find out my account balance, a stores opening hours or make a payment, I will use the web or a custom app. Anyway, how do today’s consumers get a phone number for a business, more than likely from a company website? If the website or app isn’t able to handle my request what makes a company think an IVR system would be able to do so? I highly doubt it.

In summary, I know that not everyone uses mobile technology and that an IVR system can be useful in some scenarios. But I feel that in order for organizations to improve their level of customer service, as opposed to their bottom line, they would be better to focus their time and money on mobile technologies and move away from IVR’s. At the end of the day, if companies stopped using the technology, would consumers genuinely feel they are missing out on something? I doubt it…

Liz Erk- What is the most critical element of any company’s customer service program? (This could be technology-based, people, more than one, etc.)

Dave Ballard- There really isn’t one single element, it’s finding the right balance between technology and process. And especially the right staff! It sounds obvious, but you’d be surprised how many companies think technology alone can solve their problems.

LE- When you assess a company’s existing customer service center, what is the one common “mistake” or “missing piece” that you find?

DB- I’d say that’s a good question! Technology is moving at an alarmingly fast rate- faster than ever. Companies are continually trying to keep pace with this technology and their competitors by getting new technology. From my perspective, there needs to be a solid and stable backend process in place first. Particularly when it comes to adding the latest and greatest new technology channels like social media, chat and Flash websites. For example, it’s great companies are interacting with customers via online chat, but at the end of the day if you are using the same 20 year old broken process to issue a refund, are you really doing the customers a service? Or are you just trying to simply add a new channel for the sake of adding a channel? They really need to be able to support new channels in a smart and useful way.

LE- What industry sector has provided the biggest challenges when it comes to evaluating and recommending a customer service strategy?

DB- I’ve worked with a number of clients across a variety of industries, and I’ve found that organizations all face the same challenges, believe it or not. Generally organizations know their industries really really well. They all need guidance on how to create that “company-centric” strategy, and then also how to best use the different technologies to make the most of that strategy. All the information is there, it’s just understanding how to streamline those processes.

LE- Which industry commonly seems to “get it right?”

DB- I think it’d be unfair to pin one industry over another. I tend to find the organizations who truly get it right are the ones least resistant to change, and have buy-in from everyone who’s effected by the new software solutions from the top down, from executives right through to customer service representatives. Implementing a new CRM software solution is an excellent opportunity to overhaul a business and provide excellent customer service, and that should be embraced by everyone.

LE- What was the toughest obstacle or “worst nightmare” you’ve ever faced in getting a customer set up?

DB- I wouldn’t say worst nightmare, but I’d say one of the most challenging parts of the job is building a state-of-the-art solution out of a legacy system that hasn’t been updated for years. At Sword Ciboodle our solution integrates with multiple backend systems in order to provide a unified agent desktop to offer a 360 degree view of the customer, so at times it feels we can be limited in what we can achieve by the other systems, however I have excellent managers who are able to overcome this time and time again and we’re able to deliver strong solutions.

LE- Without naming the client, what’s a unique, funny or just plain odd experience you’ve had on a client site?

DB- You put me on the spot now, haha! Okay, here’s a unique one: I did work on a solution for an auto company and the customers send them audio recordings of their engines to help their engineers playback and diagnose the problem. It was certainly different and we were chosen because of our ability to adapt for this unique customer interaction.

******

It’s cool to see the trends and common denominators with clients. I’m hoping in the near future Dave can walk us a through “a day in the life of a client deployment…”

Marie Curie Cancer Care, a customer of Sword Ciboodle has been shortlisted for The Best Use of Technology category at this years’ European Call Centre and Customer Service Awards.   Last year Sword Ciboodle implemented a contact centre CRM solution that intelligently matched nurse location, training and skill set to unique and changing patient needs.  In less than six months, Marie Curie increased patient visits by a third and improved service levels by almost 20%.  CRM matters to Marie Curie and with the help of Sword Ciboodle it has enabled quick positive results taking their business and patient needs from Zero to Hero.

The European Call Centre and Customer Service Award is taking place alongside the Call Centre and Customer Management Expo this year at London’s Olympia Stadium on the 11^th and 12^th October.  As always Sword Ciboodle will be on hand to demonstrate our latest technology and showcase why our products increase the customer service experience, increase agent morale and lower costs for businesses.  Visit us this year at stand D18 and meet our Heroes to find out more and how we can help your business.

The first point to note is that typically customers are not actually treated equally – as anyone who has ever had to walk through the salubrious front of a plane to the cattle-hold in the rear will attest. However, even when formal attempts at price differentiation are ignored, customers generally will still be treated differently – especially when they have to deal with a human. Oftentimes, the decision on how to treat a customer is left, at least in part, to the agent, who may vary how accommodating they are based on how pleasant the customer has been, how close it is to the end of their shift or how hungover they are from the night before.

There is, however, nothing particularly untoward in being discriminating in the level of service we provide either – though it does need to be based on something a little more meaningful than the number of pints your agents consume on a Tuesday night. Business is all about allocating scarce resources in the most efficient manner to ensure the greatest return to the owners. Therefore any business action should have both its costs and benefits carefully analysed to allow for the optimum behaviour to be selected.

Of course the key here is having sufficient information – and using it – to make sure all these potential costs and benefits are taken into account. For example, one could naïvely assume that the “Premium Member” who pays $70pm to use a gym should always trump the “Basic Member” who pays a meagre $40pm. However, in actual fact, a given basic member may have a greater net value compared with a given premium one. This is because the former may prefer to sit at home eating nachos and watching “The Biggest Loser” instead working-out, while the premium member visits daily and constantly calls in to complain, raising the cost to serve him above the difference in his membership rate.

Even if crude measures are dumped in favour of something more sophisticated, businesses can still shoot themselves in the foot by being myopic. Just because a customer is of low value today doesn’t mean they won’t be valuable tomorrow. Obviously treating a customer well will make them more susceptible to your upsell attempts but this isn’t the only way their value can increase over time. Take students, for example, most of their assets are typically held in books and ramen – but yet banks scramble for their custom. This is not because they think instant noodles are the only safe store for capital in this turbulent economic climate but rather because they know students generally go on to become graduates who, in turn, get paid more money and subsequently generate more business for the bank.

Differentiation also runs the risk of incurring the greatest cost of all: the opportunity cost of getting it wrong and mistaking one of your best customers for an undesirable. This is why the process cannot be left up to humans. Even assuming the agent has the best interests of the business in mind, they cannot possibly conduct an accurate assessment of the customer’s current and future value then determine how they should be treated based on this while trying to keep their handling time down, cross-selling other products and remembering to tell them about your self-service website. It therefore must be built in to the CRM application.

For this to be successful it requires a number of factors. Firstly, the CRM software must constantly be capturing and updating accurate and timely information about the customer. It must then feed this data into an intelligent and evolving analytics engine to make predictions and assessments of value based on this data. Finally, it must be process-centric and use the output of the analysis throughout the application to ensure the agent employs the correct policy and disposition for the customer in question.

It goes without saying that we should always strive to provide a high minimum standard at the lowest possible cost to serve for all our customers. However, in this increasingly competitive international business environment we need to be smarter about how we use our resources – and subsequently how we decide what customers to develop, hold or divest. Better CRM is the key to both.

As for the business of trying to convince a customer they are important via the medium of recorded message, it seems that this may be beyond the scope of even the smartest CRM software. Perhaps the offshore agent that’s just picked up will do better with the script he is clumsily regurgitating to this “valued” customer…

The core concept of cloud computing is that distributed resources are shared amongst the cloud users in an abstract way such that each individual client need not concern themselves with where the data is stored or the processing carried out. With the recent surge in mobile computing the appeal of this approach is clear. Users expect to be able to perform increasingly complicated operations on the go, however, cannot reasonably carry around the capacious hard-drives or sustain the power-hungry processors and graphics cards required to fulfil these needs. The cloud farms out all the clever stuff to some remote behemoth (with mains power), that can tirelessly crunch bits in a distant server room somewhere.  This means that even relatively dumb smartphones can employ state of the art applications and consume terabytes of media, without the need to carry around a disk array and battery pack every time they leave the house. Moreover, since the mechanics of utilising these services are concealed from the user, the tech-novices that have been snapping up the latest hand-held devices will still be able to reap the benefits of this sort of architecture without first picking up a computer science degree.

But can clouds bring similar benefits to customer relationship management? After all call center agents aren’t typically roaming around while taking calls and it’s not as if users typically need high-spec machines to run their CRM application anyway. Similarly, in a typical CRM setup most of the processing is already done remotely today – particularly in those with self-service components. Even the case for arguing the cloud provides additional abstraction to the users is weak: most users would be blissfully unaware if their content was served by a Solaris box at a particular MAC address running WebSphere one day and a Windows NT box with a different address using JBoss the next.

So why bother? The main reason is ease of deployment. When your computing power is being provided by a cloud you no longer need to fret about purchasing expensive hardware and constructing a secure, climate-controlled facility to house your fancy new gear. Similarly, someone else can concern themselves with penetration testing and getting everything setup. It could be argued that this simply pushes a one-off capital expenditure into a recurring operational expense and will cost more in the long run. However, surely the opportunity cost of this large initial outlay would be greater than a smaller, on-going cost where the saved capital could be invested in the business’ own area of expertise. Moreover, running costs could actually be reduced in some instances, since the provider of the cloud-based services would hopefully be able to achieve economies of scale and better utilization and therefore could pass these savings onto the service-consumer. At the same time the business can spend less on technical support staff, security and insurance by moving their computing power to the cloud.

Clouds also provide the reassurance of business continuity since the organization only needs to worry about providing a disaster recovery site for their agents, rather than also having to duplicate their server capability. Similarly, it provides the option for low-risk, incremental changes in capacity that would help the business respond to an uncertain future and could be of particular use to smaller firms. Likewise, industries that experience choppy demand for their services across the year – or even theoretically throughout the day – can more easily scale-up and scale-down rather than always having to provision for an infrequent peak demand.

However, clouds aren’t unique in providing these abilities. Organizations commonly make shared use of disaster recovery sites and come to arrangements to lend their spare capacity to each other during times of exceptional demand. Furthermore, many companies are essentially already using “clouds” under the guise of Software as a Service (SaaS) or Utility Computing. It is also the case that many businesses have pre-existing investment in expensive hardware that adequately fulfils their needs and have hired support staff that cannot be readily jettisoned – in which case there may be little benefit to paying someone again for what they already have.

Perhaps more importantly, companies using cloud-based solutions are a little less in control of their own destiny. They suddenly have to rely on some third party for mission-critical services: which they could botch and cause severe damage to the service-consumer’s company. The service provided may be less tailored than a bespoke in-house solution and prices could rapidly go up when contracts expired if the business has become obviously dependent on a cloud provider’s services. Worse still the cloud-provider could go out of business leaving service-consumer unable to meet their customer needs and therefore sure to follow in its footsteps.

Like so many “revolutionary new technologies” cloud-based computing is sold to us a panacea that will cure a multitude of ills – but upon closer inspection it’s neither as “new” or “revolutionary” as its proponents would have us believe. It’s clear that for SME’s cloud-based computing can help to remove some of the barriers to entry that will enable them to compete with larger rivals and it can help to de-risk the operations of businesses of all sizes. However, for more established players, with steady demand the benefits may be less pronounced and CTO’s are likely to prefer the devil they know than the novel ones that lurk within the clouds. Essentially this is analogous to the outsourcing of operations that is so common in the CRM sphere – and boils down to a decision on what direction the company wants to move in strategically. Would they rather virtualise their organization, focusing only on their core competencies or vertically integrate, controlling as much of the value-adding activities as possible.

It may still start raining CRM – but that doesn’t mean that everyone needs to get wet.

The drivers for this are clear: more than 90% of Americans and Western Europeans have internet-ready phones and as these devices become smarter and cheaper an increasing proportion of internet traffic is coming from hand-held sources. Moreover, in the developing word, where access to traditional means of using the Internet are more limited, the potential market here is staggering – in India, for example, more people now own a mobile phone than have access to a toilet or latrine!

Of course you don’t need Apps to access the internet on hand-held devices – WAP-enabled browsers have been letting users surf the web on their phones since the time when the closest thing to an app was a pixel-wide “snake” chasing dots around a black and white screen. Indeed many companies now have low-graphic mobile variants of their websites to this end and most new mid-range phones running on 3/4G networks can easily handle standard versions too. Moreover, upon downloading some companies’ apps it’s often difficult to see exactly what “application” they are actually supposed to provide, with many offering less features than their mobile website.

So why spend the money developing and maintaining this additional channel in CRM software? The primary reason is often marketing. Apps currently are highly totemic – they act as a sort of status symbol, showing that the company is technically astute and will gain them kudos with users who want to get the most from their expensive gizmo. Similarly, as this trend continues it will become a qualifying criterion for customers to do business with the organization in many sectors, in much the same way as we have seen with websites in the past decades. Less subtly, it is also about brand exposure – if the customer sees your logo every time they scroll through their list of apps or browse the App Store this will reinforce your brand identity. Likewise, a heavily branded app will reflect more favourably on the customer’s image of the company than a dowdy mobile webpage. Senior management are aware of these factors and thus this will increasingly be a capability they will value in their CRM solution.

However, there are also technical reasons to use apps. Firstly, they can provide us with more information about our customer. For example, a feature of many companies’ apps is to provide barcode scanners that enable the customer to find out more information about a product: integrating this with their account could provide information on not just what they’ve bought but what they are interested in, enabling more targeted cross-sell/up-sell in our next interaction with them. They could help reduce contacts by providing location-based services such as a branch-finder or using the device’s camera for digital check cashing. Built-in cameras could also help reduce handling time by allowing video-conferencing with technical support staff or the photographing of tags printed on correspondence so that the agent and customer can look at the same document together.

Apps could also help integrate multi-channel interactions and improve usability. For example customers hate using IVR but it can greatly improve the handling of their call: so why not let them choose from option menus in the app what their call is about then let the app dial us, passing their account information and selections in using the same DTMF system as the customer would? Agents or the website could perhaps “push” information to the customer’s handset while the app is running to help answer the customer’s query or give them a reminder or confirmation of what was discussed. Conversely, the app could open the relevant web page or pass context information to an agent when the customer gets stuck or exhausts the app’s capabilities. Finally, it could provide a convenient way for the user to provide feedback on a specific interaction that doesn’t require them to stay on the call which could be employed for quality assurance and performance management.

It is clear that there are many possible practical uses for apps – but even if they do end up little more than gimicky bandwagons, sometimes it’s better to be on the bandwagon with your customers than sulking while it drives off with them on-board.