Decision Matrix: Selecting a CRM Vendor in Government

COMPETITOR FOCUS SERIES Decision Matrix – Selecting a CRM Vendor in Government (Competitor Focus) CRM moves from ‘customer’ to ‘constituent’ relationship management Reference Code: DMTC2243 Publication Date: March 2009 OVERVIEW Catalyst Due to demand for a better understanding of the competitive landscape in the government constituent relationship management (CRM) market, Datamonitor has developed the CRM in government Decision Matrix. This report explores the competitive dynamics within the government CRM market and helps agencies to select a vendor based on its technology strength and impact in the market. Datamonitor provides a complete view of vendor capabilities and advises on those that readers should explore, consider and—most importantly—shortlist. Summary Datamonitor believes that the competitive landscape for CRM in the government market is characterized by the following factors: • Oracle and RightNow have emerged as the leading solution vendors in the government space. • Lagan, Microsoft Dynamics and Salesforce.com offer solutions which are strong challengers to the market leaders. • Consona is emerging as a vendor which governments seeking strategic CRM implementations should explore. Decision Matrix – Selecting a CRM Vendor in Government (Competitor Focus) DMTC2243 / Published 3/2009 © Datamonitor. This brief is a licensed product and is not to be photocopied Page 1

Table of Contents TABLE OF CONTENTS Overview 1 Catalyst 1 Summary 1 Market Developments 5 Governments have adopted CRM to help improve services and enhance operations 5 The CRM in government Decision Matrix 7 Market leaders: Oracle, RightNow Technologies 8 The challengers: Lagan, Microsoft Dynamics, Salesforce.com 9 The prospects: Consona 10 Market Leaders 11 Market leaders: technology assessment 11 Market leaders: market impact 12 Vendor Analysis 15 Consona OneServe: CRM in government radars 15 Lagan: CRM in government radars 17 Microsoft Dynamics: CRM in government radars 19 Oracle Siebel: CRM in government radars 21 RightNow Technologies: CRM in government radars 23 Salesforce.com: CRM in government radars 25 APPENDIX 27 Summary scores 27 Datamonitor ratings 27 Extended Methodology 27 Sources 29 Further reading 29 Ask the analyst 30 Datamonitor consulting 30 Disclaimer 30 Decision Matrix – Selecting a CRM Vendor in Government (Competitor Focus) DMTC2243 / Published 3/2009 © Datamonitor. This brief is a licensed product and is not to be photocopied Page 2

Table of Contents TABLE OF FIGURES Figure 1: The CRM in government Decision Matrix 8 Figure 2: Market leaders analysis: technology assessment 12 Figure 3: Market leaders analysis: market impact 14 Figure 4: Consona government CRM radars 15 Figure 5: Lagan government CRM radars 17 Figure 6: Microsoft Dynamics government CRM radars 19 Figure 7: Oracle Siebel government CRM radars 21 Figure 8: RightNow government CRM radars 23 Figure 9: Salesforce.com government CRM radars 25 Decision Matrix – Selecting a CRM Vendor in Government (Competitor Focus) DMTC2243 / Published 3/2009 © Datamonitor. This brief is a licensed product and is not to be photocopied Page 3

Table of Contents TABLE OF TABLES Table 1: The following vendors have been profiled to understand the CRM market in government 5 Table 2: CRM in government Decision Matrix vendors 8 Table 3: Vendor scores 27 Decision Matrix – Selecting a CRM Vendor in Government (Competitor Focus) DMTC2243 / Published 3/2009 © Datamonitor. This brief is a licensed product and is not to be photocopied Page 4

Decision Matrix – Selecting a CRM Vendor in Government MARKET DEVELOPMENTS Governments have adopted CRM to help improve services and enhance operations ‘Constituent-centric government’ is not simply a buzzword in the public sector, but has become an established practice of putting service to the constituent—defined as everyone from citizens, to local businesses, to other agencies—at the heart of the agency mission, and deploying strategies which help to achieve this goal. In today’s commercially oriented world, it has become increasingly common for governments to turn to constituent relationship management (CRM) solutions to help improve operations and deliver better service. From case management to contact centers, CRM is being implemented by governments attempting to redefine the way in which public agencies operate. By integrating data collection from multiple interactions with the same constituent, CRM allows agencies to develop a more comprehensive view, and ultimately provide a better service experience. Once agencies have adopted processes geared towards a constituent-centric strategy, and ensured staff buy-in, the deployment of a CRM solution acts as the enabler in the equation. Table 1: The following vendors have been profiled to understand the CRM market in government Consona Oracle Siebel Lagan RightNow Technologies Microsoft Dynamics Salesforce.com Source: Datamonitor DATAMONITOR Datamonitor believes that the following conditions characterize the market for CRM in government: • Agencies are faced with the need to ‘do more with less’ – the operating environment for today’s government agencies is characterized largely by its lack of both human and financial resources. Agencies are concerned with reducing operating costs as a result of tight budgets (which are now even tighter due to the current economic climate) and the looming retirement of employees from the baby boom generation. At the same time, the private sector has increased expectations among constituents as to what constitutes ‘good service’, and governments are being forced to keep up with these new, elevated standards. Ultimately, governments are faced with the challenge of doing more with less, providing more and better services with fewer resources. When it comes to managing relationships with constituents in a more efficient manner, CRM is a key tool. It allows agencies to use a commercially developed solution to provide their constituents with more personalized service at a lower cost, and also helps to meet the ‘doing more with less’ challenge; for example, by reducing walk-in inquiries, and thereby reducing the number of staff required to handle walk-in requests, or the automation of case management across agencies to reduce phone and mailing costs. • CRM will help governments improve tracking of performance indicators, increasing accountability and transparency – CRM provides government decision makers with the information they need to evaluate the level of service they are providing to constituents. In the public sector, there has been a definitive movement towards performance management and the need to focus on quantitative indicators to measure success. As a result of Decision Matrix – Selecting a CRM Vendor in Government DMTC2243 / Published 2/2009 © Datamonitor. This brief is a licensed product and is not to be photocopied Page 5

Decision Matrix – Selecting a CRM Vendor in Government these two factors, government CRM solutions are increasingly incorporating analytics and reporting tools which allows agencies to measure nearly every aspect of their interactions with constituents; from who is contacting them to what they are inquiring about, and how long it takes to resolve the request. As governments increasingly require accountability and transparency in their operations, CRM solutions will see more advanced analytical functionality, and become more tightly integrated with business intelligence solutions that allow agencies to turn their CRM data into actionable items which will improve efficiencies. • CRM helps governments achieve a more complete view of their constituents across agencies – it is no secret that public sector agencies have traditionally faced numerous challenges around sharing information. While there are certain legal restrictions and privacy regulations governing such practices, much of the data that can be shared between agencies are not, due to governments’ siloed nature and bureaucratic culture. Whereas a tax collection agency may not traditionally practice information sharing with social services, there are undoubtedly benefits, and CRM solutions can help provide agencies with a more complete view of their constituents by linking information about certain inquiries together. For example, in the case of a constituent phoning their local government about a tax inquiry, a CRM solution could identify common issues related to the inquiry, such as a social service request, and direct the agent to connect the constituent with the appropriate agency. The solution could then create a record linking the two inquiries together, providing a more streamlined service in the future and alleviating the common complaint from citizens that they are too often asked to repeat information by various government agencies. At the same time, this allows governments to paint a more complete view of the constituent, ultimately helping agencies to understand what services could eventually be moved to a shared-services platform, or where there is an opportunity for collaboration. • The economic climate will lead to a shift in the CRM landscape – with government budgets under increased pressure due to the global economic climate, large-scale projects such as 311 implementations are likely to slow slightly, due to their high price tag and resource-intensive nature. At the same time, there will be a tendency for agencies to seek small and mid-scale CRM implementations, which entail both lower costs and less risk. Vendors that can capitalize on this space will be well-served; governments will continue to seek out reliable vendors which are able to provide the necessary support and not put a strain on internal resources. It is somewhat of an “if the shoe fits…” scenario; while larger vendors will continue to dominate the large implementations, the opportunity in the immediate future lies in meeting expanding demand for mid-size deployments. • Governments have benefited from being late adopters of CRM solutions – having been developed over the last decade as a tool with which commercial enterprises can manage relationships with their customers, CRM now encompasses a number of very mature solutions. As late adopters of CRM, governments are therefore reaping the benefit, taking advantage of well-developed offerings which adequately meet or even exceed their requirements. At the same time, when issuing requests for proposals (RFPs), governments generally outline their requirements in-depth, due to the heavily regulated environment in which the solutions are deployed. In particular, CRM offerings for government must meet standards around functionality, security and data privacy. The combination of maturing CRM technologies and well-defined RFPs and service level agreements (SLAs) have resulted in the requirements for government being clearly established, in particular around functionality, security and data privacy. This leads vendors to go to market with strong offerings whose expectations are laid out relatively explicitly, leaving little room for straying from established standards. Decision Matrix – Selecting a CRM Vendor in Government DMTC2243 / Published 2/2009 © Datamonitor. This brief is a licensed product and is not to be photocopied Page 6

Decision Matrix – Selecting a CRM Vendor in Government THE CRM IN GOVERNMENT DECISION MATRIX In this Decision Matrix, Datamonitor provides a summary of CRM vendors’ capabilities based on a quantitative assessment of their market impact as well as the technology features that they offer. The detailed scores underpinning the Decision Matrix can be found on individual vendor radars and in Table 3 in the Appendix. Datamonitor also provides guidance for government agencies looking to deploy CRM solutions, outlining whether they should immediately shortlist, consider or explore solutions from these vendors. The following definitions are used for each of these recommendations: • Shortlist – these vendors’ products and services should always be placed on an agency’s shortlist for CRM technology selection. This category represents the leading solutions that Datamonitor believes are worthy of a place on most technology selection shortlists. The vendor has established a commanding market position with a product that is widely accepted as best of breed. • Consider – the vendors in this category have good market positioning and are selling and marketing their product well. The products offer competitive functionality and good price/performance, and should be considered as part of the technology selection process. • Explore – solutions in this category have less broad applicability, and may have limitations in terms of the product’s functionality, or the vendor’s execution capability. However, they will still be suitable to meet specific requirements, and may be worth exploring as part of the technology selection process. Because realizing value from a CRM deployment is critically dependent upon the solution’s ability to execute the agency’s overall CRM strategy, a decision to purchase one solution over another should be based on a broad array of factors, including—but not limited to—the degree of alignment between the solution’s features and functionality and the specific objectives of an agency’s CRM strategy. As a result, Datamonitor’s recommendations of shortlist, consider and explore should only be taken within the context of an agency or government’s specific solution requirements. Decision Matrix – Selecting a CRM Vendor in Government DMTC2243 / Published 2/2009 © Datamonitor. This brief is a licensed product and is not to be photocopied Page 7

Decision Matrix – Selecting a CRM Vendor in Government Figure 1: The CRM in government Decision Matrix 8.0 7.0 Microsoft Dynamics Oracle Siebel 6.0 Market Impact (Scale 1-10) 5.0 Salesforce.com 4.0 3.0 Lagan RightNow 2.0 Consona 1.0 5.0 5.5 6.0 6.5 7.0 7.5 8.0 8.5 9.0 9.5 10.0 Technology Assessment (Scale 1- 10) Lagan Consona Oracle Siebel RightNow Salesforce.com Microsoft Source: Datamonitor DATAMONITOR Table 2: CRM in government Decision Matrix vendors Shortlist Consider Explore Oracle Siebel Lagan Consona RightNow Technologies Microsoft Dynamics Salesforce.com * vendors are listed alphabetically in each category Source: Datamonitor DATAMONITOR Market leaders: Oracle, RightNow Technologies With its Siebel 8.1.1 release, Oracle maintains a commanding lead in the government CRM market. Its offering is a key solution in its portfolio and, complimented by its Apps Unlimited strategy, is a clear market leader. It scores near the top in each technology criterion, in particular around analytics, multi-channel offering and workflow management capabilities. From a strategy and execution perspective, its Application Integration Architecture and Apps Unlimited provide governments with a strong offering that integrates with other solutions and the old legacy systems that are prevalent in many public sector agencies. Oracle has also added new Web 2.0 and social computing features, demonstrative of its continuing commitment to innovation in the market. Oracle's market impact is also strong, with its industry expertise and Decision Matrix – Selecting a CRM Vendor in Government DMTC2243 / Published 2/2009 © Datamonitor. This brief is a licensed product and is not to be photocopied Page 8

Decision Matrix – Selecting a CRM Vendor in Government solid reputation serving to maintain its global standing as a market leader. In addition to its CRM offering, Oracle leverages its vast array of other solutions, from enterprise resource planning (ERP) to enterprise content management (ECM) to business intelligence (BI), to provide public agencies with a common platform that provides easy upgrades and integration, resulting in a strong market presence around the globe. RightNow Technologies has emerged as a market leader, in large part due to its customer service function, which has proven a valuable addition to governments as they struggle to improve online service for constituents. As a smaller vendor, RightNow has managed to compete effectively against the larger vendors due to its robust and flexible offering, its strong market strategy and its good relationships with its customers. In its November 2008 offering—the latest in its quarterly release schedule—RightNow also enhanced the capabilities of its interactive knowledge base, a market leading aspect of its CRM solution, as well as its analytics perform. In terms of market impact, is strategy is well thought-out and executed. RightNow has a rapidly expanding client base, comprising small to large agencies across the globe, and is expanding its footprint in the government space, in particular at the US federal level and in other markets such as Europe and Australia. The challengers: Lagan, Microsoft Dynamics, Salesforce.com Lagan, focusing exclusively on government CRM, is a key challenger to the market leaders. Having begun in the UK with a focus on local UK councils, Lagan has expanded its footprint to include one of the largest 311 contact center deployments in North America. Today, it is one of the leading CRM vendors among local governments in both Europe and North America, and is beginning to compete at higher levels of government. Because Lagan’s solution has been designed specifically to address government needs (it was not adopted from commercial CRM) its distinct understanding of the government market is its key differentiator. Its solution takes a case management approach to CRM, helping agencies to deliver services in a more streamlined fashion, in particular around workflow, for a range of reusable government business processes. Its case management-based approach to CRM is well-suited to government operations, and its deep understanding of the local government market makes it an option that agencies should consider when purchasing a CRM solution. Microsoft Dynamics’ CRM 4.0 emerges as a challenger to the market leaders based not on the robustness of its solution but on its market impact, although it does provide good value to agencies seeking a basic CRM implementation. It scores consistently well in most technology aspects, and leads in both the integration and user interface categories. The solution’s ability to integrate seamlessly with the entire Microsoft suite of products and the familiar user interface are perhaps the most important differentiators from its competitors. Overall, its functionality continues to evolve and, in the government space, it meets all of the requirements that agencies typically look for in a CRM vendor. From a market impact perspective, it has a dominant position in the overall software market, with a growing base of CRM customers consisting mainly of mid- size deployments. Microsoft’s strategy of targeting the mid-market, rather than overextending itself by going after larger size implementations, seems to have benefited the Dynamics product line, and has allowed the company to expand its footprint at a steady pace. Microsoft's global reach and wide variety of other enterprise software offerings provides a stability which governments will no doubt find appealing, and it continues to explore new delivery methods and functionality in an effort to catch up with the market leaders. A market leader in commercial CRM, Salesforce.com remains a strong challenger in the government sector. It has seen very strong growth in its client base, in particular due to its on-demand offering, which provides agencies with a cost- effective, ready-to-go solution that is among the leading offerings in the market. It has also developed a number of Decision Matrix – Selecting a CRM Vendor in Government DMTC2243 / Published 2/2009 © Datamonitor. This brief is a licensed product and is not to be photocopied Page 9

Decision Matrix – Selecting a CRM Vendor in Government innovative tools that agencies can leverage; its Force.com platform and Ideas forums are useful among agencies looking to exchange best practices and new applications. Because government agencies do not compete with one another in the same sense that parties in the commercial sector do, platforms which allow best practice sharing are a particularly compelling differentiator for the government sector. Salesforce.com’s main challenge remains adapting its largely sales- oriented platform for the government vertical. While the issue is largely one of semantics, it is nonetheless an important aspect of messaging and product development that the company is beginning to grasp as it makes inroads with government clients. The prospects: Consona Having recently been re-branded as part of Onyx's strategy to streamline its product offerings, Consona OneServe CRM is a solution that offers good value and performance. Its strength lies largely in its unique approach of tagging everything in its system—from cases, to addresses, to incidents, to people—and establishing strong relational qualities between objects. The result is an effective manner of providing the much talked about ‘360 degree view’, not simply of the constituent, but also of the entire enterprise. As the re-branding begins to play out in the market, Consona could move into a ‘challenger’ position if it gains traction with its current client base and continues to expand, in particular in the US market. Decision Matrix – Selecting a CRM Vendor in Government DMTC2243 / Published 2/2009 © Datamonitor. This brief is a licensed product and is not to be photocopied Page 10

Decision Matrix – Selecting a CRM Vendor in Government MARKET LEADERS As the competitive landscape may vary significantly across the two areas covered by Datamonitor’s Decision Matrix— technology assessment and market impact—it is important to consider these categories separately in order to develop a more complete understanding of each vendor’s particular strengths and weaknesses, and why it has been assigned a shortlist, consider or explore rating. In the following section of this report, Datamonitor will present the market leaders for each area and then discuss how they vary across the sub-criteria within the assessment areas. Market leaders: technology assessment While all six vendors profiled provide strong solutions for agencies, Oracle and RightNow stood out in terms of their offerings. Notably, Oracle led or tied in all categories except user interface, scalability, and strategy and execution, and is the clear market leader. Microsoft’s solution scores consistently across all categories, with Lagan and Salesforce.com also showing good ratings, in particular around analytics and scalability, respectively. When it comes to government CRM offerings, which must often interface with a number of other solutions and legacy systems, integration and interoperability are key components, and are closely tied to the solution's relative maturity, as well as its breadth and depth. Oracle Siebel leads in all three categories, largely due to its ability to leverage AIA and Apps Unlimited, providing a platform for deep integration with all Oracle solutions as well as other vendors’ offerings. Microsoft also scores well in this category, due to the dominance of its Office and Outlook solutions. As a standalone CRM vendor, RightNow’s solution stands up to those of the major software vendors in the market, having been integrated with various government systems in both the civilian and defense sectors. All three solutions score high in relative maturity, having seen numerous upgrades which add significant features, thereby expanding breadth and depth for agencies. Lagan, with its wide variety of implementations across various agencies, also leads in terms of breadth and depth. Oracle’s offering is also the leader in workflow management and automation—a particularly important criterion for assessing government CRM solutions, as it is used heavily in social service case management and agency contact centers. Oracle Siebel provides a robust workflow capability which is built on a tightly integrated business rules function and policy modeling tools which help determine the appropriate actions to take for a particular case. The ability to analyze and report on CRM data is central to agency missions, due to the prevalence of performance management and regulatory conditions around service levels. Oracle Siebel also leads in this category, with a wide variety of pre-configured government-tailored reports and strong drill-down capabilities. RightNow and Lagan also score highly in analytics, due to their advanced reporting functionalities for government agencies. In terms of scalability—an important factor for an agency looking to increase the size of its implementation, often in a short period of time—Salesforce.com leads the market, due to its established and reliable soft as a service (SaaS) offering. RightNow, Microsoft and Oracle also score well, having made increased investment in their SaaS offerings, with Oracle and Microsoft also benefiting from their size. On a related note, vendors' ability to support their deployments through implementation, maintenance and support services is reflected in the strategy and execution category, and is led by Microsoft and RightNow. Microsoft and RightNow both provide leading end-user interfaces, due to their simple and intuitive designs. Both have a similar appearance to Outlook, providing agencies with quickly deployable solutions that require minimal training and a Decision Matrix – Selecting a CRM Vendor in Government DMTC2243 / Published 2/2009 © Datamonitor. This brief is a licensed product and is not to be photocopied Page 11

Decision Matrix – Selecting a CRM Vendor in Government relatively flat user adoption curve. When it comes to configurability—the ability to adjust the solution for internal purposes as needed—Oracle and RightNow lead once again, as their solutions provide the most comprehensive functionality around easily interchangeable widget features. Figure 2: Market leaders analysis: technology assessment Interoperability & integration 10 Configurability Offering maturity 9 Workflows and management tools Offering breadth & depth 7 6 End-user interface Strategy & execution Analytics & reporting functionality Offering scalability Multi-channel capabilities Lagan Microsoft Oracle Siebel RightNow Salesforce.com Consona Source: Datamonitor DATAMONITOR Market leaders: market impact Microsoft’s strong brand recognition, global reach and large government-specific revenue provide it with a leading impact on the market, based on Datamonitor’s criteria. Its impact is due largely to the dominance of Office and Outlook, which has resulted in the adoption of Dynamics CRM as a logical addition in many cases. It is interesting to note that, despite its size, Microsoft’s target market is not large-scale implementations such as large citywide 311 initiatives, but rather mid-size implementations across agencies or smaller jurisdictions. This has allowed Microsoft Dynamics to achieve a broad footprint and user acceptance, reducing strain on operational capacity and thereby mitigating the risk of failed implementations. Decision Matrix – Selecting a CRM Vendor in Government DMTC2243 / Published 2/2009 © Datamonitor. This brief is a licensed product and is not to be photocopied Page 12

Decision Matrix – Selecting a CRM Vendor in Government Salesforce.com also has a significant market presence, due to its easily deployable and scalable delivery model. At the same time, its implementations are not large scale, but aimed primarily at single agencies with a sales component, such as transit agencies, or case management functionality, such as social services. Due to the increasing prevalence of hosted software deployments, Salesforce.com has seen an impressive increase in new customers, and its CRM installed base is the highest of the vendors profiled. Its impressive client list is reflective of the increasing popularity of the on-demand delivery model and, coupled with its AppExchange and Force.com platforms, Salesforce provides a strong value proposition which has translated into wide deployment globally. Oracle performs consistently well in market impact without leading in any category. Hidden behind the ratings is the fact that Oracle’s CRM implementations are technologically robust, favoring quality over quantity. While Oracle does offer a hosted offering for governments, its larger public sector clients often require large-scale implementations and are restricted from allowing data to be stored offsite. While governments looking for large-scale implementations will generally consider Oracle, it should be noted that it also has the capabilities to implement successful mid-size deployments, and is attempting to convey that message to the market in light of the economic climate and the reduced appetite for large-scale deployments by cash-strapped agencies. While these three vendors lead the market impact category, the remaining vendors should not be dismissed because of their size. While it is difficult for smaller and mid-size vendors to compete with the global reach of the large players, they nonetheless have strong products which have made an impact on the market, in particular given the economic climate, with governments looking for implementations at a lower cost and smaller scale. In fact, their smaller size and client base can serve as a competitive advantage when it comes to providing service and support to their customers, as well as their role as pioneers in introducing disruptive technologies to the market. For example, RightNow’s SaaS offering is comparable to Salesforce's and, despite its smaller market presence, the company outshines its competitors in many technology criteria. While not a leader in any of the market impact criteria, Lagan’s government-specific offering provides an excellent solution that is highly tailored to government needs. As a government-only vendor, Lagan has seen an impressive rate of growth over the past decade, and despite its relatively small size, supports major CRM initiatives in some of North America’s biggest jurisdictions. Finally, Consona has a strong presence in the UK local market, and its expertise and understanding of this space has spurred its impressive growth rate, which leads all vendors in this study. Decision Matrix – Selecting a CRM Vendor in Government DMTC2243 / Published 2/2009 © Datamonitor. This brief is a licensed product and is not to be photocopied Page 13

Decision Matrix – Selecting a CRM Vendor in Government Figure 3: Market leaders analysis: market impact Company size 10 9 8 Revenue growth Government Revenue 7 6 5 4 CRM installed base New customers Installed base Geographic reach Lagan Microsoft Oracle Siebel RightNow Salesforce.com Consona Source: Datamonitor DATAMONITOR Decision Matrix – Selecting a CRM Vendor in Government DMTC2243 / Published 2/2009 © Datamonitor. This brief is a licensed product and is not to be photocopied Page 14

Decision Matrix – Selecting a CRM Vendor in Government VENDOR ANALYSIS Consona OneServe: CRM in government radars Consona is a US-based corporation with a UK subsidiary which offers CRM and ERP enterprise technology solutions. In August 2006, Consona, a privately held company, purchased Onyx Software Corporation. In March 2007, Consona then purchased KNOVA Software, a knowledge management (KM) vendor, and began integrating all of its brands under one umbrella brand, Consona CRM. The company offers product ‘bundles’ which cover a variety of CRM functions, across sales, marketing, and customer service and support. Its CRM offering is now tightly integrated with KM, and is aimed at large, mid-market and local authorities. The OneServe suite is a rounded CRM solution set offering case, knowledge and feedback management, a vertical solution aimed specifically at UK local government. OneServe citizen management is essentially a case management solution template for local government with a business rules engine, process scripting, marketing, and knowledge modules. The solution is highly configurable, which allows for a focused implementation that enables the organization to map its business methods and customer lifecycle rather than be forced to adopt processes within the application. Consona takes a people-related approach to CRM, mapping the relationships between people, places and objects within the authority’s jurisdiction. OneServe has been designed with the UK market in mind, but is readily transferable for similar requirements in other countries. Consona’s OneServe application is particularly suitable for authorities looking for a strategic implementation to transform the citizen’s experience, and aligns best-in-class technology with day-to-day local authority practices. OneServe seeks to provide a holistic view of the citizen and agency operations, by offering a solution that enables joined-up, de-siloed organizational processes across multiple departments. Figure 4: Consona government CRM radars Technology Radar Market Impact Radar Interoperability & integration Company size 10 10 Configurability 8 Offering maturity 8 6 Revenue growth 6 Government Revenue Workflows and management 4 4 Offering breadth & depth tools 2 2 0 0 End-user interface Strategy & executionCRM installed base New customers Analytics & reporting functionality Offering scalability Installed base Geographic reach Multi-channel capabilities Cons ona Average across vendors Maximum s core Consona Average acros s vendors Source: Datamonitor DATAMONITOR Decision Matrix – Selecting a CRM Vendor in Government DMTC2243 / Published 2/2009 © Datamonitor. This brief is a licensed product and is not to be photocopied Page 15

Decision Matrix – Selecting a CRM Vendor in Government OneServe has common design, customization and integration capabilities, including Outlook calendar and email. It also has web API integration capabilities for applications such as citizen forums and chat, and plans to add VOIP capability in the near future. OneServe also has an intuitive user interface configuration tool which allows rapid page design and field definition that enables users to add tabs, and alter, customize and auto-fill fields and effectively take ownership of the application without recourse to external consultancy. Consona’s applications are primarily on-premise, and are built on a Windows platform with open architecture and a preconfigured baseline user interface with open integration architecture so it can be linked to back-office systems. The user interface look and feel can be changed through the use of style sheets. In addition, its ‘user roles’ capability enables users to see the appropriate information they are entitled to, which will help them to resolve issues and maintain confidentiality (this would be particularly useful for social service departments). In addition, Consona OneServe feedback management allows authorities to manage and execute multi-channel inbound and outbound communications to address issues such as school closures, flood alerts, planning notices, survey and consultation invitations, and constituent feedback. Recommendation: explore Going forward, the new re-branding initiative will allow Consona's current and potential customers to better leverage the company's expertise in government CRM. The company should therefore be explored, particularly by agencies considering strategic implementations. The main benefits of Consona’s solution are that it offers a high degree of flexibility: agencies can purchase within and across product lines, or an entire suite, which also offers pre-defined solutions to meet more common business needs. Consona OneServe is a robust, flexible and rounded citizen service solution for UK local authorities that ensures service evolution and transformation of the citizen experience, while reducing the cost of service delivery, to provide a better service for citizens and businesses. Decision Matrix – Selecting a CRM Vendor in Government DMTC2243 / Published 2/2009 © Datamonitor. This brief is a licensed product and is not to be photocopied Page 16

Decision Matrix – Selecting a CRM Vendor in Government Lagan: CRM in government radars Lagan's position as a vendor focused solely on the government sector is unique, and its enterprise case management (ECM) solution—previously called Frontline—is an up-and-coming player in the market. A Belfast-based vendor, Lagan was founded in 1994 after the UK government provided increased funding for e-government initiatives. The solution is very niche, serving the diverse but specific needs of government agencies, in particular in UK local governments, where it is among the most dominant players. Over the past two years, Lagan has made investments in its ECM functionality on top of CRM, and has experienced strong growth. Designed around case management, Lagan’s solution initially saw widespread implementation at local level in the UK, and has since expanded into the US and Canada. Today, it has a wide range of clients, ranging from 311 in large jurisdictions to implementations in individual agencies. Its solution consists of an application library, which focuses on human services/social care and 311; a business process suite, focused on comprehensible government CRM and its ServiceFlow lifecycle case management; and platform components, consisting of the government to people platform (G2PP) and configuration studio. Its traditional delivery method is on-premise, although it also offers hosted services for some agencies, and can be delivered as a web-based application able to run on any device. The solution is built on an extensible object data model, which allows any object—such as individuals, organizations, buildings or streets—to be related to any other object, with configurable, relationship-specific data. Figure 5: Lagan government CRM radars Technology Radar Market Impact Radar Company size Interoperability & integration 10 10 Configurability 8 Offering maturity 8 Revenue growth 6 Government Revenue 6 4 Workflows and management 4 Offering breadth & depth 2 tools 2 0 0 CRM installed base New customers End-user interface Strategy & execution Analytics & reporting functionality Offering scalability Installed base Geographic reach Multi-channel capabilities Lagan Average acros s vendors Maximum score Lagan Average acros s vendors Source: Datamonitor DATAMONITOR Lagan is particularly robust in contact center/311 support, disaster management, performance management and economic development. Lagan human services is an enterprise case management solution for human services which provides major agency functions from assessment, to plan development and vendor management. It also offers a commercial off-the-shelf (COTS) platform for agency-specific solutions. In particular, its solution supports case management in social services, where data have to be managed very precisely, and the case often lasts over a long period of time. It also works heavily in Decision Matrix – Selecting a CRM Vendor in Government DMTC2243 / Published 2/2009 © Datamonitor. This brief is a licensed product and is not to be photocopied Page 17

Decision Matrix – Selecting a CRM Vendor in Government department of motor vehicles (DMV) implementations that have an emphasis on case management, such as the Real ID initiative in the US. From an analytics standpoint, it offers a number of dashboards and reports out of the box, and also integrates with other vendors’ BI solutions and Microsoft SQL Server. Notably, the analytics feature allows agencies to match the individual SLAs against their performance, and users can build ad hoc reports through drag and drop reporting. While CRM was developed largely as a commercial application and has been adopted over the years for public sector needs, Lagan’s focus solely on how government uses the features and functionality has allowed it to act as a knowledgeable partner for governments implementing CRM. Designed specifically to address public agency needs—rather than adopted from commercial CRM—the solution is highly tailored to governments, demonstrative of Lagan’s strong understanding of public sector requirements. Recommendation: consider Because it has been designed specifically for the government sector, Lagan’s solution provides a strong value add in terms of meeting the industry’s unique business needs and compliance requirements, and should be considered by any agency- in particular those at the local level- looking for a CRM implementation. Designed with a specific business purpose in mind, it is able to provide end-to-end case management and service delivery in a focused manner. Lagan’s approach to CRM is to help governments streamline the delivery of services by basing business processes around case management; with its business process management and business rules engine, Lagan’s solution becomes a very powerful tool for service delivery. Decision Matrix – Selecting a CRM Vendor in Government DMTC2243 / Published 2/2009 © Datamonitor. This brief is a licensed product and is not to be photocopied Page 18

Decision Matrix – Selecting a CRM Vendor in Government Microsoft Dynamics: CRM in government radars Microsoft has invested heavily in its Dynamics product line, and continues to expand its client base at a steady rate. In particular, the Dynamics CRM install base has grown significantly, and is among the more successful elements of the Dynamics portfolio. Coupled with a strong partner ecosystem, the portfolio combines an off-the-shelf set of applications that support constituent contact and case management, with an application development platform that leverages the familiar Microsoft user experience. CRM 4.0, the latest release, provides legislative correspondence, tax and revenue services and legal case management, and public housing case management, and its request/incident tracking and outreach functions allow agencies to track issues, inquiries and events, as well as search for and communicate the results to constituents. Although MS CRM is enterprise scalable for large governmental organizations, it also provides a reliable solution for good value to agencies not looking for soup to nuts implementations. By not competing for large-scale implementations, and focusing on a multiplicity of deployments, Microsoft has adopted a strategy which reduces risk and ultimately aims to increase user acceptance. Figure 6: Microsoft Dynamics government CRM radars Technology Radar Market Impact Radar Company size Interoperability & integration 10 10 Configurability 8 Offering maturity 8 Revenue growth 6 Government Revenue 6 Workflows and management 4 4 Offering breadth & depth tools 2 2 0 0 CRM installed base New customers End-user interface Strategy & execution Analytics & reporting functionality Offering scalability Installed base Geographic reach Multi-channel capabilities Microsoft Average across vendors Maximum s core Micros oft Average acros s vendors Source: Datamonitor DATAMONITOR Whereas in previous CRM releases the main shortcoming of the Microsoft offering was its overall lack of solution maturity, the CRM 4.0 release has a variety of new and powerful out of the box functionalities. The solution now offers duplicate data detection, improvements to power and configurability of its reporting and analytics functions, and enhanced relational capabilities; forms can easily be linked to Virtual Earth and geographic information systems (GIS), and it has the ability to support email newsletters, marketing campaigns and outreach. CRM 4.0 plugs in well with major telephony vendors for managing incoming calls and screen pops, and with the 4.0 upgrade, Microsoft now offers Dynamics CRM on-premise, hosted or on-demand, with the choice of Outlook, browser or mobile-based delivery, software or SaaS, and own or Decision Matrix – Selecting a CRM Vendor in Government DMTC2243 / Published 2/2009 © Datamonitor. This brief is a licensed product and is not to be photocopied Page 19

Decision Matrix – Selecting a CRM Vendor in Government subscribe. Dynamics CRM’s comprehensive 'power of choice' is a key differentiator among the CRM solutions available to public officials at all levels of government. Perhaps the most notable strength is its familiar user interface (UI); CRM 4.0 runs on a native Outlook and Office UI, significantly reducing training time and costs. At the same time, since it is based on SOA, it allows the linking of a variety of disparate systems, and is easily configurable both with Microsoft applications and other external vendor applications. Since many clients already have a Microsoft stack in-house, adding Dynamics CRM is not a stretch. Its major differentiator is its integration with other elements of the Microsoft portfolio; email, appointments, tasks and tracking can easily be linked to Outlook and tightly integrated with the Office productivity suite. It also provides a report creation tool which can pull data from Dynamics into a pivot report in one click, and can perform trend analysts using the SharePoint portal for collaboration. Recommendation: consider With the release of Dynamics CRM 4.0, Microsoft is attempting to position its offering as more than a basic enterprise-level CRM solution targeted at existing Microsoft users, and become a more important player in both the on-demand and on- premise segments of the CRM market, in particular in the government space. In a clear sign that Microsoft is listening to its customers, CRM 4.0 is more polished and has implemented a number of new features, designed to appeal to its vertical customers in the public sector. The release is a big step forward for Microsoft, as it begins to build on its strengths and move from a player geared towards mid-size implementations to a larger player in the CRM market. Ultimately, agencies that are concerned about integrating their CRM solution with their productivity suite, and those that might not be able to afford more intensive user training, would be wise to consider Microsoft Dynamics CRM 4.0. Decision Matrix – Selecting a CRM Vendor in Government DMTC2243 / Published 2/2009 © Datamonitor. This brief is a licensed product and is not to be photocopied Page 20

Decision Matrix – Selecting a CRM Vendor in Government Oracle Siebel: CRM in government radars Due to its strong showing across all areas, Oracle is the clear market leader in the government CRM space. Its Siebel CRM offering—which it acquired in January 2006—remains the consistent benchmark for the industry. In addition to Siebel, Oracle also offers CRM capability through its E-Business Suite and PeopleSoft solutions. In the government space, Oracle is largely focused on Siebel 8.1.1, which supports multi-channel interactions from web, call center, field workers, and field offices, to integrated end-to-end processes such as housing, income support and tax. Because of its magnitude as a leading vendor, and Siebel’s strong CRM offering at the time of acquisition, Oracle Siebel offers one of the most robust CRM solutions for government agencies. The depth and breadth of its offering remains unchallenged across most categories, and Oracle’s sheer size is difficult for smaller vendors to compete with. It has superior citizen management capabilities, multi-channel support, advanced analytics and a strong case management offering. In particular, the Oracle Applications Unlimited, Oracle Application Integration Architecture (AIA) and Oracle Fusion Middleware offerings provide governments with a diverse portfolio from which to deploy or build a solution that meets their needs. Figure 7: Oracle Siebel government CRM radars Technology Radar Market Impact Radar Interoperability & integration Company size 10 10 Configurability Offering maturity Revenue growth Government Revenue 5 5 Workflows and management Offering breadth & depth tools 0 0 End-user interface Strategy & execution CRM installed base New customers Analytics & reporting functionality Offering scalability Installed base Geographic reach Multi-channel capabilities Oracle Siebel Average acros s vendors Maximum s core Oracle Siebel Average across vendors Source: Datamonitor DATAMONITOR Oracle Siebel Public Sector 8.1.1 sets the standard for solution maturity in the industry, with a full range of new features: user authentication, which enables citizen self-registration to access online services; form locator and status tracking, which allow citizens to search for application forms; and form data validations, which allow web service capability to validate against a live data source. It has strong functionality around the document verification process; using a contact matching function, the system extracts information from a PDF, and can verify this against existing records or create a new one if necessary. It also leverages Adobe in its Siebel 8.1.1 release to include forms. Decision Matrix – Selecting a CRM Vendor in Government DMTC2243 / Published 2/2009 © Datamonitor. This brief is a licensed product and is not to be photocopied Page 21

Decision Matrix – Selecting a CRM Vendor in Government From an agency facing, case management aspect, Siebel 8.1.1 has added application review, which allows case workers to review received applications, and facilitates acceptance and renewal; contact matching, which matches application information from PDF documents against Siebel contacts and reduces duplication; form upload, which allows form data to be saved into Siebel objects and create new cases from applications; master case functionality, which creates a single view of the citizen across multiple cases, and consolidates case actions and calendar entries; and forms integration administration, which provides newly added attributes to facilitate form hosting and enables the deployment of forms anywhere within a firewall. It has pre-built integration with Oracle’s on-premise CRM and ERP solutions, and multiple deployment options make it a leader when it comes to integration and interoperability. It is offered on-demand or on- premise and has strong call center support features. Oracle has a well-thought out strategy and the ability to execute soundly from a public sector perspective, leveraging its position as one of the leading vendors to deliver strong integration capabilities. Its applications unlimited strategy allows clients to ‘mix and match’ any of the existing Oracle product lines (including Oracle E-Business Suite, JD Edwards, PeopleSoft, and Siebel) and provides customers with lifetime support beyond the delivery of Oracle Fusion Applications. Oracle AIA is an open standards-based integration framework that leverages fusion Oracle Fusion Middleware and brings a sustainable integration approach through common object and services definitions. AIA allows governments to take an evolutionary approach to modernizing applications, while gaining the flexibility of business process across composite environments that exist in all governments today. AIA allows governments to take a plug-and-play approach, by incorporating Oracle Fusion Middleware technologies into the infrastructure. Siebel CRM is an open standards system built on Fusion Middleware technology, and is web-service enabled. Siebel CRM is particularly strong on analytics, incorporating an XML-based reporting module, BPEL support and Siebel Analytics. A good example is found in its social service offering, which provides a pre-packaged application that runs case trend analysis by a number of variables, including type and location of a case. It also provides a benefit dashboard which outlines details of benefits being administered and funded by the agency, and demographic analytics, which looks at cases by indicators such as income, education and race. Oracle’s offering has also been enhanced by its recent acquisition of Haley, a piece of policy modeling and automation software for legislative and regulated industries (including governments). This allows an agent to run a built-in simulation and scenario model with temporal reasoning, which can be used by agents or a citizen self-service function to determine benefits. Recommendation: shortlist Oracle Siebel is a market leader due to its robust offering, deep functionality and strong analytics, as well as its ability to integrate well with other vendor and government legacy systems. While Oracle’s strength lies in its ability to meet the needs of large scale, strategic implementations that require deep expertise and knowledge of government-specific business needs, it has also successfully rolled out a variety of mid-size deployments. While there are some concerns around cost, and service and support levels, Oracle does have the expertise to manage smaller-scale projects, drawing on its partner network and deep technology expertise. As such, Oracle Siebel should be on the shortlist for any government considering a CRM deployment. Decision Matrix – Selecting a CRM Vendor in Government DMTC2243 / Published 2/2009 © Datamonitor. This brief is a licensed product and is not to be photocopied Page 22

Decision Matrix – Selecting a CRM Vendor in Government RightNow Technologies: CRM in government radars Headquartered in Bozeman, Montana, with 14 offices worldwide, RightNow Technologies offers a robust CRM offering, with a significant segment of its clients coming from the public sector. Its customer service offering is market leading and a key application for government agencies. Its solution is used to manage a variety of agency contact centers and citizen interaction tracking, while its case management feature is used in applications from HR to benefits to facilities management. It is a market leader in customer service delivery, primarily due to its strong e-service features and multi- channel capabilities. In particular, it offers a highly effective self-service functionality for finding information online, a particularly useful features for aiding constituents trying to navigate government websites. RightNow’s focus is around organizing knowledge to enhance interactions and improve citizen experiences and loyalty, rather than simply managing internal processes and increasing efficiency. The solution offers a robust multi-channel capability (web, email, phone, chat, voice), has demonstrated innovative use of leveraging chat with some of its clients, and puts a strong emphasis on proactive communications to reduce incoming inquiries. RightNow’s offering is entirely widgetized, allowing customers to take a plug-and-play approach to building their CRM system. In November 2008, RightNow released its latest offering, which contains enhanced agent scripting, guided assistance, a desktop add-in framework that allows external functionality or applications to be embedded into the RightNow agent desktop, unified email bounce management, customizable agency login screen, chat with file attachments, and a number of improvements to analytics, marketing and feedback. The solution includes a new customer portal, co-browse functionality and proactive chat. Over the past year, it has also added a knowledge syndication widget, which allows content from the RightNow knowledgebase to be published on any web page, and multi-channel capabilities to centralize the capturing of constituent requests. Figure 8: RightNow government CRM radars Technology Radar Market Impact Radar Interoperability & integration Company size 10 10 Configurability 8 Offering maturity 8 6 Revenue growth 6 Government Revenue Workflows and management 4 4 Offering breadth & depth tools 2 2 0 0 CRM installed base New customers End-user interface Strategy & execution Analytics & reporting functionality Offering scalability Installed base Geographic reach Multi-channel capabilities RightNow Average across vendors Maximum s core RightNow Average across vendors Source: Datamonitor DATAMONITOR Decision Matrix – Selecting a CRM Vendor in Government DMTC2243 / Published 2/2009 © Datamonitor. This brief is a licensed product and is not to be photocopied Page 23

Decision Matrix – Selecting a CRM Vendor in Government From an analytics perspective, RightNow also offers a strong out of the box solution in terms of dashboards and reporting. Its new co-browse feature enables constituents to grant an agent permission to share the consumer's desktop during a chat or phone interaction, allowing the agent to point out where an icon or field might be located—a particularly useful capability in complex scenarios. Contextual workspaces provide access to the relevant knowledge at the appropriate time, allowing agents to handle tasks more efficiently. The features allow for a workspace to be modified based on actions taken by an agent or information that is known about a constituent or case, while guided assistance gives agents the ability to walk through a series of questions to ask—with a decision tree interface—when resolving an issue. Recommendation: shortlist RightNow's offering is very strong, and should be shortlisted by government agencies looking for CRM solutions. Over the last year, its quarterly releases have added a number of innovative new features, and its hosted delivery option provides governments with an effective way of delivering service at a lower cost, while still maintaining quick deployment, robust functionality and the deep analytical capabilities necessary for a government CRM solution. Governments looking for a strong, reliable solution for customer service and contact management would be well-served by RightNow; it has a small but significant presence in the government sector, in particular in its knowledge base offering for citizen service, and while not a large company, RightNow makes up for what it lacks in size with its high level of customer support. With a focus on improving the customer experience, RightNow provides a market-leading solution for governments looking to enhance service delivery and interactions with their constituents. Decision Matrix – Selecting a CRM Vendor in Government DMTC2243 / Published 2/2009 © Datamonitor. This brief is a licensed product and is not to be photocopied Page 24

Decision Matrix – Selecting a CRM Vendor in Government Salesforce.com: CRM in government radars Salesforce.com, one of the leading SaaS CRM vendors to the commercial sector, is gaining ground in the government space, with its solutions being used as both straight CRM functions as well as case, asset and contract management solutions. The key benefit around Salesforce is its delivery model. By focusing its resources on providing an efficient, lightweight and rapidly-deployable solution, governments are able to deliver CRM at significantly reduced costs, and provide near-instant scalability. The company has strong revenue growth, a trend which is likely to continue as the economy forces organizations to adopt less costly SaaS deployments. Notably, Salesforce takes a more partnered approach to service delivery, especially at the state & local level. It is used for a wide variety of functions, including incident management, correspondence, complaint tracking, call center management, customer service portals, training, and even lost and found. From an analytics perspective, there is a focus by Salesforce on transactional management reporting, such as throughput rates and backlogs, in particular around grant management and case management. Figure 9: Salesforce.com government CRM radars Technology Radar Market Impact Radar Interoperability & integration Company size 10 10 Configurability 8 Offering maturity 8 6 Revenue growth 6 Government Revenue Workflows and management 4 4 Offering breadth & depth tools 2 2 0 0 End-user interface Strategy & execution CRM installed base New customers Analytics & reporting functionality Offering scalability Installed base Geographic reach Multi-channel capabilities Salesforce.com Average across vendors Maximum s core Salesforce.com Average acros s vendors Source: Datamonitor DATAMONITOR Salesforce has a number of unique differentiators which it has leveraged to gain traction in the market. Its development platform, AppExchange, is a peer-to-peer app sharing community that allows customers to offer Salesforce applications to other agencies and therefore build out their CRM solutions. With subscriber growth central to Salesforce’s success, the AppExchange platform takes on a very important role strategically, and is translating into a more successful initiative in the long-term. In addition, Salesforce Ideas allows customers to make suggestions for service improvements and enhancements, and creates a basic online community by aggregating the top applications and suggestions. This has seen resonance in the public sector, in particular around citizen forums. Finally, Salesforce offers Force.com as its development platform which gives clients the opportunity to build applications- as opposed to simply managing or sharing- using JAVA or .NET. Decision Matrix – Selecting a CRM Vendor in Government DMTC2243 / Published 2/2009 © Datamonitor. This brief is a licensed product and is not to be photocopied Page 25

Decision Matrix – Selecting a CRM Vendor in Government Salesforce faces some key challenges; like other on-demand vendors in the public sector, ultimate success the government market depends largely on the adoption rate of on-demand by government agencies. In addition, because Salesforce focuses primarily on sales force automation, which is less applicable to government, thereby rendering the solution slightly less popular among agencies focused on constituent service. In an effort to overcome this challenge, Salesforce has recently both: a) adopted a more aggressive vertical approach for the public sector; it has received necessary federal security accreditation for its SaaS offering, and as the solution matures, more public sector-specific applications are beginning to emerge from the Force.com platform, and b) made major investments in its Customer Service capabilities (Intranet, large volumes/scale, Sites) Recommendation: consider In the end, Salesforce offers a robust solution which provides governments with a good option for quick and low-cost deployments. While generally considered a market leader in the horizontal CRM market, in the government sector, it is still on the verge of competing with the dominant players. The company continues to grow in the government space, and its challenge will be around remaining competitive in the on-demand market, with other vendors offering increasingly flexible deployment packages. In addition, it continues to adopt its offering- developed specifically for commercial enterprises- to the government market. Nonetheless, Salesforce’s solution has a number of features and functionality that perform nearly up to the standard with the larger, market leaders in the government space, and offers a speed of deployment that is difficult to rival. As such, governments should consider Salesforce as a strong on-demand option when purchasing a CRM solution. Decision Matrix – Selecting a CRM Vendor in Government DMTC2243 / Published 2/2009 © Datamonitor. This brief is a licensed product and is not to be photocopied Page 26

Decision Matrix – Selecting a CRM Vendor in Government APPENDIX Summary scores Table 3: Vendor scores VENDOR TECHNOLOGY ASSESSMENT MARKET IMPACT Consona 7.3 1.5 Lagan 8.2 1.7 Microsoft Dynamics 7.7 6.6 Oracle Siebel 9.0 6.2 RightNow Technologies 8.6 2.1 Salesforce.com 8.2 5.2 Source: Datamonitor DATAMONITOR Datamonitor ratings • Shortlist – these vendors’ products and services should always be placed on a government’s shortlist for CRM technology selection. This category represents the leading solutions that Datamonitor believes are worthy of a place on most technology selection shortlists. The vendor has established a commanding market position with a product that is widely accepted as best of breed. • Consider – the vendors in this category have good market positioning and are selling and marketing their product well. The products offer competitive functionality and good price/performance, and should be considered as part of the technology selection process. • Explore – solutions in this category have less broad applicability, and may have limitations in terms of the product’s functionality, or the vendor’s execution capability. However, they will still be suitable to meet specific requirements, and may be worth exploring as part of the technology selection process. Extended Methodology Datamonitor assesses CRM vendors based on three core criteria, each of which consists of between eight and 12 specific criteria. Taken together, these criteria serve as the basis for Datamonitor’s positioning of vendors as shortlist, consider, or explore in the competitive landscape for government. Technology assessment Datamonitor analysts assign vendors a score from one to 10 for each of the assessment criterion, whereas the overall technology assessment is determined by taking the average of these scores. The technology assessment criteria used for the CRM market in government include: Decision Matrix – Selecting a CRM Vendor in Government DMTC2243 / Published 2/2009 © Datamonitor. This brief is a licensed product and is not to be photocopied Page 27

Decision Matrix – Selecting a CRM Vendor in Government • Interoperability and integration – the ease with and extent to which a technology offering can exist, interface, combine and work with the products, services, and other solutions from other vendors. • Offering maturity – the extent to which an offering has developed in comparison to similar offerings on the market. • Offering breadth and depth – the degree to which the solution supports government functions, from 311/contact centers to case management, and the extent of functionality offered to support each business requirement. • Strategy and execution – vendor capability features including financial stability, training options, support policies and maintenance options, as well as deployment services and implementation partners, are all taken into account, as is the vendor's ability to execute these capabilities. • Offering scalability – the ability of an offering to meet the demands of government agencies. Scalability can have many dimensions: transaction rates, computational throughput, concurrent user load, process sophistication, etc. • Multi-channel capabilities – the extent to which the solution supports the use of multiple contact points with constituents such as telephone, mail, email, web and in-person, with an emphasis on ensuring that information is provided once and then shared regardless of the interaction channel. • Analytics and reporting – the extent to which the solution provides capabilities for reporting on the interactions with constituents. • Workflow and management tools – the extent to which the solution provides tools to help manage multi-step business processes such as service requests, automated workflows and case management. • Configurability – the extent to which the agency is able to configure the solution to meet their own specific needs/preferences, look and feel. User sentiment (not included in this Decision Matrix) As part of each technical assessment, Datamonitor surveyed users of CRM technology in government across North America and Western Europe, drawn from a variety of sources. These end-users were asked to rate the technology vendors they work with; Datamonitor analyzes the results and provides an average rating in each of the following categories. (Note: due to an insufficient number of responses to an end-user survey, the ‘user sentiment’ section usually included in Datamonitor Decision Matrices has been excluded from this report). • Product quality – the enterprise’s perception of the quality of the vendor’s products. • Customer support – the quality of the vendor’s business/technical support offerings. • Service capabilities – the quality of a vendor’s particular service offerings (consulting, integration, maintenance, management). • Vertical specialization – the extent to which the vendor offers industry-specific solutions and expertise. • Portfolio depth – the enterprise’s perception of the depth of the vendor’s product portfolio. Decision Matrix – Selecting a CRM Vendor in Government DMTC2243 / Published 2/2009 © Datamonitor. This brief is a licensed product and is not to be photocopied Page 28

Decision Matrix – Selecting a CRM Vendor in Government • Service levels – the quality of a vendor’s service level agreements (SLAs) and its ability to meet them. • Financial stability – how financially stable the enterprise believes the vendor to be. • Client engagement – the effectiveness of the vendor’s sales-force and the enterprise’s perception of its channel to market. Market impact Datamonitor analysts use data collected through primary and secondary research to determine a vendor’s global market impact. Market impact is measured across six categories, each of which has a maximum score of 10: • Company size – each vendor’s revenue is calculated as a percentage of the market leader, multiplied by 10 and then rounded up to the nearest integer. • Government revenue – revenue attributable to the government vertical is calculated as a percentage of the market leader for each vendor, multiplied by 10 and then rounded up to the nearest integer. • New customers – the number of new agencies that each vendor brought under contract in 2008 is calculated as a percentage of the market leader, multiplied by 10 and then rounded up to the nearest integer. • Geographic reach – the number of agencies a vendor has under contract outside of the US and UK is calculated as a percentage of the market leader, multiplied by 10 and then rounded up to the nearest integer. • Installed base – the number of agencies using at least one of the vendor’s applications, such as enterprise resource planning (ERP), is calculated as a percentage of the market leader for each vendor, multiplied by 10 and then rounded up to the nearest integer. • CRM installed base – the number of government agencies having purchased the vendor’s CRM application is calculated as a percentage of the market leader, multiplied by 10 and then rounded up to the nearest integer. • Revenue growth – each vendor’s revenue growth rate over the last 12 months is calculated as a percentage of the fastest growing company in the market, multiplied by 10 and then rounded up to the nearest integer. Sources • Vendor briefings – in-depth briefings were conducted with each of the six vendors profiled in this report. • Secondary research – secondary research sources were used to inform and validate the conclusions of this report. • Financial analysis – analysis of vendors’ financial performance, taken from annual and quarterly reports, investor presentations, as well as a variety of secondary sources. Further reading Datamonitor (2009) Decision Matrix: Selecting an On-Demand CRM Vendor (Competitor Focus), January, DMTC2261 Datamonitor (2008) 2009 Trends to Watch: Government Technology, December, BFTC2188 Decision Matrix – Selecting a CRM Vendor in Government DMTC2243 / Published 2/2009 © Datamonitor. This brief is a licensed product and is not to be photocopied Page 29

Decision Matrix – Selecting a CRM Vendor in Government Datamonitor (2008) Where in the City? Using GIS to Manage Government Information (Strategic Focus), December, DMTC2248 Datamonitor (2008) Government IT Spending to 2013 (Interactive Model), November, IMTC0292 st Datamonitor (2008) Elections in the 21 Century: The Growing Adoption of Electronic Voting (Strategic Focus), October, DMTC2210 Datamonitor (2008) Future IT Trends and Projects: Saudi Arabia Public Sector (Industry Focus), June, BFTC1932 Datamonitor (2008) Decision Matrix: Selecting a CRM vendor in the higher education market (Competitor Focus), June, DMTC2109 Datamonitor (2008) CRM and the Move to Constituent Centric Government (Strategic Focus), March, DMTC2279 Ask the analyst The Technology Knowledge Center Writing team Ben Madgett, Analyst, Public Sector & Vertical Markets Technology bmadgett@datamonitor.com Datamonitor consulting We hope that the data and analysis in this brief will help you make informed and imaginative business decisions. If you have further requirements, Datamonitor’s consulting team may be able to help you. For more information about Datamonitor’s consulting capabilities, please contact us directly at consulting@datamonitor.com. Disclaimer All Rights Reserved. No part of this publication may be reproduced, stored in a retrieval system or transmitted in any form by any means, electronic, mechanical, photocopying, recording or otherwise, without the prior permission of the publisher, Datamonitor plc. The facts of this report are believed to be correct at the time of publication but cannot be guaranteed. Please note that the findings, conclusions and recommendations that Datamonitor delivers will be based on information gathered in good faith from both primary and secondary sources, whose accuracy we are not always in a position to guarantee. As such Datamonitor can accept no liability whatever for actions taken based on any information that may subsequently prove to be incorrect. Decision Matrix – Selecting a CRM Vendor in Government DMTC2243 / Published 2/2009 © Datamonitor. This brief is a licensed product and is not to be photocopied Page 30

Decision Matrix: Selecting a CRM Vendor in Government

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