Enterprise Relationship Management & The Extraprise
Realizing the Potential of Web-enabled ERM
By Shep Parke
In today's business environment, Enterprise Relationship Management (ERM) is helping companies
concentrate on their core competencies and quickly deploy information to their customers, to the field,
and to everyone in the value chain. The value chain consists of an extended supply chain among partners
and contractors and a well-linked delivery chain to customers. This integration of suppliers, distributors,
manufacturers, and customers into a totally connected universe is known as the extraprise.
An extraprise is an integrated, extended enterprise featuring a single, comprehensive ERM system that
offers access to everyone in the customer management chain: telemarketing, telesales, field service and
sales, call center customer service, marketing, resellers, business partners, and customers. The extraprise
approach incorporates e-commerce as a single component of the overall front-office solution for
business-to-business and business-to-consumer applications. It lets everyone in the value chain interact
live while sharing data on a global, 24x7 basis. Enterprise Relationship Management allows companies
to move to the next level of world-class customer service, using the power of the Internet and the World
Companies that have embraced ERM already have realized benefits in efficiency and profitability by
combining sales, support, and marketing databases into a single repository that tracks and manages the
organization's interactions with its customers. Customer repositories of this type not only keep basic
customer information and purchase histories but can also help handle service and support requests. In
addition, they help identify the best targets for promotional campaigns and, as an end result, produce
higher levels of customer satisfaction and a closer relationship with vendors.
Credit Alexander G. Bell
The early history of ERM centers on the telephone. The phone's ubiquity, ease of use, and direct
communication channel with customers made effective mass marketing possible. Savvy organizations
that leveraged the power of the telephone by creating call centers achieved huge economies of scale in
their marketing and sales operations. Use of the Internet and the Web represents the next step on the
path to success, building on four main premises:
Increased customer satisfaction: The Web offers customers immediate and convenient access to
information. This avenue of self-service increases customer interaction and satisfaction levels
while reducing per-customer costs for the company. The hold times and call scripts inherent in
call centers don't exist with the Web, so customers are more likely to be retained for future
Lower operating costs: The average customer support center call costs a company $60. Diverting
inquiries from live representatives to search-and-retrieval engines and automated agents can
dramatically reduce costs in all areas associated with call centers, including staffing, equipment,
training, and telecommunications.
Increased profitability: The arithmetic is straightforward—diverting just 10 percent of call center
calls to the Web results in tremendous savings for companies of all sizes. Selling costs are lower
as well, because a great amount of customer activity can be guided through personalized
Abundant marketing data: A compelling, personalized Web-enabled experience creates a wealth
of data for the extraprise. Organizations can track customer travel through the site, find out what
terms customers are seeking, and get them to volunteer for or opt into programs that provide
them with specific messages and critical information. This type of data is unique, invaluable, and
continuously fed back to the organization.
Although there might be some drawbacks to Web-enabling customers—slow information download or
identification of a browsing client—the problems are not serious and can be overcome easily and turned
Web-enabled ERM in the extraprise environment brings a wealth of benefits to the organization, such as
in-depth customer identification and a higher level of customer/company interaction.
This means that once an organization does identify a specific customer, it does so with richer data about
that person. The organization can move customers from the anonymous to the familiar and can deliver
customer-specific information. Getting to know Web-enabled customers means moving them to familiar
status as quickly as possible to help solidify leads. Several methods have emerged for accomplishing
Premium content and services: Many sites register their customers in order to let them access
support databases, promotions, product bulletins, and pertinent information. Companies may not
charge for this registration, but registration enables companies to capture specific customer
information and track these specific customers while they are visiting.
Personalization: The next-higher level on the registration continuum is personalization, which
lets companies reduce clutter for customers. It enables customers to go after the information they
need and drill down only through the specific areas in which they are interested. This technique
also gives organizations the power to provide specific, focused updates to repeat visitors who
already are registered and have personalized their profiles.
Automated customer advocates: Agent technology can help customers with their service updates
and alert them of special promotions. Registered and personalized customers can be led through
the site, with maximum value to the customers and maximum efficiency to the organization.
Contrast this with the experience of unknown customers blindly browsing through a site in hopes
of fortuitous matches between what they want and what they can find at the site.
The Web-enabled extraprise can establish a close, one-to-one, specific relationship with customers. The
technology does the hard work of identifying the customer, offering the services desired, and ensuring
that the experience is rewarding enough that the customer will want to come back to the site and
continue to be a faithful customer of the company.
Executive management teams at companies of all sizes are now aware of the potential of Web-enabled
ERM and integration of the extraprise model. Yet most global companies have not yet adopted a clear
ERM strategy that integrates the Internet and the Web, beyond lead generation, searchable
knowledgebases, and other simple forms of e-commerce.
Why? In part because Web enablement at the front end of the business, where the customer engages the
organization, is still a novel phenomenon. Many companies have demonstrable, unambiguous success
with adopting ERM in their call centers and team-selling solutions, yet this success is so recent that they
have not yet had the time to consider the next step seriously.
Traditional sales force automation (SFA), and then ERM, initiatives were driven by top management
and sales organizations, with IS providing traditional data processing services. But electronic commerce
initiatives tend to be driven by IS departments, and managers in those departments often do not yet have
a foundation of proven integration strategies for moving forward rapidly.
The urgent need to achieve and retain a competitive advantage, to equip field sales and telemarketing
with the most-effective solutions, and to stay in constant contact with customers was intuitively
understood by the people who were leading the charge into early SFA and recent ERM initiatives. With
Web-enabled ERM, the IS department is put front-and-center to integrate the organization's customer
interface directly into its own operations. The traditional IS requirements of seeing proven solutions;
avoiding risk; and focusing on system reliability, availability, and scalability must be addressed.
IS management's caution is reinforced by an e-commerce landscape that today features thousands of
vendors, most of them dealing with a fraction of the customer interaction solution. For example, many
new companies are focused on monitoring Web traffic, on tracking customers, or on personalization.
Some might handle transaction processing and others push specific content.
So companies, such as Accenture and Siebel Systems, that can offer more fully formed extraprise
solutions for electronic commerce will be able to empower enterprises of all sizes in their evolving Web-
enabled ERM strategies. Technology barriers to Web-enabled ERM are falling, customer access to
bandwidth is increasing, and Internet security is becoming less of an issue among consumers (and
certainly for business-to-business transactions). Database-to-Web integration strategies are offered on
multiple platforms, and search and agent technology creators are developing new ways of manipulating
data before results are served up. This makes problem resolution easier and the customer experience
Continued executive support of ERM, of the Web, and of Web-enabled extraprise initiatives seems to be
a foregone conclusion. Investors and venture capitalists continue to pour money into these ventures, and
the stock market is rewarding companies that stake their territory in the emerging e-commerce
landscape. Already, many companies have achieved competitive advantages and demonstrated success
in sales volume, market share, and even profitability through their Web-based initiatives. The clock
cannot be turned back for companies who hesitate in this environment.
Shep Parke is a Partner with Accenture's Global Customer Relationship Management practice. His
primary focus is in solution design and implementation for business-to-business selling effectiveness.