1. SocialmeetsCRM, July 2011
SocialmeetsCRM
The
Future
of
Customer
Relationship
Management
lies
in
Value
Networks
and
Collaboration
A SocialmeetsCRM White Paper
Thomas Wieberneit
July 2011

2. SocialmeetsCRM, July 2011
Summary
With the rise of mobile technologies, communities, social networks and general
social media Customer Relationship Management as we know it is undergoing
drastic changes. These technologies dramatically changed the playground as we
know it, and we still need to fully understand the new rules of the game in order
to be able to successfully compete in the marketplace.
Figure 1: The rules of CRM have changed (with kind permission of Mark Tamis, under creative
commons 3)
Although only depicting a part of CRM the above Figure , which got crafted by
Mark Tamis portrays a very important aspect of this change.
A
deceivingly
simple
question
Recently a valued colleague asked me a deceivingly simple question: “Where
does CRM heads to in future?”
Although it appears to be it is not that simple a question. There are many
complexities involved, on technical, organizational, and strategic level. It really
forced me to think as a great number of ideas, observations and discussions
need to be brought into a structure in order to answer this question.
To lay out a foundation it is important to start off with a definition of CRM.
Wikipedia provides a good and widely accepted one that I will use as this
foundation:
Customer relationship management (CRM) is a widely-implemented strategy for
managing a company’s interactions with customers, clients and sales prospects.
It involves using technology to organize, automate, and synchronize business
processes—principally sales activities, but also those for marketing, customer
service, and technical support. The overall goals are to find, attract, and win new
clients, nurture and retain those the company already has, entice former clients
back into the fold, and reduce the costs of marketing and client service.[1]
Customer relationship management describes a company-wide business strategy
including customer-interface departments as well as other departments
This definition shows that the question has at least two layers: A technological
one, and a strategic one.

3. SocialmeetsCRM, July 2011
It covers business processes and with that also implicitly the need of change
management and corporate culture.
Of course, we should not forget about the customer.
The
situation
Let us start to discuss the easiest one: The technology. Technology is the
simplest because it “merely” is a toolkit – and then I have some roots in
technology …
What I consider state-of-the-art right now is the availability of integrated
software suites that cover marketing, sales, service, and analytics – this across a
variety of channels, including mobile, web, interaction center. Surely, some
software packages are stronger in one area or the other but essentially we have
seen a tendency towards suites. The other thing that we have seen is a shift
from on premise to on demand. In parallel we have seen the change from a
horizontal CRM to industry specific solutions and the start of a change of mind on
the vendors’ side, away from product to solution. This implies the advent of
outside-in thinking. SaaS as a method of delivery is well established now and will
likely become even stronger, albeit with the occasional backslash.
Then we have a raft of buzzwords: Social media, communities, and related to
this social analytics (“socialytics”) and social CRM, customer experience
management, mobility, location based services, unified communication,
gamification, to name but a few.
On the strategy level we see more and more companies applying holistic and
business driven CRM strategies as opposed to the originally very technology
driven CRM implementations. We see that the companies are starting to
integrate different business functions and –processes. This is accompanied by
the thought of establishing a 360-degree view on the customer. Further,
companies started to not only ask for more internal efficiency but also to see
increased top- and bottom lines coming out of their CRM initiatives. To support
this companies implement loyalty programs and reach out into different
channels, including social media. Companies also increasingly look into building
their brands by providing consistent customer experiences across the various
touch points that they offer.
On the service side we observe a number of support communities leveraging
crowd sourcing; product development partly gets input via idea marketplaces,
which is another crowd sourcing example, and so on.
All this has the three goals of increasing customer retention, increasing the
number of customers overall, and increasing the operational efficiency.

4. SocialmeetsCRM, July 2011
Figure 2: Traditional CRM landscape; businesses have relationships with their customers
But
where
is
this
headed
now?
Different people say different things: Graham Hill suggests value co-creation1
being the right path, although there are other possible routes; others are
suggesting “a complete package, consisting of a thorough strategy and value
added services”2 or are simply putting it as being “social and mobile3”. Gartner
looks at it from a more technical level by saying that the (big) vendors will
concentrate more and more on providing a platform that can then get used and
enhanced by more specialized vendors and customer companies.
What one can say is that social CRM, as we experience it now, is only a step on
the journey. This is mainly because it covers only parts of the customers’ needs
and demands and because CRM is inherently social. Few years from now we will
have ceased speaking of social CRM because this stream has been merged back
into an (enhanced) idea of CRM.
1
http://www.customerthink.com/interview/social_crm_whats_right_whats_wrong_whats_next_inside_scoop_with_graham
2 http://thesocialcustomer.com/index.php?q=coriecrm/30585/future-crm-software
3 http://www.computing.co.uk/ctg/feature/2046203/computing-research-future-crm-social-mobile

5. SocialmeetsCRM, July 2011
Figure 3: The Social CRM Landscape as it can be seen today
So,
let’s
connect
the
dots
The future of CRM, as a strategy and as a technology, will more and more be
driven by two dimensions, the company internal and the company external
dimension. I also think that CRM will more and more be driven by strategy as
opposed to the technology. The technologies mentioned above and likely some
more will converged to support the strategy.
Internally there still is a high need for user adoption, especially when it comes to
CRM systems. This will be achieved on the short term by making internal
systems more and more available via easy-to-use or even fun-to-use applications
that do not require an explicit login into the CRM system itself. These
applications are logging the user on to the CRM system implicitly or via settings.
The CRM systems themselves will be more networked with other systems and
include and provide more relevant information automatically, instead of requiring
manual action. As a part of this mobile devices will become more and more
important, also to be able to ubiquitously access the systems. In the longer run I
think that gamification, or rather lessons learned from the success of game
platforms, and behavioral theories will drive the evolution of systems. How this
will look like is still evolving, but I think that Michael Wu is correct when he says

6. SocialmeetsCRM, July 2011
that fun should be made a part of the design requirements4 of a business
application, in order to gain user productivity.
Externally it is about the rationalization that (potential) customers, be they
companies themselves or consumers, are now at eye’s height with the
companies they buy from. With that companies will need to strive for
• Convenient and easy experience for the customer, both during the
preparation and execution of a transaction, but also afterwards.
• Creating value for, if not together with the customer; this value is not only
the product itself but also includes services around the product; these
values are provided, pre- to post purchase. These services will appear to
be individualized to the customer.
• Shifting their concentration from transactional “value in exchange”
thinking to process-orientated “value-in-use” thinking
Figure 4: Future CRM landscape with collaborating businesses and customers
4 http://lithosphere.lithium.com/t5/Building-Community-the-Platform/The-Future-of-Enterprise-Software-will-be-Fun-and-
Productive/ba-p/25486

7. SocialmeetsCRM, July 2011
How
can
this
look
like?
Earlier this year there have been a few blogs describing potential futures in a
retail orientated environment; one by Mark Tamis5 around the scenario of
preparing for a cocktail party, another one, by me using grocery shopping6, or a
more recent one by Vanessa DiMauro on the future of social shopping7. Surely
there are others, sorry for not mentioning them as well.
Both examples combine the convenient and easy experience with the idea of
creating additional value for the customer in collaboration with other companies,
and with the customers’ interactions, including their relationships to other
people.
Let me briefly sketch another example using the automotive sector, again
connecting different companies and customers, to create value.
BMW and Audi have thriving communities on Facebook. At least in Germany it is
long possible to “custom build” one’s dream car using configurators. The goal
and achievement of this is higher brand engagement and an improved customer
experience, both important parts of a CRM strategy.
This experience goes on after the cars get picked up with subtleties like sound
design and lots of helpers, including maintenance warnings.
Now let’s go on a little further and think of a “no worries” package: as part of
their commitment to the client the dealership picks up my car if there is an
appointment scheduled, e.g. from my workplace – and delivers it back in the
afternoon, when the service is performed. Given my permission my car could
even send its health data back to the service station, thus avoiding a good
number of surprises; some will stay but the dealership can inform me early that
something bigger is going to happen – that information could even be provided
by the car itself. Going on the car systems could identify a pending failure
somewhere on the road and warn me to either reduce load and/or to drive to a
nearby service station. The GPS system could direct me there. The service
station is already informed about what needs to be done, so that they can call
me on my car phone to further explain the problem and discuss options. They
probably can schedule the service immediately or alternatively provide me with
an adequate loan car to continue my trip while caring for its pickup and the
delivery of my car to where I am. The car, using the sensors that it already has
built in can communicate with a hive of other cars that are on my route,
identifying and notifying me of adverse traffic or weather conditions. It might re-
plan my route for me – or tell me that any other route likely still needs more
time.
5 http://marktamis.com/2011/02/28/social-crm-in-retail/
6 http://blog.ciber.com/article.cfm?articleid=2011030714918&ptopic=crm
7 http://www.customerthink.com/blog/the_future_of_social_shopping

8. SocialmeetsCRM, July 2011
Conclusion
The value chain as we know it converges towards a value network, that partly
gets built dynamically to fulfill a customer’s need or, in other words, to get the
customer’s job done.
Companies will organize themselves and network with other companies, transfer
customers between them in a dynamic flow. This will happen based upon the
explicitly or implicitly stated need of a customer, the ‘job’ she wants to get done.
As a consequence we will see dynamic value networks of companies, customers,
and their connections that are purpose-built and rebuilt to fit the need.
All this will be supported by a strong platform built from currently disparate but
converging technologies.
In few words CRM will change from being a company strategy to an ecosystem
strategy. The ecosystem consists of different companies, customers, and their
networks, collaborating with the goal of putting together a value proposition that
leads to customers choosing your company's over ones proposed by others.

9. SocialmeetsCRM, July 2011
About
the
Author
Thomas Wieberneit, Owner SocialmeetsCRM
Thomas is an executive with more than 15 years of leadership experience in
consulting, the software industry and in the armed forces. For more than 10
years Thomas held various leadership positions in SAP’s CRM development
organization, where he contributed to shaping and developing SAP’s CRM
solution. Before starting SocialmeetsCRM he was responsible for establishing and
driving the CRM consulting practice for CIBER in New Zealand and Australia and
CIBER's innovation in the area of social CRM. Thomas is an expert in CRM, in
distributed software development and the introduction and application of agile
development methods in enterprise scale projects.
If you would like to learn more about how SocialmeetsCRM can help you
facilitating and implementing a social CRM strategy in your company, please get
in touch with him via phone: +64-21-241-7701, by e-mail to
thomas.wieberneit@gmail.com, or via twitter @twieberneit. Please also visit our
web site www.socialmeetscrm.co.nz for more information.