Posts Tagged ‘Chief Service Officer’

News Analysis: Vertical Solutions Extends Customer Experience And Field Service Footprint With Three Partnerships

Vertical Solutions Partnerships Showcase Why Complex Field Service Is A Critical Glue Between ERP and CRM In Improving Customer Experience


Announced March 4th, 2014 at the Microsoft Convergence event, Vertical Solutions, made three significant partnerships with Blue Horseshoe Solutions, Cincom, and Vidcie.  The Cincinnati, Ohio based customer experience software vendor provides cloud contact center and service management solutions that bridge the worlds of physical goods with customer experience.  The analysis of the three announcements show:

  • Where after market sales and service creates a strategic differentiator for Cincom. Cincom signed a reseller partnership with Vertical Solutions for integrated Field Service Management and Maintenance Repair Operations.  Cincom is a global Microsoft ISV for manufacturing. The partnership allows Cincom to resell VSI’s Service Lifecycle Management Solution with Cincom’s Business Suite for Microsoft Dynamics AX.

    Point of View (POV):
    In the current digital business transformation, manufacturers realize that product margins can no longer sustain growth.  While service revenues, warranty management, and installation can provide additional revenues, organizations must move from selling products to keeping brand promises.  Post sales service is a key component to ensuring that the brand promise is kept for manufacturers.
  • Why supply chain and post sales service should team up to improve customer experience in the Blue Horseshoe partnership. Blue Horseshoe provides a Supply Chain Suite for Microsoft Dynamics AX.  The partnership ties customer support, field service and mobile environments with logistics, supply chain, transportation management, advanced warehousing, and order completion.

    (POV):
    While the Blue Horseshoe solution provides a robust capability in supply chain, Vertical Solutions provides post sales and complex field service requirements.  These requirements enable customers to deliver on the complete order management cycle.  In speaking with several Blue Horseshoe and Microsoft Dynamics AX customers, they have a need to reduce warranty costs and improve customer satisfaction through improved first visit resolution programs.  Constellation believes that customers do not care what department resolves the issue, just that the issue is resolved across the continuum of customer engagement.
  • How video streaming can provide real-time access to experts through the Vidcie partnership. The partnership with Vidcie allows customers to integrate video streaming technology into the VSI enterprise Service Lifecycle Management solution VServiceManagement.  Vidcie is a Silicon Valley based hands free live streaming, mobile, and wearable technology provider.  Vidcie is More…

News Analysis: Gainsight Spring 2014 Release Targets Large Enterprises Making The Transition To #DigitalBiz

Customer Success Management Pioneer Adds Key Functionality For March 2014 Release

On March 18th, Mountain View, CA based Gainsight announced the Spring 2014 release of its customerssuccess management platform.  Led by CEO Nick Mehta, the cloud software vendor has received over $29M in funding from key investors such as Bain Capital, Battery Ventures, Capital Innovators, Cultivation Capital, Silicon Valley Bank, and Summit Partners.  In addition to the latest release, the company added two industry veterans Sherif Botros from SAP as Chief Data Scientist and Puja Ramani from Facebook as Director of Product Management and Analytics.

Five key features designed for the largest of enterprises were announced for the Gainsight Spring 2014 release and include:

  • Support for sponsor tracking with LinkedIn and InsideView. New feature takes contacts listed in a client’s CRM system and monitors status changes in InsideView and Linkedin.  Known as Gainsight Sponsor Tracking, the feature also adds relevant news, events, and CRM intelligence.  These additional, external data points factor into a holistic customer health score that includes usage, support, engagement, and and other relationship health metrics.

    Point of View (POV):
    A top root cause for churn is an executive sponsor’s departure.  The automated system serves as an early warning indicator when status changes for key contacts to help provide the advantage of time and insight when protecting renewals and future upsell.  The feature also locates potential advocate or customers to on board.
  • Delivery of a Salesforce1 mobile app .  The Gainsight Salesforce1 Mobile App integrates natively with Salesforce (see Figure 1).   The Gainsight offering allows users access on Android and iOS phones and tablets.  Alerts, tasks, customer health data, and survey feedback are integrated with Salesforce system data.

    (POV):
    Mobility tops this year’s list of key enabling digital technologies in almost every Constellation survey.   Customers can take advantage of in-between and wait times to update customer health and fill notes via the application.  Many existing customers expect that this feature will improve team productivity from 10 to 25%.

Figure 1. Gainsight Delivers a Native Integration To Salesforce1

  • Release of  Gainsight Success Snapshots. As a new data visualization publishing feature, the solution helps clients build and publish data filled presentations, executive updates, and QBR reports.  Users can populate presentations with customer queries or templated reports.

    (POV):
    Customers seek not only good reporting tools, but also consumer grade user experience and ease of use. Data visualization tools play a key role in effectively democratizing the data to decision process among stakeholders championing customer success.

News Analysis: Microsoft Dynamics CRM Acquires Parature For Customer Service Capabilities

Dynamics CRM Gains Key Technology and Team To Take Existing Customer Care Assets To Next Level


On January 7th, 2014, The Microsoft Dynamics CRM team announced a definitive agreement to acquire Herndon, VA based Parature for an undisclosed sum.  This acquisition is Microsoft Dynamic’s CRM’s largest to date. Parature is an East Coast software start-up success story founded in 2000 by five Cornell students including Duke Chung.  Originally named Cyracle Technologies, the company’s first product addressed the live chat market.  Current CEO, Ching-Ho Fung, the first angel behind Blackboard, provided the initial angel investment in 2001.  Parature’s key investors include Valhalla Partners, Sierra Ventures, and Accel Partners.  The acquisition is significant for both Parature and Microsoft Dynamics Customers because:

  • Parature fills in a key gap in the Microsoft Dynamics CRM offering. Microsoft CRM currently has a customer care offering that delivers core customer service with case management, universal queuing and routing, and light scheduling and field service.  Parature provides key self-service knowledge base software, core customer service,  live chat, mobile access, survey and feedback capabilities, social monitoring, and Facebook portal capabilities to the Microsoft service offering.

    Point of View (POV):
    Microsoft’s core strengths have come from the sales automation product and the tight integration with Office.  Since 2012, with the arrival of Corporate Vice President, Bob Stutz, the Dynamics CRM team has sought to round out the rest of the customer experience offering.   (Note: Bob Stutz was a key force in the development of Siebel CRM and SAP CRM.)  The acquisition of Marketing Pilot provided a key building block for marketing automation.  This acquisition of Parature adds to General Manager Jujhar Singh’s investments in customer care.  Dynamics CRM customers gain the knowledge base functionality in Parature, which is the crown jewel.  This knowledge base was recently rearchitected and one of the most modern in the industry.  Parature customers will gain greater investment in the customer service and support product line with deeper integrations to a full customer experience suite.
  • Parature adds 70 million end users to the Microsoft Dynamics CRM ecosystem. The company has built a strong foothold in key industries such as education, gaming, high-tech, non-profit associations, online media, public sector, and travel.  Major brands include Ask.com, Asure Software, ATRA, Brenau University, BuilderMT, CompTIA, e-MDs, EPA, Florida Atlantic University, Hitachi Data Systems, IBM, IGN Entertainment, iWin, NASA SEWP, PlayFirst, SoftChalk, Threadless, Top Down Systems, TMA Resources, and Travel Lodge UK.

    (POV):
    Parature’s relentless focus on customer success has led to tremendous growth.  In 2013, Parature doubled its end user count from 35 million in 2011 to 70 million.  Microsoft’s team will More…

News Analysis: Verint Announces Intent To Acquire Kana For $514M

Verint Adds to Vovici and Contact Center Assets To Expand Customer Engagement Offerings


On January 6th, Melville, NY based Verint® Systems announced a $514M intent to acquire Sunnyvale, CA, KANA Software.  Verint is a software vendor with a core in analytical software.  Verint’s core offerings provide enterprise intelligence and security intelligence.  The acquisition is significant in the market because:

  • Big data and analytics meet customer experience. Verint expects to expand its customer engagement optimization offering with the acquisition of Kana.  Verint’s core capabilites, Vovici’s voice of the customer assets, and Kana’s multichannel customer experience solutions allow customers to move from data to information to insight to action or decisions.

    Point of View (POV):
    Bringing intelligence into customer experience adds context and relevancy. This combination is a key step in moving from systems of engagement to systems of mass personalization at scale.  Constellation expects more acquisitions that combine the 5 pillars of digital business – social, mobile, cloud, big data and analytics, and unified communications.
  • Verint gains key customers and industries. Verint’s key customer base of 10,000 customers gets 900 new customers in six key industires.  Kana’s base includes a variety of marquee brands and public sector agencies in the mid market to enterprise space.  Business service customers include Hyatt, Starwood, USPS, and Priceline.com.  Communications and media customers include O2, Comcast, Cox, Quest, Talk Talk Group, Telekom Austria, Telus, Time Warner Cable,  Tracfone, Virgin Mobile, and Vodafone.  Financial services customers include Admiral, Bank Leumi, Capital One, Chase, Citigroup, Domestic and General HSBC, ING, Barclays,  Standard Bank, and VHI.  Retail and wholesale clients include American Greetings, Avon, Carglass, Conrad, Foot Locker, Hanes More…

Trends: Real World Lessons In Optimizing The Customer Service Experience From Kana Connect

Workshop On Optimizing Your Customer Service Experience Identifies Eight Strategies
At the 2013 Kana Connect event from September 15th to 17th, 2013 in New Orleans, I had the pleasure of co-leading a workshop with Scott Hays a Sr. Director, Product Marketing for KANA Software.  The goal of the session was to explore eight strategies to improve customer experience. 

By now, you are well aware that “experience counts.” Your customers’ loyalty and future purchases hang in the balance. In this session, we’ll explore the key things you can do to make sure their experiences are positive. Ray Wang from Constellation Research and Scott Hays from KANA guide an interactive workshop to invigorate your future initiatives.

Speaker(s): Scott Hays, Ray Wang, Constellation Research

The event began with a overview of  Constellation 9C’s of customer engagement  and then an overview of the eight ways to optimize your customer service experience.  Teams were broken up to documen current state and to rank future state.  Teams were told to identify the top three ways among these eight strategies:

  1. Effortless and personalized
  2. Channel convenience
  3. Channel consistency
  4. Social media
  5. Unified agent desktop
  6. Agent knowledge
  7. Process-driven
  8. Internationalization

Results Show Future Focus on Channel Consistency, Social Media, and Effortless and Personalized

Given the Kana customer base, current state priorities of agent knowledge, process driven, and channel convenience came as little surprise to the participants.  In fact, most workshop attendees have had More…

Event Report: Metaio’s #InsideAR Conference Hails The Future Of An Always On, Always Augmented Reality

Digital Business Arrives In The Always On Always Augmented World


On October 10th and 11th, 2013, over 800 attendees from more than 45 countries arrived at the Munich Olympic Park to share their passion and excitement about the latest augmented reality (AR) developments (see Figure 1).  Hosted by augmented reality pioneer Metaio, Inside AR 2013, has emerged as one of the world’s largest conferences dedicated to the business of AR.  The conference touched on key areas such as:

  • Wearable computing
  • Hardware advances
  • Applications and development
  • Global adoption
  • Future of digital business and AR
  • AR use cases from engineering to sales
  • Consumer AR
  • Future of print and packaging in AR
  • Public sector use cases

Figure 1. Full Flickr Stream Of InsideAR Including Demo Videos


<iframe align=center src=http://www.flickr.com/slideShow/index.gne?user_id=35408001@N04&set_id=72157636422322475&detail=yes frameBorder=”0″ scrolling=no width=”600″ height=”500″></iframe>

Source: Copyright © 2001 – 2013 R Wang and Insider Associates, LLC All rights reserved.

Augmented Reality Brings Contextual Experiences To Life

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News Analysis: Clarabridge Raises $80M in Funding For Expansion

General Catalyst, Summit, and Yuchun Lee To Take Clarabridge To Next Phase Of Growth

Rapidly growing Reston, VA based Clarabridge, announced on September 10, 2013 a $80 million round of capital.  Founded in 2006, Clarabridge is a leading provider of customer experience solutions.  The funding announcement is significant as Clarabridge:

  • Invests into global expansion and product innovation. General Catalyst Partners, Summit Partners, and Yuchun Lee invests in the latest round .  Clarabridge intends to apply the investment towards global expansion, accelerate product innovation, and execute strategic transactions.  Key customers include B/E Aerospace, Best Buy, Charming Shoppes, Inc., Choice Hotels, Dell, Expedia, E.ON, Fidelity, Gaylord Hotels, Government of British Columbia, Intuit, J.D. Power, L’Oréal USA, Marriott International, PetSmart, QVC Inc., Sage North America, United Airlines, Walmart, Walgreens, and Wendy’s International.

    Point of View (POV):
    With over 150% of revenue growth over the past 3 years, Clarabridge plans to expand beyond it’s latest entry into San Francisco and London.  The CEM vendor  has the opportunity to build out new geographical markets while expanding industry reach in auto, cpg, finance, healthcare, hospitality, insurance, manufacturing, pharma, restaurants, retail, technology, telecommunications and travel.   Moreover, as the CEM space continues to evolve, Clarabridge now has a war chest to acquire new technologies or engineering talent as the market continues to expand and large legacy vendors acquire to consolidate.
  • Brings on experienced investors and board level expertise. Previous board members included David Blundin of Link Ventures, Don Raine of Grotech ventures, John Glushik of Intersouth Partners, Jonathan Perl of Boulder Ventures, and Sanju Bansal COO of MicroStrategy.   Larry Bohn of General Catalyst Partners and Tom Jennings of Summit Partners will join as part of the board.  Meanwhile, Yuchun Lee will serve as Chairman of the Board.

    Point of View (POV):
    While the previous board and investors provided the initial catalyst to Clarabridge’s success, in order to take it to the next level, the company needed new energy and direction.  David Blundin and Sanju remain on the board from the previous set of investors.  With Yuchun as chairman, expect innovative approaches to partnerships, OEM relationships, and positioning of Clarabridge in a broader customer experience context.

The Bottom Line: Clarabridge Poised For Growth

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News Analysis: Zuora Raises $50M Series E Round, Rides #MatrixCommerce Wave

Zuora Rides The Wave In The Subscription Economy

On September 5th, 2013, Foster City, CA based Zuora, announced $50 million in Series E capital.  The announcement has significant ramifications not only for Zuora’s self proclaimed subscription economy category, but also the broader business theme of matrix commerce because Zuora:

  • Expanded the investor pool. Zuora successfully added Next World Capital, Northgate Capital and Vulcan Capital to existing investors.  Benchmark Capital, Greylock Partners, Index Ventures, Redpoint Ventures, Shasta Ventures, Tenaya Capital, Workday founder and co-CEO Dave Duffield and Marc Benioff, chairman and CEO, salesforce.com all contributed to the existing round.

    Point of View (POV):
    The quality of the investment round and the amount indicate significant affirmation that the subscription economy thesis carries a gravitas among the A-list of Silicon valley investors and angels.   With $132.5M in funds raised to date, Zuora is sitting on tremendous amounts of cash from fundraising.  While Zuora could wait well into 2014 for an additional round, the move to raise additional capital will provide Zuora with an advantage over any new entrants or potential direct competitors.  Buyers can expect Zuora to be around for quite some time.
  • Added new board members with deep experiences. CEO and founder Tien Zuo adds Abhishek Agrawal of Vulcan Capital and Craig Hanson of Next World Capital to the board.

    Point of View (POV):
    Craig Hanson  brings significant experience in mergers and acquisitions of late stage and public companies.  Successful acquisitions include MXLogic, LeftHand Networks, NexGen Storage, Nimsoft, PSS Systems, and SenSage.  Abhishek Agrawal brings deep consumer experience from his General Atlantic heritage including Alibaba Gropu, Bazaarvoice, Dice, Facebook, Gilt Groupe, and Network solutions.  Buyers can expect more expertise in supporting vertical markets.  Buyers can expect new partnerships and entry into new geographies.
  • Demonstrated continued growth in a new market category. Since 2007, Zuora’s core solution provides subscription commerce, billing, and finance solutions for pay-as-you-go pricing models.   The More…

Event Report: CRM Evolution 2013 – Seven Trends In The Return To Digital Business And Customer Centricity

Market Leaders Refocus On Digital Business and Customer Centricity

The annual gathering of the industry’s top thought leaders, users, and vendors of CRM converged at the Marriott Marquis in New York this past August 19th to 21st.  As with any good conference, the speaker tracks and the corridor conversations provided a glimpse of where market leaders and fast followers planned to make their future investments and provided key insights for 2014.  After speaking with over 100 attendees, the following seven trends emerged from this year’s event:

  1. CRM is dead, well not really. While the term CRM is loosely used to define many things.  Leaders realize that CRM is the technology.  Customer experience is the business process and journey maps.  Customer centricity is a state of mind that’s required of management and leaders.  While customer experience is the new term du jour, all three elements (i.e. technology, business process, and people leadership) are required for success.  Front office is more descriptive than Tom Siebel’s legacy term of CRM.
  2. Customers seek outcomes not products or services. Customers no longer buy products.  Customers expect products to be bundled with services.  Services providers now seek to sell experiences.  Experience providers now sell access to outcomes.  This evolution of what customer’s want and what’s delivered continues to accelerate.  With hipsters and millennials short on cash, access, experiences, and outcomes have emerged as one market category to deliver for in this growing sharing economy.  However, not all customers seek just access. A movement to move too far, will result in a backlash from a majority of customers who seek ownership without the shackles of renting.
  3. Transformation projects now rally behind the shift from social back to digital business. The social business and social crm era focused on a key aspect of CRM – the relationship.  In the past, CRM excelled at management, poorly accomplished customer, and failed at relationship.  Looking back three years,  the rise of social ties back to the need to address relationships.  Now that social moves to the mainstream, market leaders refocus to digital transformation of customer centric initiatives.
  4. Funnels make no sense in an asynchronous world. Classic sales, marketing, and service funnels force fit customers into unrealistic models.  Entry points will ebb and flow as channels and context drive demand into a variety of use cases.  Design must account for this constant state of change.
  5. Big data provides relevancy and context. All the hype on big data continues to miss the point.  Customer centricity requires context.  Context creates relevancy based on a customer’s roles, relationships, products, services, location, time, sentiment, and intent.  Without relevancy, acquisition, targeting, and personalization will fail.
  6. Front office still needs back office integration. Integration with back office is required for customer experience.  A customer who makes an order for a product or service that’s out of stock and billed twice for something they did not receive will most likely be upset.  Customer centricity is both a front office and back office exercise.
  7. Identity plays a key role. Identity plays a multi-faceted role for each individual. The business implications of identity after authentication, authorization, access, and availability touch on commerce, work lives, personal lives, and engagement with each other.  Identity is a unifying factor in the current transformation to a digital world and required for customer centricity.

The Bottom Line: Business Leaders Must Embrace Customer Centricity In Order to Differentiate In A Digital World

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Monday’s Musings: NSA PRISM Scandal Hurts US Cloud Companies And Hastens The Return Of On-Premises Software

Non-US Based Organizations And Even Some US Organizations Will Not Tolerate Snooping In A Post PRISM World

Since the Edward Snowden PRISM revelations, Constellation has received a steady stream of inquiries on cloud strategy.   In fact, nervousness runs high among many non-US based companies using services from US based cloud companies across the cloud stack.  In early August 2013, the Information Technology & Innovation Foundation put out its report “How Much Will PRISM Cost the U.S. Cloud Computing Industry” Assuming that 20% of current clients switch to a non US based provider,  the report estimates a loss of $22 to 35B by 2016.

Constellation agrees.  All signs point to an anti-US stance until the security issues is addressed.  The odds on the US government moving fast on this issue are as good as Major League Baseball players or Tour de France Cyclists honoring a performance enhancement drug use ban.  In fact, Constellation is aware of at least 50+ contracts that have been put on hold or cancelled in the past 30 days.  With the EU’s Nellie Kroes already sounding the alarm bells in a way she only can, cloud buyers have taken notice.

The Bottom Line: Clients Should Consider Alternatives To Pure Cloud Models And Encryption Technology

Interesting enough, fifteen years into the cloud revolution, talk has rekindled about building on-premises software in light of this scandal. Unfortunately, the last major on-premises software company to receive funding squandered it all in 2005 and retooled to the cloud. Furthermore, a few entrepreneurs are looking at VC funding to take some key systems back on-premises.

However customers do not have time to wait for new software to arrive in the on-premises deployment option.  In the meantime, a few near term strategies have emerged:

  1. More…

News Analysis: Kana Express 13 Addresses Omni-Channel Customer Service for Mid-Market

Just 14 months after announcing the acquisition of Trinicom, Kana has revealed the latest release of its cloud customer service suite for the mid-market, Kana Express.   Released on June 27, 2013, the new product reflects the company’s mission “To provide leading customer service solutions that empower our customers to create experiences that count, for their customers wherever they engage”.

Key features in the release include:

  • Advanced analytics and reporting. Kana Express features improved trend analysis, performance reporting, and forecasting.  Personalization has been improved and new reporting options include an easy to use custom dashboard designer.

    Point of View (POV):
    Analytics and reporting is often an after thought in design for mid-market solutions.  Key reports such as contact flux, cockpits, and customer monitors provide not only information, but insight into what the next best action could be.  The custom dashboard designer enables easy creation of visualizations and filtering of data by dimensions.
  • Anytime, anywhere, access. Improvements in access include mobile device usage, Section 508 disability compliance, and internationalization capabilities.  Support for 30 languages out of the box, user defined time zones, double-byte character sets, and international address validation add to a list of features supporting international business requirements .

    Point of View (POV):
    Prospects will most likely flock to the eye candy features of mobile support for device and screen readers.  However, the internationalization efforts close the gap between large expensive enterprise solutions and what mid-market solutions traditionally offered.  Constellation sees this as an immediate win for companies with an international footprint but not an international budget.
  • Improved browser based user experience. Kana Express supports Chrome, Firefox, Internet Explorer, and Safari browsers.  Additional enhancements include support for live chat, contextual next best options, and real-time access to the knowledge base.

    Point of View (POV):
    Agents can tailor the new UI and personalize to their preferences, reducing click throughs and improving productivity.  One powerful feature is the ability to automatically present contextual knowledge such as a related topic, interaction history information, or external system data.

Figure 1. Kana Express Screenshots Show New User Experience and Improved Accessability

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Monday’s Musings: The Controversy Surrounding Gartner’s CRM Market Share Analysis

The Gartner Market Share Analysis:CRM Software Report Raises Questions On Accuracy of Market Sizing Reports

The recent Gartner report “Market Share Analysis: Customer Relationship Management Software, Worldwide, 2012” has generated some controversy among the enterprise software set.  The report and other reports such as these, are often used for bragging rights by vendors and for buyers to gauge vendor viability.

This specific report attempts to rank CRM software spending by vendor using total software revenue worldwide.  The good news – the numbers are directionally correct with Salesforce.com claiming the top mantle from SAP this year with $2.525 billion in CRM revenue (see Figure 1). The bad news – many question the accuracy of the actual revenues numbers as listed in the press release, especially for the Microsoft Dynamics CRM business.

As Scott Bekker at Redmond Magazine reported, “Gartner put Microsoft’s CRM revenue at $1.1 billion, up from $900 million in calendar-year 2011.  That’s a sizable bump. As of May 2012, Microsoft was only claiming that all of Dynamics, which includes Microsoft’s established ERP products as well as CRM, amounted to $1 billion in annual revenues.”

Mssr. Bekker makes a polite but astute point.  The 26% bump in CRM revenue is significant.  However, the total revenues are questionable.  In any modest observation, that kind of overall growth in the Microsoft Dynamics unit would have Microsoft CEO, Steve Ballmer, shouting from the tops of Mount Ranier and probably have Kirill Tatarinov next in line to be Microsoft’s CEO.

Figure 1. Gartner’s Recent CRM Software Spending by Vendor, Total Software Revenue Worldwide, 2012 (Millions of Dollars)

Not to violate any copyright laws, despite fair use laws, here’s a link to the full table found in their press release. A recreated table below shows the rankings.

Bottom line it shows Microsoft in 4th place for CRM with over 1.1B in revenue.

Organization 2012 revenues 2012 marketshare (%) 2011 revenues 2011-2012% growth
salesforce.com 2,525.6 14.0 2,004.6 26.0
SAP 2,327.1 12.9 2,325.1 0.1
Oracle 2,015.2 11.1 1,870.0 7.8
Microsoft 1,135.3 6.3 900.9 26.0

The Market Sizing Game For Vendors And Legacy Analyst Firms Flawed With Faulty Methodology

In reality, the market sizing game for enterprise software is both an art with some science.  Having played this role as a vendor in an Analyst Relations capacity in a past life, one knows that executives can not disclose such financial information directly to a research or market sizing firm.  The research analysts must play a guessing game with the software executive and ask 100 questions to zero in on a number.  Unlike hardware, where individual counts are more obvious, software revenue sizing requires analysts to dig deep into financial statements and any conversation where growth rates have been discussed.  Revenues are hidden in bundling, suite sales,  discounting schemes, channel revenue deals, OEM arrangements, and inter-company transfers.  To complicate matters, SaaS revenue calculations can differ from how on-premises revenues are calculated.  Analysts must also determine the truthfulness of vendors who are trying to indirectly guide analysts to the “right” numbers.  In short, this is hard work.

As assumptions are built on previous numbers, one false guess in a previous year, cascades and geometrically inflates or deflates a set of future numbers.  In the case of these CRM numbers, one may speculate that past executives may have provided a higher number than actually generated, resulting in the current alleged inaccuracies.  Another speculation may come from previous and current analysts who may only focus on one area of the business and not have the total picture on the Microsoft Dynamics overall business.  There are many points of inaccuracy that can occur with software revenue market sizing and every legacy analyst and market sizing firm works hard to avoid these situations.  For market analysts, dissecting revenue from vendors such as SAP and Oracle is often difficult as these numbers and break outs are masked with multiple acquisitions and product lines.

To be clear, the SAP and Oracle numbers also seem inflated.   These numbers have been inflated over decades.  Given that these vendors also have many other lines of revenue aside from CRM, it’s hard to gauge the accuracy of their numbers without some digging.  Now one would assume a market sizing firm should be doing this right?

The Microsoft Dynamics CRM Revenues Do Not Meet The General Sniff Test

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