While US$13 billion will be spent on CRM initiatives worldwide in 2005, the market is full of dissatisfied users with huge investments in products and services that do not fully satisfy their needs, according to a study by Forrester Research, Inc.
The latest Forrester Wave research evaluated and ranked four major CRM players: Amdocs, Oracle, SAP, and Siebel Systems. William Band, a consulting analyst with Forrester Research, quipped: "The selection of a CRM vendor is a marriage, not a date."
But on a more serious note, Band warned that enterprise buyers need to think carefully about the vendor partner they choose and understand the long-term commitment of the decision. The research suggests that, over the coming year, companies will spend an estimated US$3.2 billion on CRM license costs alone, and they will also incur costs involving hardware purchases, software integration, maintenance, and the administrative expenses of managing new IT assets.
The study found that buyers are generally dissatisfied with CRM investments on multiple levels, and are now demanding easier integration, faster ROI (return on investment), and better support from their vendors.
The survey of 94 business and IT executives found that:
- Only 29% of executives surveyed are satisfied with how easily CRM applications integrate with existing data applications and sources.
- Only 34% are happy with how easy it is to work with CRM software vendors after they have purchased applications and services.
- Less than 50% of buyers are fully satisfied that the business benefits achieved meet their expectations.
But while there are several choices of CRM vendors (ranging from licensed vendors serving enterprises to hosted CRM vendors using a software-as-a-service model) Forrester chose to evaluate enterprise CRM suites delivered through an on-premise licensed arrangement. The report evaluated four leading vendors based on 177 criteria, grouped into three categories (current offering, product strategy, and market presence). The survey's findings showed that while all four vendors' CRM suites offer advantages, companies must choose the best fit for their specific needs. Overall, Forrester found that:
- Siebel continues to lead the pack. Siebel continues to offer the most comprehensive solution-set for enterprise-class organisations, with the largest array of front-office solutions tailored to specific industry challenges and opportunities.
- SAP has momentum and is gaining ground. SAP, through mySAP CRM, has emerged with increasing momentum. The company is investing heavily to fill out its product suite and offers buyers end-to-end business process solutions.
- Oracle is growing and is likely to overtake the leader. Oracle's recent acquisition of PeopleSoft gives the combined entity full coverage of all major CRM functionalities and a larger, more industry-balanced customer base on which to build.
- Amdocs is also an excellent choice in certain circumstances. Amdocs offers a flexible application with deep customer service functionality, scalability, and profound knowledge of the communications services providers and high-tech industries. The company offers an end-to-end solution by integrating customer-facing relationship management with the important customer billing process.
The CRM Forrester Wave includes specific recommendations for buyers to use when shopping for a CRM suite, and is available to all Forrester WholeView 2 clients through Forrester's web site.