links for 2006-03-30
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Not reinventing the wheel is a good thing.
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Tim Russert used this phrase once on Meet The Press. I’ve since wondered where it originates.
March 29th, 2006
Archive for March, 2006
links for 2006-03-29
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Yes, I’ve been biggen by the Rails bug. This stuff can be a competitive advantage in the right hands.
March 28th, 2006
links for 2006-03-28
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“A Microsoft VP zipped through a demo, moving information from Outlook to Powerpoint to Groove to some kind of social networking program…” = DISASTER. Who is that person targeting? Not the 45-yr-old VP in the crowd. Loved the Tommy Hilfiger quote too.
March 27th, 2006
links for 2006-03-26
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One suggestion offered is to turn the computer’s Bluetooth services off, then back on, prior to EVERY sync. Gee thanks! I say as I dig for an old sync cable.
March 25th, 2006
A wizard wizard
I noticed this today. In Microsoft’s SQL Server v8, there is a wizard you can run that will show you all the available wizards within the suite. That’s right…a wizard to run other wizards.
My head is going to explode.
March 24th, 2006
The Problem with CRM Software
I just read a couple of excellent articles over the weekend for this semester’s marketing course. The topics included: Acquiring and Retaining Customers, and Assessing Customer Lifetime Value. Really expansive terms, but it managed to distill down my issues with CRM Software as it stands now.
To back up, at my last few jobs, I have been in charge of implementing customer relationship management solutions. I’ve had exposure to SugarCRM, Centric, and to a lesser extent, Salesforce.com. In all of them the theme is the same: you open the software to your sales force, they export their Outlook contacts to the service, then commit to using the platform to track leads and register opportunities for the business. So CRM software in general can be very effective at managing the customer acquisition process.
Basically, after this weekend, I’m now convinced that approach is 100% wrong.
The problem with CRM software is that it tracks neither customer satisfaction nor customer profitability. All three tools I mentioned above have ZERO integration with (1) the company books, and (2) the company sales orders. Both of these are absolutely crucial to understanding the customer retention process.
SATISFACTION
So there’s this thing called the Order Management Cycle. It basically describes the customer’s interaction with the company at 8 different stages of the sales order process. It covers everything — from quote to cash — but from the customer’s perspective. How satisfied are they along each step of the way? Was there an issue with post-sales support, or a late shipment, or poor communication when the quote was delivered?
I’ve seen companies that run on-time delivery charts to measure their level of customer satisfaction. Overall it’ll tell you what percentage of orders were shipped on time. But is that a measure of customer satisfaction? Say a customer needed 10 orders filled, and the business got 9 out on time, but was 2 weeks late on the 10th. If the customer needed all 10 orders to start their work, to them all 10 orders were a failure. But for production — check it out, we’re 90%! Basically, no one is managing that need to deliver that 10th job on time.
PROFITABILITY
It’s a sad fact that most businesses do not track the costs of customer retention. The common wisdom seems to be that it costs less to maintain an existing customer than it does to bring in a new customer, which translates to ‘don’t bother measuring retention costs’. It’s even easier to do that when you can wrap your arms around marketing campaign contributions to your bottom line.
But is the wisdom right here? It might not be. If you have a high-maintenance customer, they could actually be driving up your support costs to a level equal to the margin they brought in. So all you’re really done is gotten bigger — or more likely, increased workload on current staff — without gaining a penny in additional sales. Meanwhile, your opportunity costs of running that support are left fluttering in the wind.
This is where profitability fits in. All customers basically fit into a 2-dimensional grid: acquisition cost, and retention cost. Studies show that the customers that have low retention costs are the most profitable customers. (Big surprise — you’re not constantly on the phone with them.) So understanding their acquisition costs is only half the battle; you have to know what it’ll take to keep them aboard. Even if you spend a ton of money to acquire them, if they’re easy to maintain and please, you’re making that money back and then some.
So back to the CRM software. When you think about those two topics above, it’s clear these tools don’t deliver on either one. Without direct hooks into sales orders, how can you know how satisfied these customers are? And without a window into their profitability, how can you know if their requests are killing your bottom line?
When you get right down to it, what the heck does CRM manage? Where’s the “relationship” and “management” in that acronym? Is it really nothing more than an expensive Outlook clone?
Maybe there’s something out there I haven’t seen before — something that does indeed track both metrics. I’m guessing SAP or Oracle have it, and it probably doesn’t come cheap. But looking at the current ‘external’ tolls, I’m seeing their capabilities in a new light. Without direct integration, they’re not managing anything but phone numbers, email addresses, and salesperson egos.
March 20th, 2006
links for 2006-03-18
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Takeaways: Collaboration is key. Failure is okay. Stay nimble. And Box o’ Wine can be cool!
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A history of free markets in the 20th Century. If you only watch one economics program on PBS, this should be it.
March 17th, 2006
iPod’s Problems in France
I think my macroeconomics course is starting to rub off on me. Here I am, staunchly defending free markets and condemning socialism.
Newsvine – Draft Law Clouds iPod’s Future in France
And to think, last week I didn’t even know who Friedrich Hayek was.
March 17th, 2006
Protected: JSS vs JSON
One week into my exploration into Newsvine — which just launched last week — and I am fairly impressed. While they didn’t get bought by Fox as rumored (congrats to lotto winner NewRoo for that distinction), seems like Disney is a more likely takeover company, given founder Mike Davidson’s background with ESPN.com. But I digress.
One of the things I’ve noticed in Newsvine is the use of a phrase I’ve never heard before: JSS. From what I can gather from the description, JSS is supposed to be a JavaScript implementation of RSS, where you can publish external data directly to a user’s browser (so it never actually touches the intermediate site).
My first thought was that there was already a name for this service, i.e. JSON. But on closer look, there is a huge difference. JSON just loads the data — you are responsible for organizing that data, albeit in any format you choose. (del.icio.us example) It’s powerful in that it’s customizable, at the cost of convenience. JSS actually eliminates the parsing requirement — it just gives you the links in whatever format the publisher chose. (Newsvine example) Easy to use, at the cost of flexibility.
My guess is that newsvine prefers adoption over customization, so they rolled the JavaScript library and parser into one. Which is fine — seems fairly pragmatic. But I think the larger issue is that, eventually, users will figure out that no two JSS feeds (from two different publishers) will look alike. In the end, webheads that want to use JSS will be investing that customization effort anyway — to format their CSS in order to get each JSS feed to fall in line. Doh!
My unsolicited advice to anyone who ‘created’ JSS or a JSS-type library: publish the standard. Offer up a way to hook into a CSS — but provide a tool to overwrite it. If I want to publish 10 JSS feeds from across the Internet onto my site, but in 2 different styles, make sure I only have to make 2 changes to my stylesheet – not 10.
Enter your password to view comments March 15th, 2006
links for 2006-03-15
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“So your co-founder was the _webmaster_ for Netscape? Are you fucking kidding me? Am I supposed to be all relaxed now knowing that one of the executives for this company used to be a webmonkey for netscape.com?”
March 14th, 2006
