2006: The Year Services Become King and other predictions
It's going to be a very busy 2006 and one that will truly be transformational. Predicting the future is always risky business, yet here are predictions for the coming year, foremost being a shift from a purely-oriented product focus in many software companies to service first. At the center of this transformation is that selling with a transaction mentality will continue diminishing, and selling through educating and by earning the trust of prospects and clients will flourish.
Here are predictions for 2006:
- Selling services based on being a trusted advisor makes transaction selling obsolete. This ties back to the services-oriented approach many best-of-breed companies are going to adopt in 2006. Transaction selling ignores relationships and focuses purely on closing deals on incentives and price. Trusted advisors will outsell transaction-oriented sales reps by a wide margin in 2006.
- The biggest CRM spending category of the year will be on integration and services. A few of the CIOs I know are holding onto their decision making responsibility due in large part to this point. They own the customer data and maintain its many integration points. Look for the vision of a unified customer to be a major focus during the coming year throughout CRM.
- Software-as-a-Service (SaaS) breaks out of CRM and into the rest of the enterprise. Credited with the rejuvenation of CRM, SaaS continues its torrid growth pace anchored by Salesforce.com and RightNow Technologies in 2006. In keeping with a services focus into the coming year, SaaS will find its competitive strength in the greater depth of functionality relative to licensed applications and more affordable pricing. Expect to see the option of single- versus multi-tenant SaaS models in 2006 depending on the feature refreshes required by customer. Ultimately SaaS will find its way into providing supply chain visibility back to channels through CRM systems so orders, quoting and pricing are in synch with each other constantly.
- Service-Oriented Architectures prove they are ready for prime-time. In keeping with the dominant trend for 2006, Service Oriented Architectures will prove themselves ready for the more complex business processes including consolidated order management and fulfillment and pricing integration.
- Measuring Marketing and Voice of the Customer Programs using analytics and dashboards gains momentum globally. Marketing in many companies is constantly fighting battles related to the results of their strategies and debates of whether their efforts are making a contribution to Sales. Look for Marketing departments to champion hosted analytics apps like Sales is championing hosted CRM and SFA apps today.
- Indian outsourcing companies start acquiring software companies. Infosys and HCL are two specifically who could make an even deeper move into the retail by acquiring retail software companies who focus on order management, pricing or data management.
- Google acquires at least four more companies and firmly establishes itself as a enterprise platform. The names of these four companies may or may not be publicly shared, yet Google is well on its way to be an enterprise platform due to the constant contribution of content from both indexed sites and new initiatives including Google Base, reliance on advertising by smaller companies that can’t afford more expensive advertising strategies, and the fact that search engine technology is the quickest fix for the most broken of content management systems. Look for Google to be the first out with video Instant Messaging and other collaboration applications that will serve as on-ramps for entire content management taxonomy support.
- AdWords sparks an industry of optimization tools due to lead generation successes. The technology behind constraint engines could easily be applied to Google AdWords to further optimize word selections and the optimal allocation of budgets by keywords chosen. Google offers a Budget Optimizer today yet it doesn’t allow you to see the median bid for a keyword network-wide. If a constraint engine could define the median value for a key word, its optimal performance for your subject by time and location then the economics of buying them would change drastically and greatly improve individual companies’ performance.
Posted by LOUISCOLUMBUS on December 22, 2005 at 02:08 PM in Business Transformation | Permalink
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