Magazine article CRM Magazine

Is CRM Too Hard for Microsoft? Redmond's Mighty Software Maker Finally Has What It Needs for a Great CRM Program-But Is It Too Late?

Magazine article CRM Magazine

Is CRM Too Hard for Microsoft? Redmond's Mighty Software Maker Finally Has What It Needs for a Great CRM Program-But Is It Too Late?

Article excerpt

At Microsoft's Convergence event in March, President and Chief Executive Officer Steve Ballmer told attendees that, thanks to acquisitions and its own development work,Microsoft was in the right place as far as business applications were concerned. "Unless we close this Yahoo! deal, the biggest decision I've made as CEO is pushing into the business applications area," he said. "It's one of the best decisions I've ever made, one of the most important decisions I've ever made, and the reason that brings us all here today."

Ballmer also reinforced Microsoft's ongoing commitment to some of its core business-software design philosophies: role-tailored user interfaces; the expansion of business intelligence to the individual user; ubiquity in personal productivity applications; and familiarity for business users accessing team applications regardless of whether those applications are deployed on company servers or via one of Microsoft's hosted arrangements. Ballmer also noted that the increasingly broad options available in CRM technology meant it was re-emerging in various incarnations, managing relationships of all kinds--a phenomenon he referred to as "xRM."

Ballmer then tackled a question often posed by prospective customers:Why Microsoft? "We've been in [this marketplace] now for about seven years," Ballmer said, "and I still get asked, 'Is Microsoft a serious player in business applications?'" Before making comparisons to other vendors, he pitched Microsoft's own merits: "We're going to bring raw innovation to these issues," he said. "We're going to bring integrated thinking about how ERP and CRM fit in the broader context of what people are trying to do with technology." Microsoft, he added, would approach business solutions "with the same kind of long-term approach and tenacity we bring to everything."

[ILLUSTRATION OMITTED]

But, in a report released a week before the conference, The 451 Group suggested that the right strategy for Microsoft is disengagement--not from the customer, but from CRM entirely. "[In] one area, Microsoft stubbornly clings to business as usual: CRM and ERP software, which it sells under the Dynamics brand, "wrote Brenon Daly, a financial analyst with The 451 Group."Despite spending more than $2 billion on deals--plus untold tens of millions on [research and development] over the past half decade--this product line continues to lag rivals significantly, particularly at the high end of the market." The report went on: "Unlike its alsoran online search division, which has turned to a desperation bid for Yahoo to make up lost ground, Microsoft shouldn't look to acquisitions to close the gap on rivals of Dynamics. …

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