Highly Competitive - software industry insights

Symbiosis: Customer Experience and Business Process

Companies continue to struggle with prioritizing the Customer over their business-as-usual, ingrained product and self-focused strategies.  Upper management in many industries seem to be dragging their feet when challenged to quickly and energetically change business practices to better serve customers. These leaders seem to look at the “Customer” as if it were an abstract representation of a value on a spreadsheet -- instead of probably the single most important factor for most businesses.

Now from the customer perspective, which is what upper management should have as top priority, interactions with most companies are becoming more and more a multi-channel journey of multiple touch points that are used to communicate, gain information, compare vendor offerings, seek assistance, make purchases, register complaints, and so on. If companies meet the needs of customers, then those experience journeys will repeat over customer-preferred channels. Multi-channel strategies for customer engagement are imperative because customers are more and more the ones who choose how they will interact with companies and on which channels.

On the flip side, customers don’t see their interactions in terms of “channels” -- just like customers don’t care how or why a company’s business processes fail to provide an overall positive experience with the company. Customers see that they did or did not have a successful interaction and that they did or did not achieve what they wanted. The outcomes of these interactions influence how customers regard companies and whether they will continue doing business with them.

Once a company has made a commitment to becoming customer-focused for its business strategies and operations, there is work to be done:  integration of channels, integration of business processes, and integration of data from customer interactions all become imperative. Integration of channels leads to understanding of touch points in individual channels as well as cross-channel. Aligning business process integration with the customer leads to creating single customer experiences across the enterprise and across communication channels. Integration of interaction data with operational data provides a more complete view of the customer in real time. Individual department and program goals across the enterprise must be also integrated and related to customer experience excellence.

Business processes must become a dynamic, intelligent and highly integrated interface for company interactions internally and externally. Most internal systems in companies should incorporate factors like customer experience and engagement, rather than functioning solely from a product, service or departmental perspective. Processes play a key role in bringing these factors together to achieve customer focus and relevance. Integration internal to the organization means cross-functional / cross-department teams to envision and implement customer strategies, translated into business processes that holistically connect the enterprise.

 

Symbiosis, Integration

Like symbiotic relationships in nature, business-customer symbiosis is founded on the belief that customer goals and business goals can be aligned in ways advantageous to both parties. The relationship that a company has with its customers affects almost every area of the business and every point of interaction with the customer, internally and externally. That’s why effective business processes are so important to enable top-notch customer experiences.

For mutual benefit, the focus for all business processes shifts to customers to embrace what they want from companies, how they view companies and how they want to work with them. Agile business processes connect all parts of the enterprise to the individual points and stages of the customer experience journey. Business processes also encompass other enterprise practices and strategies. Business-customer symbiosis can ensure the integration of both perspectives to the benefit of both parties. Business process ties directly to desired business outcomes – which now must align with customer desired outcomes.

 

Data Fuels Process and the Customer Experience

Happily, companies have a lot of data sources to help them gain insights into their current and potential customers through analytics, real conversations, social media content, customer service interactions.

Data, information and intelligence are the fuel for effective business processes that support and promote successful customer experiences and interactions. By considering business processes and business information in parallel to customer-focused strategies and initiatives, business outcomes are likely to improve.

Customer interactions produce an escalating amount of data related to internal systems such as CRM and call center management, and related to external sites such as corporate websites and social venues. Significant issues impact the ability of enterprises to correlate all the data into the so-called “single view” of the customer:

• Social media data that is primarily content and crucially dependent on context for meaning
• Company-controlled data sources that do not easily reveal customer process or outcomes
• Complexity of integrations needed to bring all this disparate data together
• Pulling data together to reflect the customer perspective rather than the internal systems architecture

Data directly related to customer-focused processes is likely to get closer to providing the elusive customer “single view” where an integrated process spans multiple interactions, touch points, transactions, and systems. The right data fueling processes is an important part of designing innovative business strategies that truly focus on the customer. Deriving timely customer insights benefit the strategic and operational aspects of an enterprise. However, a good many customer interactions or touch points are increasingly shorter-lived due to the proliferation of digital channels and their use by customers. The opportunity for enterprises to meet customer desires and needs is becoming shorter for each interaction and increasingly difficult to capture, analyze and understand.

 

Business Process Management Meets Customer

 Business process management (BPM) can no longer be solely focused on achieving operational efficiency and optimizing the business. Business processes must become more responsive to a focus on the customer, and become well-integrated across multiple systems to do so. BPM is crucial to customer-oriented systems as well as operational systems, and actually provides an essential piece to integrating these systems in order to better serve customer needs. Business processes are key to an agile holistic business strategy that helps customers achieve success with the company’s products and services. An interesting development in BPM is adaptive case management (ACM) that may be leading the way to greater convergence with customer systems such as CRM and call center applications.

An important aspect of BPM is continuous improvement, something that must happen for enterprises to respond to ever-changing markets and customer desires. To bring about customer-focused continuous change, enterprises need to articulate vision for strategies and initiatives from the customer perspective; and then tie process improvement to the customer experience. Working with customer data and analyses, enterprises may benefit from analyzing the ‘reverse engineering’ of outcomes expected by different customer segments, and then use insights to define how the enterprise should operate across process, organization, and technology domains to deliver optimal customer experiences and success.

Enterprises that allow separate solution and process silos for each channel to persist will greatly impede responsiveness to customers and will add to customer frustration by failing to provide one experience across channels. These enterprises probably did not start with a customer experience strategy and likely developed and/or acquired solutions specific only to individual channels without heeding the need for seamless integration of processes.

 

Business Process and Customer Experience Management Technology

Responsive and accurate support for customer interactions through people, processes and practices is a cornerstone of the management that enterprises can apply to enabling positive customer experiences. Enterprises must recognize that ‘management’ doesn’t mean controlling and dictating to the customer what the ‘experience’ will be. It does mean managing how well the enterprise provides a single experience across channels, how well it fulfills the needs and desires of customers based on customer terms, and even how well it delivers high quality products and services.

BPM can be instrumental for designing and maintaining effective and agile processes that are a sophisticated means to respond well to customer needs, while navigating many complex variables moving from customer to customer. Well-designed and customer-oriented processes make a big difference when integrating touch points for a ‘single view’ of customer interactions.

In the 2011 Forrester Wave for Web Content Management for Online Customer Experience, Stephen Powers defines customer experience management (CXM or CEM) software solutions as:

A set of solutions which enable the management and delivery of dynamic, targeted, consistent content, offers, products, and service interactions across digitally enabled consumer touchpoints. Previously, organizations, processes, and technologies to serve the online channels were silo’d, resulting in overhead, inconsistent experiences, and inability to measure results. However, as online initiatives have evolved and matured, so have product offerings to support those initiatives.

Three categories of solutions comprise online CXM: those based on process, delivery, and measurement:

Process-based solutions enable business users to create experiences. Process-based solutions consist of tools that business users (as opposed to IT users) use to create and manage structured and unstructured content for customer experiences. This category includes WCM, digital asset management (DAM), eCommerce, customer relationship management (CRM), marketing campaign management, marketing resource management, desktop publishing tools (such as Microsoft Word), and interactive development environments (IDEs).

Delivery solutions bring interactive experiences to customers. Vendors often tightly couple both WCM and eCommerce solutions with native delivery tiers, enabling businesses to create content and design and deliver experiences in a single package. But other technologies enable experience delivery, including rules- or algorithm-based content targeting solutions like search, personalization, and recommendations engines; marketing automation solutions such as campaign management and offer management; and customer service interaction management solutions that support customer data and history, customer self-service, knowledge management, and customer feedback management.

Customer intelligence solutions enable businesses to gauge the success of experiences. A/B and multivariate testing enable marketers and business users to test out variations of experiences on certain demographics before rolling them out to a broader audience. Web analytics tools give insight into how consumers consume content and interact with experiences. Social analytics provide insight into how consumers engage with companies by monitoring social interactions. 

 

Source: BP Trends

 

 

Process Alignment: Voice of the Customer Meets Voice of the Business 

Enterprises are accustomed to setting success metrics through KPIs related only to internal business process performance and internally-defined business outcomes. Unfortunately these metrics are frequently out-of-synch with customer perceptions of how well the enterprise met their expectations. Enterprise and customer metrics can be mismatched in other aspects of the customer experience:

 For instance the business may define the process cycle time – the length of time the process takes to run – as measured from when the customer places the order to when the products are dispatched. The customer, on the other hand, may well perceive the time taken to be from when they first went on to the website to look for a product, to the point at which the product started working. Clearly there can be a substantial difference between the two measures. 

Ideally we want to ensure that our measures of process effectiveness (the Voice of the Process) are the same as the customer’s measures (the Voice of the Customer), albeit the customer’s measures are informal measures. 

 

Source: BP Trends

 

Juxtaposing customer and enterprise views of process, experience and success through customer journey diagrams will reveal the disconnects between enterprise perceptions and what customers are likely experiencing. Enterprises are still working on finding more ways to capture the actual customer experience since true direct insight is not easily attained. Insight is pieced together with data from many sources including customer surveys, content from social sites, repeat business with the same customer, customer transactions, and interactions with customer service.

 

Symbiosis at the Heart of the Enterprise

Enterprises continue to be challenged to deliver positive customer experiences that are mutually beneficial and crafted from the customer perspective. Instead of designing business processes integrated with a customer experience strategy, many companies just tack on aspects of monitoring customer interactions to existing processes. For many companies, the main focus is still on their own needs, their own problems to be solved by the business process. And frequently when enterprises say they are customer-focused, they really mean they are trying to engineer upsells and cross-sells for their own benefit, without necessarily delivering real value to the customer.

As I continue to emphasize in much that I write, technology alone is never sufficient: enterprises need integrated and agile processes that also recognize the importance of people and practices to achieve goals and positive business outcomes. To become a truly customer-focused organization that enables customer experience excellence, the entire enterprise must be part of the overall experience:

• Starting with Upper management: choose Customer as The strategic focus
• Enable and empower customer-focused people in every part of the enterprise
• Design processes that are flexible enough to change with dynamic markets and customer needs
• Draw on innovative information systems to fuel business processes and provide continuous customer insights for fostering customer experience excellence

Keeping the focus on customer outcomes will help align people, processes, practices, and technology to the continuous changes needed to facilitate optimal customer experiences over time. Neither customer experience excellence nor well-integrated business processes should be after- thoughts for business execution – they are the symbiotic heart of success.

 

 

Related Links:

In Pursuit of Customer Experience Excellence

Information, Intelligence and Process:  Combining Forces to Better Answer Business Needs

The Ever-Expanding Importance of Analytics–True Intelligence for Business

Goals and Metrics – Measuring Customer Engagement on the Web

Achieving the Social Business, Inside and Out

Findability Inside The Firewall – Still Trying To Find The Information We Need

 

About the author: Julie Hunt is an accomplished software industry analyst, providing strategic market and competitive insights. Her 25+ years as a software professional range from the very technical side to customer-centric work in solutions consulting, sales and marketing.  Julie shares her takes on the software industry via her blog Highly Competitive and on Twitter: @juliebhunt   For more information: Julie Hunt Consulting – Strategic Product & Market Intelligence Services

Information, Intelligence and Process: Combining Forces to Better Answer Business Needs

Originally published as a 4-part series on Hub Designs Magazine May 2011

Data governance can be seen as formalized policies, practices and processes set up to manage voluminous data assets across enterprises. Data governance also sits on an important growing convergence that encompasses multiple, and frequently separate, disciplines: data quality / data integration, master data management (MDM), business process management (BPM), business intelligence (BI) and analytics. The solutions surrounding the management of information, data and intelligence are emerging from artificial silos to acknowledge the greater overlap and interrelationships of these technologies and practices. Deliberate initiatives to tighten up the convergence of these solution spaces will not only improve the better overall functioning of all of these solutions but will help both IT and Business users see how it all works together. A greatly beneficial result should be the elimination of duplicate demands on business users and IT for implementing and managing these systems.

Forrester’s Rob Karel on aligning Business Process and Data Governance Initiatives:

Data governance is not – and should never have been – about the data.

High-quality and trustworthy data sitting in some repository somewhere does not in fact increase revenue, reduce risk, improve operational efficiencies, or strategically differentiate any organization from its competitors. It’s only when this trusted data can be delivered and consumed within the most critical business processes and decisions that run your business that these business outcomes can become reality.

So what is data governance all about? It’s all about business process, of course.

Let’s add this note to Karel’s assessment: business process is about optimizing the Business.

The current state of the increasing interrelationships between Data Governance, MDM, BPM, BI / Analytics (as well as DQ, DI) is also the story of the teaming up of Business users and IT as collaborative partners in doing the work that help businesses meet strategic goals, bring value to company customers, add to competitiveness. Both sides of the story must start with the business problems and the jobs to be done, plus the desired outcomes and benefits. Then decisions must be made regarding the role to be played by the software solutions to be implemented. Starting with the business also encourages the exploration and creation of the specific business cases that reflect needs and requirements. With such business cases defined, monitoring outcomes of data governance, BPM, BI, etc., should have clear basis.

While business processes are a major focus for strategies around data governance, BI and BPM, data still retains a significant role as a strategic asset that enterprises can use to differentiate themselves. These two entities (process and data) must be accorded respect when developing interrelated approaches that incorporate all of these solutions. Just as these solutions are best in synch with one another, so must the enterprise itself work with these solutions across departments and diverse teams. For business and intelligence processes to yield useful, timely and accurate results, the underlying data must be trustworthy.

Knocking down the Silos

Data, information and content permeate most enterprises where business users must become much more directly involved in creating the overall solution for handling these vital resources. Business users usually hold the key to the context for data and processes, as well as future usage considerations. The integrated components of MDM / data governance, BI / analytics, and BPM need to deliver real results to business users but are also highly dependent on participation of business users to reflect reality and provide on-target solutions. True collaboration between Business and IT teams starts with requirements, results, procedures, and then leads to collaborative work on joint projects. Such collaboration fosters reuse, reduces duplication of effort and processes, and builds a network of Business and IT staff that is aligned with how systems support key business objectives, initiatives and future direction.

Commonality also crosses the business drivers for data governance, MDM, BI, and BPM where key benefit areas consist of growing revenue, cost efficiency, different levels of agility, and compliance. Efforts should provide improvements for:

• Faster, more accurate decision-making - real-time intelligence
• Identifying and engendering new markets, new products, new customers
• Enhancing and supporting customer relationships / customer service
• Operational procedures
• Customer cross-selling / up-selling
• Ease of compliance, audits, risk management

Rajan Chandras, Data Gaps Plague Process Initiatives:

For one, the genesis of these types of initiatives is often very different. BPM is undertaken when organizations find themselves beset with process shortcomings, and with the primary purpose of better understanding, improving and integrating business processes. Data governance initiatives, on the other hand, are usually justified by shortcomings in data quality, consistency and integrity.

Then, data governance is often closely intertwined with master data management, and thus organized alongside important "master" business data entities -- customer, product, organization and such.

That said, Rob Karel, Forrester analyst and lead author of the report, suggests that IT must learn how to better educate and evangelize data issues in a language and a context that matters to the business -- a responsibility that Karel puts squarely on IT, "because IT often has a more cross-enterprise view than siloed business units and functions."

For data governance and process governance efforts to be successful, they both (business and IT) must frame their priorities and business value in the context of which business processes they are aiming to improve, transform and optimize, says Karel.

From Forrester study, September 2010

Source:http://alteryx.com/How-Alteryx-Performs/Pages/White-Papers/Forrester-Report-on-BI-Platform-Requirements.aspx

Intelligence, People and Process

MDM is a reflection of how an enterprise uses data, information – and content - for business purposes. The creation and management of master data touches more than the information itself. By creating data repositories and processes that reflect business functions, enterprises should develop access to the information that is so necessary to effectively and efficiently achieve business goals. It’s extremely important to analyze, manage and provide access to all forms of information – structured and semi-structured data, as well as “unstructured” content.

For BI and analytics solutions to provide real intelligence, they must be based on accurate and timely data sources. BI outputs are based on data aggregations, until recently, from structured data in data warehouses, with delivery in report or dashboard form to enterprise users. Analytics add the dimension of mathematics and formulas, with variants addressing forecasting and prediction.

Neil Raden responds to the ebizQ question: How does master data management change BI?:

…to describe how organizations collect data as part of a process, but manage to make it infinitely more valuable by using it for other purposes.

What does this have to do with BI and MDM? In our research, we have found that most knowledge workers shun BI for two reasons (not performance or ease-of-use): relevance and understanding. MDM adds nothing to address these concerns because its representational framework, a relational schema, is inadequate. It's a representation of a model. An ontology is a model. Until MDM rejects the relational model as its underlying schema, it will be unable to add the rich meaning, relationships and even reasoning that an ontology can do.

So, the point is, if you're going to go to the massive effort and expense of an MDM solution, take some advice from 21 years ago…Make the data useful for people, not just governors and black belts.

One newer area of interest for BI / analytics solutions is the inclusion of collaborative activities to add contextual and qualitative layers to the output of BI processes. To achieve authentic intelligence, contextual / qualitative layers can provide a strong basis to test, fine tune and filter the artifacts of analytics. Analytics can benefit greatly from human filters that bring experience, knowledge, creative thinking. Context has a big role here: context for sources, context for outcomes, context for usage with other data points, to achieve the optimal Intelligence for “making better business decisions”.

The possibilities for new applications of analytics increase with collaboration. Inviting in many-to-many interactions also opens up processes to new ideas from participants. Gartner found that social venues and collaboration help to track and capture outcomes of the decisions made based on BI / analytics:

Gartner's user surveys show that improved decision making is the key driver of BI purchases. However, most BI deployments emphasize information delivery and analysis to support fact-based decision making, but fail to link BI content with the decision itself, the decision outcome, or with the related collaboration and other decision inputs. This makes it impossible to capture decision-making best practices. Solutions are emerging that tie BI with social software and collaborative tools for higher-quality, more transparent decisions that will increase the value derived from BI applications.

With convergence, employees in the enterprise should operate more effectively, where improved data governance/MDM lead to better BI, where collaborative processes also enhance and validate BI, where a collaboration setting for BPM works to deliver more of the information that the enterprise needs. A possible approach to marrying collaboration, data and intelligence to business processes, and, more importantly, to the way people work, can be seen in Tibco’s re-work of tibbr. Dennis Howlett provides this description of tibbr:

It intelligently marries people, process and context, delivering information the way people want to consume

Tibco connects tibbr to business processes and event-triggering that are then exposed in tibbr for taking action. While tibbr is built more for real-time information streams than archives of content and information, tibbr and Tibco have created a platform with a lot of potential for improving overall information findability that adheres to context and worker roles. It connects to process, people/workers, collaboration venues, data and information streams, centralizing all event streams into one dashboard. Information can be organized by subject or topic, rather than by people. tibbr enables users to create, contribute to, and subscribe to the real-time event streams that matter most to them.

Convergence Clarifies Benefits and Value

In a recent Gartner report covering predictions for data integration and MDM:

Through 2015, 66% of organizations that initiate an MDM program will struggle to demonstrate the business value of it.

It’s probably not a stretch to extend this “struggle for value” to BPM and BI / analytics. But through the convergence of MDM with BI / analytics and BPM, an analyst like Sandy Kemsley sees increased business value, in this Loraine Lawson interview:

Lawson: It's become more important with MDM to identify pain points and a real business case. Yet MDM is still pretty IT-centered. Does connecting it to BPM allow it to be more business-focused as a project?

Kemsley: Absolutely – connecting it to BPM, and also connecting it to business intelligence and analytics, because that's one of the things that many business users are interacting directly with analytics, whether it's just simple reporting or dashboards or a more complex, drill-down. You can get better analytics if you have consistent data models and those consistent data models are going to be helped by MDM, that's one of the key business benefits. When you want to have a report that gathers data from a number of different systems, it's not going to be some huge, big, long project because somebody has to figure out what data maps onto what other data. It's going to be a much more straightforward thing because while the data may not all be in one place, at least it will be in a consistent format so that you can easily bring it together.

 

Individually these solutions can achieve some value and success for an enterprise, but at the cost of much duplicated effort and resources. In convergence, with initiatives for business improvement and better decision-making, an integration of BI/analytics, BPM, data governance and MDM has definite synergistic outcomes that can greatly increase business value and reduce wasted effort. Integrating business insights into process execution will significantly improve the quality of decisions and lead to continuous process optimization. And process events kicking off BI and analytics for real-time decision-making increases beneficial outcomes.

All of these solutions should be about solving frequently complex business problems and supporting the work to be done in the enterprise. Each solution brings a significant piece of the “big picture”: better decisions for the business with reliable data feeding both intelligence and process. Ultimately the biggest payoff is how this convergence feeds directly into business agility and continuous change to constantly fine tune sustainable competitiveness.

Related Links

The Ever-Expanding Importance of Analytics–True Intelligence for Business

Goals and Metrics – Measuring Customer Engagement on the Web

I have a confession to make: I am a Hybrid

Findability Inside The Firewall – Still Trying To Find The Information We Need

About the author: Julie Hunt is an accomplished software industry analyst, providing strategic market and competitive insights. Her 20+ years as a software professional range from the very technical side to customer-centric work in solutions consulting, sales and marketing. Julie shares her takes on the software industry via her blog Highly Competitive and on Twitter: @juliebhunt For more information: Julie Hunt Consulting – Strategic Product & Market Intelligence Services

 

IT + Marketing: Innovation Through Collaboration in B2B Software Companies

 

I’ve read a lot of articles and posts that have discussed various aspects of the uneasy relationship (in many cases) between IT groups and Marketing groups. The people and process side of this ongoing situation puts me in mind of the obstacles and needs for the adoption of a collaboration culture in software companies. For the purpose of this article, collaboration means: talking to each other, listening to each other, analyzing and planning in concert, presence of mutual respect – no silos, no turf wars. Good intent, good communication -- bi-directional and legitimate. The kind of enterprise collaboration where teams work together for common cause: business success, growth, innovation, getting the work done well.

Whether it’s dubbed “IT working with Marketing”, or “Enterprise Collaboration”, upper management has the same responsibility to encourage and sponsor all types of necessary and differentiating collaboration to achieve business goals in ways that are better, faster, and smoother. Unfortunately for many software companies, upper management is not stepping up to enable and empower useful collaborations, particularly cross-departmental. Upper management in this context means CEO, CFO, COO -- all too often, the CIO and the CMO are not accorded power over the decisions coming from these other roles.

 Ben Horowitz on the ‘Innovation Business’:

The technology business is fundamentally the innovation business. Etymologically, the word technology means “a better way of doing things.” As a result, innovation is the core competency for technology companies. Technology companies are born because they create a better way of doing things. Eventually, someone else will come up with a better way. Therefore, if a technology company ceases to innovate, it will die.

Collaboration frequently is a very good way for software company teams to not only work for company success, but to better innovate. Innovation in software companies should not only be about products and solutions; it should be about how the company itself works as a thriving and growing organism, how it empowers staff to be successful on the company’s behalf.

  

Neither IT Nor Marketing Is A Monolithic Being Calling Its Own Shots…

Contrary to popular belief, the “modern” IT group did not spring up fully formed as an autonomous entity that makes decisions in a vacuum. Obviously an exaggeration, but I think a lot of people have this notion in the back of their minds when considering the role of IT. With a startup, the IT team may be more focused on digital infrastructure: hardware, telephony, internet, internal systems. As the company grows and different kinds of employees are added, IT grows too. If the software company IPOs, then the IT group is heavily involved in compliance, security, ensuring always-on performance, and so on. Internal systems may become more complex and numerous, employees more virtual, hardware and infrastructure demands more sophisticated.

Frequently the result is that IT groups become silo’d, but usually not by their own design. Upper management sets the agenda for IT groups and usually holds responsibility for the positioning of IT as separate from the rest of the company.  In recent years, most IT groups have suffered through significant staff cuts while more has been piled on the remaining staff. Upper management then expects instant change from IT to better support the business -- without sufficient resources – and particularly without a strong collaboration culture in place.

Marketing groups are in the same boat as IT regarding who decides their destinies. Software companies in startup mode have a history of adding Marketing functions in haphazard fashion. Many startups still look at “marketing” as something to slap on when the sales team needs more help finding buyers. The reality is that for most software companies, Marketing is an important component of the Business, just as IT is.  But too often, upper management misses the strategic opportunities to do it right – to build teams working together, instead of separately and frequently in conflict.

 

Strategy, Business and Tech

IT has been the target over past several years in companies that rightfully want IT to be more aligned with the strategic needs of the business. IT has received black marks for not moving quickly, not feeding innovation, and so on. Balance this criticism of IT with the reality that upper management usually has a big hand in the current state of IT affairs.

Eric Brown frequently addresses the future of IT with a strong dose of reality:

What’s missing in most of the articles I’ve run across about reinventing IT or changing IT is the effect the Business has had on IT. You can’t really reinvent or change something unless you know the how and why behind the creation of that entity in the first place.

…at the end of the year, the grades are handed out.  Sometimes IT fails. Sometimes IT over-achieves. …most times, IT gets a barely passing grade.

Is this barely passing grade (or failing grade) due to incompetence or mismanagement? Most times it’s not…most times it’s due to changing priorities that aren’t clearly thought through and/or communicated throughout the organization

 And who creates the constantly changing priorities? Upper management.

Harvard Business Review also weighs in on the future of IT:

The authority and responsibility for IT-enabled business outcomes needs to be aligned. The CIO's dilemma…is the challenge of promoting innovation while increasing efficiency. IT is in the untenable position of being held responsible for this even though their business partners control the decisions that impact their ability to do so.

IT governance is really business governance. In many organizations, IT has led the way in implementing governance over critical decisions related to strategy, business architecture, investments, change, programs, risk and sourcing. Over time, organizations have realized that decisions in these areas need to be coordinated across the enterprise and have elevated and consolidated these activities outside and above IT.

This isn't your grandmother's technology. "Technologies for collaboration, business intelligence, and customer interface all require experimentation and iteration" and a hands-on relationship between workers and their technology. Increasingly, the technology necessary to assemble, deploy and operate technology will be provisioned by external providers freeing up internal IT resources to focus on the meaty issues of coaching users on how to exploit the technology and ensure horizontal integration, security, continuity, and performance across the extended enterprise.

 

Marketing + IT  <>  Business + Tech

For many B2B software companies, Customers are now Buyers, many of whom want to drive the relationship and buying cycle, moving sharply away from the former sales-team-focused cycles. The customer experience with the company has gained importance; many company-centric processes must give over to processes with a strong customer focus. Both Marketing and IT have important roles in customer engagement, with marketing technology growing in sophistication and variety. But in most companies the IT group carries the additional responsibility of working with multiple disparate internal constituencies, with priorities determined by project portfolio management, internal politics, and by decisions from upper management.

When IT resources are not easily available to support time-sensitive initiatives, marketing groups have frequently implemented their own technology solutions as a form of Shadow IT. New approaches to effective customer engagement lean heavily on cloud/SaaS based technologies that are fast to set up and use by non-IT staff. Unfortunately a significant side effect of not including the IT group has led to problems: new data silos, separate operations and analytics – lack of integration with other systems in the company.

As cited in a recent post by Cheryl Burgess, the current and frequent state of finger-pointing and lack of mutual respect between IT and Marketing is summed up by Chris Murphy of  InformationWeek:

IT sees marketing as looking for shortcuts, shortcuts that will come back to bite the organization. Marketing, meanwhile, sees IT slowing them down, not delivering on the operational basics, and not understanding marketing needs.

Burgess also points to an Accenture-sponsored study involving over 300 CMO’s and 300 CIO’s that presented this view of Marketing + IT:

The CMO Council believes there is a global imperative for marketing and IT organizations, which too often have been polarized and adversarial, to find common ground around the business of innovating more efficient, effective and measurable ways to target, acquire and stay intimately connected to customers. The need for greater synchronization, partnership and collaboration between these two groups has never been more critical to their mutual success.

 

The Marketing Technologist: Success More Likely With IT and Marketing In Collaboration

Frequently, companies gain better paths to innovation, collaboration and competitiveness with the presence of business-technology hybrids who span departments and leverage cross-team expertise. The demands of innovation, meeting customer needs, and rapidly changing solution markets are challenging software companies to work much more quickly and collaboratively than ever before.

An important hybrid is the marketing technologist. Scott Brinker has published an extensive and well-crafted piece on the rise of the marketing technologist, describing “technology-powered marketing” where “Marketing must take ownership of the technology in its domain”. Some of Brinker’s observations on the marketing technologist hybrid:

As marketers, you're already responsible for the outcomes based on such technology. The accountability so widely promoted in digital marketing has you in the hot seat for results. It's only sensible that you should have full control over the means and mechanisms to deliver those results.

You must be the driver of marketing technology, not merely a concerned passenger. But if you don't have technical depth, who can help you navigate? …I propose a new role in the marketing department: a marketing CTO or chief marketing technologist. The mission of the marketing CTO is to provide that technology navigation.

 Brinker makes the case for highly functional collaborations between IT and Marketing:

..technology decisions and marketing strategy are intertwined. You can't address one without impacting the other.

 Brinker also profiles the ‘3 Spheres of Marketing Technology’: “All these technologies — the ones we buy, the ones we build upon — can be categorized into three overlapping spheres”:

                    

                    

 

Customer-Focused / Technology-Driven Marketing: Attract More Buyers

In 2008, Booz & Company published its view of the growing integration of marketing strategies with technology, “Not Your Typical Marketing Campaign – The Next Wave of Technology-Driven Marketing”:

Next-generation direct marketing demands a front-to-back rethink of the overall IT architecture, with the ultimate goal of better understanding the customer... In the past, each channel would feed customer information individually into the back-end customer relationship management (CRM) and enterprise resource planning (ERP) systems that processed transactions and held much of the customer data. Using the new architecture, all of those channels now connect to a central integrated engine. This engine, available throughout the network, mediates between channels and the customer data and back-end processing. The central campaign engine also contains the business rules that govern every interaction with every customer.

The single most critical innovation, however, lies in doing away with the typical siloed, channel-specific archi­tecture on which most current direct marketing and campaigning technol­ogy depends. No customer-centric marketing effort can be truly success­ful if the technology is still organized around interaction channels, rather than those all-important customers who naturally interact with the busi­ness through multiple channels.

Each step of the way will require the willingness to rethink your overall marketing strategy, the tactical processes by which you plan and carry out each campaign, and the IT tools you need. You must develop the skills required to design and execute analytic campaigns and, of course, you will need to build the technologies to enable those cam­paigns.

 Most important, from begin­ning to end, the CIO and the CMO must work together as partners to design, build, and test the necessary infrastructure, and to expand it, step by step, throughout your company.

 

Marketing Technology + IT: Marketing ERP?

Looking at the transition from channel silos to a more integrated marketing technology platform brings up the notion of Marketing “ERP” to provision, manage and analyze initiatives supported by marketing tech. Egbert Hendriks @ephendriks introduces this notion (whether seriously or tongue-in-cheek) in a recent exchange on Twitter with Kevin Cochrane @kevinc2003:

@ephendriks RT @niels_goossen: Why Marketing Should Run Its Own Technology -- InformationWeek http://bit.ly/dRaLSs

@phendriks: I agree- marketing is becoming a technology-driven discipline. #wcm #dam #vms #bpms integrate in a marketing "ERP"!

@kevinc2003: @ephendriks what do you see as being a marketing "ERP"? Interested in your perspective / insights

 

From the Booz & Company paper:  the diagram to the right below could suggest a path to a Marketing ERP platform. Also be sure to note the transition from channel silos on left, to a more integrated marketing technology platform on right.

 

 
 
http://www.booz.com/global/home/what_we_think/reports_and_white_papers/ic-display/47189813

 

Indeed, marketing has been increasingly technology-driven, relying on marketing management platforms, analytics (multiple), various software systems for content (WCM, WEM, DAM), BPM, VMS (vertical marketing system), social media, lead gen, mobile/multichannel management. We could also throw in MDM, CRM, data/application integration processes, other reporting.

BUT – at this point, the answer to building out highly effective marketing technology systems incorporating the best of Marketing and IT is not found in throwing more tech at the situation. Nor is creating a new software category going to help.

A better approach is the enablement and empowerment of IT and Marketing working as true collaborative partners, where upper management fully supports the elimination of silos and frees up IT to work on strategic initiatives. Software companies still have lots of people and process matters to figure out first. Innovate how the company works together as teams with common purpose. Collaboration culture can lead to and encourage innovation culture, both of which can lead to business success and competitive agility.

 

  

Related Links

I have a confession to make:  I am a Hybrid

Internal Disruption–No Longer Business As Usual

Levels of Social – and Integration – Cut Across Enterprises

Shallow Thinking Ensures Bad Business Decisions

 

About the author: Julie Hunt is an accomplished software industry analyst, providing strategic market and competitive insights. Her 20+ years as a software professional range from the very technical side to customer-centric work in solutions consulting, sales and marketing.  Julie shares her takes on the software industry via her blog Highly Competitive and on Twitter: @juliebhunt   For more information: Julie Hunt Consulting – Strategic Product & Market Intelligence Services