Friday, March 31, 2006

Entellium on SaaS

Recently, their were reports of information misrepresentation between two SaaS players—SalesForce and Entellium. Sadagopan points to the response by Natalee Roan, CMO of Entellium, who takes out time to respond, to what she terms as “inaccuracies and lack of integrity in the document.” She gives her take on “business practices she finds incredulous in this industry.” It makes for an interesting read from one of the industries insiders (albeit fairly new at this game). She says:
  • “Hosted CRM companies get to market a monthly fee and then charge a year or more before you even get started.
  • From my vantage point, the worst thing that ever happened to Customer Relationship Management is that it became productized into "CRM" so companies don't have to bother living up to the words behind what they are selling.
  • They turn the sale into a "features-functions" war rather than take the time to understand what you need. Even the way they arrange their product line is designed for the consummate "up-sell." By design, they leave out 1 or 2 key features that force you to move to the next product for a considerably higher price - and you can't mix and match the lower priced products with the more expensive ones.
  • The few that market Service Level Agreements (SLAs) offer a mere few paragraphs with no teeth - and the largest of them all only offers SLAs to a select few customers, despite numerous and lengthy down-times. Those CRM companies that do claim an SLA force you to keep track of uptime and chase them for your money. They also say nothing about back-up schedules, downtime notifications, incident resolution times….all critical items in Software as a Service, or hosted solutions.
  • The industry seems to intentionally avoid standardization just to keep their high prices in tact, with hundreds of partners waiting to take a bite out of the unwary buyer. Somehow we've been trained to think that it's acceptable to have to pay yet more people to get a product to work as advertised. And they've pulled the greatest marketing ploy of all - to make you believe your business so special that this extra work is needed in the name of "customization". The entire industry is a feeding frenzy on the customer.”
“Let me summarize: Even with hosted CRM companies that advertise "No Software" -You buy more features then you can possibly use, on a long-term agreement that you pay for up-front, with no service guarantees if something goes wrong. Further, you wind up paying them to support their own product, and needing them or someone else to make the product work the way they told you it would before you signed on the dotted line in the first place.”{emphasis added}

IMHO: SaaS still has some issues to overcome, but it is making big strides—and fast!! SalesForce’s trust site is one step in the right direction. There is a lot of innuendo and propaganda going around (where is it not??), and somebody needs to cut to the chase and clarify the picture for an industry which is built on customer trust. This is the currency they will not want to lose, cannot lose. They do and they are dead, especially with the big guns gearing up to take on the small guys.

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