On a recent weekend, before Blackboard Inc. was set to go live with an upgrade to PeopleSoft Enterprise 9.0 and SQL Server 2005, IT staff at the company went bowling.
"If that tells you anything, the move went very smooth," said Rav Sandhu, director of enterprise applications at the Washington, D.C.-based company. "There's no such thing as moving to production with no issues, but there weren't any real showstoppers."
That isn't always the case, of course. Upgrading major systems can be a complicated, costly and time-intensive process. And it's only getting more so, according to Joshua Greenbaum, principal and founder of Daly City, Calif.-based Enterprise Applications Consulting. Larger databases, larger infrastructures and, particularly, service-oriented architectures (SOAs) are making upgrades harder.
"Absolutely, without a doubt, upgrades are more complicated," Greenbaum said. "Software does follow a complexity trajectory, and upgrades, if they're done for the right reasons, usually involve more complexity. Hopefully, the reward will also increase and time invested will be well spent; but that's not always the case."
Part of that additional complexity often comes in the form of adding users to the system, but for Blackboard, a maker of online learning software, there were three major reasons for moving from PeopleSoft 8.9 to 9.0, according to Sandhu. The company also plans to upgrade to the PeopleSoft Enterprise Finance
"We wanted to upgrade our heavily used CRM system so we can do integration to the supply chain," Sandhu said.
Secondly, the company is streamlining its business processes in sales, marketing and support and wanted a marriage between processes and technology. Process change is an ongoing exercise at Blackboard, Sandhu said. As the company has grown, so have the demands on its systems. Sales was looking for a sales productivity toolkit, with more mobility, a disconnected client and task management and forecasting.
"For us to go that path and supply their needs, we wanted to make sure we were on the current platform," Sandhu said. "[PeopleSoft] 9.0 has a much better format to get us there."
Finally, Blackboard was falling behind with fixes and updates on its PeopleSoft 8.9, making it more difficult to get through testing on the system, Sandhu said.
"We thought we might as well go to next level which inherits all those fixes, plus all those enhancements that come down the pike," he said.
For many organizations, a real barrier to CRM upgrades are the customizations they've made to the system, particularly for companies that started with earlier versions, according to Rob Bois, analyst with Boston-based AMR Research Inc.
"There are plenty of stories about people who put business logic in stored procedures and cemented them in place," Bois said. "An upgrade for them will require a lot of hard coding business logic. That's the biggest hurdle. They can't justify it."
However, there is something of an inverse relationship between how recently a company implemented CRM and how difficult its upgrade will be.
"Companies that are on later versions do find the upgrade easier," Bois said. "At the same time, that's one of the benefits of getting to a new version -- getting to that componentized version or service-oriented architecture."
The SaaS alternative
AMR Research has found that companies typically continue to go through a CRM upgrade every two to three years, according to Bois. However, the emergence of Software as a Service (SaaS), where the software provider handles all the upgrades off-site, is helping to change that strategy.
"IT understands that SaaS relieves them of this burden," he said, "which is one reason they're more on board with it than in the past."
Blackboard was well positioned to take on the upgrade, with a skilled IT staff that has a close relationship with the business side of the company.
"Our philosophy here at IT at Blackboard is we tend to be an extension of the business side. We work closely with stakeholders," Sandhu said. "By having a purview of what they're looking for, we collectively came to a decision that this was a good time [for the upgrade]."
The company always has both a business sponsor and an IT sponsor for technology projects. For the CRM upgrade, David Sample, senior vice president of sales, and John Lambeth, vice president of IT and security, took the lead.
In addition, an IT steering committee meets quarterly and, for major projects, a project kick-off is conducted, complete with charter, identification of team members, and an organizational chart.
"The business was anxious to get CRM 9.0 up and running, even though we knew it was an aggressive timeline," Sandhu said. "Based on the availability of resources and other deliverables, we started in April."
The project was complete, with a little help from Oracle support, 18 weeks later.
The steering committee was also able to enlist the help of a number of power users of the system who set up communication within their own group and did training. Training and testing took about five weeks, Sandhu said. While the project went relatively smoothly, there were some hitches with adding new users to the system.
"If I had it to do over again, I would slap on another two to three weeks of testing," Sandhu said. "If we [had] had an opportunity to do more testing, we would have driven more scenarios."
Companies with existing CRM systems are seeing more pressure to move to the latest version, according to Greenbaum, despite programs like Oracle's Applications Unlimited, which pledges ongoing support for the CRM systems it acquired from Siebel, PeopleSoft and J.D. Edwards.
"Oracle has said, 'We will not force you to upgrade out of the code base you're in,' but even in the context of that program, Oracle is putting a fair amount of pressure to upgrade to the Fusion Middleware product and latest and greatest in the database," Greenbaum said.
There is reason to buy Fusion Middleware, he noted. Security administration that supports single sign-on through a portal, application integration and master data management are all good reasons to complement CRM, even if companies are not changing their functional use of the software.
Compliance is also pushing some firms to upgrade their systems, but most firms focus those efforts on financial applications, according to Bill Band, principal analyst with Cambridge, Mass.-based Forrester Research Inc. Moreover, CRM vendors can't turn to new gadgets to convince users of the need to upgrade.
"Traditionally, vendors try to push upgrades on buyers, but it's been more difficult because features and functions are fairly mature, so it's not so obvious," Band said. "That's why the core of CRM users are trying get the most value they can out of it."