Managing the demand chain in e-business

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CHICAGO -- The Internet changed everything, but it hasn't replaced all the other activities a company engages in to build relationships with their customers, David Schmaier, executive vice president of Siebel Systems, Inc. said in his keynote address.

The recent dot-com crashes validate the idea that the Internet is not the panacea for all of a company's CRM efforts, according to Schmaier. Prior to the dot-com crashes, software vendors had been suggesting that companies fire their sales people, disengage their other distribution channels, and put up a Web site. "This is a dramatic oversimplification of the facts," he said.

According to Schmaier, the GM analogy asks what percent of sales will be done purely over the Internet. Up to 20% of sales may be purely over the Internet, and that is a big number, but it's not 50%, he said.

"E-business is a confluence of all these different factors," Schmaier said, referring to sales, marketing, customer service and the Internet. "Today, e-business is building software for everyone in the company that is in the ecosystem of employees, partners and customers," he added.

"We're all here to talk about channel strategy," Schmaier said. In the past, a company would typically have one distribution strategy. For example, a customer would buy Nike shoes in a store, purchase IBM computers through a sales representative, a Lands' End golf shirt through a catalog, and a Ford automobile through a dealer, he said.

Now, however, customers can choose how they communicate with companies through the Web, e-mail, a call center, field visits, resellers and other channels, according to Schmaier. "The Internet is driving companies to rethink their distribution strategies," he said.

Yet there is a problem for companies, who often have difficulty allowing customers to interact with the company when they want, through any channel, any currency and any language, Schmaier said. This is because the companies have focused on the back-office operations, without much thought to the front-office processes, he said.

"If the company doesn't remember who [the customers] are, customers will find a company that does," Schmaier said. He compared not having a channel strategy to an airplane without radar.

The call center is turning into a customer interaction center, and sales force automation is becoming increasingly important to the bottom line, he said. With an e-CRM suite, a company can provide interactive selling to customers, such as price lists on the Web or a virtual salesperson, he added.

E-mail is also an important part of the solution, as it can be used to mine data and give a timely response, Schmaier said. A rules-based personalization engine that assigns each customer his own profile is also important to improve a customer's experience, he said.

Schmaier also sees customers moving from a static Web experience to something such as the Call Me Now technology, which a customer can use to request a call from a customer service representative over the Web.

There is also a growing trend toward auctions, which encourage dynamic communication, he said. Companies will need to provide support for a full range of auction types, Schmaier added.

"E-business supports a broad range of services," Schmaier said. Companies need application integration to appropriately handle e-business, and enterprise application integration should be open and extensible, he added.

"We believe conclusively that e-business leads to higher levels of customer satisfaction," Schmaier said.

"This was relevant because we do a call center," said Joseph Puglisi, chief information officer of Emcor Group Inc. and an attendee of the keynote. "We're looking for call center software, field force deployment and wireless," he added.

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