Excerpt from:  NetSuite and NetSuite Consulting
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October 12, 2005

CRM Commoditization? It's a strange idea...

SAP has recently made some statements about hosted CRM vendors making CRM into a commodity. Wow, the things people will say when they are losing!

Let's attack the solution, folks, not the problem! This seems to be the plan of SAP, commenting on hosted, software as a service, CRM systems in this article.

A little background. Big complex systems sucked corporate America, and much of the rest of the world for that matter, dry in the 90's and first few years of the new millennium. In response to this great sucking sound a new and better software delivery model, software as a service, comes out. Enterprise class computing without the machines, without the bloated IT Staff, using the Internet as its backbone. 

Now the backlash. SAP blames on-demand software as a service CRM vendors for making CRM a commodity. So in other words he's saying that SAP's software, the same copy of which goes out to every customer, attains the status of specialty, custom software by virtue of its on-premise licensing. In fact, on premise software has less flexibility to be mastered for different vertical industries because it was built on a technology stack in the 80's. All of the on-demand software that I know about, including NetSuite, incorporate, by orders of magnitude, more flexibility than traditional client-server packages.

The only commoditization that might be taking place is when clients think that on-demand software, because it does not require an IT staff to install and maintain, does not require professionals to configure and customize. This is not true. NetSuite implementations of great value are done by professionals who know how to use the products inherent flexibility to verticalize it and make it perform to the client's business model.

SightLines has this expertise and regularly customizes NetSuite for its client's business model. There are however those companies who try to implement themselves and it is no secret that they are not impressed with the product after a year of tinkering around. Will they switch to another brand? Very possibly, because it is easier to blame the product than your self-implementation.


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