Yet questions remain about just how successful the technology is, what metrics should be measured and tracked and how to build the knowledge base for the right customer segment. Given the current economic conditions, senior management still needs to be convinced of the potential ROI.

In this podcast, recorded in 2009, John Ragsdale, research director for the Service and Support Professionals Association, explains how to build a business case for self-service technology.

Ragsdale discusses:

• The future of the market for self-service technology
• How to approach upper management about self-service technology
• Where organizations are realizing cost savings
• Where they’re seeing revenue from self-service
• How to monitor customer satisfaction with self-service
• How to measure success

 SearchCRM.com: So, I’d like to start off by getting your predictions for the self service market over the next few years. Do you feel like self-service is a strong technology investment given today’s economic climate?

John Ragsdale: Absolutely and it’s one of the bright spots at the moment in this economy. I’m seeing strong spending for knowledge base tools and self service technology, partly because of the bullet proof ROI story that they promise.

I just completed my 2009 technology survey. This is a survey of 300 high tech companies and we asked them about their technology budgets for the year and how they’re allocated and self service and multi channel tools represent 30% of the total technology spend for 2009 and that’s compared to 22% last year. So we’re seeing a lot of attention shift toward self-service and knowledge. And even though spending has slowed we’re still seeing companies investing in 2009 and 2010 in knowledge base and self service.

You know it’s not just about call deflection. Companies are seeing self service as a way of remaining competitive and offering an exceptional customer experience. So I’m happy to say, spending still looks good. So of course it’s down this year compared to last year but we still see strong spending plans.

SearchCRM.com: So given some of those benefit you mentioned. For organizations that would like to invest in self-service technology what’s the best way to approach upper management and get them on board for these projects?

John Ragsdale: Well, I offer three pieces of advice and the first of course is to build that business case. That business case will really help show that not only are you going to get a return on that investment you’re probably going to profit from that investment and very often within the very first year. So, when executives see what the return can be for this project, not only do you see service and support getting the green light, you also see the projects move up in the priority list.

The second thing to help get your executives to understand is to analyze your customer demographics, and there’s a lot of good studies out there including some work I’ve done, that shows the channel preferences by different customer demographics. And if executives are still thinking customers only want to pick up the phone and call you, they’re terribly outdated in the way customers’ attitudes have changed about support.

The final thing is survey, survey, survey. The voice of the customer is becoming so important. More companies have this chief customer officer. And when you survey customers about their ideal service experience they will definitely talk about what their expectations are for self-service. So I think when executives understand customers are demanding this, it’s not just something we’re trying to shove down their throats, they understand it’s really a critical project they want to get on board with.

SearchCRM.com: Well it seems that cost savings is a big driver for self-service adoption. Can you dig into that a little more and explain how shifting interactions from the phone to other channels can result in some cost savings?

John Ragsdale: Sure, based on what I see from SSPA member companies, of course the number one ROI story is call deflection and call deflection gets the most attention because the average cost per call today ranges from around $15 on the consumer side up to $45 or more on the enterprise or B2B side. So if you can implement self-service and deflect calls away from phone agents, clearly you’re saving a lot of money. The ROI adds up really fast and it’s very easy to track, but do you do need to look beyond just call deflection.

On the multichannel issue, there are varying channel costs and there are so many tools out there to automate email responses and speed up delivery of resolving  issues for customers by email.

We’re seeing more and more companies investing in web chat. Even on the B2B side we’re seeing a large number of companies enacting reactive and proactive web chat. Those offer some productivity enhancements because agents can handle multiple sessions at a time. So moving customers away from the phone to other assisted support channels with lower total operational costs.

And the final thing I’ll mention is that we’re hearing form more and more companies that the non-phone channels such as email and chat lend themselves much easier to outsourcing and going offshore. You don’t have the accent neutralization to worry about and we’re seeing time and time again, big companies like Symantec for example, sending email and chat offshore and not only do customers like it, customer satisfaction has gone up for those channels. Companies are also finding that if they can get customers to try out these new channels they can find innovative ways using outsourcers to service those channels very cost effectively.

SearchCRM.com: So, on the customer side, how can self-service help with customer satisfaction and how can companies keep an eye on that?

John Ragsdale: I do think that it drives customer satisfaction and we just gave out our spring Star award to SSPA members with exceptional service operations. One of our Star award categories is for best online support. All of the applications submitted showed that the day a new knowledge base or self-service implementation went live that overall customer satisfaction went up and it’s a very sharp increase on that very first day so we know that it impacts. And the best way to track this is you’ve gotta do both transactional and periodic surveys. So those transactional surveys are how was your self service experience what could we do different in the future, but you also need those periodic surveys about what do you think of our service and support over the past year, so it’s important to do both.

Also, look at the impact to metric s because even though you’re implementing self service hopefully for call deflection all that great knowledge base content that you’ve created have a big impact on support agents dealing with customers. So you see specific impacts to key operational metrics like first contact resolution, average talk time or handling time, customer hold time abandon rate, all across the board. So make sure you’re looking at how that implementation affects every metric you track because you may find some surprising impacts you hadn’t expected

SearchCRM.com: And for companies that are using self-service. How can they determine how successful it is or how many customer had expectations met or questions answered via that channel.

John Ragsdale: Well, Lauren this is a very controversial topic and I tend to get in a lot of trouble with the vendors but the vendors tend to make some ridiculous claims about 100% success of self-service. Our SSPA benchmark database which has hundreds of operational metrics that our members contribute to annually shows that self-service success is currently at 40% a shockingly low 40%. That has trended down every year since we first started tracking it in 2003. So, if you want an accurate way to track how customers are succeeding or not succeeding with self-service there are three ways.

The first is by tracking those “useful” and “not useful” clicks that you have on every piece of content in your knowledge base. So that’s helpful the problem with that is that only 3% of customers will give you a useful or not useful click. The second way is those post interaction surveys we were just talking about. Surveying every person who hits your website and asking if they found what they needed.

The third way, that is the most accurate way, and a few companies really do this is a click stream analysis so every time a customer hits your website for self-service track to see if they called you or emailed you or created a ticket online within the next four or six or 24 hours. And that is the best way to see if they could not find what they needed by self-service and had to call you.

SearchCRM.com. So in the age of Web 2.0 can you talk about some of the potential that exists for new self-service outlets and how companies might measure success in that area?

John Ragsdale: Definitely. I have to say the Web 2.0 best practices are still emerging and benchmark metrics are really hard to come by. I recently went off on a search on behalf of one of our members looking for some key metrics and I couldn’t get data from anyone. The vendors either don’t track it or won’t share it and most of the community projects are still in their infancy compared to something like knowledge management or CRM. So it’s not really mature enough to have metrics over a long enough period of time to track. So again you’re seeing vendors making claims that forums are deflecting up to 30% of calls but so far they can’t give me a single case study showing that call volumes have dropped. So definitely some conflicting numbers out there. So the numbers that  I see people tracking or the emerging metrics are the number of active members in a community, members by reputation level, such as what percent are novices versus experts. How many new posts are you receiving a day how, how long does it take to resolve a customer question posted on a forum and what is the amount of customer versus employee time because of course you’re trying to shift more and more of the moderation duties over to customers.

To my knowledge nobody knows what the ideal benchmarks should be but I will definitely be publishing and writing about this as soon as I can track down some numbers I have confidence in.

SearchCRM.com: So how can companies monitor the ROI for self-service. You mention that you’re seeing some organizations that are seeing ROI. How are they monitoring that and what metrics are they using?

John Ragsdale: My first piece of advice would be if you working on building that business case I wrote a report last year called building a business case for knowledge management that lays out how to do this and gives some examples. If you’re listening and you’d like a copy of this report drop me an email to jragasdale at the SSPA .com and I’d be happy to send you a copy.

My hints here are make sure you have a good metrics plan in place before you make any changes. I often see companies that implement a new policy, a new technology, a new practice whatever and they don’t have any details of what they how doing before so you can’t really tell what the changes were.

Look at the fluctuation in any metrics as of the day that new knowledge base or self service tool goes live. As I mentioned before you might have impacts in areas you don’t expect. There are typical metrics both on the hard and the soft side. On the hard side you have those operational metrics like first call resolution, average handling time, percentage of issues resolved at Level 1 or the percentage of issues escalated so those have real easy dollar figures attached to them.

But you also have soft metrics which I think are important to include but it’s harder to put the dollar numbers there. Things like increases in customer satisfaction and loyalty and one area we’re seeing a lot more attention around was moving customers to self-service also can be used as a revenue generation tool because we’re seeing more self service sites now prompting customers, “if this is the problem you’re having, consider upgrading to this new version or this new product” and they can do a one-click purchase while they’re on the web site. So not only are you deflecting calls but you’re generating some extra revenue and that’s always a good thing to do.

SearchCRM.com: So maybe you can end with some tips for being successful with self-service technology with some case studies you’ve seen with SSPA clients.

John Ragsdale: Looking over the recent star award applications and talking to a lot of companies I’ve identified three things I’ve seen in common in the top performing self service sites. The first is companies are doing very detailed use case analysis to understand who’s using your site what their needs are and what tools they need to get the help they need. So in the past you may have had self-service sites really directed at techie people so you would have like index trees. In fact you may have a lot more novice users coming to your website now who may have very simple questions and maybe something like an avatar or a chat bot would be more effective for them.

The next thing is the use of rich media and some great use of videos, film strips, some sound file. The third thing I’ll point out is tight integration to other areas on the website. 50% of SSPA members now have a customer community and it’s important to have a good integration between your knowledge base and the community. So if people search the knowledge base and you don’t have an article but there’s a forum discussion going on about that topic they should get a link. And if they’re trying to post a question on the forum and you’ve already answered that question in the knowledge base you should direct them there.

But also making sure that’ it’s easy and there’s good integration between your download site, calibration tools, users manual, release notes. Just keep in mind that all of these in the mind of the customer are part of a single self-service experience so if you have them really sub-divided and hard to find on your website you’re really making it difficult.

SearchCRM.com: Well John, we really appreciate you joining us today and sharing your insight on self-service technology.

John Ragsdale: My pleasure and thanks for having me. 

While “attracting and retaining new customers” comes in at #5 of the top 10 business priorities, CRM software doesn’t even make the list of technology priorities. Last year, it came in (along with other enterprise applications) at #2.

Yet, according to the more than 1,500 CIOs that took the survey, the business priorities typically associated with CRM still rank highly, including attracting and retaining new customers (#5), targeting customers and markets more effectively (#8) and expanding current customer relationships (#10). So why the lack of interest in CRM technology?

A couple of theories are floating around out there. Bob Apollo on CustomerThink suggests it’s a shift in what companies IT-enable. He writes.

We need to stop thinking about automating often badly-aligned “sales” and “marketing” processes and seize the opportunity to facilitate our prospect’s buying processes and embrace the dramatic changes that the net and web 2.0 have already made to buyer behaviour.

Meanwhile, Michael Maoz, a Gartner analyst focused on CRM, partly blames the hype around social networks:

But today the media and the hanger-on writers are all abuzz about “Social” and so our CIO community rushes in, at the risk of leaving behind the core of what they are out to do in the first place: build better systems to meet customer needs and demands. That is still CRM, the business process and strategy, wrapped in new clothing.

Rather than being less interested, Maoz, argues CIOs are smarter about CRM now. They know it’s not just about the technology.

And even so Gartner’s Top 10 technology priorities, contains plenty of intersection with CRM: Cloud Computing at #2, as really CRM software was at the forefront of the SaaS movement and remains there; Web 2.0 (check the Twitter stream for #SCRM if you don’t think so) and even Business Intelligence (#5) and Mobile Technologies (#6).

Maybe the premise is off in the first place. We shouldn’t be talking about CRM anymore at all. AMR long ago shifted to the term customer management and Forrester’s Bill Band has begun writing about the extended CRM application ecosystem.

Call it what you will, but it seems to me the market and the need for technology (and processes) to better connect with, and serve, your customers is alive and well.

Today the company released Spring ‘10 the 30^th edition of its software. Among the enhancements to the latest release are a new service and entitlements feature that allows customer service agents to track a customer’s entitlements and maintain SLAs; Salesforce Answers; the Adobe Flash Builder for Force.com; and, public and private authenticated sites as part of Force.com Sites.

Yet, more interesting was the news earlier in the week that the company is raising $500 million through convertible notes. Proceeds will be used for general corporate purposes including funding acquisitions, Salesforce.com said.

While $500 million certainly isn’t going to buy someone like Siebel ($5.85 billion in 2005) or PeopleSoft/JD Edwards ($10.3 billion in 2004) it would have been in enough to acquire Epiphany in 2005 ($329 million).

What can it buy and what will it buy are, of course, entirely separate questions. But there’s nothing like a little rampant speculation and no place for it like a blog, so here are some of the contenders.

Larry Dignan has already assembled a pretty good Salesforce.com target list over on ZDNet, counting RightNow, Kronos, SuccessFactors, Jive Software or Lithium and a group he calls “the tuck-in club.”

I’d agree that RightNow would be a lot to take on. Besides, Salesforce.com has put a lot of effort into building out and marketing its own customer service application (remember Benioff’s OpenWorld appearance). Rather, Salesforce.com might follow the lead of RightNow and buy a collaboration vendor to extend its Chatter initiative, the way RightNow bought HiveLive. That makes Dignan’s speculation about Jive and Lithium as targets more likely. Of course, Jive just purchased FilterBox which would make one wonder if they’d then turnaround and sell so quickly. Lithium, with a significant overlap in RightNow’s customer base, also raises some questions.

Other SaaS providers?

Would Salesforce.com buy up WorkDay, Dave Duffield’s HR and payroll services business, to build out some back office functionality?  What about swallowing up Zoho and its productivity suite, while also taking out a competitor for smaller CRM installations? Or an on-demand sales compensation company like Xactly or Callidus? That would fit nicely into Salesforce.com’s core SFA business.

Of course, it doesn’t necessarily have to be spent on a SaaS company. Salesforce.com has already shown itself willing to go on-premise with its acquisition of Instranet.

In fact, it looks like the prices for SaaS vendors are only going up. As Bruce Richardson writes in his final First Thing Monday for AMR before signing on with Infor, SaaS vendors had a very good year.

He writes:

Back to the results: NetSuite closed 2009 at $15.98 per share, up 89.3% since December 31, 2008.

RightNow ended the year at $17.37, up 124.7%. Its market valuation topped $552M.

Salesforce.com closed 2008 at $73.77, up 130.5%. I bet you wish you loaded up when it dropped to $25.19 last winter. If you had, you could be reading this on your own island near Richard Branson’s. If the company’s share price grows another $6.00 or $7.00, salesforce.com will have a $10B market valuation.

The real stars, though, were archrivals SuccessFactors and Taleo. SuccessFactors finished the year at $16.58, up 188.85%. Taleo’s share price jumped 200.38% over the course of 2008, ending at $23.52.

 As any historian will insist, we must study the past if we want to prepare for the future and Salesforce.com’s brief acquisition history does offer some clues. They seem more likely to spend on small companies created on the AppExchange like: Sendia, a mobile software company for $15 million, Kieden, which became Salesforce.com for Google AdWords; or Koral. Actually if there’s a common thread here, maybe Kronos is due for a big offer.

 I’m curious what other prognosticators think make good targets and are willing to put their name to.

 Whatever the answer, it looks like more consolidation is on its way.

This year is not as easy as some. Gone are the heady days of CRM news, like in 2005 when all this took was throwing acquisitions, such as the Aspect-Concerto and Oracle-Siebel deals on a list, on a list with innovations, like CDI and Microsoft CRM 3.0. Even the top CRM stories of 2008 were easier to define.

But while the year was light on major acquisitions and suddenly-hot technologies, it was not without its shake-ups and developments. With the dust slowly settling on the market leaders and the major suite vendors firmly in place, 2009 became a time for everyone, including users, to regroup and map out where they’re headed. We start with the vendors:

Microsoft grows up

The year saw Microsoft CRM add its one millionth user and take Microsoft Online international. With the recession looming over 2009, Microsoft also took the opportunity to target Salesforce.com and Oracle CRM On Demand users with a special price promotion. It wasn’t alone either. Obviously sensing that price was a competitive differentiator, Microsoft and SugarCRM both took steps to make CRM cheaper, simpler and cloudier.

SAP heads for the clouds

Meanwhile, SAP’s roadmap took a familiar turn. The applications heavyweight announced plans to not only roll out its full SaaS-based business suite Business ByDesign to full production, but to add multiple business applications on-demand including sales automation, travel and expense and services management. However, for all its commitment to on-demand, SAP had very little to say about its existing on-demand CRM product. Neither did anyone else.

It may not matter. Some customers are obviously happy with SAP’s existing CRM applications. Coca-Cola is using SAP CRM to roll out the ordering system for its new beverage dispenser.

 Oracle straightens out its CRM roadmap

Oracle, tied up for years bringing together the spoils of its acquisition spree under the Fusion Applications umbrella, made some headway in 2009, announcing that the first set of Fusion Applications will be released this year, including sales and marketing modules. Oracle’s CRM roadmap includes a heavy dose of social CRM as well as long-awaited features such as running Siebel in Outlook. Paul Greenberg shared his take on the CRM roadmap and Siemens seemed to be happy with Oracle’s CRM direction. Siemens dumped a number of SAP projects in hopes of standardizing its CRM systems on Oracle.

Salesforce makes a platform push

 Cisco for a contact center in the cloud and pushing its Service Cloud, which features Twitter integration. CEO Marc Benioff spared no expense on marketing it, buying up a huge booth and staging a presentation at Oracle’s own conference.

But it wasn’t all just about the vendors.

“Cloud” gets a little cloudier

Confused about the difference between hosted, on-demand, SaaS and cloud applications? Direct your frustration to the man cited above (who is now calling Salesforce.com a “cloud company”). But it’s not just Benioff. Sage and Consona announced plans this year that will add a little more to the cloud CRM confusion. With the emergence of offerings from Amazon, Microsoft and others, it’s now possible to own the software but rent the infrastructure. It’s only getting more complicated.

Users test out their social CRM strategies

Clearly, the term of the year goes to “Social CRM,” thanks largely to the vendor and analyst community (more below) that have helped push the term beyond the early, simpler days when it was called CRM and Web 2.0 or social networks. For all the hype and confusion, 2009 marked a year when businesses started listening and formulating a strategy around social CRM. For example, Xerox embarked on a social media monitoring program and JellyVision Labs has begun leveraging social networks to help it sales force. SearchCRM.com also managed to add a couple columnists to help readers sort through the noise. Allen Bonde has been writing about social CRM from the marketing perspective while Paul Greenberg is tackling real world examples of social CRM and the strategy behind them.

CRM software sellers get social medicine

If 2009 was a year in which businesses began experimenting with social CRM, it was also the year the vendors in the market jumped in with both feet. RightNow bought HiveLive to round out its social offering, NetSuite partnered with InsideView to get social with its CRM and ERP suite. Salesforce.com, not only added integration to social networks via the Service Cloud, it promised to deliver a collaboration platform with Chatter. Again, SearchCRM.com turned to Paul Greenberg who compared several of the emerging social CRM products.

And the No. 1 CRM story of 2009?

Remember “doing more with less,” that trite little term that meant management still wanted you to work as hard, get as much accomplished, and bring in as much revenue, only with less resources? Well that had CRM practitioners focused on…

Saving money

There was no shortage of advice on how to save. Gartner offered both five low cost contact center infrastructure projects and five low-cost CRM strategies. Forrester suggested ways to mine more value from existing CRM implementations while others started to see CRM outsourcing as more attractive. Marketing got in on the action as well. Forrester analyst Suresh Vittal suggested the recession could reshape MRM and marketing while Gartner suggested now might be a good time to buy MRM.

Others may argue there were bigger stories or more important developments (and we welcome that feedback), but from our perspective that was the best of 2009. Here’s hoping 2010 is a little easier and a lot more profitable.

In this 15-minute podcast, appropriate for both IT and customer service business executives, Brian Hinton, senior consultant with Strategic Contact, discusses:

• An outline of the history of process optimization
• How it fits into the call center environment
• Where call center hardware and software vendors fit in
• Areas within the contact center that are ripe for process optimization
• Quick wins and good places to get started

For more on call center process improvement

Learn how West Marine is using work-at-home agents to cut costs, improve service

See Gartner’s five low-cost contact center infrastructure improvements

A couple of questions linger.

Chatter, which essentially adds a Collaboration Cloud to the Salesforce.com stack (in fact, by the second day of the conference, Benioff’s slides were referring to it as such, alongside the Chatter branding), is yet another sign that social networking or Enterprise 2.0 is making its way into enterprise applications.

Several times during the conference — amidst his many speaking opportunities — Benioff remarked “there’s nothing else out there like this.”

Not entirely true.

Its competitors in the CRM market are building out similar capabilities, such as NetSuite in partnering with InsideView and RightNow in acquiring HiveLive. SugarCRM added Sugar Feeds, tools to let team members know when they’ve added a new contact, lead or opportunity. Oracle’s Beehive has been out for more than a year. Then there are the Enterprise 2.0 vanguard like Jive and SocialText.

But, he’s right, there are differences.

There’s a difference between what NetSuite has done with InsideView, which acts more as a monitoring tool for outside social media and what Salesforce.com is doing with Chatter, which lets employees within the company talk with one antoher. And it’s different from Beehive and the Enterprise 2.0 collaboration platforms, which are separate applications, in that Chatter sits within the Salesforce.com application. Additionally, Chatter provides something I hadn’t seen before; updates from other applications, for example SAP automatically letting a sales rep know when an order has been filled.

So, rather than partnering with or acquiring an Enterprise 2.0 company, Salesforce.com elected to create its own collaboration platform and embed it within the Salesforce.com application. It’s an effort to ensure users live in Salesforce.com as much as possible.

The most popular of collaboration tools will not go down easily

Yet Salesforce.com still has to convince its customers to leave the most popular of all collaboration tools — Microsoft Outlook. In fact, the announcement that drew some of the biggest applause from the 18,000 assembled at Dreamforce was news that the company had updated Salesforce for Outlook 2, associating to leads or cases automatically, when users click “send to Salesforce” from Outlook.

And Microsoft is not standing still either. On Wednesday, it also announced social networking plans. The next version of Outlook, Outlook 2010, will allow users to view the email sender’s activity on Twitter and Facebook. The next version of Outlook, Outlook 2010, will allow users to view information from the person sending emails, showing their activity on Twitter and Facebook.

The other thing I have yet to see was any sort of filtering or semantic understanding. Chatter allows users to bring in results of searches on Twitter or Facebook and embed them in the Salesforce.com interface. At Dreamforce, Benioff demonstrated how an internal group at Salesforce.com, focused on competing with Microsoft SharePoint, could pull in all tweets regarding their competitor. Yet it offers no filtering, just a constant stream of information, be it useful or not.

Salesforce eyes the enterprise

Additionally, this is clearly an effort by Salesforce.com to extend itself into the wider enterprise. By offering a Chatter Edition for $50 per user per month, Salesforce.com hopes to reach employees outside of the traditional sales, service and marketing realms associated with CRM. Benioff said as much in a meeting with financial analysts, calling Chatter his “Trojan Horse strategy.”

 Salesforce.com intends to use to spread its footprint. A Chatter Edition license includes a Force.com and Content license.

Time will tell if users in the back office are as excited about Salesforce.com as the sales teams, the early adopters of Salesforce.com, who loved the application and forced it on the rest of the organization. And if they’re willing to pay for it.

The past year has seen a wave of integration and innovation with social networking sites and CRM platforms. NetSuite jumping on the bandwagon is nothing new.

NetSuite has teamed with InsideView to integrate InsideView’s social media monitoring into the NetSuite platform. Again, not really new. InsideView already has a similar application on Salesforce.com’s AppExchange.

What is new is the way NetSuite went about it and that it’s pulling social media monitoring into its ERP system.

That NetSuite turned to an outside company for social media intelligence is interesting. InsideView monitors Twitter, LinkedIn, Facebook, Jigsaw and editorial sources such as Thomson Reuters, among others and provides users with results relevant to their role. As social media monitoring and collaboration tools become a requirement for a CRM system, the CRM vendors need to figure out how they deliver that technology — developing, partnering or buying.

We’ve seen each approach so far. Oracle was among the first, creating its Social CRM applications, separate modules like Sales Prospector and Sales Library, that essentially serve as collaboration tools for sales people within an organization. Others have built out integrations to social networking sites. RightNow has built a connection to Twitter and YouTube it calls the Cloud Monitor. Salesforce.com has also built integrations between Facebook, Twitter and its customer service application (throwing in ask and answer functionality) it calls the Service Cloud 2. Salesforce.com obviously has some high hopes for the application because CEO Marc Benioff devoted most of the very expensive stage time he paid for at OpenWorld to demonstrating the Service Cloud 2. Microsoft has added Twitter integration with one of its CRM accelerators. Apparently, even SAP is preparing to roll out Twitter integration.

Acquisitions, so far, have been relatively few. RightNow, apparently tired of giving Lithium all of its community building business, acquired HiveLive and is incorporating community-driven customer support capabilities into its own suite.

The size of some of these social media start ups (HiveLive cost RightNow just $6 million), would indicate that more such acquisitions are in store. As John Ragsdale, vice president of technology research with the Service and Support Professionals Association, said at the time of the HiveLive acquisition.

“Partnering is just not enough. That’s what this proves. Buyers want more than a partnership.”

So, who’s next? Well, there’s a plethora of small social media monitoring and social networking companies out there. Even the largest social networking sites are getting attention. SAP has invested in LinkedIn via its venture capital arm. I won’t speculate other than to predict more consolidation in the technology business, a prediction that never fails.

And maybe we’ll see some interest in integrating social networks with ERP. NetSuite and InsideView are betting on it.

Mini Peiris, NetSuite’s vice president of product marketing, told me that the InsideView’s results can extend to roles beyond the typical sales, service and marketing and to back office employees like people in recruiting, collections and procurement.

“For a collections professional you can leverage [company profile information] to find other people in an organization to get the invoice that you’re chasing paid,” Peiris said.

LinkedIn integration can be a powerful tool for people in HR the same way information on financial results or bankruptcy filings can be powerful for collections, Peiris added.

InsideView on the other hand seems to be benefitting itself.

“NetSuite has a number of objects not available in other applications because it’s an end-to-end platform,” InsideView CEO Umberto Milletti said. “The number of places we’ve integrated is above and beyond what we’ve done before.”

I plan to be there tomorrow at Benioff’s session to see if he plays the polite guest (my guess is he will), but in the meantime, there were a few interesting tidbits from some successful CRM deployments at a customer panel.

These are not necessarily Oracle-specific but some practices I hadn’t seen before and worth noting here.

ANZ, an Australian financial services firm, extended and upgraded a small Siebel 7.8 deployment to Siebel 8.0 across the organization. A new CEO wanted to make the company more customer-centric and pushed for the new system. Getting executive buy in is a well-known imperative for a successful CRM project. So is ensuring user adoption, which ANZ did by involving users throughout the project.

“The native Siebel 7.8 UI is really devoted to call center users and not everyone’s cup of tea,” Christian Ventner, head of sales and services for the bank, noted.

But, beyond that as part of the project, ANZ included an “I know the customer” program. To provide a greater customer experience, ANZ included a large “What the customer wants” button as part of the UI. So, right away an employee notes why the customer is there, be it for investment advice or a question about an account. It can be adjusted by role (for example, a teller may not be able to offer investment advice) and quite clearly ensures the customer is getting the right person and the right information.

US Foodservice tests the application in a live environment

US Foodservice went beyond just including users in its design; it had them test out multiple products in a live environment. The company was transitioning from a niche CRM application that hadn’t met its needs to Oracle CRM On Demand. It narrowed down its list of finalists to three and then took the applications to its sales reps.

“We decided to go to the divisions with [reps] and let them work with it,” said Bridget Warns, senior director of US Foodservice. “In real time, we were configuring this application based on their feedback. The investment they had was key in our success of rolling it out.”

Three clicks or less for Scottish Widows

Similarly, Scottish Widows, a UK-based life pension and investment company, was choosing between Oracle On Demand and Salesforce.com and tried both in a live environment for two months with its sales force, swapping out one for the other.

“From that we were really able to build our business case and get backing from our director that it was the right thing to do,” Stephen Miller sales operations manager for Scottish Widows, said. “We rolled it out to 300 people at 14 sites in two months.”

Additionally, it made sure to make the application easily navigable.

“We wanted to ensure we met key design principles,” Miller said. “In any application there was a max of three clicks to get to any information.”

Nothing grabs attention in this market like tales of CRM failure, but these are a few tactics that led to success.

No, I didn’t get one.

Yes, I signed up for one.

No, I don’t take it personally.

The Twittersphere, the Blogosphere and all those places where gadget-heads meet up to discuss the latest “revolutionary” product is already abuzz about Wave.

So, how does that affect CRM?

Well, Salesforce.com, never a company to hesitate to latch onto emerging technologies, is already prepared to ride the wave (and yes, I promise I will never use that term again).

It issued a demo of a prototype showing how a company could leverage Google Wave with its customer service team.

So, maybe you run a forward-thinking contact center that has evolved past simple phone and IVR communications and now utilize chat and self service and maybe you’ve even found a way to involve social networks, internal and external. But it looks like you may have one more technology and business process to master.

Don’t get me wrong — Google Wave could very well be a very good thing and may, in fact, “revolutionize” how customer service agents interact with your customers. Our friends over at Unified Communications Nation, after all, are calling it Unified Communications gone wild and most people still haven’t wrapped their heads around unified communications in the contact center.

However, it is an example of how quickly companies like Saleforce.com and Google are changing things and how fast companies need to adapt.

I’m curious if that makes you excited or nervous? Or both?

By the way, SAP hasn’t stayed in the background, it’s just that its contribution focuses on collaborative business process modeling, not CRM.

Here’s a list of the extensions and prototypes for Google Wave.

 Kundra expressed excitement and optimism for deploying cloud-based applications in his blog:

Federal agencies and departments encounter many difficulties in deploying new IT services and products. Procurement processes can be confusing and time-consuming. Security procedures are complex, costly, lengthy and duplicative across agencies. Our policies lag behind new trends, causing unnecessary restrictions on the use of new technology. Past practices too often resulted in inefficient use of purchased IT capabilities across the federal government. We are dedicated to addressing these barriers and to improving the way government leverages new technology.

Yet he also sounded a note of caution:

We are just beginning this undertaking, and it will take time before we can realize the full potential of cloud computing. Like with Data.gov, Apps.gov is starting small - with the goal of rapidly scaling it up in size. Along the way, we will need to address various issues related to security, privacy, information management and procurement to expand our cloud computing services. Over time, as we work through these concerns and offer more services through Apps.gov, federal agencies will be able to get the capabilities they need to fulfill their missions at lower cost, faster, and ultimately, in a more sustainable manner.

 Apps.gov store. RightNow has also been instrumental in bringing government agencies on board with SaaS. In April, it released hosting capabilities to support the Department of Defense (DOD) and other civilian government and intelligence agencies that have stringent compliance and security standards.

Bill Ives lauded both RightNow and the federal government at the time. He wrote:

 I am pleased to see greater government uptake on the opportunities the cloud brings. There seems to be a genuine drive to balance security requirements with flexibility, cost savings and reduce unnecessary red tape with standardization.

 While at the Gartner CRM Summit this week, I had a chance to talk with Jason Mittelstaedt, CMO of RightNow, who said that providing an application secure enough for the DOD has helped allay the reliability and security concerns of many potential customers.

Yet, one attendee I spoke with at lunch still wondered how people are coping with security and privacy when it comes to SaaS. His company, a financial institution in the Midwest, is running Oracle CRM on-premise and has already invested in the infrastructure required to house the system. It is still nervous about SaaS.

SaaS vendors still have some convincing to do, but the stamp of approval from Kundra and the DOD should help.