According to a new report from researchers at GartnerG2, the financial services industry must again move to the forefront of developing news ways to tap intosoftware. Because these companies were among the earliest adopters of CRM before it hit the corporate mainstream, they are well-prepared to help move the enterprise applications segment forward, said GartnerG2 analyst Kimberly Collins.
"Certain sectors in the financial services industry such as banks and investment firms took the big risks and made the initial investments," Collins said. "In order to stay ahead of those that followed them, these companies need to consider a host of new applications emerging on the market."
GartnerG2 highlighted the following eight CRM applications that are becoming hotbeds of emerging technology for
Collins believes that this "latest breed" of CRM software will allow enterprise software users to push CRM deeper into their organizations and out to channel partners. And according to Scott Nelson, an analyst at sister company Gartner, many financial services companies are working to build their own applications to deliver on these goals rather than turning to packaged software vendors such as market leader
"Companies are developing their own CRM applications, because they believe they can create programs that are far more tailored to individual business models than generic packaged software," Nelson said.
Many financial services companies are taking the skills they learned implementing and customizing shrink-wrapped CRM software and using them to build new applications for process-focused operations such as opening new customer accounts or canceling credit cards, Nelson said.
The analyst believes many companies have tired of adhering to the confines of vendor-based CRM systems that demand laborious integration to communicate with other applications. Nelson said analytics software and efforts geared toward customer personalization are among the areas in which businesses are working internally to develop CRM tools.
An example of this trend in the financial services field is in customer contact centers, where businesses are using text mining to spot fast-moving trends as they emerge, Nelson said.
According to Collins, the "do-it-yourself" approach is nothing new to the financial services industry, where homegrown systems have always had a significant presence. Many of these companies are beginning to consider a "blended" approach regarding CRM applications, whereby they build tools that sit on top of packaged software frameworks.
"It's not a custom-versus-packaged scenario, but one where both kinds of applications are being used together," Collins said.
In order to facilitate the blended CRM applications trend, software vendors will need to learn to become better partners, Collins said. CRM applications makers such as Siebel, PeopleSoft and Oracle should no longer consider "framework" software makers such as Chordiant Software as direct competitors, Collins observed.
Companies such as Onyx Software, Nelson said, have begun marketing technologies to help customers develop their own tools--a move that will likely threaten the prospects of CRM software vendors.
Onyx's "embedded CRM" applications function as components that allow developers to build custom systems. And while Nelson believes that CRM software makers such as Siebel will stick to a traditional vanilla approach, he observed that some integrated applications providers such ashave released tools that help their users customize tools to work with partners.
In fact, Onyx executives say they expect that 50 percent of the software maker's business, in several years, will be derived from the embedded CRM applications. According to Eben Frankenberg, executive vice president of business development at Onyx, financial services companies are already putting the tools to use.
"A great example is a bank where a teller needs a single desktop that allows for transactional processes, but which also provides CRM functions like customer profiles," said Frankenberg. "We've decompiled the components of CRM so that tellers can have the different applications they need."
According to Nelson, the trend towards component-based CRM growing in the financial services industry could be an indication of where the market may be headed.
"We've been talking about moving away from monolithic CRM systems for some time," Nelson said. "This trend is evidence that the movement may finally be happening."