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A Winning Combination: Software-as-Services Plus Business Consulting and Process Services
By Laurie McCabe
January 30, 2004
What would you think if your CRM software vendor, RightNow Technologies, called you up a few months after your initial implementation to schedule a 90-minute phone call with a dedicated team of consultants to “tune up” your application and customer service best practices — for free?
“I was a little suspicious initially. It’s not a request you commonly get, especially from a vendor/partner,” Randy Linnell, vice president of Customer Care at RightNow customer Lindows.com, tells ASPnews. “When we initially heard about the tune-up process, we weren’t sure what to expect, if it was a hook to sign up for pro services or something like that. As it turns out, it’s been a very pleasant surprise.”
That’s a common reaction — the first time, according to RightNow CEO and founder Greg Gianforte. “We live in a bad neighborhood,” he tells ASPnews. “We have to do some things to overcome the suspicion. We’re guilty by association because we’re in the software business.”
But once the customer experiences their first Tune-Up, they typically see results right away, and look forward to the next one in six months. The program has been quite successful, with Lindows.com’s latest Tune-Up marking the one-thousandth such engagement. The Tune-Up process is primarily driven by the best practices that RightNow has compiled over the course of nearly 2,000 deployments of its hosted, on-demand CRM applications.
“We try and do everything in our power to make sure that our customers are successful. It was distressing to us when we heard about a good idea from one of our customers, and then walked into another account and they didn’t know about the good idea,” Gianforte says. “Sometimes it had to do with the use of our product, but as often as not, it had to do with best practices related to how their organization was structured, how they had laid out their web site, or how they were touching their customers. That was the genesis of this Tune-Up idea. What we started doing is compiling a set of best practices around service delivery.”
Lindows.com has done four Tune-Up sessions over the course of two years, and has realized significant improvements in its customer service processes and immediate impact on the cost reduction after every session, Linnell says. After its most recent Tune-Up session, Lindows.com realized a seven percent usage increase of RightNow’s web self-service solutions and a 19 percent reduction in email inquiry volume. This was accomplished in large measure by redesigning the support area of the corporate web site to redirect and train online visitors to utilize the web self-service application first before submitting an email inquiry.
Previous Tune-Up sessions yielded similar results and savings, especially when Lindows.com decided to switch from an on-premise version of the software to RightNow’s hosted version after understanding its additional operational and service benefits.
“The honest feeling we have when we get done with these is that we just had some time with their very best brainpower sitting on our side of the table with us,” Linnell says. “I’m not aware of anybody else doing it, and certainly not in a ‘let us help you tune up your engine’ kind of thing. It’s always been ‘We’ve got mechanics, and if you want to pay for them, we’re happy to send one to help you’ professional service-type engagements.”
RightNow’s Tune-Ups are also a reaction to the ‘drive-by’ software installations of other vendors, where they dump the software off, provide a month or two of consulting, and then disappear, never to be seen again. “Unfortunately, CRM software is not an event, it’s an iterative process. It’s a lifecycle relationship,” Gianforte says.
Of course, trying to implement the full set of best practices would be daunting, if not impossible, so RightNow helps the customer to address current issues, and then makes time again when new issues arise. Gianforte likens it to learning a language. “If you wanted to learn a language, and had someone teach you vocabulary for two days, you’d remember some of it, but it doesn’t mean you can speak that language. The same is true with CRM. To get really good at it, there are a lot of best practices.”
So at the first Tune-Up, RightNow’s consultants would teach the customer to conjugate some verbs — and then let them live with the software for awhile. Then they come back in and teach them some adjectives, then come back six months after that and expand their vocabulary that much further, he says.
“We don’t expect someone on the first engagement is going to fully embrace all of the best practices that we’ve uncovered. We work with them on understanding where the next step is in terms of getting more value for their organization,” he says.
The Tune-Ups are one example of RightNow’s overall belief that customers should get real value out of the relationship, and that RightNow has to earn the right to their business. While it stems from a desire to do right by its customers, it’s not an altogether altruistic notion — it’s also good business.
Since RightNow typically sells on a 2-year term agreement, the company is able — and even obligated — to invest in the relationship to earn the renewal at the end of the term period. And customers who do Tune-Ups are four times more likely to renew their contract, Gianforte says.
“We’ve seen a direct correlation between our ability to create value for the customer through Tune-Ups, and their propensity to renew their contracts with us. We think that’s a win-win on both sides,” he says. “It really requires that you take a long-term perspective on the relationship.”
This philosophy has a profound effect on the business, Gianforte says. “We’ve had 20 consecutive quarters of revenue growth and have been cash-flow positive. We’ve been able to invest heavily in new product development, nearly doubling the size of our engineering team this past year. We have a whole series of new products coming out.”
And new products are another reason it’s so important for the company to do right by its current customers, Gianforte says. “Everyone knows it’s much easier for us to further a relationship with an existing customer than it is for us to acquire a new one. Once we fight hard to win them, we do everything in our power to make sure we can keep them — not through any form of coercion, but through loving them and serving them so they don’t want to break the relationship.”
RightNow has been recognized as a Top 25 Provider on the ASPnews.com Top 50.
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