June 25, 2002 Customers in the Crystal BallMicrosoft Corporation is producing a new CRM packaged application, and version 1.0 will include reporting enabled by Crystal EnterpriseA few months ago, the Great Plains subsidiary of Microsoft announced its intentions to produce a new packaged application for customer relationship management (CRM). A more recent announcement from Crystal Decisions Inc. explains that the first release of Microsoft CRM will include reporting functions, enabled by an embedded version of Crystal Enterprise. In many ways, the new announcement signals just another reseller agreement struck by Crystal Decisions (which produces these regularly) and just another facet of the long-standing relationship between Crystal Decisions and Microsoft. In other ways, however, it presents a number of interesting intersections with mid-market IT products, packaged applications, Web services, customer domain expertise, and licensing issues with OEM and reseller agreements. Let's take a look at some of these intersections. Targeting the Middle MarketMicrosoft CRM is (or rather, will be) a collection of packaged applications for various CRM tasks. Version 1.0 will include modules for sales and customer service. Future versions will, no doubt, expand to other CRM tasks. Microsoft CRM targets small- and mid-size enterprises (SMEs). No surprise here, because Microsoft and Crystal Decisions have long served various middle markets (and certain segments of high markets, too, of course). You can expect Microsoft to roll out more business solutions for SMEs in the next few years, as it builds on the acquisitions of Great Plains and Navision. The Role of Web ServicesCrystal Decisions made an early commitment to Web services for business intelligence, which helps explain why Microsoft chose to embed a limited version of Crystal Reports in Visual Studio .NET. (For details, see "BI Web Services take a Step Forward.") Microsoft and Crystal have struck a number of deals and relationships over the years, but the Visual Studio deal positioned Crystal Enterprise as a good technology fit for Microsoft CRM. In other words, the new CRM app is Microsoft's first packaged application built atop a .NET foundation, and Crystal Enterprise supports .NET-based Web services. OEM and Reseller ComponentsOEM and reseller agreements can be fairly complicated, making it difficult for user organizations to understand what they're getting and at what price. Let me sort this out for you. What's in the box? Microsoft CRM will include 125 reports (created with Crystal Enterprise) about various aspects of customer service and sales activities. Due to an OEM arrangement, Microsoft CRM also includes — at no additional cost — a limited version of Crystal Enterprise (called "Crystal Enterprise for Microsoft CRM"), so end-users can view, print, export, and filter (by selecting parameters) these reports. Note that the limited version does not let users modify the included reports or create new ones. What's not in the box? Microsoft CRM users who want to modify reports and create new ones will need to purchase either an enhanced version of Crystal Enterprise or Crystal Reports Standard edition with a data driver for Microsoft CRM. Because of a reseller agreement, both are available exclusively through Microsoft's value-added reseller (VAR) channel, priced as an upgrade instead of a new purchase. Note that all the special versions of Crystal products mentioned thus far only work with Microsoft CRM. What else might you need? A lot of companies have valuable customer data in a variety of back-office systems, which they'd like to incorporate into reports and analyses. If you want to report against data in Microsoft CRM, as well as other diverse systems, you'll need to acquire the full edition of Crystal Enterprise (or an equivalent product from another vendor). Availability and PricingMicrosoft CRM, including Crystal Enterprise for Microsoft CRM, is scheduled for general availability in North America near the end of calendar 2002, rolling out to other geographies in early 2003. The limited version of Crystal Enterprise for Microsoft CRM is included at no additional cost with the Microsoft CRM license. Upgrading to the enhanced version requires a fee that's undetermined, as of this writing. Named user pricing applies at approximately $200 per named user (this may change), with a minimum of five users and increments of one after the initial five. Microsoft (not Crystal Decisions) supports the Crystal products it embeds or resells. Assessment: Where (and when) Do We Get Domain Expertise?The 125 canned reports included in the Microsoft CRM box focus on the business functions of customer service and sales contacts. This is commonplace when you consider that almost all packaged applications (regardless of the business domain they focus on) include a body of canned reports. In fact, the reports in many applications are enabled by embedded versions of products from Crystal Decisions or its nemesis Actuate Software Corp. Canned reports are valuable, because they save you the time and expense of writing a body of new reports, while encapsulating useful horizontal domain expertise — in this case, about generic sales- and service-oriented interactions with customers. But the value is in getting you started, not in sustaining you. Hence, many user organizations start with canned reports, move through an intermediary stage where they alter the canned reports to fit their business a little closer, but soon reach a lifecycle stage where they need to write new reports infused with domain expertise specific to their business situation or vertical industry. Data content is another driver in the lifecycle, because organizations often need to report against a wide range of enterprise data, not just that under a packaged application. The catch is that many SMEs (which Microsoft CRM targets) haven't the resources for such a project. Perhaps VARs have an opportunity to create bodies of reports (for Crystal Enterprise for Microsoft CRM) that are tied to vertical industries, which could be marketed (or resold) through the Microsoft VAR channel. These issues (concerning the life cycle stages of reports in packaged applications) are not unique to the Crystal Decisions and Microsoft relationship, or even to CRM and customer intelligence. The issues arise whenever a corporation needs to leverage valuable data under a packaged application for the purpose of business intelligence. At least, with the CrystalDecisions-Microsoft agreement under discussion here, an upgrade and migration path (as outlined earlier) addresses the progression from horizontal canned reports to vertical custom ones more clearly than most OEM and reseller agreements do. Philip Russom, Ph.D. [www.PhilipRussom.com] is a Research Director at Giga Information Group where he provides advice to user organizations about data warehousing, business intelligence, and database management. |
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