The Roundup: Businesses Open Wallets For ASPs

By David Aponovich

(Back to article)

Businesses Open Wallets for ASPs
Driven by promises of a strong return on investment, worldwide spending on application service providers is expected to post steady gains in the coming years, according to Boston-based Aberdeen Group.

Aberdeen's recent "Worldwide ASP Spending Forecast and Analysis 2001-2005" reports that the ASP market size, which was $3 billion in 2001, will grow to roughly $16.1 billion by 2005.

This includes spending on the gamut of ASP market segments including enterprise resource planning (ERP), human resources, financial and accounting, education and training, customer-relationship management, e-commerce, communications, and collaboration.

The growth will come despite a customer-acquisition slowdown over the past several months, the report says.

Aberdeen's ASP report looked at ASP spending in 157 countries. "Growth in the ASP industry will remain robust through 2005," said David Wright, vice president of Aberdeen's Private Equity Services Division. "Our data clearly shows that, both domestically and internationally, many ASPs are gaining sales traction via strong ROI sales messages."

"Despite the recent hype hangover suffered by the ASP industry, Aberdeen remains confident in the industry's long term value proposition. Indeed, with IT departments experiencing serious capital constraint, the ASP value proposition has never been more alluring," said Lew Hollerbach, managing director of Service Providers Communications Infrastructure & Services at Aberdeen.

Six Steps to Fix a CRM Program
According to a recent Peppers and Rogers Group white paper titled, "How To Turn Around Your Stalled CRM Implementation," billions of dollars are being invested in CRM, yet up to 80 percent of the projects fail to deliver expected returns.

The authors of the report emphasize that successful implementations are a result of the careful alignment of strategy, process design and technology, along with a healthy dose of change management.

The report provides a six step analysis that can help executives identify where their CRM failure resides, and it offers practical advice on how to repair, rebuild and set a course for a successful and sustainable CRM implementation. The six steps include:

  • Scale back expectations.
    The report states that even though quick return on investment (ROI) is achievable, the real benefits of CRM are of a longer-term strategic nature.

  • Appoint a Chief CRM Architect.
    This appointment is a critical step and it requires someone with deep knowledge of both CRM and the customers. The person in this key role will be responsible for helping the company embrace CRM conceptually and pragmatically, while creating and enforcing strategy.

  • Re-evaluate your team.
    Often CRM implementation fails because team members lack the skills and expertise required. CRM success requires full commitment and cohesive participation of the entire team.

  • Think "barn-raising."
    Similar to the barn-raising of the early pioneers, the idea is to draw upon the collective manpower while optimizing the various skills, knowledge and experience available. The term "barn-raising" represents both the teamwork and urgency that is needed.

  • Stop the bleeding.
    In what is referred to in the report as "one crazy week," where current CRM initiatives receive a rapid and rigorous assessment, the analysis will generate the points of greatest pain.

  • Build and sustain momentum: launch "success viruses."
    In this step, the report notes that "the greatest successes emanate from initiatives that capture the imagination and excitement of the entire company -- and for that matter, its customers." The euphoria of the CRM recovery operation should incite enthusiasm within the rest of the organization.

    Peppers and Rogers Group, a business strategy firm, is based in Norwalk, Conn.

    -- from ECRM Guide, an internet.com site.

    Don't Oversell When Recruiting
    Recruiting is more about marketing than selling according to Lou Adler, founder and CEO of the executive recruiting firm POWER Hiring Inc. in Tustin, Calif.

    During the hiring process executives often oversell, over-talk, or under-listen and ultimately either lose the best candidates, or pay too much. The key to improving the interviewing process is to make the candidate earn the job.

    Here are Adler's top 10 tips for effective recruiting:

    At-Work Web Use Skyrockets
    On-the-job Web usage by U.S. workers continues to skyrocket, according to a new report from the Web measurement service Nielsen/NetRatings in New York City.

    Between June 2000 and June 2001, the number of workplace Net users grew 23%, from 24.4 million to 42.3 million, according to the report.

    Every other metric grew too, including the average number of sessions per month (up 10%, from 39 to 43), the average number of unique sites visited per person (up 25%, from 28 to 35) and the average time spent online per month (up 10%, from 20.5 hours to about 22.6 hours per month).

    "Nearly 15% of all Americans access the Internet from their workplace, and that will continue to grow," said Sean Kaldor, vice president of analytical services for NetRatings. Enterprises, after all, depend more and more on the Internet more and more for research, B2B transactions and daily office management.

    According to the report, nearly ever Web site category saw an increase in audience traffic, including corporate information sites, whose traffic grew 49% from a year ago. Financial site traffic 42% and online travel sites surged 31%.

    The question not answered by the report: How much work time (and money) employees waste surfing the Web on non-work-related pursuits.