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Salesforce.com aims at SAP customers with CRM connector

A new connector in the latest version of Salesforce.com integrates company sales divisions with SAP R/3 systems.

Salesforce.com's latest CRM release, the 20th in the company's seven-year history, integrates with one of its new...

competitors in the market for on-demand business applications.

The Summer '06 release from the San Francisco-based company includes a connector for SAP R/3, allowing companies running back-end systems from Germany's SAP AG to integrate with Salesforce.com on the front end.

"Obviously, integrating with a number of systems is critical," said Kendall Collins, vice president of product marketing. "Our vision of the business Web is thousands of heterogeneous applications that deliver value. We're going to deliver whatever our customers need."

Salesforce.com's vision of "the business Web," an application environment where everything is provided on demand, or Software as a Service, contrasts with its enterprise CRM market competitors, which are offering CRM both as a hosted tool or in on-premise deployments. SAP itself entered the on-demand CRM market in March, after years of resisting the temptation to provide Web-based software applications. Microsoft too has promised an  on-demand version of its CRM product in the second quarter of 2007.

"Our competitors are stuck integrating acquisitions, apologizing for delays, consolidating and regrouping," Collins said. "We feel we've been the only ones innovating. We've spent a lot of time on AppExchange, but we continue to be laser-focused on CRM."

Salesforce.com declined to share how many current customers it has using R/3. It's probably fewer than a hundred, and the release shows the company's desire to win enterprise customers and hold off SAP, according to Rob Bois, an analyst with Boston-based AMR Research.

"Given how new SAP's on-demand CRM application is, they recognize they still have a window of opportunity there," Bois said. "We hear from our clients that SAP CRM is on the horizon but it's still two or three years away. They're looking for something to do in the meantime. SAP's entrance was an effort to curtail that, and this is the shot back from Salesforce.com."

Much of Salesforce.com's development effort of late has been focused on AppExchange, its online repository of on-demand applications, but the Summer '06 release also features enhancements to sales, service and marketing. It offers new mobile CRM functionality from its acquisition of Sendia in April, including the ability for reps to view, add, edit and delete individual items and receive new leads in their device.

The Summer '06 release also includes advanced call scripting. For example, the new tools allow companies to provide service professionals with a customized script that leads them through a diagnostic conversation with customers, provides sales agents with guided selling, or leads marketing personnel through a survey.

Lead-tracking history enhancements allow sales managers to track lead status changes from week to week and conduct trend analysis for compliance and auditing requirements.

That factored heavily into Charter Communications Inc.'s decision to implement Salesforce.com in its customer service department. The St. Louis-based cable provider was struggling to deal with Sarbanes-Oxley compliance regulations and selected Salesforce.com for its business customers. Charter developed some of its own back-office integration through Salesforce.com's application program interfaces. The new service entitlements were also a bonus, according to Chad Rycenga, Charter's director of IT. The Summer '06 release helps to ensure that customers get the right level of service, differentiating response times, service escalations, and compliance dashboards and reports.

"As with most Salesforce implementations, you find they spawn out of the sales group," Rycenga said. "We found that the [end user] adoption of Salesforce was significant. We looked to manage integration as a means of truing up our sales data."

Charter has been a Salesforce.com customer since 2003, but in March the company launched two virtual call centers -- with 500 seats -- in Rochester, Minn., and Louisville, Ky., to handle overflow business calls. The entitlements feature helped sway Charter to add Salesforce.com's service application, Rycenga said, but so did the ability to get its virtual call centers up and running quickly. Charter runs a different CRM system for its larger, residential call centers, but it will probably stick with Salesforce.com for the foreseeable future.

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