A week after Microsoft showed its CRM hand, analysts are divided in their assessment of how successful the company will be in its ambitions to enter the enterprise applications market.
“The move is Microsoft’s latest aim at the Business Application market,” according to analysts at AMR Research. “Eventually, the company will dominate this market, but it will take time… For now, the product has limited functionality; it does little more than contact management in sales and case management with a knowledge base in service.
It also points out that the time scales Microsoft has announced to deliver the software do not favour success in Europe. The scheduled North American release in the fourth quarter of this year will still precede the releases of an international English version in the first quarter of next year and other European language versions in the second, well over a year away.
AMR does praise the idea that Microsoft has cited application usability as a key objective and predicts that the software will turn out as ergonomic an interface as any of its new competition.
But it concludes: “While Microsoft's news has certainly shaken the market, European decision-making should not be affected in the short- or even mid-term. If you are a large enterprise or a large front office in a mid-market company and have a serious CRM requirement, even an imminent Microsoft release would have no effect. If you are a smaller organisation with a pressing requirement, then unlike American companies that can take advantage of earlier release dates, you are unlikely to be able to wait until next year and should press ahead regardless of Microsoft.”
On the other hand, Gartner Group is more positive in its assessment. Its analysts argue: “Microsoft’s entrance into CRM software will benefit small businesses (up to 100 users, primarily synchronising desktop data over high-speed lines) since most are Microsoft-centric shops that put a premium on reliability and stability in their technology choices.”
But it warns that Microsoft will face a challenge with small and medium enterprises that need more than basic capabilities and with enterprises that have integration needs outside of the Microsoft environment. It predicts that as Microsoft gains comfort with the effort involved in selling customisable applications around 2004, it will make at least one aggressive acquisition to serve the midsize enterprise market.
Gartner concludes: “For small businesses that have at least basic IT expertise in-house, Microsoft CRM will offer technology that enables simple sales and basic customer service activities. SMEs with less than 100 employees should consider other products until 2003 in North America and in the first quarter of 2004 in the rest of the world. “