CRM – Column 2

PegaWorld 2015 Day 2 Customer Keynotes: Big Data and Analytics at AIG and RBS

After the futurist view of Brian Solis, we had a bit more down-to-earth views from two Pega customers, starting with Bob Noddin from AIG Japan on how to turn information that they have about customers into an opportunity to do something expected and good. Insurance companies have the potential to help their customers to reduce risk, and therefore insurance claims: they have a lot of information about general trends in risk reduction (e.g., tell an older customer that if they have a dog and walk it regularly, they will stay healthier and live longer) as well as customer-specific actions (e.g., suggest a different route for someone to drive to work in order to reduce likelihood of accident, based on where they live and work, and the accident rates for the roads in between). This is not a zero-sum game: fewer claims is good for both AIG and the customers. Noddin was obviously paying close attention to Solis, since he wove elements of that into his presentation in how they are engaging customers in the way that the customer chooses, and have reworked their customer experience – and their employee and agent experience – with that in mind.

Between the two customers, we heard from Rob Walker, VP of Decision Management and Analytics at Pega, about the always-on customer brain and strategies for engaging with them:

Know your customer: collect and analyze their data, then put it in the context of their entire customer journey
Reach your customer: break down the silos between different channels, and also between inbound and outbound communications, to form a single coherent conversation
Delight your customer: target their needs and wants based on what you know about them, using the channels through which you know that they can be reached.

He discussed how to use Pega solutions to achieve this through data, analytics and decisioning; obviously, the principles are universal.

The second customer on stage was Christian Nelissen from Royal Bank of Scotland, who I also saw yesterday (but didn’t blog about) on the big data panel. RBS has a good culture of knowing their customer from their roots as a smaller, more localized bank: instead of the branch manager knowing every customer personally, however, they now rely on data about customers to create 1:1 personalize experiences based on predictive and adaptive analytics in the ever-changing context of the customer. He talked about the three pillars of their approach:

It’s about the conversation. If you focus on doing the right thing for the customer, not always explicit selling to them, you build the relationship for the long term.
One customer, one bank. A customer may have products in different bank divisions, such as retail banking, credit cards and small business banking, and you need to be cognizant of their complete relationship with the bank and avoid internal turf wars.
You can do a lot with a little. Data collection and analytics technologies have become increasingly cheaper, allowing you to start small and learn a lot before expanding your customer analytics program.

Alan Trefler closed out the keynote before sending us off to the rest of the day of breakout sessions. Next years, PegaWorld is in Las Vegas; not my favorite place, but I’ll be back for the quality of the presentations and interactions here.

These two keynotes this morning have been great to listen to, and also closely aligned with the future of work workshop that I’m doing at IRM BPM in London next week, as well as the session on changing incentives for knowledge workers. Always good when the planets align.

PegaWORLD 2015 Keynote: CRM Evolved and Pega 7 Express

Orlando in June? Check. Overloaded wifi? Check. Loud live band at 8am? Check. I must be at PegaWORLD 2015!

Alan Trefler kicked off the first day (after the band) by looking at the new world of customer engagement, and how both organizations and the supporting technology need to change to support this. He took a direct hit at the silos of old-school companies such as traditional financial services (“What *is* a middle office, anyway?”, a question that I’ve often asked), and how many applications and platforms fail to move them beyond that model: conforming (to how an application works out of the box) versus strategic (mix your own DNA into the software). Like many other vendors in this space who are repositioning as process-centric application development platforms, the term BPM (business process management) didn’t come up; Pega is repositioning as “CRM Evolved”. To be fair, Pega has always had a strong CRM (customer relationship management) bias, but it looks like they’re rebranding the entire business of their customers as CRM, from sales and onboarding through support and back into operations. This includes anticipating and operationalizing customer actions, so that you can respond to a potential problem before it ever occurs, and moving from conforming to strategic software in order to allow you to evolve quickly to meet those needs. He warned against implementing the Frankenstack, pieced together from “dead software products”, and decried the term BPM in favor of case management as how customer engagement and operations need to work, although arguably there is a lot of what we think of a traditional BPM implemented as part of Pega’s customers’ solutions.

We’re definitely seeing the BPM market (broadly defined to include dynamic and ad hoc process management including case management) bifurcating into the application development platforms such as Pega, and the more out-of-the-box, low-code process platforms. BPM is really much beyond just process management, of course: many of these platforms include mobile, social, IoT, analytics, big data and all of the other popular features that are being built into almost all enterprise applications. Trefler talked about Pega 7 Express – I’ll be going to a session on that after the keynote – which is a simpler user experience for application development. Having seen their more complex user experience in a few client projects, this is definitely needed to cut through the complexity in order to address the end-user computing/citizen computing needs. In other words, although they are primarily in the heavy-duty application development space, they also realize that they can’t ignore the “low end” of the market if they want to achieve greater awareness and penetration in their customer environments beyond the IT development group.

Trefler also talked about Pega’s vertical industry applications, and we heard from Dr. Mark Boxer from Cigna Healthcare. He discussed how they use Pega’s Smart Claims App, although we mostly saw a lot of futuristic videos of what healthcare could be like, including big data and gamification. Plus Apollo 13. It’s not clear how much of this that Cigna has implemented (presumably they are not working on the moon shot) although I know that some US healthcare companies are reducing premiums for customers who use wearables to monitor their health since it allows for early problem detection.

Don Schuerman, Pega’s CTO and VP of Product Marketing, took the stage to talk about their technology, with a big focus on strategic applications rather than the platform itself – Trefler did make a comment earlier about how their marketing used to be really bad, and I think that someone told them that applications show better than platforms – plus their cloud infrastructure. He was joined by Jim Smith, CIO of the State of Maine, who was not afraid to talk about BPM: he sees BPM plus agile plus legacy system modernization as the cornerstones of their enterprise strategy, underpinned by a cloud platform for speed and security. He showed some pictures of their filing cabinets, pending files in paper folders and other paper-based inefficiencies; it’s interesting to see that there is still so much of their digital transformation – and that of many other organizations that I work with – that is relying on getting paper into digital form, either natively (i.e., online forms replacing paper ones) or through image and data capture.

Brian Matsubara, head of Global Technology Alliances at Amazon, talked briefly about their Amazon Web Services offerings, and their partnership with Pega to create the Pega Cloud on which Pega 7 Express and other products are domiciled. I don’t need to be sold on cloud in general or AWS in particular since I trust critical business data to AWS, but there are still a lot of skittish organizations who think that their own data centers are better, faster, cheaper and more secure than AWS. (Hint: they’re not.) I just finished up the materials for a workshop that I’m giving in London next week on the Future of Work, and I agree with what Matsubara said about (public) cloud: it’s not just cheaper infrastructure, it provides ways of doing business that just weren’t possible before, especially consumer mobile and external collaboration applications. Schuerman stressed at the end that they need to help their customers make cloud strategic:

The keynote finished with Kerim Akgonul, SVP of Products, who discussed changing customer attitudes: customers now expect more, and will quickly make their displeasure public when the experience is less than awesome. He talked about their suite of applications – Marketing, Sales Automation, Customer Service, and Operations – and how decision-based Next Best Action predictions and recommendations are an underlying feature that drives all of them. The Pega Marketing application brings tools to help improve customer engagement, including next best action and 1:1 targeted marketing. Their Sales Automation application offers guided selling through the end-to-end sales process. Their Customer Service application uses case management paradigms and next best actions for guided customer conversations, while interacting with social media and other channels. Akgonul is always willing to participate in the on-stage highjinks: last year, it was a wild motorcycle ride, and this year it’s a wellness app on an iWatch and iPhone that tied in with a customer service agent’s screen, with some assistance from his colleagues David Wells and Don Schuerman. Fun, and drove home the point about how these technologies can be used to improve customer engagement: mobile, omni-channel, next best action, gamification and more. He wrapped up with a more serious, if somewhat breathless, look at some of the newer features, including offline mobile apps that can synchronize data later, pattern detection in real-time streaming data such as dropped calls, dashboard personalization, and the new Pega 7 Express lightweight application builder.

Gartner’s BPM trends and forecasts

Another webinar going on right now, Gartner BPM Roundtable: Business Process Management Trends and Forecasts, hosted by Global 360 and featuring Jim Sinur of Gartner (yes, this turned out to be “webinar day”, I have a third one after this if I’m not burned out).

The usual webinar format is the “expert” talks to his slides for 30-40 minutes, then some marketing geek from the vendor talks about their product for 10 minutes. Not this one: it’s a very dynamic conversation between Mr. Sinur and Michael Crosno, President of Global 360, and both of these guys are really smart about BPM. Yes, Mr. Crosno talks about Global 360 product features, but it’s used as a springboard for Mr. Sinur to talk about the importance of specific functionality in the current and future BPM suites marketplace.

A few really great insights. The first one is was that legacy BPM deployments are more likely to have been for the purpose of reducing paper, whereas the new deployments are all about streamlining processes and improving productivity, with a new and increasingly important focus on extending the enterprise. Although this is something that we all know by gut feel, it’s good to see some real numbers behind it:

The second insight is that customer requirements are evolving from enterprise content management (ECM) to enterprise process management: a shift from information lifecycles to process lifecycles. As a “column 2” advocate, I’m really glad to see Gartner recognizing the shift in focus from content to process. Mr. Sinur showed a scale that started with image management and went all the way through to business optimization, with the crossover from ECM to EPM happening between portals and process execution. He puts “workflow” in the ECM space, that is, the subset of BPM that is used for content lifecycle management.

Another point was the trend for CRM vendors to integrate BPM with their products, usually by buying or OEM’ing in a third-party product, because they see it as an essential part of managing the customer relationship. I’ve been seeing this trend lately as well, such as with Onyx’s acquisition of a BPM product and their current push to integrate it into their mainstream CRM product.

By far the best webinar that I’ve listened to in months. The slides and the audio playback will be available tomorrow on Global 360’s site.