Salesforce.com CRM Rollout at Cisco Said to Slow

Marc L. Songini   Today’s Top Stories   or  Other CRM Stories  

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July 4, 2005 (Computerworld) -- What once looked to be a marquee deployment of hosted CRM software at Cisco Systems Inc. is now the subject of a damning report from an equities research firm that says the project has stalled.

In a note published on June 22, analysts from JMP Securities LLC said that a deployment of hosted CRM software from San Francisco-based Salesforce.com Inc. had been delayed.

Salesforce.com signed a deal with Cisco during the second half of 2004 that called for an initial rollout of up to 2,000 seats and a later installation of as many as 10,000 seats by this June, according to San Francisco-based JMP.

End-user resistance and integration challenges forced the deal to be renegotiated so that the rollout is staggered. Completion is now set for March 2006, the report said.

Salesforce.com confirmed that Cisco is a customer but declined to comment on the size or status of the implementation. Cisco also declined to comment, citing a policy of not talking about vendor relationships.

Some analysts said the report calls into question Salesforce.com's ability to handle large implementations.

So far, according to JMP, only 1,000 seats are running the software, and Cisco is due to review the deployment.

The JMP analysts said "due diligence" in their research found that Cisco users have been slow to embrace the system because it doesn't support tools that handle tasks such as territory management, advanced account hierarchies and forecasting.

Cisco IT staffers are struggling to link the Salesforce.com software with those tools and are questioning the wisdom of relying on so heavily customized a hosted application, the report said.

Cisco is also coping with unexpected change management and training issues, forcing the company to throw more resources at the project.

"Last," said the note, "we believe that [Cisco] executive support for the Salesforce.com service may be waning due to some changes in the business operations leadership as well as a sense among the sales leadership that it's not worth rocking the sales operations for a new software vendor."

Salesforce.com declined to comment on any details of the report, but it issued a statement that said, "Salesforce.com has consistently been ranked at the top of the class as it relates to customer satisfaction, and we'll continue to work hard with Cisco and all of our other customers to ensure that remains the case."

Rebecca Wettemann, an analyst at Nucleus Research Inc. in Wellesley, Mass., raised questions about the hosted software's ability to support deployments of more than 2,000 seats. "There's nothing wrong with the platform, but it's not proven that it's a CRM solution that scales," she said.

In a report last month based on a survey of 29 Salesforce.com customers, Wettemann indicated that the larger companies using the software typically do so on a divisional level with deployments that don't exceed 1,000 seats.

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