The AARM Report
January 19th, 2004

Reading times for the following as shown. (R signifies reminder)

1. OFFSHORE OUTSOURCING: "PERCEPTION" OF COST-SAVINGS UNREALISTIC (1"25")
2. Register now for P.CRM Certification next Session Feb. 18/19 Toronto
3. TELECOMS SHIFT TELEMARKETING DOLLARS TO DIRECT MAIL (45")
4. Our Benefactors - 4"
5. Career Opportunities
6. Practitioners Available

This Wednesday - One of North America's hottest and controversial speakers on Direct Marketing and How to build your Business
is
in the Spot Light
Jan 21st - Toronto
going going ...........
Click Here for Details

I highly recommend getting to Part 1 of the Bernie Goldberg Series on Business-to-Business Direct Marketing. Bernie is one of the hottest speakers in this subject area. There is no doubt in my mind you will run for the phone after his first session to book part 2 on Feb. 25th and Part 3 on April 15th. Guaranteed! Bernie's business and speaking experience stretches far and wide all over the world. You won't want to miss this rare opportunity to see and hear "Bernie" in action.

In the meantime - OFFSHORE OUTSOURCING: "PERCEPTION" OF COST-SAVINGS UNREALISTIC.

As more and more organizations turn to offshore outsourcing to cut costs, a new META Group report warns that the "perception" of actual savings from sending projects or functions overseas is highly unrealistic. With the current offshore outsourcing movement set to grow between 20 to 25 percent in the next two years, META Group believes that the misperception of cost-savings will be the number-one risk faced by stateside executives.

According to the report, IT organizations often assume that labor arbitrage will yield savings similar to a person-to-person comparison (e.g., a full-time equivalent in India will cost 40 percent less) without regard for the hidden costs and differences in operating models. In contrast, META Group believes that IT organizations can only expect a general savings of 15 to 20 percent during the first year.

Overall, before deciding to jump on the offshore outsourcing bandwagon, the report recommends that decision-makers 1) consider a series of risk factors; and 2) put a contingency plan in place (just in case the vendor fails to deliver). META Group vice president Dean Davison stresses that the process of risk analysis is paramount: "High risk or exposure might deter the organization from outsourcing, it might shift the outsourcing strategy, or it might drive the company toward outsourcing," he said.

Prior to sending projects or functions overseas, Davison advises decision-makers to consider four key risk factors:
1) Security—Offshore outsourcing inherently raises the risk of security breaches or intellectual property protection. Thus, privacy concerns must be addressed;

2) Scope Creep—There is no such thing as a fixed-price contract. Most projects change by up to 15 percent during the development cycle;

3) Culture—Most leading vendors have cultural education programs, but executives should not assume that cultural alignment will be insignificant or trivial; and

4) Knowledge Transfer—The time and effort to transfer knowledge to the vendor is a cost rarely accounted for by the IT organization.

META Group observes IT organizations experiencing a 20 percent decline in productivity during the first year of an agreement, largely due to time spent transferring technical and business knowledge to the vendor.

Supporting these findings, a recent Forrester brief also warns that "the move to offshore is not a simple short-term project for firms but a four-stage journey taking place over a 24-to 60-month period." Additionally, the report cautions that with varying levels of experience with offshore suppliers, internal project management skills, and perceptions of the offshore workforce, firms will face different challenges as they go through each stage of the journey. In general, according to Forrester, what starts as an administrative function evolves over three or more years into a program management and development discipline.

For more information on the META Group report, "Top 10 Risks of Offshore Outsourcing," visit http://www.metagroup.com. For more information on the Forrester brief, "Users' Offshore Evolution and Its Governance Impact," visit http://www.forrester.com/ER/Research/Brief/Excerpt/0,1317,33325,FF.html.

AARM Members can download information on these reports. (some, restrictions apply). Contact information@aarm.org Give us your membership number and mention CRM Report 2004 0119.

Until Next Time.

Robert T. Stacey
President and CEO - AARM

This week's issue is made possible through the kind support of Canada Post Corporation

Visit :http://www.canadapost.ca


Register now for the February 18/19th Certification Sessions.

AARM's P.CRM Certification sessions feature mentors from the very best minds in the industry. You'll meet and work shoulder-to-shoulder with CEO's, VP's, Directors, CRM experts and thought leaders from across North America.

"The P.CRM sessions encompass all aspects of CRM, as well as providing considerable, practical detail on the "how-to's". The material is current and reflects industry best practices. Because of the high caliber of the participants, questions are intelligent and peer learning opportunities are high".

"As a great believer in continuous learning, I have participated in many learning forums. I give the P. CRM program top marks!" CD - BMO Financial Group

Click here for more information

This week's issue is made possible through the kind support of Transcontinental

Visit: http://www.transcontinental.ca

3. TELECOMS SHIFT TELEMARKETING DOLLARS TO DIRECT MAIL

Last year, due in part to the national do-not-call registry, negative publicity and growing public distaste for telemarketing, the total volume of telecommunications direct mail jumped 22 percent over 2002 in the U.S., according to the latest data from direct mail tracking service Mintel's Comperemedia.

Andrea Wald, senior telecommunications analyst for Mintel's Comperemedia, suggests that the impressive growth in telecommunications direct mail stems from "marketers' inability to use telemarketing to solicit their products and services to millions of potential customers who signed up for the registry. Companies may be choosing to send direct mail rather than following up and soliciting additional services to customers via the telephone. It is possible direct mail has now become a preferred method of contacting and marketing to potential clients."

As for the types of mailings sent in 2003, retention mailings surged 262 percent over 2002, "win-back" direct mail soared 191 percent, while cross-sell mailings jumped 102 percent. In terms of specific categories within the telecom sector, the TV (Cable/Satellite) and Wireline categories saw the most dramatic increases in direct mail, up 44 percent and 29 percent, respectively.

Specifically, Wald attributes the 44 percent rise in direct mail for traditional cable and satellite TV to more intense competition between cable and satellite providers. Similarly, Wald says the large increase in wireline direct mail was due to increased competition—driven by the ability of the Baby Bells to finally offer long distance services across most, if not all, of their territories.

For more information, visit http://www.comperemedia.com.

For more information AARM members should email to information@aarm.org - give us your membership number and mention CRM Report 2004 0109.

This week's issue of the CRM Report is made possible through the kind support of The Boire Filler Group.


It's one of the basic tenets of Customer Relationship Management.
The more you know about your customers, the more effective and cost-efficient your marketing strategies will be.

Here's where we come in.

The Boire Filler Group uses advanced and powerful data mining techniques to help you understand your existing and potential customers. Their age, gender and income. Where they live. What they buy. How they buy. And why.

We provide the insight that defines and drives successful marketing and communications strategies and, ultimately, builds strong customer relationships. Click our logo to reach us.

Gain exposure for your products and services - help the industry grow and prosper at the same time. Help support CRM Education. Let me show you the many ways you can. Call me .... Donna Lang - P.CRM at 416 481 1327
or toll free 888 250 4456 or email donna@aarm.org


4. OUR BENEFACTORS OF THE WEEK

AVAYA - Avaya provides communications systems, applications and services to 90% of the Fortune 500.

THE BOIRE FILLER GROUP The Boire Filler Group uses advanced and powerful data mining techniques to help you understand your existing and potential customers.

CANADA POST CORPORATION

CARLSON MARKETING GROUP a recognized leader in Relationship Marketing, helps clients measurably grow sales and profits by designing marketing strategies that build better relationships with the audiences that our Clients depend on for their success: employees, channel partners, and consumers.

IBM IBM Business Consulting Services is the world's largest consulting services organization. With deep business process and industry expertise, IBM Business Consulting Services designs, builds and runs solutions to deliver bottom-line business value.

PEOPLESOFT

POLL STREAM
If you are looking for a polling solution that delivers results, then Poll Stream is the choice for you. Exceptional data collection combined with clear branding and integrated incentives is your recipe for success.

POSTLINX - CONNECTED TO CUSTOMERS

An established, technically advanced leader in direct-to-consumer mailing services.

SAS Institute (Canada) The Power to KnowÆ.

SAS is the market leader in providing a new generation of business intelligence software and services that create true enterprise intelligence. SAS solutions are used at more than 40,000 sites -- including 90 percent of the Fortune 500 -- to develop more profitable relationships with customers and suppliers; to enable better, more accurate and informed decisions; and to drive organizations forward. SAS is the only vendor that completely integrates leading data warehousing, analytics and traditional BI applications to create intelligence from massive amounts of data. For more than 25 years, SAS has been giving customers around the world The Power to KnowÆ. Visit us at http://www.sas.com/offices/NA/canada/index.html

Transcontinental

Attend the 8th annual Linkage Strategies for Integrating Customer Feedback to Improve Corporate Performance event being held Feb. 25-27 in Miami in co-operation with IIR. Center your corporate performance around the customer experience to retain at risk customers, increase incurring revenue (B2B), reduce churn (B2C) and increase bottom line profits. Learn how to link your customer data to your financial, operational, brand, customer relationship and strategic information. AARM members receive 20% off the standard fee (some restrictions apply.) For information on the session, click here to download a pdf of the brochure readable by Acrobat Reader, then call the AARM office at 888 250 4456 to obtain an AARM Member Discount Registration Code.

5. CAREER OPPORTUNITIES
Direct Marketing Sales Professional - Posted November 7, 2003

Senior Sales Professional

Vice President Promotions - New Loyalty Programs

Vice President Sales

Chief Financial Officer - Diversified Marketing Services Firm

Vice President Sales and Promotion

Senior Executive Assistant - Marketing/Advertising/Promotions/Internet
6. PRACTITIONERS AVAILABLE.

Experienced Sales and Marketing Executive with an extensive record of success in product development and media advertising coupled with strength in direct marketing.

High-energy Senior Marketing and Sales Executive with a variety of accomplishments in both business-to-business and business-to-consumer environments, in both franchise and corporate settings, for both Canada and the U.S. I also offer senior experience in and have achieved notable accomplishments on the marketing services side of the business.

ITEM NOTES

* Sections of Items 1 and 3 courtesy of the Friday Report Published weekly by HOKE COMMUNICATIONS e-mail DMMagazine@aol.com, or mail to Hoke Communications, 224 Seventh Street, Garden City, NY 11530. FRIDAY REPORT is published weekly. Via email - $125/yr.; Print version via mail $250 in North America, $350 elsewhere; Both print and email $350 in North America, $450 elsewhere.
You have been sent this email because it is our understanding that you want to be informed about educational activities in the field of Customer Relationship Management, (CRM). You have also subscribed to the AARM CRM Report. If at anytime you do not wish to be informed about CRM educational activities, please let me know and we'll arrange to have you removed from our files. Robert T. Stacey - President AARM. roberttstacey@aarm.org

Since 1995 AARM, as a not-for-profit association, has been promoting industry growth, development and education. AARM fulfills its role by providing Conferences, Seminars, Workshops, Professional Certification in CRM, Executive Briefings, Networking Sessions and other CRM, Direct Marketing and Interactive Marketing related activities. Today, the AARM community comprises thousands of executives from across the Fortune 1,000 companies as well as small and medium sized businesses.