Vendor Relationship Management
Encyclopedia
VRM, or vendor relationship management is a category of business activity made possible by software tools that provide customers with both independence from vendors and better means for engaging with vendors. These same tools can also apply to individuals' relations with other institutions and organizations.
The term was coined by Mike Vizard on a Gillmor Gang
podcast on September 1, 2006, in a conversation with Doc Searls
about the project Searls had recently started as a fellow at the Berkman Center for Internet & Society
at Harvard University
. Vizard saw VRM as a natural counterpart of Customer relationship management
. Searls' project then became named ProjectVRM, and has since worked to guide development of VRM tools and services.
VRM tools provide customers with the means to bear their share of the relationship burden with vendors and other organizations. They relieve CRM of the perceived need to "target," "capture," "acquire," "lock in," "direct," "own," "manage," and otherwise take the lead of relationships with customers. With VRM operating on the customer's side, Customers are also involved as participants, rather than as followers.
In its description of ProjectVRM, the Berkman Center says "The primary theory behind ProjectVRM is that many market problems (including the widespread belief that customer lock-in is a 'best practice') can only be solved from the customer side: by making the customer a fully empowered actor in the marketplace, rather than one whose power in many cases is dependent on exclusive relationships with vendors, by coerced agreement provided entirely by those vendors."
Doc Searls believes VRM will help create what he calls an "The Intention Economy," which he described first in an essay by that name in Linux Journal
. There, he writes, "The Intention Economy grows around buyers, not sellers. It leverages the simple fact that buyers are the first source of money, and that they come ready-made. You don't need advertising to make them. The Intention Economy is about markets, not marketing. You don't need marketing to make Intention Markets." Searls is currently working on a book by the same title for Harvard Business Press
. He also sees VRM addressing some of what he calls the "unfinished business" of The Cluetrain Manifesto
, which he co-wrote in 1999 with Christopher Locke
, Rick Levine and David Weinberger
. Here he refers to Cluetrain's preamble, which says "We are not seats or eyeballs or end users or consumers. We are human beings—and our reach exceeds your grasp. Deal with it."
CRM magazine devoted much of its May 2010 issue to VRM. The magazine also named Doc Searls' one of its Influential Leaders in its August issue.
The term was coined by Mike Vizard on a Gillmor Gang
Gillmor Gang
The Gillmor Gang is a podcast about information technology run by Steve Gillmor, a former contributing editor at ZDNet.-History:It was originally hosted on ITConversations.com. From May 2005 until November 2006, it was hosted by Podshow. The show then ended until being resurrected in November 2007...
podcast on September 1, 2006, in a conversation with Doc Searls
Doc Searls
David "Doc" Searls , co-author of The Cluetrain Manifesto, is an American journalist, columnist, author and a widely-read blogger, a fellow at the Center for Information Technology & Society at the University of California, Santa Barbara, and a fellow alumnus of the Berkman Center for Internet &...
about the project Searls had recently started as a fellow at the Berkman Center for Internet & Society
Berkman Center for Internet & Society
The Berkman Center for Internet & Society is a research center at Harvard University that focuses on the study of cyberspace. Founded at Harvard Law School, the center traditionally focused on internet-related legal issues. On May 15, 2008, the Center was elevated to an interfaculty initiative of...
at Harvard University
Harvard University
Harvard University is a private Ivy League university located in Cambridge, Massachusetts, United States, established in 1636 by the Massachusetts legislature. Harvard is the oldest institution of higher learning in the United States and the first corporation chartered in the country...
. Vizard saw VRM as a natural counterpart of Customer relationship management
Customer relationship management
Customer relationship management is a widely implemented strategy for managing a company’s interactions with customers, clients and sales prospects. It involves using technology to organize, automate, and synchronize business processes—principally sales activities, but also those for marketing,...
. Searls' project then became named ProjectVRM, and has since worked to guide development of VRM tools and services.
VRM tools provide customers with the means to bear their share of the relationship burden with vendors and other organizations. They relieve CRM of the perceived need to "target," "capture," "acquire," "lock in," "direct," "own," "manage," and otherwise take the lead of relationships with customers. With VRM operating on the customer's side, Customers are also involved as participants, rather than as followers.
In its description of ProjectVRM, the Berkman Center says "The primary theory behind ProjectVRM is that many market problems (including the widespread belief that customer lock-in is a 'best practice') can only be solved from the customer side: by making the customer a fully empowered actor in the marketplace, rather than one whose power in many cases is dependent on exclusive relationships with vendors, by coerced agreement provided entirely by those vendors."
Doc Searls believes VRM will help create what he calls an "The Intention Economy," which he described first in an essay by that name in Linux Journal
Linux Journal
Linux Journal is a monthly technology magazine published by Belltown Media, Inc. of Houston, Texas. The magazine focuses specifically on Linux, allowing the content to be a highly specialized source of information for open source enthusiasts.-History:...
. There, he writes, "The Intention Economy grows around buyers, not sellers. It leverages the simple fact that buyers are the first source of money, and that they come ready-made. You don't need advertising to make them. The Intention Economy is about markets, not marketing. You don't need marketing to make Intention Markets." Searls is currently working on a book by the same title for Harvard Business Press
Harvard Business Press
Harvard Business Press is the book-specific division of Harvard Business School Publishing, owned by the Harvard Business School, based in Boston, MA.The Press publishes general interest books in addition to business books...
. He also sees VRM addressing some of what he calls the "unfinished business" of The Cluetrain Manifesto
The Cluetrain Manifesto
The Cluetrain Manifesto is a set of 95 theses organized and put forward as a manifesto, or call to action, for all businesses operating within what is suggested to be a newly-connected marketplace....
, which he co-wrote in 1999 with Christopher Locke
Christopher Locke
Christopher Locke is a widely read blogger, author and the editor of the e-newsletter since 1995. Starting in 2005, he has been writing the blog....
, Rick Levine and David Weinberger
David Weinberger
David Weinberger is an American technologist, professional speaker, and commentator, probably best known as co-author of the Cluetrain Manifesto David Weinberger (born 1950 in New York) is an American technologist, professional speaker, and commentator, probably best known as co-author of the...
. Here he refers to Cluetrain's preamble, which says "We are not seats or eyeballs or end users or consumers. We are human beings—and our reach exceeds your grasp. Deal with it."
CRM magazine devoted much of its May 2010 issue to VRM. The magazine also named Doc Searls' one of its Influential Leaders in its August issue.
VRM development work
As of August 2010 ProjectVRM lists nineteen VRM development efforts. These include:- Azigo
- EmanciPay
- Information Sharing Workgroup
- Kynetx
- ListenLog
- myinfo.cl
- Mydex
- Paoga
- SwitchBook
- TrustFabric
- UMA
- Banyan Project
- The Mine Project
- Project Danube
See also
- Customer relationship managementCustomer relationship managementCustomer relationship management is a widely implemented strategy for managing a company’s interactions with customers, clients and sales prospects. It involves using technology to organize, automate, and synchronize business processes—principally sales activities, but also those for marketing,...
(CRM) - Extended Relationship Management (XRM)
- Vendor lock-inVendor lock-inIn economics, vendor lock-in, also known as proprietary lock-in or customer lock-in, makes a customer dependent on a vendor for products and services, unable to use another vendor without substantial switching costs...