YOU’VE READ THE ARTICLES. You’ve attended the trade shows. You’ve done your homework. And it’s become clear: Your company needs to use customer relationship management tools and techniques to maintain its competitive edge. So now what?
If the idea of beginning a CRM effort seems daunting, take heart — it can be and has been done successfully. But make no mistake, it can be a substantial undertaking. Many projects have floundered (as many as 40%, according to some sources). However, this doesn’t have to be your experience.
Here are six key practices that characterize successful CRM programs.
Identify ‘Champions’
Assemble a team that’s committed to the CRM vision and readily grasps why the program is important. No one can start something like this alone. To ensure the team’s effectiveness, gather champions from every corner of the organization. Recruit members from upper management as well as each department or business unit. Usually operations, sales, customer service, Internet support, and information technology are involved; but don’t forget other areas like accounting, legal and human resources.
These members become the project advocates to and for their respective departments. They carry the message to those who feel the project’s impact. Their main message is that this is not just the latest crazy idea or management fad. It’s a companywide effort and a new way of doing business.
Develop a consensus
The next step is to develop an internal consensus on what CRM means to your firm. This may seem obvious, but it’s not quite as easy as it first might appear. What does CRM mean to you, management and your customers? How broad or narrow should the definition be?
If you were to ask four CRM vendors for their definition of CRM, you would likely receive five different answers. Why all the confusion? Simple. Because defining CRM is like the old adage about the three blind men trying to describe an elephant.
Internal consensus will be necessary to gain management’s support for future phases and drive acceptance of changes such as alterations to operational procedures or adoption of best practices.
The definition should address broad business practices, outlining a customer-centric philosophy rather than a detailed plan of attack. For instance, “customer relationship management is the maximization of the value of the company to the customer and the customer to the company.”
Develop the Vision
Once the team has formed its definition of CRM, the next step is to determine what CRM means specifically to the organization. Why start a CRM project? What shape will CRM practices take for each customer touch point within the organization?
Create a vision statement that incorporates your company’s particular business goals and objectives. Gather input from those on the front lines as well as upper management. When completed, the documented vision will serve to guide the activities and decisions throughout the rest of the development process.
There are two critical issues to keep in mind:
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Business goals come before technology solutions. Define the business goals before selecting technology. Too often, companies are under pressure from management or a vendor to begin a CRM project without identifying what the real goals are.
Business rules should define the system. Take the time to list specific goals relative to your definition of CRM. And do this before researching technology solutions. Review what’s happening today, how it’s been tweaked or optimized for specific situations, and what the ideal processing should be. This is the area in which endorsements from managers can be most critical. Process owners may perform tasks in specific ways and may be reluctant to let go of their ideas or past work.
This crucial step represents the most common point where projects begin to go off course. This is the time to evaluate everything thoroughly and determine where changes or improvements are needed. Once a firm understanding is developed, then technology solutions that match the requirements can be considered — not the other way around.
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Customers, not business goals, measure success. Defining business goals is a necessary step to ensuring selection of the appropriate tools and the development of efficient customer-centric procedures. These goals are not, however, the same criteria by which to gauge the success of a CRM project. It’s important to always keep the customer foremost in the process and approach success from the customer’s perspective.
Internal goals are often along the lines of “sell 10 more widgets” or “lower operating costs by 3%.” But these are the results from focusing on customer interaction — the ends, not the means. They are the measure of doing the right things.
By focusing on the process, the desired result will come. Trying to force results invariably will result in wasted time. You should define success by how enjoyable it is for customers to do business with each forward-facing aspect of the organization (sales, customer service, accounting). Failing to focus on the customer heightens the risk of not meeting any of the original business goals.
Share the Vision
With a clear vision in mind, the next step in the process is to generate curiosity in order to build companywide awareness of the CRM effort. Develop a catchy slogan or a project name. The goal is to keep the importance of this project in everyone’s minds.
Establish communication channels for sharing success stories, answering questions and addressing concerns. An internal CRM effort can be accomplished with newsletters, e-mails or even via an intranet site.
To help people get on board, boil the vision down to one or two sentences or use word pictures. For example, develop names for customer profiles. “Karen, the Soccer Mom” might represent your average customer. Demonstrate how each aspect will enhance Karen’s relationship with the company. Share the vision in terms of how the CRM project will affect Karen.
Manage Expectations
Is there internal consensus on how quickly the company should see a return on its CRM investment? How much time has been allowed to develop new procedures and software? How high are the expectations that CRM will deliver significant cost savings or increased income? What’s the pace of change within the organization?
While roles and responsibilities can be well defined and easily redefined, people tend to be uncomfortable and resistant to paradigm changes. Some may be committed for a short time, but if they sense failure, additional work without reward, or mixed political pressures, they will return to old, familiar practices.
Establish quick-win milestones and easily achievable goals to keep the work force on track. Set realistic expectations and don’t lose heart halfway through the process. As one marketing professor was fond of saying, “Great marketing will only hasten the demise of a poor product.” So it is with CRM systems. Understand what this CRM project can and cannot accomplish. Realistic goals never fail to meet reasonable expectations.
Continually Refine Efforts
Once the tools are in place for delivering on the vision, don’t assume the project is done. One benefit of CRM is the ability to “sense and respond” to customer needs. Make sure this also applies to the entire enterprise and that the organization doesn’t depend on technology as its sole business solution.
Take time to constantly refine the process. Revisit the vision, documentation and training regularly to see if it all still applies. Establish and maintain clear internal and external feedback channels. Identify where the information goes and who has the authority to act on it. Success must be measured from the customer’s perspective, so use metrics such as types, number and frequency of issues as well as the expected time to resolution.
Solicit ideas from those who regularly interact with customers. And don’t be afraid to interview customers, both the happy and the not-so-happy, to gain insight on the feedback process itself.
Set up systems to acknowledge, reward and empower everyone in the organization to provide great customer interaction. Encourage those who are already taking steps to improve customer relationships.
Keep the cycle going — make it harder for your customer to want to do business anywhere else. This is, after all, the competitive differentiator and the reason you began the program in the first place.
JAMIE BOTDORF AND ARI BUCHWALD are strategy integration services consultants with Fair, Isaac and Co. Inc., Oakbrook Terrace, IL.
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