The Missing Links in CRM
No organization is ignoring the need for customer-centricity
today. One manifestation of this focus is the ride on the
Customer Relationship Management (CRM) bandwagon. The research
firm, META, projects that the market for CRM tools will grow
from a sizeable US$4.7 billion in 2002 to an overwhelming
US$10 billion by 2003.
While we are still on numbers, figure this one out: Up to
a whopping 70% of current CRM implementations are not realizing
their full potential. A key cause is the razzle and dazzle
of CRM software. Many of us associate CRM with software technology.
While technology certainly enhances our ability to draw close
to our customers, it creates an irresistible itch in the minds
of CEOs. Yet we are only scratching the dermal layer of this
CRM animal to rid of this itch.
Let’s cut to the chase: We need to first consider several
often-neglected dimensions before taking on the CRM technological
platform. The entire CRM model is linked concentrically.
See Figure 1 below.
Customer Strategy. Before we can even consider the CRM
platform, let’s be clear what our customer strategy is.
We need to ask ourselves what type of customers we want to serve
(customer segmentations), and what the selected customers want
in their experiences with us (service value propositions). Different
customer groups look for different service values. Public hospitals
cater mainly to the average working class. Efficiency and costs
are thus the core value propositions the public hospitals need
to focus on in designing their services. On the other hand,
private hospitals target the rich who want to be pampered with
personalized extras.
Relationship Mapping. When the customer experience,
with its accompanying service values, is established, we then
move one step closer to implementation. At this stage, all
customer contact points and activities are sequentially mapped
out in details according to the intended value propositions.
A credit card company decided that prompt responsiveness is
important to applicants. As a result, their application process
is streamlined to allow for instant approval over the phone.
Here, the customer experience becomes tangible in the form
of customer related processes.
Key Measures. Now we are ready to cater to our bosses’
constant cravings: Results! Let’s give them more than
their usual corporate goals. Ask ourselves: What do we want
to achieve by carrying out these customer processes? The answer
would be setting Key Performance Indicators that measure how
well we execute our processes. Examples of such indicators
are customer churn rate, stock-out percentage and customer
satisfaction index. This is not enough; we have to dig deeper
and create Service Standards. These track critical activities
in the customer processes such as lead-time, pick up phone
within 3 rings and standard greeting protocol etc. These indicators
and standards will later help determine what data fields the
CRM system needs.
See Figure 2.
Organizational Alignment. If we have done all of the
above, we would have successfully created some dissonance
and tension in the organization. What now? Let’s stir
up more change! Functions and departments have to align with
the customer strategy and its processes. Not the other way
round. Roles, responsibilities and titles must change to enable
us to carry out the processes. Hierarchy might be flattened.
More of us might need to multi-task. The linkage between back-room
functions like accounting and front-end functions like customer
service must be tightened.
People. Let’s finally look at the only factor
in our organizations that is alive and kicking. Our people
are the executors of our wonderful and intricate CRM architectures.
Beware of GIGO: garbage in, garbage out. The ultimate outcome
of our CRM depends on how our staff uses the system. We need
to work on our people’s mindset as well as skills. They
have to first, be convinced of the merits of adopting the
system. Then they need to learn how to use the system to allow
it to yield maximum benefits. Here we take on internal cultural
conflicts and turn it around to suit our new found focus on
the customer.
Platform and Architecture. Thank you for your patience.
For all techies, over to you. We can now talk software, architecture,
servers…. But the key difference is: you have to listen
to us. If we have followed the above roadmap, we would have
the necessary specifications and direction to allow our vendors
and IT colleagues to do their work.
Order is restored. We dictate what the CRM should do and
not the other way round.
Written by:
George Quek
Director
DistincTions Asia Pte Ltd
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