This is an open letter to all you corporate executives out there who are grappling with the hoary task of designing and implementing customer relationship management (CRM) in your organizations.
Despite all you’ve heard and read on surveys, research reports, and whatnot about the high failure rate of CRM implementation and the low rate of customer satisfaction with the most popular CRM packages, I have the solution: the three-point pledge.
But… before you take the pledge, you’ve got to qualify:
- Are you really willing to make the changes necessary to increase CRM success?
- Are you committed to learning more about your customers, and are you willing to do what it takes to identify, attract, and retain the right types of customers?
- Are you really serious about improving the operational performance of your organization?
If the answers are a resounding “yes” to all three questions, then stand up, place your hand over your heart, and repeat the following: Pledge 1: Don’t adopt new technology without a clear understanding of how it can generate economic benefit. Understand potential risks and rewards, and your organization’s design, strengths, and weaknesses. I pledge not to adopt new technology without a clear, viable strategy to use the resulting functionality to improve revenue and profits, reduce costs to a degree that substantially exceeds the total amount of investment required to make the technology work in my organization, or both. By viable, I mean this strategy will be grounded in a deep and real knowledge of customer needs, interests, and behaviors; the core competencies of my staff; the competitive strength of my offerings; the cohesiveness of my corporate culture and organization; and the architecture of my technical infrastructure.
Does this seem silly to you? Well, it represents a major mind shift from most of your counterparts out there in Corporate America. Many organizations buy software packages as a magic bullet for their problems. They believe that once installed, the software will work its mojo. Mysteriously, people, business processes, and the organization become smarter and better.
Think I’m kidding? Just consider the organizations that bought CRM packages. They painfully and meticulously reconciled, cleansed, and integrated customer data and recreated all of it in a brand new data model — just so these businesses could achieve an integration of customers across different customer-facing processes and channels.
What did these same companies do to recoup the costs of this massive investment? Create self-service Web sites so customers could view and manage their accounts to lower servicing and handling costs? Provide value-added analysis at the customers’ request to offer superior value and better deals to generate added revenue?
Nope. They spent a lot of time and money but only achieved a better internal view of customers. Although an integrated view of customers gives companies the potential to offer better service and deliver superior value, it doesn’t really generate any economic benefit by itself.
Stay tuned for the next installments. I’ll cover pledge points two and three.
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