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Customer Relationship Management

Chapter # 1. Introduction to CRM 1.1 Evolution of CRM

Customer Relationship Management (CRM) is one of those magnificent concepts that swept the business world in the 1990s with the promise of forever changing the way businesses small and large interacted with their customer bases !n the short term" however" it proved to be an unwieldy process that was better in theory than in practice for a variety of reasons #irst among these was that it was simply so difficult and e$pensive to trac% and %eep the high volume of records needed accurately and constantly update them !n the last several years" however" newer software systems and advanced trac%ing features have vastly improved CRM capabilities and the real promise of CRM is becoming a reality &s the price of newer" more customi'able !nternet solutions have hit the mar%etplace( competition has driven the prices down so that even relatively small businesses are reaping the benefits of some custom CRM programs

1.2 In the beginning

)he 19*0s saw the emergence of database mar%eting" which was simply a catch phrase to define the practice of setting up customer service groups to spea% individually to all of a companys customers !n the case of larger" %ey clients it was a valuable tool for %eeping the lines of communication open and tailoring service to the clients needs !n the case of smaller clients" however" it tended to provide repetitive" survey+li%e information that cluttered databases and didnt provide much insight &s companies began trac%ing database information" they reali'ed that the bare bones were all that was needed in most cases, what they buy regularly" what they spend" what they do

Customer Relationship Management

1.3 dvances in the 1!!"#s

!n the 1990s companies began to improve on Customer Relationship Management by ma%ing it more of a two+way street !nstead of simply gathering data for their own use" they began giving bac% to their customers not only in terms of the obvious goal of improved customer service" but in incentives" gifts and other per%s for customer loyalty )his was the beginning of the now familiar fre-uent flyer programs" bonus points on credit cards and a host of other resources that are based on CRM trac%ing of customer activity and spending patterns CRM was now being used as a way to increase sales passively as well as through active improvement of customer service

1.$ Introduction Customer Relationship Management % CRM

)he generally accepted purpose of Customer Relationship Management (CRM) is to enable organi'ations to better serve its customers through the introduction of reliable processes and procedures for interacting with those customers !n today.s competitive business environment" a successful CRM strategy cannot be implemented by only installing and integrating a software pac%age designed to support CRM processes & holistic approach to CRM is vital for an effective and efficient CRM policy )his approach includes training of employees" a modification of business processes based on customers. needs and an adoption of relevant !)+ systems (including soft+ and maybe hardware) and/or usage of !)+0ervices that enable the organi'ation or company to follow its CRM strategy CRM+0ervices can even redundanti'e the ac-uisition of additional hardware or CRM software+licences )he term CRM is used to describe either the software or the whole business strategy oriented on customer needs )he second one is the description which is correct )he main misconception of CRM is that it is only software" instead of whole business strategy

Customer Relationship Management Ma2or areas of CRM focus on service automated processes" personal information gathering and processing" and self+service !t attempts to integrate and automate the various customer serving processes within a company )here are three parts of application architecture of CRM,

operational + automation to the basic business processes (mar%eting" sales" service) analytical + support to analyse customer behaviour" implements business cooperational + ensures the contact with customers (phone" email" fa$" web )

intelligence ali%e technology

3perational part of CRM typically involves three general areas of business )hey are (according to 4artner 4roup) a 5nterprise mar%eting automation (5M&)" 0ales force automation (0#&) and a Customer service and support (C00) )he mar%eting information part provides information about the business environment" including competitors" industry trends" and macroenviromental variables )he sales force management part automates some of the company.s sales and sales force management functions !t %eeps trac% of customer preferences" buying habits" and demographics" and also sales staff performance )he customer service part automates some service re-uests" complaints" product returns" and information re-uests !ntegrated CRM software is often also %nown as 6front office solutions 6 )his is because they deal directly with the customer Many call centers use CRM software to store all of their customer.s details 7hen a customer calls" the system can be used to retrieve and store information relevant to the customer 8y serving the customer -uic%ly and efficiently" and also %eeping all information on a customer in one place" a company aims to ma%e cost savings" and also encourage new customers CRM solutions can also be used to allow customers to perform their own service via a variety of communication channels #or e$ample" you might be able to chec% your ban% balance via your 7&9 phone without ever having to tal% to a person" saving money for the company" and saving you time

Customer Relationship Management

Improving customer service

CRMs are claimed to improve customer service 9roponents say they can improve customer service by facilitating communication in several ways,

9rovide product information" product use information" and technical assistance on =elp to identify potential problems -uic%ly" before they occur 9rovide a user+friendly mechanism for registering customer complaints

web sites that are accessible 1; / <

(complaints that are not registered with the company cannot be resolved" and are a ma2or source of customer dissatisfaction)

9rovide a fast mechanism for handling problems and complaints (complaints that 9rovide a fast mechanism for correcting service deficiencies (correct the problem !dentify how each individual customer defines -uality" and then design a service use internet coo%ies to trac% customer interests and personali'e product offerings use the internet to engage in collaborative customi'ation or real+time 9rovide a fast mechanism for managing and scheduling followup sales calls to

are resolved -uic%ly can increase customer satisfaction)

before other customers e$perience the same dissatisfaction)

strategy for each customer based on these individual re-uirements and e$pectations



assess post+purchase cognitive dissonance" repurchase probabilities" repurchase times" and repurchase fre-uencies

9rovide a fast mechanism for managing and scheduling maintenance" repair" and 9rovide a mechanism to trac% all points of contact between a customer and the

on+going support (improve efficiency and effectiveness)

company" and do it in an integrated way so that all sources and types of contact are included" and all users of the system see the same view of the customer (reduces confusion)

)he CRM can be integrated into other cross+functional systems and thereby

provide accounting and production information to customers when they want it

Customer Relationship Management

Improving customer relationships

CRMs are also claimed to be able to improve customer relationships 9roponents say this can be done by,

CRM technology can trac% customer interests" needs" and buying habits as they

progress through their life cycles" and tailor the mar%eting effort accordingly )his way customers get e$actly what they want as they change

)he technology can trac% customer product use as the product progresses through

its life cycle" and tailor the service strategy accordingly )his way customers get what they need as the product ages

!n industrial mar%ets" the technology can be used to micro+segment the buying

centre and help coordinate the conflicting and changing purchase criteria of its members

7hen any of the technology driven improvements in customer service (mentioned

above) contribute to long+term customer satisfaction" they can ensure repeat purchases" improve customer relationships" increase customer loyalty" decrease customer turnover" decrease mar%eting costs (associated with customer ac-uisition and customer >training>)" increase sales revenue" and thereby increase profit margins

&echnical functionalit'
& CRM solution is characterised by the following functionality,

scalability + the ability to be used on a large scale" and to be reliably e$panded to multiple communication channels + the ability to interface with users via many wor%flow + the ability to automatically route wor% through the system to different database + the centralised storage (in a data warehouse) of all information relevant customer privacy considerations" e g data encryption and the destruction of

what ever scale is necessary

different devices (phone" 7&9" internet" etc)

people based on a set of rules

to customer interaction

records to ensure that they are not stolen or abused

Customer Relationship Management

(rivac' and ethical concerns

CRMs are not however considered universally good + some feel it invades customer privacy and enable coercive sales techni-ues due to the information companies now have on customers + see persuasion technology =owever" CRM does not necessarily imply gathering new data" it can be used merely to ma%e 6better use6 of data the corporation already has 8ut in most cases they are used to collect new data

Customer Relationship Management

Chapter # 2. CRM (lanning 2.1 CRM Planning: Keys for Project Success
7hether updating" upgrading" 2ump+starting" or restarting your CRM efforts" some basic steps will help %eep you on the path to a positive R3! )hin%ing about the potential R3! of your customer relationship management (CRM) pro2ect should start during the selection process 8efore you write an R#9 or start tal%ing to vendors" you need to do some homewor% to ensure that on the right trac% to ma$imi'e R3!

2.2 Identif' the (roblem ) and the *olution

8efore you start thin%ing about vendors" you should define your problem in clear business terms Ao you need to improve management visibility into the sales pipeline> Reduce customer support costs or improve customer support> Reduce customer+related administrative overhead> Ma%ing your CRM challenges specific will help you determine which technologies or components are most li%ely to deliver R3! and how you can prioriti'e your development and deployment plans Most companies. CRM goals fall into a couple of main categories, B B B B B !mproved sales performance !mproved management visibility !mproved customer support !mproved mar%eting Reduced costs

!f your CRM goals fall into more than two of these categories" you.ll li%ely want to prioriti'e one over the other and plan a phased deployment !t.s also a good idea to %now at this point what your li%ely budget is" how fle$ible it is" and what your procurement officer or C#3 will be loo%ing for in terms of business 2ustification !f you %now wal%ing into the pro2ect that you.ll need to show a si$+month paybac% period" for e$ample" you can plan accordingly


Customer Relationship Management

2.3 Ma+e the *hort ,ist

Regardless of your relationship with e$isting vendors" previous e$perience" and technology environment" you should ma%e a short list of potential vendors and give them a fair evaluation before you ma%e a decision Cour short list should be easy to define based on these factors, B Cour CRM goals )he vendors whose functionality meets your needs will depend on whether loo%ing for improved sales" improved reporting and forecasting" improved support" improved mar%eting" or a combination of different customer+related technology B Cour e$isting environment and !) philosophy Ao you have e$isting databases" order systems" or contact lists that will need to be integrated or migrated into your CRM solution> Ao you e$pect to do your own development or use consultants or systems integrators> &re you comfortable outsourcing your sales and mar%eting data in its entirety + or in part> &nswering these -uestions will help you determine whether a large+scale CRM infrastructure" a hosted solution" a point solution" or a broad solution is li%ely to deliver ma$imi'ed R3! B Cour user dynamics &re the employees you e$pect to use the solution technology savvy and open to change" or are they the ones still using pencils and paper to trac% leads> )he greater the magnitude of the change you e$pect them to ma%e" the greater the ris% that adoption will slow the R3! of your pro2ect B Cour budget CRM solutions such as 0iebel and 0&9 can cost millions of dollars to deploy and re-uire a team for ongoing support and maintenance 3n the other end of the spectrum" Microsoft CRM and #rontRange (for e$ample) can cost considerably less Cou can e$pect a hosted solution to have a minimal upfront investment and from D?00 to D1"?00 per user per year Clearly defining your re-uirements and characteristics in each of these %ey areas will prepare you for the ne$t step + evaluating each individual solution.s ability to deliver returns based on the costs and benefits associated with a deployment

Chec+ Resumes
3nce identified the li%ely vendors to deliver the best solution for you" you.ll want to chec% their references + and this doesn.t mean 2ust reading case studies on their 7eb sites Eoo% to independently developed case studies and your own

Customer Relationship Management interviews with references to learn about their decision process" pro2ect successes and challenges" and whether or not their spending + and benefits + met e$pectations

-ind a (artner .Chec+ Resumes/ 20

!n the CRM world" few companies will deploy a solution without some help from e$ternal consultants or systems integrators 0electing and planning how you wor% with consultants is 2ust as important to your pro2ect.s success as the technology you choose

1ustif' 2our Investment

3nce identified your goals and selected a short list of vendors" you can use a structured evaluation of costs and benefits to determine the best solution in terms of R3! and build the business case for moving forward 3n the costs side" you.ll want to consider the initial and ongoing software" hardware" consulting" internal personnel" and training costs associated with the pro2ect =ere are a few guidelines to %eep the R3! from your CRM pro2ect on trac%, B B B B B Cou should spend less on software and consulting than <0 percent of e$pected Cou should be able to deploy and achieve some returns in fewer than si$ #or a hosted solution" you should see benefits in fewer than @0 days Consulting costs should not be more than twice your initial software )raining users should ta%e fewer than four hours annual direct benefits months (even if it.s only a pilot)

investment 3n the benefits side" you.ll want to consider both direct and indirect benefits 9rioriti'e your e$pected benefits from most direct to most indirect" and then wor% on your estimates" using internal surveys" case study data" and reliable benchmar%ing information as a starting point for -uantifying e$pected benefits for your company

3e' 4ecision -actors

8y and large" there.s no such thing as a bad CRM solution Most solutions deliver value when chosen based on clear business needs and deployed correctly

Customer Relationship Management 3nce identified your CRM needs and your short list" there are a number of factors to consider to help you ma%e the right solution decision

5ser doption
!n evaluating the type of CRM solution that will be best for your organi'ation in terms of user adoption" you.ll want to consider two %ey factors, B )he willingness of users to adopt the application &doption can often be as much about politics and culture as it is about technology 0uccessful adoption will also depend on how much users will have to change their normal way of doing wor% to use the solution B )he technology ability of potential users Many CRM solutions are comple$ and difficult to use( others have a more intuitive loo% and feel Choose a solution that fits the abilities of your users 3nce determined where your organi'ation fits" you.ll want to consider both the comple$ity of the solution and ease (or difficulty) involved in adding and evolving functionality over time as your needs change and your users become more comfortable with the solution =ere are some red flags you should loo% out for in evaluating solutions in terms of user adoption, B B B B B B 9lans for e$tensive customi'ation Multiple components that will be integrated to meet your needs Eac% of a trac% record supporting 6your %ind6 of sales reps #unctionality planned 6for the ne$t release6 &n e$tensive training program 3ngoing consulting re-uirements for any changes or updates

!n CRM" 6you get what you pay for6 isn.t always true !n fact" many companies in the past have overspent on CRM components and features that never delivered value to their users + if they even made it out of the bo$ Cou.ll have the most success with a measured approach that doesn.t have to include a hefty initial license fee


Customer Relationship Management

E6isting Environment
7hat other solutions and data sources do your sales or customer support representatives use today" what solutions are they most comfortable using" and what will need to be integrated in some way into the CRM solution you choose to deliver value> =ow you integrate e$isting resources and applications into a CRM pro2ect should not be an afterthought !n selecting a vendor" you.ll want to e$plore how it can integrate with your e$isting environment Aemand to see a trac% record with reference customers in a similar situation

7est (ractice8 Ma+e a Match

3ne company chose Microsoft CRM because it would easily integrate with bac%+end office applications" because the sales force was already familiar with the Microsoft interface loo% and feel" and because the design of the application closely matched its e$isting business processes !t achieved a paybac% of five months

!n addition to the initial development" integration" and deployment" when selecting a solution" you should consider how easy it will be to ma%e changes over time as your needs change !n all li%elihood" the way you use CRM will change over time + and the fle$ibility of the application to enable you to support those changes can have a significant impact on the ongoing cost of the solution

7est (ractices
3nce determined which solution is right for you and built the business case" you.ll want to ma%e sure you have the %ey chec%points in place so that the pro2ect delivers on your R3! e$pectations 9ricing and 9urchasing 8efore you sign on the dotted line" ma%e sure done due diligence on your contract with the vendor Aouble+chec% the following, B B !s the initial license price per user in line with industry benchmar%s> &re you paying less" more" or the average annual industry maintenance> !f you

decide to stop paying maintenance in the future" does your contact support that>


Customer Relationship Management B !f purchasing multiple modules at the same time" do you have a clear

view of the cost of each item> &re you sure you should be buying them all now" or would a phased approach be better> B 7hat commitment has the vendor made to your deployment time line> !f a third party is involved" how are the deployment ris% and responsibility being shared>

9iloting a CRM solution can be a great way to 2udge both whether or not the solution will wor% for you and how fle$ible and agile the solution (and vendor) is in responding to specific needs Most hosted solution vendors offer a free or nearly free pilot option today( depending on the level of customi'ation and integration needed" a pilot of an internal solution before you buy may or may not be possible

7est (ractice8 (ilot -irst

3ne company deploying an e9eople CRM solution used an initial pilot at one location to evaluate the application and get valuable feedbac% on how and when the software should be e$panded to other locations 5ven after made the commitment" piloting to a select group of users before you complete customi'ation is a good way to determine whether or not the solution wor%s + and to gain valuable feedbac% on how and with what changes the solution should be rolled out to the broader population

7est (ractice8 (hase In -unctionalit'

3ne company deploying a FA 5dwards CRM solution found that while it achieved a positive R3!" it could have accelerated user adoption and thus shortened its paybac% period by introducing functionality to users in phases & phased approach would have reduced initial customi'ation costs and the need to train users" who were somewhat overwhelmed by the features of the solution


Customer Relationship Management

-ine%&uning 2our R9I

!f pic%ed the right vendor" planned a deployment with clear milestones" and gotten users on board" probably received <0 percent of the R3! you can e$pect )he tric% to really successful CRM is continuing to evaluate and evolve your solution to deliver greater value Cou.ll also want to %eep trac% of potential upgrade opportunities and ta%e a close loo% at the business case + both the benefits of upgrading and the time and pain associated with the upgrade + before you ma%e a change


Customer Relationship Management

Chapter # 3. CRM in 7usiness 3.1 Introduction

!n this day and age the use of internet sites and specifically e+mail" in particular" are touted as less e$pensive communication methods" compared to traditional methods li%e telephone calls )his revolutionary type of service can be very helpful" but it is completely useless if you are having trouble reaching your customers !t has been determined by some ma2or companies that the ma2ority of clients trust other means of communication" li%e telephone" more than they trust e+mail Clients" however" are not the ones to blame because it is often the manner of connecting with consumers on a personal level ma%ing them feel as though they are cherished as customers !t is up to the companies to focus on reaching every customer and developing a relationship CRM software can run your entire business #rom prospect and client contact tools to billing history and bul% email management )he CRM system allows you to maintain all customer records in one centrali'ed location that is accessible to your entire organi'ation through password administration #ront office systems are set up to collect data from the customers for processing into the data warehouse )he data warehouse is a bac% office system used to fulfill and support customer orders &ll customer information is stored in the data warehouse 8ac% office CRM ma%es it possible for a company to follow sales" orders" and cancellations 0pecial regressions of this data can be very beneficial for the mar%eting division of a firm

3.2 CRM *oft:are8

+e' to scalabilit' and efficienc'

CRM *oft:are provides added strength to 'our e6isting plan. CRM software is not a 6cure+all6 for the CRM program in your business 0uccessful launch of a CRM software campaign re-uires a strong CRM plan for your business" with complete ob2ectives and clear priorities CRM software can offer incredible accuracy" trac%+ ability and detailed follow+up capabilities


Customer Relationship Management

3.3 ;o: do 'ou choose CRM *oft:are<

Aoes the emphasis of the CRM software pac%age match the emphasis of your

CRM ob2ectives> !dentify your specific ob2ectives and verify your CRM software can meet those needs

!s your software user friendly> !f you can.t effectively use the software why use

it> CRM software training is usually available by contacting the vendor and as%ing for recommended referrals

=ow do other companies feel about the software> Call the provider company and

as% for a number of preferrals" (preferably three or four companies in similar si'e and scope)

3.$ =hat are some +e' components of CRM soft:are<

;istor' and &rend Management

=istory )rac%ing + get instant perspective into all customer interactions )rend Management+ see the status of all pending sales and potential revenue of

entire pipeline CRM *oft:are utomated (rocesses

Remote 7eb 0ynchroni'ation+ automatically follow+up with leads generated from &utomated 9rocess Management + allows consistent communication with

your site

customer based on user+defined criteria CRM soft:are 4ata%base Information

Centrali'ed !nformation + centrali'e" manage and simplify access to critical !ndustry )emplates and #orm s+ allows access to a database of industry specific

business information

CRM forms CRM *oft:are *ales and Mar+eting nal'sis

0ales G Huota &nalyses + view forecasted sales" closed sales" and comparisons Eeads &nalysis + trac% responses to identify effective campaigns

between sales and -uota


Customer Relationship Management CRM *oft:are Mobil &echnolog' Capabilities

0ynchroni'ation 7i'ard + %eep calendar and contact information up+to+date on Remote &ccess Capabilities + access your CRM software through the internet

your 9A& or laptop while you travel

Iot all CRM software pac%ages are the same )hey will greatly range in price and capabilities CRM &dvisor suggests a thorough evaluation is done comparing multiple CRM software pac%ages


Customer Relationship Management

Chapter # $.

nal'tic CRM

$.1 nal'tic CRM for Retailers8 An ROI Perspective &he Retailers 4ata Challenge
)odays retail environment includes increased competition among stores" a general economic downturn" rising interest rates and higher gas and heating oil prices &ll of these factors have reduced the disposable income available to many retailers" core customers !n this economic environment" retailers must learn to generate more business from their e$isting customers )o do this they must first mine the data they have collected on customer purchases and loyalty programs 0till" retailers are drowning in customer data Critical customer information is inaccessible and underutili'ed More decision+ma%ers need more access to consistent corporate data about their Eoyalty program" 930" and demographic databases e$ist" yet are not integrated

customers within a retail corporation Merchandisers and direct mar%eters lac% e$pertise in the standard analysis Current retail data analysis systems re-uire heavy !) resources to maintain and

applications sold by business intelligence vendors today utili'e &ccording to )he Marriage of Category Management G Customer Management" written by 4ary Robins and published in R!0" Fuly 1999" Category Management and promotion management need to include analyses of loyal customers #ailure to consider the effects on loyal customers means resources spent on category management and promotion might be and probably is in some or many cases harming your business Combining category and loyalty data analysis has been done before" but with great difficulty )he biggest hurdle now is getting robust" fast databases to handle the huge amount of integrated data CustomerJiew was designed to address these retail data challenges CustomerJiew supports the retailers )op mar%eting ob2ectives to solve these problems, 1<

Customer Relationship Management

Reward loyal shoppers and get them to buy more

&ccording to Robert 8lattberg" director of the Center for Retail Management at

Iortheastern s Kellogg 4raduate 0chool of 8usiness" a study of a chain drug retailer showed a :0L/<0L split" meaning the top :0L of their customers generated <0L of their revenues !t also revealed which categories were more important to top and bottom level customers !n another e$ample" a small regional chain with seven stores targeted 1*"000 of )otal revenue

their best customers based on recency and overall dollar amount spent 3f the 1*"000 customers mailed" 911 responded" generating a ? 1L response rate brought in from this particular promotion was in e$cess of D11<"000 generating more than D11 for every dollar spent on the promotion )he events average transaction was D1;<;; an almost D?0 increase from their normal average transaction

Target top switchers

!f your firm is not the lowest cost producer in the category and your switchers are price sensitive" the best mar%eting strategy for addressing price+sensitive purchasers is to attempt to change their preference structure by raising their awareness of" and preference for" specific brand/product attributes" whether they are tangible or intangible )hen try to persuade these 9rice 0ensitive 9urchasers that your offering has the better value" all things considered )he goal is to increase sales and mar%et bas%ets of top switchers

Optimize trade areas and improve assortments store-by-store & leading supermar%et chain recently used data from loyalty programs to edit !t is not 2ust sales" it is how it is affecting which products to delist in a category

loyal customers" was the mantra from the chain !n a test of the carbonated beverage category" the chain did not lose customers even after eliminating 1@L of the category s 0KMs


Customer Relationship Management

Cross-sell the most profitable products and increase the average bas et size
& leading beverage company" which has been wor%ing with over ;0 retailers" says that use of loyalty data does help retailers increase bas%et si'e &ccording to a senior category manager" we did a presentation with a small chain in =ouston" )e$as" and this company had a @ ?L increase in dollars per bas%et and a 9 *L gain in total dollars among their best shoppers

!a"imize ROI for programs funded with manufacturer co-op funds

& national retailer recently completed a targeted promotion with a leading C94 )he piece featured 10 different products" received 1@ ;L response company :?0"000 pieces were mailed bringing the retailer an additional D11;"000 of co+op dollars responders rate" and the mar%et bas%et of the responders was ;0L greater than the non+

$.2 =ho can benefit b' using Customer>ie:<

CustomerJiew is targeted at five %ey audiences within the retailers organi'ation,

CustomerJiew enables retailers to ta%e e$isting customer data and use it to drive revenue" increase mar%et bas%et si'e" and build mar%et share with no additional capital e$penses and labor costs !t enables the C#3 to show increased margins on current capital and enables profitable growth

CustomerJiew enables merchandisers to improve the effectiveness of their staff Msing CustomerJiew" merchandisers can -uic%ly see how certain products can increase mar%et bas%et si'e Msing CustomerJiew they can see how merchandise mi$ affects customer loyalty and ad2ust their assortment accordingly CustomerJiew can help merchandisers measure and build retention !t can show mar%et bas%et value of loyal vs non+loyal customers CustomerJiew can -uic%ly help identify the value of a consumer that shops in critical categories vs the shopper that does not


Customer Relationship Management

CustomerJiew can help 3perations 5$ecutives ma%e changes in an intelligent way Msing CustomerJiew a retailer can %eep labor constant while increasing margins CustomerJiew can help increase the depth of category purchases by turning cherry pic%ers into buyers" increasing a loyal customers shopping trips to a category and increasing overall mar%et bas%et si'e

Eoyalty and 930 databases tend to be stand+alone systems not integrated with category management systems Most data is uncleansed and hosted in many locations )his leads to many opportunities for consultants to create systems to clean the data" aggregate the data" de+duplicate the data" household the data" etc before the data enters the CustomerJiew system )here are also many opportunities for consultants to use CustomerJiew to help the retailers interpret" translate" and develop strategies based on the information and provide business practice recommendations

CustomerJiew can help C94 manufacturers build category/brand sales by using real retail data CustomerJiew can help them build their share of mar%et by identifying customers buying a particular category of products" but not their brands CustomerJiew can show the C94 manufacturer how to increase multi+segment sales by identifying li%ely purchase behavior across divisions" departments or categories

$.3 9ptimi?ing Customer Interactions and Mar+eting nal'tics

Customer conversations and ne: anal'tical mar+eting techni@ues ma+e d'namic customer relationship optimi?ation a ne: top priorit'. 8usiness competence comes down to a companys ability to generate value by using meaningful propositions" relevant interactions" messaging" information" and conversations that customers find compelling )he most important thing that CRM can do for you today and tomorrow is help you create effective conversations that are crafted with credible" holistic intelligence and delivered to the right customer on the right channel at the right time 8usinesses need to create economic value" which re-uires understanding


Customer Relationship Management customers and then engaging them with value propositions )he single most

important event that happens in business is a customer conversation )he conversation is where economic value begins N revenues" activity" paychec%s" and shareholder value 5very company should ma%e the composition of those Ovalue propsP its highest priority 8ut are they doing so> =ow well do businesses create conversations> =ow much do firms optimi'e opportunities> 7hat are some of the best firms driving new customer value> )his latest management challenge is being addressed by the best of+ breed CRM analytical tools that provide mar%eters with the intelligence to understand customers so that value propositions are relevant and arrive at the most opportune time for the customer )he new analytics provide capabilities for companies that wish to ma%e it a business priority to create uni-uely effective value propositions )he interesting thing is that customers e$pect it Ces" customers e$pect you to %now them N and to treat them as persons and remember every contact and transaction theyve ever made )his idea has been in e$istence for a decade" since database mar%eting began to grow in popularity and use 818 or 81C or 8181C buyers now instinctively believe that their providers should %now them Initially flattered by being treated less as a number and more as an individual with distinct requirements, consumers are now communicating their demands back to their suppliers. Where once they would not consider the idea of bargaining, they now tell the managers of brand retail chains what they are prepared to pay and specify how they want products sourced, designed, styled, combined, assembled, delivered, and maintained. Accelerating ustomer !elationships" 0wift &s !nternet communities of practice have grown" people have become more vocal about what they e$pect from providers in many consumer serving industries More than two years ago" the boo% "he luetrain #anifesto$ "he %nd of &usiness as 'sual discussed the new realities of value propositioning and mar%eting techni-ues for the new millennium =ere are the pertinent highlights, B B Mar%eting is really various types of interaction or conversations )echnology is enabling conversations among human beings that were not possible

in the era of mass media 11

Customer Relationship Management B B B B )hese networ%ed conversations are enabling powerful new forms of social &s a result" mar%ets are getting smarter" more informed" and more organi'ed &lready" companies that spea% in the language of the pitch are no longer spea%ing Companies can now communicate with their mar%ets directly

organi'ation and %nowledge e$change

to anyone

!f they blow it" it could be their last chance )he opportunities for companies that leverage CRM to interactively communicate with relevance and timeliness are enormous Cet intelligence from across the enterprise is re-uired to understand and predict what customers will want to %now about and demand )he potential to generate dramatic R3! on such an investment is worth five to 10 to 100 times the investment (ocusing on and predicting customer demand and making decisions both proactively and scientifically is an opportunity worth hundreds of millions, if not billions, of dollars of incremental revenue) starting with segmentation and improved forecasting, then shifting to integration and alignment of functions based on demand, and finally reaching optimi*ation, which is the application of advanced mathematics to dramatically improve decisions.

$.$ Manage 2our >alue (ropositions to 7etter Manage 2our 7rand and 2our 7usiness
& value proposition may be articulated in te$t on a 7eb site" catalog" or direct mail piece" or in a telephone conversation )his is where brand differentiation first appears, the proposition is the first impression of the brand and its value to customers )hus it is critical in initiating conversations" transactions" and relationships 8ut a value proposition is so much more than a message )he value proposition drives the organi'ations core logic for creating value &lthough its true that value propositions will naturally evolve over time as mar%ets and competitive conditions change" the competitive advantage belongs to companies that can proactively and -uic%ly adapt their value propositions for optimal business results 9rofessor &ri 4insberg of Iew Cor% Mniversitys 0tern 0chool of 8usiness


Customer Relationship Management insists that companies can better invent and reinvent value propositions by analytical means that center on customer behavior" in his words" Oanaly'ing dimensions of value P !t is specifically in this area N e$ploring dimensions of value N that customer analytics can ma%e an enormous difference in understanding customers well enough to generate more effective value propositions #or managing value propositions effectively" companies need to first understand what customers value N by using analytical tools integrated with mar%eting automation systems for creating and acting on customer intelligence &nd to ta%e this a step further" the analytics and automation are best supported by an enterprise view of the business and customers" driven in real+time for capturing" managing" and delivering data to mar%eters and analysts for decisioning


Customer Relationship Management

Chapter # A. Mar+et utomation A.1 Mar+eting utomation % &he CRM >endor *olutions
)he components offered in a front+ office application suite fall into three general categories,

Customer *ervice and *upport8 )hese applications automate the service

and support functions" including analytics" and they provide wor%flow engines that facilitate efficient problem and in-uiry escalation" trac%ing and resolution )hey provide customi'able" dynamic scripting capabilities for the customer service representatives as well as the capability to record customer responses in a shared contact repository !n a call center environment" they also integrate with (or provide) computer telephony integration (C)!) capabilities that allow automatic call routing and automatic screen pop+ups containing customer and product information to agents. wor%stations as they are answering or initiating calls

*ales -orce

utomation8 )hese are tools that automate the collection and

distribution of all types of sales information )hey allow for the design of sales teams based on defined criteria Calendar management" activity management" sales reporting and forecasting" lead distribution" and trac%ing sales contacts with customers and prospects are some of the myriad of capabilities offered within these solutions Many also provide access to internal and competitive product information as well as the automated collection and distribution over the !nternet of relevant e$ternal information such as brea%ing industry news and customer+specific events 0ophisticated pricing and product configuration engines and third+party channel management capabilities are also available


utomation8 )hese applications provide the ability to create

automated mar%eting campaigns and trac% the results 4enerating lists of customers to receive mailings or telemar%eting calls" scheduling automatic or manual follow+up activities and receiving third+party lists for incorporation into the campaigns are all typical functions !nternet personali'ation tools are offered here to trac% behavior on a 7eb site and allow tailoring of the contact e$perience" or generation of specific cross+ selling opportunities" based on this behavior automation suites !nbound and outbound e+mail management capabilities are also becoming popular components of the mar%eting


Customer Relationship Management Eet.s ta%e a closer loo% at the mar%eting automation component because it has been positioned as the solution for all CRM analytics

Campaign Management
0egmenting customers" generating targeted mar%eting campaigns for these segments and trac%ing results are important parts of CRM analysis !ntegrated M& tools provide these capabilities and provide campaign offers and results directly to the customer sales and support processes !ncorporating offers and solicitations into the common contact repository and prompting contact agents to follow+up on campaigns can yield dramatic benefits 0ome of the features provided are,

9lanning mar%eting activities and developing campaign hierarchies 3utlining mar%eting campaign ob2ectives Aefining campaign success measurements Coordinating multiple channels and event triggers to automate response actions 8uilding and testing sample campaigns on a subset of customers 0toring and reusing content from previous mar%eting campaigns Measuring campaign effectiveness by lin%ing directly to call center" front+line !mporting third+party target lists )rac%ing fulfillments supplied to the client via each channel to avoid duplication )rac%ing customer in-uiries related directly to campaigns )rac%ing sales force closures related directly to campaigns

employees and sales force

and ma$imi'e effectiveness

Internet (ersonali?ation
9ersonali'ation is the ability to trac% and respond to customers in an individuali'ed fashion based upon their past contacts and behavior )he true value of personali'ation in CRM is when it e$tends beyond the !nternet to encompass all customer contacts across the organi'ation 8y integrating personali'ation into the front+office applications" every contact with your customers can be well planned and personali'ed )his is a good e$ample of the acceleration of analytics into action #eatures of personali'ation tools include,


Customer Relationship Management

Collecting information on !nternet site visits &ddressing customers who visit the site by name and remembering their &llowing visitors to customi'e content to suit their purposes 0howing customers specific content based on who they are and past behaviors 3ffering specific products (on the !nternet or over the phone) based on past &llowing for the possibility of self+ad2usting campaigns and offerings based on !ntegrating technologies and techni-ues for optimal customer understanding based



customer behavior

on transaction history" demographic analysis and collected information

E%Mail Management
5+mail management capabilities are used in two ways in M& + inbound and outbound !nbound e+mail management capabilities assist organi'ations in handling inbound in-uiries from customers 7hile on the surface this would seem to be a purely service+oriented activity" organi'ations are lin%ing these facilities to their personali'ation technologies and thus tuning the resulting communications on the basis of CRM analytics 8enefits of this can be -uite high as it offers a chance to e$tend personali'ation techni-ues to multiple communication types 3utbound e+mail management capabilities provide the ability to construct and e$ecute permission+ based mar%eting campaigns (where the dialog has been started with a customer via e+ mail communications) and are said to be up to 10 percent more successful than traditional direct mar%eting at a fraction of the cost #eatures include,

&utomation of the targeting and sending of mass e+mails &utomation of mass e+mail responses Mse of decision engines to parse information from incoming e+mail Crafting responses to incoming e+mail without human intervention



Customer Relationship Management

A.2 Closing the ,oop % dopting an rchitected *olution

Iow that we understand the CRM analytic capabilities offered with M& solutions" what.s the catch> 7hen M& modules are implemented as an integrated" open part of an enterprise business intelligence environment" there may be no catch )he catch is the temptation to implement these front+office product suites and bypass the enterprise as a whole and the data warehouse specifically 7hile this automates certain types of mar%eting activities and integrates these activities to the front line" it lac%s the depth" breadth and share ability of an architected data warehouse solution )he organi'ation is deprived of the more sophisticated forms of CRM analytics" forming yet another departmental silo of analysis" furthering the very data mart chaos and inconsistency that the data warehouse is designed to prevent Eet.s e$amine the Corporate !nformation #actory (C!#) architecture to determine where the M& integration points should be #igure 1 illustrates the C!# &s stated earlier" the C!# provides a high+level technology road map for organi'ations wishing to develop CRM initiatives )he C!# is a logical architecture whose purpose is to provide a framewor% for implementing integrated technology across all areas" all departments and all functions of an organi'ation 8uilding a framewor% such as the C!# enables organi'ations to share customer information freely and distribute analytical results to all individuals in the organi'ation that need them )he C!# consists of three primary types of CRM systems

7usiness 9perations are the core operational systems (billing systems" product or
policy systems" call center and sales force automation systems" etc ) that run the day+ to+day business processes in an organi'ation !nformation originates in these systems and flows through a data ac-uisition process into the rest of the C!# where it is consolidated and integrated for strategic and tactical decision ma%ing #ront+office solutions generally reside here as they facilitate the day+to+day sales and service processes

7usiness Intelligence provides the capabilities re-uired for the strategic decision
ma%ing in the organi'ation 8usiness intelligence consists of the data warehouse" data marts and associated analysis tools" and can provide the technology infrastructure and information necessary to manage the comple$ relationships and analytics re-uired to


Customer Relationship Management understand CRM interactions 9roperly architected" the M& components of the front+ office applications would reside here

7usiness Management enables organi'ations to act on the analytical results

generated within business intelligence 8usiness management consists of the operational data store (3A0) and its associated transaction interfaces as well as the associated oper marts 8usiness management systems are sub2ect+oriented" integrated" current+valued and supply a single point of access for information across the enterprise &n enterprise customer profiling system is a good e$ample of a CRM business management function )he primary integration point for the M& components is the data warehouse contained in the business intelligence environment )he data warehouse is defined as a sub2ect+oriented" integrated" time+variant" cleansed and non+volatile collection of data for strategic analysis Cou can thin% of it as a big buc%et of generic" detailed" enterprise+wide" static and historical data )he data warehouse can serve as the source of data for data marts and for the M& components (which are actually 2ust another set of souped+up data marts) Mnli%e the data marts or M& components" the data in the data warehouse is not set up for a particular application or department )he data warehouse consists of standardi'ed" consistent pieces of data 8y constructing the data warehouse in the most generic and fle$ible way possible" you can build 2ust about any data mart for CRM analysis Cou are only limited by your technology and the data that you can ac-uire from your operational systems

)he data warehouse reflects the enterprise.s view of data in terms of business rules

and strategic re-uirements 8ecause the data in the warehouse is to be used for multiple CRM analytical purposes spanning multiple departments" it must accommodate and reinforce the enterprise.s vision of its CRM initiative

!t is optimi'ed for fle$ibility )he data must not display a bias or pre2udice toward

any one %ind of analytical processing #or e$ample" if the data warehouse is designed using a data model that is pre2udiced toward %nown data relationships or certain business processes" then analytical activities that search for un%nown relationships are compromised or" in effect" eliminated


Customer Relationship Management

!t provides detailed data for subse-uent use by the data marts 8ecause the data

warehouse must be the source for data marts containing aggregated and summari'ed data" e$ploration warehouses containing detailed data" data mining warehouses containing statistical samples of data and M& components which fall somewhere in between in terms of detail and history re-uired" it must contain the proper level of detailed data to satisfy these very diverse re-uirements )he goal is for the data warehouse to have the 6least common denominator6 level of data for the data marts and the M& components !t must serve star schemas" cubes and flat files for statistical analyses" and subsets of data for ad hoc -uerying )he !nformation #eedbac% loop" running across the top of #igure 1" is the other %ey component of the C!# for integrating M& components )his is the set of processes that transmit the intelligence gained through usage of the strategic C!# components to appropriate data stores )his is the mechanism by which we push 8! 6out to the masses 6 !t is also the mechanism by which we allow the M& components to receive information from the data warehouse and to feed information bac% into the data warehouse or on to the operational systems or 3A0 5$amples abound of storing the results of 8! analyses in operational systems such as the front+line applications 3ne such e$ample is to store the results of a customer lifetime value (E)J) analysis + that is" the actual score given to each customer based on their calculated E)J to the enterprise )he numerical values generated from such an analysis can be stored in the front+office system and accessed by the M& components during the generation of campaigns or scripts for call center agents 8ehavior toward each customer is altered based on the %nowledge of the customer.s E)J score =igher valued customers may receive different campaign solicitations than those with a lower score Conversely" the solicitations generated by the M& components should also be transported via !nformation #eedbac% into the data warehouse )his allows all analytic applications in the organi'ation to ta%e advantage of the valuable information generated by M& components 8eware of vendor sales pitches that contain phrases such as 6our M& module can drive your entire mar%eting process"6 or 6M& provides a direct lin% between CRM analytics and your customer contact points 6 7hile the capabilities embodied in the M& modules do provide significant value" they do not provide sufficient sophisticated analysis capabilities to be your sole vehicle for all CRM analytics !nstead" bypass the 19

Customer Relationship Management hype" implement M& capabilities that ma%e sense for your organi'ation and ensure that M& modules use the information feedbac% mechanism to feed information to and receive information from the data warehouse or operational systems 0taying true to an architecture such as the C!# will provide you with the guidelines necessary to build the integrated customer information environment re-uired to drive your CRM strategies

A.3 Be: Customer Management &ools -or ;igher IC and (ea+ 7usiness Results
)o create a sustainable competitive advantage through CRM or customer management and mar%eting processes" a business must master leading+edge intelligence tools that raise its organi'ational !H (intelligence -uality) to pea% levels #ully+informed business decisions" fully+informed tactics" and relevant" right+time value propositions to individual customers N re-uire an integrated infrastructure that can capture" analy'e" and optimi'e information from across the e$tended enterprise including all customer channels N with increasing speed and synchronicity )he best value propositions will be created when a business has the CRM tools to do the following, B 5nderstand the economics of 'our customer relationships both today and in terms of individual lifetime value N to better anticipate the migration of customer assets over time( B Improve 'our abilit' to evaluate and use ever' customer interaction as actionable mar%eting opportunities with rules driven lead management tools( B Cultivate highl' relevant and profitable dialogues with customers across all channels" including the e+channel" for better strategic brand and customer e-uity management( B lign business resources and customer communications for effective tactical process e$ecution that balances customer e$pectations and company ob2ectives( B Master sophisticated multistep and event%based mar+eting and %now when your customers are most receptive to offers and messages( B Intelligentl' manage the e%channel to drive revenue growth across all channels( and B ,everage the full po:er of a real+time" enterprise+wide data warehouse


Customer Relationship Management

Chapter # D. CRM Initiative D.1 Implementing a CRM Initiative

&ccording to the surveys" through the year 100; only :?L of businesses will accurately forecast the implementation cost and R3! pro2ections before initiali'ing a CRM strategy" and less than 10L will stic% to the guidelines and initiative plans theyve established without veering off the designated course to an unsuccessful destination )his is an avoidable situation that mainly illustrates the infant growing pains many companies have when trying to wrap their arms around any new business strategy !ne$perience with such an important" yet often difficult" strategy comes from it being a young and untested initiative !f a business has done their homewor% and intelligently forecasted the resources needed to fulfill a CRM initiative" the pains and pitfalls currently being e$perienced will lessen and the benefits will increase !nitiali'ing a CRM campaign and carrying it out for the long haul is a pro2ect that involves hands from throughout a business" from customer support personnel" to !) professionals" to obvious %ey individuals li%e CRM pro2ect managers #rom the person ta%ing incoming phone calls and providing accurate service to the caller" to the database+analy'ing software that efficiently and smoothly manages and processes customer data" to the front+end 7eb site that is tailored to individual customers through such things as preferred language and topics of interest" every facet needs to wor% in con2unction 8eing able to touch all points of customer interaction re-uires a comprehensive set of software that is effective and comprehensive &n intelligent database system that can support and store many users and their information is critical )his ma%es customer management very streamlined and easier &dditionally" the ability to instigate highly specific -ueries that result in rich" pinpoint demographic information is also an invaluable part of any CRM implementation )he cost of re+ gearing a business to be customer+centric depends on each case and can only be calculated with that in mind )here is no universal e-uation in which to plug numbers or OgeneralP pro2ection figures that can be applied across the board #act is" CRM initiatives are company+wide endeavors and become more elastic and abstract because of this Conse-uently" assessing costs is not as simple as chec%ing the price tags on CRM software 9redicting costs must be done through a uni-ue loo% at every case


Customer Relationship Management !n the end" the result of a successful CRM campaign will eventually minimi'e costs" such as the high price of luring and enticing new customers" and wont brea% the ban% of any company !n fact" businesses will see an e$tremely healthy increase in profits while their costs will level off to a very manageable point if theyve succeeded in their CRM goal

D.2 *even *teps to Managing 2our CRM Initiative

1. 7usiness anal'sis8 -ocus on 'our customer data%collection process )he first step in your CRM pro2ect should be business analysis )a%e a step bac% and loo% at the areas of your firm that deal with customer data (most of your firm" probably) =ow well are you handling data right now> &re you collecting all the data you want from your clients or would you li%e to collect more> !s this information accessible by all those who need it> Ao you ever have to reenter information as the client moves from Mar%eting G 0ales through to )ime G 8illing> 2. Beeds anal'sis8 Ma+e a list of 'our customersE needs &s you as% yourself these and other -uestions" ma%e a list of your customers. needs 0tart with the absolute essentials at the top 5$amples of these needs may include collecting certain types of information" a centrali'ed database" scalability" and capability to access the system remotely &n important note to rememberQthis list should include all your essential needs" even the needs met by your current system &s you wor% through your list of essentials" begin to add nice to haves )hese are needs that you would li%e to meet but are not critical to the success of your CRM system Ma%e sure your whole pro2ect team contributes to this listQyou won.t thin% of everything on your own 3. (roduct evaluation8 Compare vendors and products &fter you have your list of needs compiled" you can start comparing vendors and products &s you are loo%ing at features offered by the different products" try to cross the critical needs off your list first before you loo% at nice to haves )here will undoubtedly be products that meet a lot of your nice to haves" but are lac%ing in one or more critical needs Critical needs must be met so that the time" money" and ideas given to the CRM pro2ect do not change systems for the sa%e of change 7hen you are ma%ing your pro2ect plan" allow plenty time for this phase !t is very important not


Customer Relationship Management to rush through your evaluation )a%e your time" view lots of demos" and as% lots of -uestions $. (roduct configuration8 Ma+e the s'stem fit 'our firm Io matter what product you choose" there will most li%ely be some configuration that needs to be done to ma%e the system fit your firm )reat this as a subpro2ect with its own pro2ect plan that includes timelines and milestones Many products are highly customi'able at the front end" but far less so when they are implemented Aon.t get poor results because you sped through this step Customi'ation may not be all at the software end( you may have to do some process reengineering in your firm" as well Remember to document everything Ma%e a user.s manual for the software" and a process manual with flowcharts for the business processes A. (ilot implementation8 Roll out a small pilot to mar+eting first &fter you have customi'ed the system to your specifications" roll it out in a small" pilot environment 0tart with your Mar%eting users( they will use the software heavily and will be able to provide you with some high+-uality feedbac% Keep it in a small group until you have the system customi'ed the way you want it 7hen you have reached that point" roll it out to all users D. -ull implementation8 Communicate :ith users to e6plain the change &s you roll the system out to all users" this will be a significant change for most of your users !n addition to learning a new software interface" many users will be faced with entire new business processes )he biggest factor here is communication Ma%e sure your users understand why this change is ta%ing place( don.t 2ust mandate the change Mse training sessions and documentation to assist the users with the new system F. Evaluation8 -ollo:%through for a successful implementation &s more and more firms are implementing CRM systems" plenty of success stories are emerging )he firms that e$perience successful implementations have a plan from the beginning and follow it through to the end #ailed implementations often are the result of choosing a product that does not meet the firms needs or poor communications between pro2ect teams and end+users #ollow these < steps to managing your CRM initiative for a successful CRM implementation e$perience


Customer Relationship Management

Chapter # F. CRM Implementation

F.1 &he Implementation (rocess 3no: the re@uired commitment for CRM implementation success
Many companies thin% that choosing a solution is the hard part !n reality" choosing a system is relatively easy !mplementing a system is the hard part of the process !n choosing a solution it is common for a team to be brought together to develop a needs analysis document !t is not uncommon for teams to spend months developing selection criteria and subse-uently choosing a vendor )ypically" however" less thought is put into how the solution is going to be implemented which is one of the reasons for the well documented" high failure rate Mnli%e bac% end systems (5R9" 0CM" etc) the use of which is re-uired for day+to+day operation of a organi'ation" companies and employees have lived without CRM and may be able to continue doing so 5ach person has their own way of doing things and those habits are difficult to change )o overcome all of the possible obstacles" CRM must become part of the culture of an organi'ation and people must recogni'e that by using the system they are helping the team become more effective as a whole

F.2 Implement nd ,earn &he 7asics -irst

!t is no surprise that once companies select a solution they race to implement that solution Customers have been sold on the return on investment (R3!) of the solution" and %now that R3! will not come until the team is effectively using the solution )he common mista%e here is trying to do too much at one time )he reality is that users who are overwhelmed by a tool end up not using it !t is important that you establish and focus on short" medium and long+term goals &lthough often overloo%ed or assumed" the first goal is to ma%e sure that the user group is proficient on the base functionality of the system Msers need to be able to comfortably duplicate what they have routinely been doing in the new system #or instance" if inside sales receive incoming phone calls( do they %now how will they log those in the new system> !f outside sales ma%e sales visits" how can they eliminate filling out call reports> =ow are people going to send email and create letter and :;

Customer Relationship Management manage their tas% list> Msers who -uic%ly become proficient on this base functionality will be more apt to want to learn more and reap the potential added benefits of more proficient use of the new system

F.3 9utline n Implementation *trateg'

)he first step of implementing a new CRM system is to determine a strategy )he implementation strategy should be developed with the software provider to determine and document the process to roll the solution out to the user group Huestions li%e O7hat is the timeline>P O0hould everyone be brought on at once or do a pilot>P O7here are the strengths and wea%nesses in of the company and the individual users>P all need to be answered Mser champions and administrative champions need to be selected Eoo% within the organi'ation to determine whom the power users will be and solicit their support on the pro2ect !dentify those users who will be the most reluctant to change and help them understand how this will benefit them (3ne of the most effective ways to overcome reluctance is to help each reluctant user to find one or two things that will ma%e their 2ob easier so that they begin to see the power of the system for themselves) 0hort" medium and long+term goals need to be established and monitored for each department and for the organi'ation as a whole Companies may find that they want to trac% one metric for inside sales" another for outside sales" and a third for mar%eting 0ome companies have chosen to motivate users by offering incentive compensation related directly to system utili'ation 5ach organi'ation is uni-ue and goals and incentives need to be thought through on a case+by+case" department+by+department" and possibly user+by+user basis

F.$ Invest &ime In &raining

)raining is a ma2or component of long+term success and should be budgeted for sufficiently =aving the software provider spend one day training users is not enough to be successful )raining should be divided into multiple stages designed to fit the particular user group needs )hose stages may include beginner user training" advanced training" trainer training" goal+specific training" utili'ation reviews" and users groups to name a few


Customer Relationship Management 7eginner 5ser &raining8 Most users first e$perience with their new CRM tool will be during beginner user training which is intended to get users comfortable with all of the basic functionality of a system and should be mandatory for all users Msers will not become an e$pert in one day Mse this time to ensure that everyone is comfortable enough with the system that" once the trainer has gone" they can do all of their routine tas%s in the new system 8rea%ing up beginner user training into multiple groups over multiple days will allow users to use the system while the trainer is still available" and to wor% through real life situations &rainer &raining8 0ome organi'ations opt for training a core group of user champions who will then be responsible for training the entire team )his allows companies to rely more heavily on internal resources )his may re-uire an additional upfront e$pense but should allow minimi'ation of future training costs" especially for larger user groups 5tili?ation Revie:s8 &fter beginner user training plan to set up utili'ation reviews" both internally and with the solutions provider" to trac% usage and to uncover issues before they become real problems Most systems have built in tools to monitor successful usage of the system )ypical -uestions that need to be answered are O7ho is using the system>P O7ho is not using the system>P O7hat are they using it to do and are they following the established standards>P O&re we achieving the goals we set for ourselves and if not why>P O7hat additional assistance (training or consulting) do we need from our solutions provider>P O7hat else should we be doing in the system>P O7ho else should be on the system that is not currently on the system>P 8y wor%ing internally and with the software provider to trac% usage and monitor success and failure throughout the user group" the Company will be able to ma$imi'e the benefits of improved sales process management 5ser Groups8 &nother component of success will be internal and e$ternal user group forums 3n some set interval (daily" wee%ly" biwee%ly)" especially in the beginning" internal user groups can be very useful to help team members learn from each other and to help ensure that standards are being developed and followed 5$ternal user groups are generally coordinated by the solutions provider Aetermine whether or not user groups have been set up and plan to participate in them )hese groups provide an e$cellent way to see how other similar companies are using the system and learn from their successes and mista%es


Customer Relationship Management dvanced and ongoing training opportunities8 !nvestigate what additional training opportunities are available Most solutions providers have established programs for advanced user training Many have web+based training" on+demand training and other periodic course offerings that focus on clients specific needs )here is not one Rright way to train & well chosen software provider will have the tools in place to guide the team through this process based on the needs" goals and budget of the user organi'ation


Customer Relationship Management

Chapter # H. CRM *uccess H.1 Introduction

0eeing CRM initiatives ta%e hold and begin to pay off is often a waiting game !ts not a Oflip+the+ switchP product that automatically spits out results or something that will ta%e affect overnight and cause profits to s%yroc%et while you sleep )he pu''le must be completed and time must play its part before true success will be seen =owever" through dedicated and smart planning" businesses should see mar%edly increased profits" as satisfied customers will continually re+visit them 4radually" as businesses get to %now their customers" their customers get to %now them" and a closely aligned partnership is formed )his one+to+one relationship is the catalyst that spar%s both lifetime customer loyalty and revenue increase

!n the true spirit of thin%ing outside of the bo$" e$perts at the 4artner 4roup believe Othe most successful organi'ations will be those who" through innovation and focus on business effectiveness rather than merely efficiency" manage to brea% the mold of traditional business thin%ingP 8eing effective is paramount )he end goal of better serving customers and enabling a high percentage of customer retention cannot be met with out creative thin%ing and effective planning and actions )he tas% of perfecting the relationship between business and customer is always on going and re-uires special dedication and innovation as the commerce mar%ets continually change and :*

Customer Relationship Management fluctuate &nd over time" customers change" as does their behavior and needs" and business must be able to respond to that 8eing on the cusp of the industry and always having a hand on the pulse of the customer is %ey for success &s the CRM initiative begins to ta%e hold" %ey players will soon see patterns emerge among customers" will discover what a productive strategy is and what is not )his is the essence of a successful CRM pro2ect, being able to really %now what will wor% for your customers" what satisfies them" and what %eeps them loyal )he ability to get an accurate gut feeling about the mar%eting campaigns" new products" and the type of policies customers will respond to is invaluable )his %ind of customer %nowledge only comes from really digging in and being savvy about how you go about understanding the people that you hope will continually call on the services and products of your business )he R3! in this case would be compelling indeed

H.2 dvice for 7reeding CRM *uccess8

1 8uy the best pac%age you can afford Choosing a high+end system that allows for growth is %ey" Monster com.s Eiddell says Monster com has rolled out 0iebel 0ystems. sales force automation software to *00 users since implementing the software in Iovember 199* 7here low+end pac%ages brea% down is in their ability to handle comple$ definitions of customers" he says Monster com established formal guidelines for defining customers across divisions and applications so salespeople can access clean" consistent data 1 Choose wisely #igure out who you need to reach and then find the software that will help you accomplish that 8efore settling on RightIow" M0# scrapped a previous CRM pro2ect a month into the implementation after concluding the software didn.t wor% the way the university wanted )oo often companies choose software before they have defined the problem" &%in says 6!.ve seen it lots of times + .=ey" this is a neat application Eet.s buy it and then figure out how we can use it here .6 M0# tapped Right Iow )echnologies. e+mail management software to help the !) department" financial aid office and other administrative groups that were bogged down with customer service in-uiries from ;0"000 students and staff


Customer Relationship Management : 8uild and maintain a relationship with -uality consultants Consultants are important not only in an initial deployment" but also as pro2ect parameters change + which they will" Eiddell says Monster com wor%s with CRM consultant &%ibia" which lets the company -uic%ly e$pand its CRM resources when necessary 5ach time Monster com ac-uires a new company" Eiddell.s priority is to -uic%ly get those new team members up and running with 0iebel sales tools + a process that sometimes re-uires e$tra hands ; Rely on internal resources Consultants are helpful" but it.s important to maintain ownership of a CRM pro2ect 6Iobody.s more interested in our success than the team at Monster com"6 Eiddell says 9lus" somebody has to run the software once the consultants are gone ? Ma%e sure everyone is onboard !t.s important to have buy+in throughout the organi'ation" &%in says #inancial support is necessary" he says" 6but more important is an agreement to use the product universally 6 !t.s frustrating for end users if they e$pect to find a single source of customer service information online and it turns out a %ey department is missing from the site @ &lign your pro2ect goals and implementation schedule 8er%son and his team at )homson #inancial try to stic% to eight+ to 11+wee% pro2ects" rather than rolling out everything to everyone at once 9lus" no department is going to need every function in every application( users would be overwhelmed" 8er%son says )homson #inancial is in the process of upgrading its Jantive applications to 9eople0oft * CRM + the new !nternet+based suite from 9eople0oft" which ac-uired Jantive in 1999 67e tend to implement in small" manageable phases"6 he says Companies should identify their biggest pain points and greatest opportunities for return on investment" and ma%e those an implementation priority < 0tart with a low+ris% pilot 3ne pro2ect up and running -uic%ly can validate your CRM concepts" 8er%son says Choosing a relatively simple" straightforward pro2ect + such as outfitting a department that doesn.t re-uire integration with other bac%+end systems + is important !f you start with a comple$ trial" it can really drain momentum" he says * &im for configuration" not customi'ation )a%e advantage of today.s CRM tool sets" 8er%son says Jendors have built more robust configuration fle$ibility into CRM applications and recommend that users minimi'e customi'ations 0o if you can brea% ;0

Customer Relationship Management the habit of writing custom code to accommodate uni-ue business processes" it will be well worth the effort when it comes time to upgrade" 8er%son says 9 Aon.t underestimate data re-uirements )he time and resources needed for data conversion and cleanup will always be more than you thin%" 8er%son says 10 9rovide ade-uate training 6!f you have the time and the resources" train in advance of rollout"6 &%in says )he university departments that are least enthusiastic about the RightIow products are the ones that weren.t ready for it" he says 11 0et communications standards !n hindsight" &%in wishes his group had set content standards among departments before going live with the pro2ect instead of trying to do it later &t M0#" e+mail in-uiries are routed to as many as :0 different departments 0etting standards for formatting responses can help maintain consistency of service 11 7atch the details CRM re-uires a team that is willing to ta%e ownership of even the most minute details Monster com has team members who maintain the software" team members who constantly handle re-uests for changes and team members who police data -uality


Customer Relationship Management

Chapter # !. CRM (roducts !.1 =hat 2ou<

CRM products are automated applications that support the accomplishment of corporate goals related to customers" such as increased revenue and/or increased sales efficiency (i e " better results with lower e$penditures from sales" customer service" and mar%eting ) )hese technologies capture customer data from across the enterprise" then analy'e" consolidate and/or distribute it for use across the multiple customer facing departments (or processes) within the company CRM products can be grouped into ? general categories,

re *ome CRM (roducts and =hat Can &he' 4o -or

CustomerI(artner *elf%*ervice *'stems8 enable your customers" suppliers"

and/or partners to use the internet to gain information that is directly relevant to them )his may include customi'ed product elections" order status update" on+line order entry" or self+guided -uery and response 5$amples of these systems include email response management systems" web personali'ation systems" web+based order+entry" and web self+help

*ales -orce

utomation *'stems8 provide tools for your sales people to

maintain their contacts" trac% sales prospects" provide sales forecasts" enter and trac%


Customer Relationship Management orders" and provide customi'ed -uotes for clients 5$amples of these systems include" and on+line sales forecasting and order+trac%ing

Call Center Customer *ervice *'stems8 provide support for staff that answer
client -uestions or respond to re-uests for dispatch services 5$amples of these systems include web+based customer service" customer service call trac%ing" improved customer service representative (C0R) access to client information" and automated dispatch and trac%ing

9perational 7illingI9rder *'stem Integration *'stems8 provide

integration (as well as migration) between customer+facing (front+end) applications and the production (bac%+end) order+status and financial systems that contain the data that clients and partners may see% )hese systems are not only CRM systems" but rather the components of larger software suites that may include CRM 5$amples of these systems are pac%aged accounting and manufacturing systems that have CRM front+ends

&echnolog'%Enabled ,ead Generation *'stems8 enable targeted mar%eting

based on client needs and/or past business trends )his lead generation could be dynamic (emailing offers or customi'ing web content) or static (providing targeted databases of clients by type) )hese systems include customer data mining" automated mar%eting campaigns" and customer personali'ation tools


Customer Relationship Management

!.2 =hat 3inds of CRM (roducts 4o =hat<


Customer Relationship Management

!.3 ;o: Much 4o CRM (roducts Cost<

&ccording to 5rin Kini%in at 4iga4roup" CRM (software only) costs vary as follows, & limited system (in terms of range of functions or customi'ability) usually

supports less than ?0 users and costs around D?00/user & departmental system (which supports ?0 N :00 users and has a more increased

range of functionality and increased ability and need for customi'ation) usually costs around D1?00/user &n enterprise system (which supports over ?00 users and has a higher range of

functionality and introduces dramatic change management issues and re-uirements for customi'ation) costs around D:?00/user 0ome vendors -uote this functionality for D1000/user !mplementation and customi'ation costs will add from 1?L (limited system) to

100L (departmental) to :00L (enterprise) for software installation" implementation" and customi'ation 0ome vendors estimate as much as ?00L for implementation and customi'ation )his does not include vendor maintenance and ongoing customi'ation costs as well as cost of organi'ational process changes


Customer Relationship Management

Chapter # 1". E%CRM 1".1 E%CRM8 4elivering a *uperior Internet Customer E6perience
=ow one !nternet retailer delivers the highest -uality customer e$perience" builds customer loyalty" and drives revenue

Retailing ;ealthcare and (harmaceuticals on the Internet

!n 199<" a billion+dollar retailer of pharmaceutical" health" and beauty products decided to e$pand its business to the !nternet" launching a web retail operation as a division of its bric%+and+mortar operationQthe first in its industry to go online &s with many of the early web+based forays into e+commerce" this site was deployed primarily to establish a web presence for the company )he initial site was not designed" however" to anticipate the high volume" high availability" and competitive functionality re-uired as traffic and content grew and new players entered the mar%et )he site" its applications" and its underlying infrastructure couldnt scale to accommodate thousands of orders per day" couldnt be enhanced in web time" had inade-uate capability to support applications and was unstable as a whole !n addition" the order fulfillment process was unable to scale to %eep pace with growth of the !nternet business channel )he company decided to discard the entire OhomegrownP site and began again

EMC and Its (artners *tep up to Meet the Challenge

!n 1999" the company turned to 3racle" 5MC" and Cisco to help implement an e+CRM application solution that could deliver, J & highly available" scalable" secure" and manageable technology infrastructure that would %eep pace with rapidly changing customer numbers and mar%et conditions J Rapid time to mar%et" as competitors had established a five to si$ month lead in site functionality J &n outsourced" hosted site with an 5MC 9rovenS application service provider (&09) that could deliver a 1;$<$:@? service level commitment and technology on


Customer Relationship Management demand )he resulting solution consisted of a highly functional e+CRM web site using the 3racle CRM e8usiness 0uite" built on a modular 5MC 0torage &rea Ietwor% hosted at a third party &09 data center location )he company implemented the solution in three phases, J )he !mplementation 9haseQdesign and development J )he 9roduction 9haseQsolution deployment and stabili'ation J )he 4rowth 9haseQdelivering more functionality to more users

Immediate/ *ignificant 7usiness Impacts

)he companys 5+!nfostructure enables the web site to %eep pace with multiple simultaneous in-uiries from hundreds of concurrent users )he customer view is simple" and the company has been able to increase its level of customer

1".2 Customer Relationship Management/ :hat reall' matters<

)o run a successful customer support business that adopts customer centricity approach demands control" control over process" technology and finally your staff Consistency and information sharing became on top of the Menu for many organi'ations )e core of any CRM initiative is the use of %nowledge about customers to either align your process with it or you align them with you Knowledge must be up to date and would be able to categori'e" filter and sort every segment of it Customers may prefer to use e+mails" others use the telephone &nd as we all %now that some customers do not feel comfortable with technology and demand a face to face interaction Customers li%e to interact with the same service regarding any transaction with the organi'ation i e , single view of your organi'ation" while on the other hand" organi'ations that adopt a single view of their customers approach envelops the customers with in the organi'ation mesh 0o" what really matters> T Class & customer support centers characteri'ed by the following, B Customers information is up to date and accurately inserted in the data base" and it is accessible to all customer facing points


Customer Relationship Management B 0taff has been carrying out customer support training and attaining in house standards B Calls and e+mails responses are regularly audited and monitored to maintain level standards B !nternal process e$ceed customers e$pectations B 4&9 analyses are carried out on regular basis (-uarterly" annuallyT) for individuals and also for processes 0tatistical data should not be all that matters" well after all what do they actually tell you or indicates> )he -uantitative approach is rather to satisfy internal demands than customers =ow many repeated customers do you have each year> )his is really what matters" -uality of service leads to a greater customer satisfaction and repeat of business which by its role will be reflected in the balance sheet eventually !nternal slogans are for internal consumption #or customers" perception e-uals reality

1".3 Customer Relationship Management

Customer relationship management (CRM) is the most tal%ed about of the three enterprise applications that are the focus of this paper &s the economy remains sluggish and customers remain cautious" the need and desire to get closer to customers are the primary means of differentiation in the mar%etplace Companies see%ing this differentiation must as% the -uestions below 1 7hat does getting OcloseP to customers mean> 1 =ow do we get close to customers today> : =ow do ! drive or e$tract new revenue using CRM> )he first -uestion has many possible answers !ndeed" the companies that e$plore all possible methods are better positioned to get a better picture of a customer #or my purposes" ! will only focus on a few critical aspects )he first is to uncover patterns of buying from the customer base Mncovering these trends is fundamental to any business 3ne might argue that an e$pensive CRM system is not re-uired to do this )o a certain e$tent" this is true =owever" analysis of buying patterns is different from


Customer Relationship Management that of buying history & customers buying history is only one component of the pattern 3thers include the financial mar%et" demographics" geography" recent mar%eting messages" and other parallel actions such as sales" new product introduction" competitive offerings" positioning tactics" and pricing !n "he lue train #anifesto$ "he %nd of &usiness as 'sual 7einberger and 0earls ma%e the following point "he first markets were markets, not bulls, bears)not demographics, eyeballs or seats. #ost of all, not consumers. "he first markets were filled with people, not abstractions or statistical aggregates+ they were the places where supply met demand with a firm handshake. &uyers and sellers looked at each other in the eye, met, and connected).where people came to buy what others had to sell,and to talk. 7hile 7einberger and 0earls were trying to ma%e a bigger point about the !nternet and its role in current mar%et philosophy" the germane point here is the notion of connection More than anything" strategic companies are trying to figure out how to more effectively connect with customers )hey believe that will be a sustaining factor in their survival )he second -uestion above is e-ually important Ma%ing customers feel uni-ue because you understand their li%es and disli%es is difficult but critical CRM systems allow a vast amount of input about a customer in order to build a comprehensive profile )he simplest e$ample (and one of the most common) is the contact manager concept )here are many sales tools for contact management &n integrated CRM tool can add real+time integration to other systems (e g " financial" order management" and -uality control) 4iving the presales team" customer representatives" and post+sales team the ability to input information about a customer cycle over time builds a profile that enables each team member to serve the customer better 4iving sales management Oone+clic%P reporting capability on leads" problems in the pipelines" brea%down of revenue by product" or other metrics can ensure a more successful forecasting and mar%et strategy implementation =ospitality industries also use CRM systems to get closer to customers Customer loyalty programs li%e fre-uent flyer and preferred guest programs can record ;9

Customer Relationship Management recurring customers preferences and then target specific services to specific customers 4rocery chains monitor purchases to effectively mar%et specific products or offer discounts &lso" if such monitoring identifies that a customer has moved" they will send a Omoving specialP coupon boo% to the customer 5ven in the restaurant industry" companies li%e Mnion 0tation in Iew Cor% trac% patterns to record favorite tables" bottles of wine" and health concerns for patrons )hese efforts help businesses %now their customers better in order to better serve them )he third -uestion" however" re-uires more comple$ analysis =ow can a business derive new revenue opportunities from this data> 0ometimes customer buying patterns can offer new streams of revenue )his comple$ field of analytics is the most difficult aspect of CRM engines" but it can reveal important data #or e$ample" one retailer found that if it lowered the price of a can of tennis balls by D 1?" the sale of tennis rac%ets (a higher margin item) increased !n addition" grocers can trac% not only the brands customers li%e within a given product set" but they can correlate that information to the shelf position where it is stoc%ed 8y measuring trends over time" grocers can determine the impact of shelf position on customers buying habits Msing this information" they can bro%er better deals with the suppliers by mar%eting OpremiumP shelf space )o increase customer satisfaction and effectively manage distribution" many businesses tie their distribution systems into the Iational 7eather 0ervice because a ma2or weather event could affect operations )o %eep customers satisfied" businesses that supply roc% salt and snow shovels must be well stoc%ed for that first" possibly une$pected snowstorm 5$amples abound" but the point is that %nowing your customers today is as important as ever Io so+called Onew economyP will ever change that =owever" we have new" comple$ tools to help us do this( they collect and analy'e information to help us gain closer relationships to customers" derive new revenue opportunities" and target mar%eting initiatives for ma$imum impact 7e must also reali'e that these customers have more ways to interface with organi'ations todayQwebsites" sales reps" cashiers" and call centers to name a few Msing a method (such as CRM) to get a macro view of the customer is invaluable in todays fragmented communication environments =owever" li%e 5R9 systems" CRM systems will only be effective if organi'ations sociali'e the pro2ect goals and actually use the tools )hese are a CRM implementations biggest challenges today !t is not the software( it is establishing use of the software Many corporations have failed at ?0

Customer Relationship Management this I- #aga*ine reports Oone #ortune ?00 organi'ation is on its fourth try at CRM

because the sales force has re2ected all previous attempts at sharing customer informationP (Koch) Changing mindsets must be a top priority CRM systems are evolving !ndeed" out+of+the+bo$ products e$ist that can marginally increase an organi'ations effectiveness =owever" the ne$t generation of CRM is trying to integrate more effectively with an organi'ations 5R9 initiatives to see how customer buying patterns affect manufacturing" human resources" finance" and long range planning !n this environment" the data warehouse is %ey( collecting" storing" and analy'ing information effectively is critical to an organi'ations success at recreating that mar%et of old where buyers and sellers meet" loo% at each other in the eye" and connect

1".$ CRM nal'tics8 >isuali?e 7usiness Intelligence *lo:er Econom' 4emands Methodolog'
4one are the boom years of the 90s when growth seemed unstoppable" no matter what you did Q or didnt do 8ut now" more than ever" your business needs to be more agile" more productive" and more profitable Cou need to wring every iota of useful information from the valuable business data gathered throughout your enterprise" and use it to give yourself a competitive advantage =ow can you accomplish that> 8y implementing business intelligence (8!) software that gives you deeper insight into your organi'ation through greater understanding of the operations of your company !n todays competitive landscape" it is imperative that you thoroughly understand and proactively manage your operations and your customers )he slowdown in the economy has put pressure on !) information technology) departments to demonstrate real R3! (return on investment) on any investments made in new technologies 0o where do you invest> !n 8! software )his investment provides a direct positive impact on your profitability by allowing you to harness the power within the most important untapped asset you already have Q your data Cour peers agree &ccording to a recent 8usiness 7ee% article (Fune 1;" 1001)" the 8! software industry grew by 9L while the software industry as a whole grew only < <L 8! software allows an organi'ation to access" to analy'e" and to share information

ggressive 7usiness Intelligence


Customer Relationship Management across the enterprise using tools and analytic applications !t is the %ey to bridging the information gap in decision ma%ers minds !t is the difference between e$periential" anecdotal %nowledge and actual data 8! can provide visibility into data about your operations that can generate -uic% paybac% engendering better decisions when and where they are needed 8! software ta%es advantage of the investments you may already have made in systems such as CRM and 5R9 by e$tracting value from the data collected within them CRM analytics is a speciali'ed area of 8! software that focuses on analy'ing and ma$imi'ing the lifetime value of customers Most importantly" CRM analytics can help you improve your bottom line by providing better insight into your customers 7hen budgets are tightest" organi'ations need to understand their e$isting customers in order to retain them and to ma$imi'e lifetime value )his minimi'es the significant costs of attracting new customers Cultivating relationships with your high+value customers can have a direct and immediate effect on your profitability

1".A 5sing CRM nal'tics to 5nloc+ Customer 4ata

3perational CRM has delivered benefits to many organi'ations over the last several years 8y automating customer+facing processes such as sales" support" and campaign management" organi'ations have gained efficiencies in their customer operations )remendous amounts of data have been collected about customers and how they interact with your organi'ation at these touch points 8ut the holistic understanding of a customers behavior over time N the ability to identify, analy*e and predict changes in behavior N has been loc%ed inside the vast vaults of CRM and 5R9 data storage systems


Customer Relationship Management

CRM analytics provides the %ey to those vaults and enables insight into customer behavior &rmed with that insight" your organi'ation can now discover the right balance of promotional effort" cost" and support that will result in improved revenue and customer loyalty CRM &nalytics is an area that provides significant and rapid return on investment 7here do you start> &t the foundation of CRM analytics are customer+ centric data and approaches Aata must be organi'ed and managed at the customer level with historical detail covering purchasing and returns behavior" contacts with customer service" payment behavior" and mar%eting response behavior 8eyond data" it is important to think in a customer+centric manner 7hile it is important to as%" O7ho is li%ely to buy this new product if we offer a 10L discount>P" you also need to be as%ing" O7ho are our most profitable customers and how has their behavior changed over the last three months>P )he goal is to ma$imi'e the value of your customers over the entire relationship with the customer" not for a single mar%eting campaign 7henever the need for Ocustomer+centricP data is established" organi'ations typically react by calling for an enterprise data warehouse with data collected from every possible data source in the organi'ation Mnfortunately" the single enterprise+wide data warehouse ta%es too long and costs too much to build before any benefit can be gained & more effective approach is to develop an information architecture that enables you to build smaller" more agile application+centered data marts 0uch a


Customer Relationship Management design is possible today using the much improved capabilities of an 5)E (e$tract" transform" and load) tool as the central repository of your data definitions and business rules (metadata) & central repository facilitates a single version of the truth" even as you build department+ or application+level data marts one at a time )hese targeted data marts must contain both atomic and aggregated data that can support multi+dimensional analysis !t is the ability to -uic%ly view your data along different dimensions and to intelligently drill down into the data that enables you to proactively identify and address issues and opportunities


ccessible/ -le6ible/ Graphical

nal'tic &ools are a (re%

Mseful analytical tools must deliver simple" robust functionality )he tool should provide visual techni-ues that enable any user to easily identify trends" opportunities" and problems without digging through pages of tabular numbers Modern re-uirements should include 7eb+based -ueries" with the delivery of =)ME pages that have hot spots for further rill down & CRM analytics portal should provide easy access to %ey business and customer metrics )hese capabilities allow you to democrati'e %nowledge of the customer" putting it in the hands of the front+line managers tas%ed with ma%ing decisions that affect customer relationships Cour CRM analytics tool must provide you with a complete" customi'able reports that include all the views and the -ueries available to you &ccess to various reports" views" and -ueries should be controlled based on user roles and needs &ll reports and informational views must be available for distribution in both electronic and hard copy formats &nalysis helps devise strategies that ma$imi'e profitability" whether at the promotion level or at the customer or product level Cour analytical tool must be able to ma%e your results actionable by integrating with operational CRM systems as well as with any bac%+office systems that can influence customer interactions #or e$ample" it is important to %now actual e$penses by product or by customer in order to evaluate how certain products or customers contribute to profit


Customer Relationship Management

1".F s+ing the Right Cuestions to Get the ns:ers &hat Matter
* E%75*IBE** I* E>9,>IBG &9 =;ERE B ,2&IC* I*

REC5IREMEB& Iot only does e+business present enterprises with growing volumes of data" it demands increasingly greater analysis )his presents a ma2or challenge, integrating these new and fre-uently disparate data sources into coherent analytical formats Auring the 7ebs early days (of 2ust a few years agoU) most mar%eting activities were relatively static" involving publishing data sheets" product manuals" and other generali'ed mar%eting materials )his model is -uic%ly evolving to include more dynamic applications 7e are moving toward innovative personali'ation technologies that combine rule+based processing" telephony" intelligent content distribution" and other techni-ues to give 7eb companys powerful new abilities to create highly targeted" customi'ed commerce e$periences for their customers and partners #or these techni-ues to succeed" however" businesses will demand greater sophistication in analytical tools 9ut another way" these companies will re-uire on+demand detail on who their customers are( what they want( how they want it( and where and when they want it 0uch %nowledge can only come from business intelligence

E%7usinesses might as+8

V7hat are sales margins" product by product> V7hich forms of advertising are most effective" and for what audiences> V7hich products sold best for calendar event WWW> V7here is online advertising wor%ing> 7here should it be scaled bac%> V7hich customers should we target with direct email> 7ith 5+promotions> V7hich suppliers have e$celled in ship+to+customer time> #or which products>

7usiness%to%business vendors might as+8

V7hich of our suppliers are consistently on time> V7hich of our partners are most fully automated> V7hich of our products are most time+critical>


Customer Relationship Management V7ho among our customers demand the greatest service levels> V=ow should we ad2ust our supply chain to enter new mar%ets>

Integrated 4ata (rovides the Most Complete Information

Clearly" the challenge for business intelligence e$tends to integrating data among sales" mar%eting" and support automation applications" in addition to integrating disparate bac%end data sources !ntegrating and analy'ing customer transactions and data from across the enterprise creates a customerNcentric view for businesses !n todays business environment" customers send real+time clues to their needs and purchasing behavior via their interactions with e+business systems Mnderstanding and optimi'ing the entire customer lifecycle Q from prospect to lead to customer Q re-uires integrating data from front and bac% office systems and across all customer touch points" both traditional and online

*pecific nal'sis for E%business K 7est (ractice Metrics

&nalytic applications improve front office business performance by using pac%aged analysis and %ey metrics to drive best practices across the enterprise CRM analytic solutions help companies use valuable front office resources most effectively by identifying bottlenec%s" measuring performance against industry+ or business+specific metrics" and pinpointing problems and opportunities 7ith e+business+ready analysis integrated with the traditional customer data sources" companies can, VRemove process bottlenec%s in sales funnels by analy'ing deal velocity and revenue attainment V&naly'e Oabandoned shopping cartP behavior to understand barriers to online purchase V!dentify and leverage the most popular 7eb site content and advertising V#ine+tune online promotions and personali'ation by profiling behavior based on customer segmentation V0hare information and best practices in sales and mar%eting by analy'ing successful mar%eting campaigns" product promotions" vertical mar%ets" or win/loss trends V!mprove support by analy'ing bac%logs" case volumes" and scheduling


Customer Relationship Management V!mprove support -uality control by measuring performance against %ey metrics" such as first call closures and time to close VMeasure mar%eting campaign effectiveness in terms of leads generated" clic% through or online purchase" deals" revenue generation" and resulting customer profitability V!ncrease and accelerate sales revenue with deal analysis" funnel optimi'ation" and cross+sell/ up+sell analysis

nal'tics &ools ;elp 7usiness -ocus on the Most >aluable Customers

0mall movements in percentages of customers represent large percentages of profits #or e$ample" a 0eybold study of the #leet 8an% in Iew 5ngland identified that up to ;0L of its customers and products are unprofitable at any time &ccordingly" successful companies not only aim to ac-uire and retain more customers" they also focus on their most profitable ones CRM analytics help companies prioriti'e" grow" and satisfy high+value customers in many ways, Ran% and profile customers by critical dimensions" such as revenue" lifetime customer value" and profitability V0egment and profile customers based on demographics" online session behavior" and propensity to respond to mar%eting campaigns V4row e$isting customers with up+sell and repeat business" online personali'ation and cross+promotion offerings

ccelerated 4ecision%Ma+ing :ith =eb%based pplications

&nalytic applications targeted at business users can increase the responsiveness and agility of organi'ations by ma%ing them alert to changing customer or mar%et patterns Msing traditional decision support products" this information is often delayed" for a number of reasons" such as, V8usiness users are isolated from comple$ business intelligence solutions" and must re-uest reports or analysis from resource+constrained !) or M!0 departments" delaying timely access to information V!nformation in client+server applications is incomplete or inaccessible


Customer Relationship Management

8y pac%aging analysis" accelerating deployment" and putting information in the hands of the business users" analytic applications have the potential of delivering significant Otime+ to+mar%etP value )he Otime valueP associated with decision+ma%ing may be the most important" although difficult to -uantify" factor in figuring the R3! for an analytic application

)he best way to improve a sales forces effectiveness is to empower them with pertinent information on their target mar%et 3n+demand analysis of customer data fuel the R3! for a sales organi'ation by creating a comprehensive view of the customer base" across all customer touch points )he -uantifiable benefits of a sales analytic application come from improving the sales reps effectiveness" reducing the ris% e$posure during the sales cycle" and enabling the rep to sell more product )hese %ey drivers of R3! all lead to increased revenue

)he ability to trac% responses to mar%eting campaigns and profile target customers yields significantly greater returns on mar%eting dollars R3! is traced through improved response rates or clic%+through for mar%eting campaigns and advertisements CRM &nalytics fuel improvements in R3!" which can be measured by more and better customers for your mar%eting dollar

Customer *ervice
)he customer support functions in an organi'ation have significant influence over a companys recurring revenue stream 8y enabling support organi'ations to trac% service levels for top customers" products re-uiring the most service resources" and bottlenec%s to problem resolution" a company can optimi'e service levels" focus support efforts on the most costly problems" and increase customer retention and satisfaction CRM &nalytics allows us to ensure longer customer relationships" reduced customer turnover and lower overall support costs


Customer Relationship Management

7enefits &s companies move from a product+centric to a customer+centric orientation" and as they add new e+business channels to traditional customer interactions" they need the tools to analy'e and optimi'e their efforts )raditionally" performing analysis across the many different systems and information sources about the customer has been a difficult tas%" involving significant data integration" data mart implementation" and e$tensive !) support for analysis and reporting 9ac%aged analytic applications such as 0ynergy Jisual0martS" with pre+pac%aged %ey performance indicators" analytic views" and an easy+to+use interface" deliver the competitive advantage of better business performance information without the e$pense and time of traditional decision support solutions &s a small+ to mid+si'ed business (0M8)" you face even more pressure to ma$imi'e every investment dollar &ll the steps re-uired to implement world+class CRM analytics may seem daunting &s an 0M8" your focus is on ma$imi'ing value and minimi'ing your costs for deployment and maintenance of a CRM analytics system =osted application services" where a software provider provides access through a browser" provide the functionality that can accommodate your needs" minimi'e upfront investments" shorten deployment times and provide the functionality to get you deriving value -uic%ly 7ith todays business environment putting increased pressure on you to ma%e better decisions faster than ever" Jisual0mart provides you with a -uic% and cost+effective way to ma%e an immediate positive impact on your business


Customer Relationship Management

Chapter # 11. Ideas for CRM *uccess 11.1 Revealing CustomersE Beeds *uccess
Many organi'ations have made significant investments in their CRM systems over past five years )he perceived success or failure of these initiatives has" in large part" depended on the organi'ations. ability to clearly define appropriate success metrics at the start of the CRM implementation 7hen a company fails to clearly define its goals" there is no way to accurately measure the return on its CRM investment" and thus" no way to determine if the program was a success or failure Many CRM implementations are challenged from this perspective =owever" there is hope for those struggling with this problem, reporting applications" analytics tools" and wor%flow automation engines are now available at a fraction of what they cost only five years ago )hese applications" tools" and engines are helping businesses discover the hidden 2ewels stored within their CRM databases &s CRM implementations move beyond 2ust collecting customer information and reporting on it" a fundamental driver for many organi'ations is the desire to better understand their customers. needs and preferences Companies want to transform the large amounts of data collected in their CRM databases into meaningful reports that different types of employees can use to do their 2obs better )his desire is driving businesses to ma%e better use of the reporting applications" analytics tools" and wor%flow engines that a few CRM applications now offer )o be useful these new applications" tools" and engines must also be easy+to+use" built+in or fully integrated" and reasonably priced )hese business intelligence capabilities++once only included in the most e$pensive" high+end systems++are now more widely available" but few CRM vendors offer them for an affordable price 8ecause of the new" low price point" more businesses" and the users within these businesses" have the opportunity to implement these capabilities at a reasonable cost

nd (references Is 3e' &o CRM


Customer Relationship Management )oday.s decisions get made at all levels within the organi'ation Cohesive decision+ ma%ing is critical to the success of companies )his means more people stand to benefit from a well+planned CRM strategy as it raises the potential for even greater contribution from each employee to the top line #or instance" 6)o provide our sales and mar%eting team with fast and efficient reporting on our sales activity" integrated Crystal Reports with our Ma$imi'er database"6 said Murray Munro" senior vice president of national sales" mar%eting" and government relations at 4rowth 7or%s Capital Etd 6=aving access to this %ind of information in a user+friendly presentation enables our sales staff to interact with their contacts at a deeper level and allows our mar%eting staff to analy'e trends and ma%e plans for the future armed with %ey information 6 )a%ing your customer relationships to the ne$t level re-uires commitment from everyone within the organi'ation #or companies that are considering a reporting" analytics" and wor%flow automation strategy" perhaps the best advice is a thorough evaluation of your strategic sales" mar%eting" and customer service and support processes )hen measure how the implementation of reporting" analytics" and wor%flow automation can positively impact your company.s results 8y conducting this analysis customers will be in a better position to leverage their e$isting CRM investment 7hen a CRM system is used to its highest potential" organi'ations will have a much better opportunity to drive more intimate" profitable customer relationships

11.2 &op A" (roven Ideas -or CRM *uccess

CRM pro2ects fail++and succeed++for many reasons 7hen they fail it.s often because they lac% guidance !t ta%es a customer+centric vision across all departments and employee levels to be successful !t.s a daunting tas%" but don.t reach for the antacid yet 7hile the formulas for CRM success may differ Aon.t believe it> )he proof is in the process 7hen CRM wor%s" C+level e$ecs ma%e smarter decisions because they have a :@0+degree view of corporate performance( salespeople increase their proficiency and close more deals( mar%eters create more


Customer Relationship Management targeted campaigns with better insight into their effectiveness( and employees++ especially C0Rs++become more productive and efficient Consider the ?0 ideas list here a guide to proven strategies for starting or resuscitating your CRM efforts )he sales" mar%eting" customer service" and company+wide ideas are color coded to show where they best fit in the organi'ation Companies following these strategies are the ones truly committed to long+term CRM success 1L 8rea% down those silos =aving an integrated customer service solution is critical to maintaining customer service Aisparate databases of customer information prevent companies from gaining a holistic view of the customer throughout the organi'ation 2L Ma%e a business case 9rior to selecting the CRM system" monitor employee behavior and performance to identify which business processes can benefit the most Aetermine how the CRM system might help share information and resources" cut clutter" administrative duties" and duplicated tas%s 3L Keep customers in mind 7hile the technology that enables successful CRM is important" at its heart CRM is a business strategy #inding out how technology can enable all of your company.s touch points to facilitate its corporate strategy is %ey 6)he software is only there to enable your implementation of a CRM strategy" not the other way around"6 says !''y #ranco" CRM leader for Iorth &merica at Cap 4emini $L &s% and ye shall receive #arm Credit 0ervices of &merica wanted to become more vital to its customers and the overall rural agricultural credit business" where customer interactions are largely face+to+face )o evaluate possible new retail locations" employees as%ed their customers and discovered they wanted to carry out ban%ing and financial dealings at their own place of business 0o that.s what doing &s% customers how they want to interact with your company AL 8uild a team 8efore selecting your CRM software" form a CRM team with reps from each department to ma%e sure their colleagues. needs and concerns are addressed )oo often companies neglect to include the correct sta%eholders" and the initiative fails to meet the needs of those tied to its results 9ic% your CRM team wisely" as it should evangeli'e the new system when it arrives @1

Customer Relationship Management

DL Consider people" process" and technology 3ne of the most common reasons why CRM initiatives fail is that e$ecutives tend to thin% of CRM as an !) pro2ect !n fact" it is an organi'ational and business+process change that re-uires companies to thin% about people" process" and technology to succeed FL Create a pro2ect chec%list Companies need to consider the following si$ steps when implementing their CRM initiatives, creating a clear strategy" addressing organi'ational issues" enabling processes" implementing the appropriate technologies" recording and trac%ing the data that drives the insight" and measuring the appropriate metrics" according to Feff 0chumacher" an associate partner at McKinsey G Company HL 5$perience counts 6! can.t emphasi'e enough the value of an e$pert consulting organi'ation that understands our business XandY a vendor that has a trac% record"6 says Fean Marc 9igeon" president of !nortech )o that end" as% the consultant and vendor for customer references !L )a%e the 4oldiloc%s approach 0ome CRM tools are too big( others are too small #ind what.s 2ust right for your business Fust because other companies li%e yours use one approach doesn.t mean you have to do the same thing 1"L 8enefits come in many flavors Cost 2ustifications are critical" but loo% deep enough to see the indirect effect of changes to your CRM policy Eoo% past the dollar signs of implementation and consider things li%e employee efficiency" productivity" and customer satisfaction 11L Calculate short+ and long+term costs over time CRM is not a one+time e$pense )otal cost of ownership ()C3) and return on investment (R3!) need to be used together when evaluating a CRM pro2ect 5$pectations should be managed over time Consider costs over monthly" -uarterly" yearly" and three+year periods Costs don.t end with technology" so consider services as well" which can easily cost twice as much as the technology


Customer Relationship Management 12L 5mulate best practices Iothing turns employees off li%e being forced to do their 2obs differently for no obvious reason 0tudy your top sales and service people" then design or invest in technology that enables your firm.s best practices++their best practices++to be emulated company+wide 13L 4et support from the top brass !f management doesn.t believe in the new system" why should the employees> Many times the difference between a successful CRM strategy and a huge waste of money is a leader who motivates the rest 3nce hot on the idea" you need to %eep them committed" so communicate with them regularly 1$L 4o with a CC3 Ces" another acronym to add to your mile+long scroll of industry terms" but this one.s got potential" we promise !f lac%ing accountability across all departments" the chief customer officer is the person to bring it to your organi'ation 0till not sure what a CC3 really does> !t.s her 2ob to %eep an eye on everything we put on this list 1AL 4et a champion of change Aon.t have a CC3 handy> Choose a manager who.s behind the implementation" understands the problems" reali'es the benefits" and understands the importance of the implementation from the company.s side" says Eorie 4oudie" director of customer support for )arantella &fter all" there.s nothing more motivating than somebody who always has that can+do attitude 7ant proof> Fust watch a Richard 0immons video 1DL Aeputi'e wisely & strong second+in+command" the person 6who ma%es all your glossy words actually happen"6 is critical" says 0adie 8aron" mar%eting pro2ect manager at 5versheds 1FL 0et goals 0etting predefined and mutually agreed upon goals with your CRM team prior to selecting the CRM vendor will give an organi'ation an idea of how well the CRM solution performs once it is installed =ow can a company succeed if success cannot be measured>


Customer Relationship Management 1HL 0et attainable goals 0imply because one salesperson has an *0 percent close rate does not mean all salespeople can come anywhere near that 6Iot all customers write business cases Iot all business cases have metrics Iot all metrics are reasonable"6 says 8arton 4oldenberg" president of !0M Aetermine a department.s average performance levels and aim for ? percent to 10 percent increases in areas li%e sales" customer retention" or lead generation 1!L Cleanse preemptively !dentify your %ey client data set before you flip the switch and ma%e sure it.s accurate and up+to+date Ao the data audit from day one 2"L Keep it simple Aon.t buy what you don.t need )he fewer bells and whistles" the less time and money you.ll need to devote to training 9eople don.t li%e change as it is( %eeping things simple only ma%es the switchover that much easier 21L 0uccess can be contagious !n baseball they say that hitting can be contagious !mplementing CRM is no different 7ith a full+suite product in particular" starting an implementation with a department you %now will find success can ma%e other departments start as%ing" 6=ey" why can.t we do that>6 !f one department finds success with CRM" others will want to as well 22L )rain early" train often 4ive your employees as much time as possible to learn the new application )hey don.t li%e change any more than other people do" but the sooner you begin" the sooner they reali'e a part of the process and the -uic%er they will reali'e the benefits Repeat and augment training as necessary to %eep those s%ills fresh 23L !dentify -uic% wins )ac%le the smallest" easiest tas% straight away and save the hard stuff for later 0uccess early on gets the ball rolling and motivates employees 2$L )a%e baby steps 0ales teams" li%e cats" can be finic%y 7hen automating the sales force" roll out the CRM system in small steps 7ith many sales teams" the number one concern is" what.s in it for me> Aump or force a strategy on them and they.ll get cran%y


Customer Relationship Management 2AL #ocus on R3! 6CRM should provide salespeople with better pipeline reporting" rather than only ma%e it easier to sell more )he latest CRM solutions are forcing salespeople to enter more administrative numbers than before &s a result" firms find they spend millions in sales automation only to learn that sales reps are still using &C)U6 says 0cott Ielson" 4artner vice president and distinguished analyst 2DL 0low down" 0peedy Aon.t get too far ahead of your customers in introducing CRM technologies++changing human behavior is tough" and ta%es time Recogni'e that customers and employees may be struggling to %eep up with the pace of technological change Iew applications are best served up in small" measured doses" says Fim Fohnson" director of information services at Master Eoc% Company 2FL #ind super users 7hy fight uphill all the time> 4et the most enthusiastic people to use the system first 2HL Keep your eye on the pri'e Measure the results and soothe the inevitable hiccups by showing people the benefits of the new CRM system" says 0tephanie Eedou$" assistant vice president of customer and provider service at 8lue Cross 8lue 0hield++ Rhode !sland 2!L )est the waters Ma%e sure your email and other communications are actually being delivered to the right people at the right time )roubleshoot with test customers before ma%ing your services generally available 3"L 0ee your customer through the same glasses Jarious departments in your organi'ation may see your customer as diversely as they would wal%ing past a fun house mirror++attractive and valuable from one angle" unappealing from another Msing one integrated set of analytical data throughout the company can help e$ecutives to ma%e %ey decisions about how much to invest in a particular customer 31L Keep things uniform Mnify your message across all communication channels" including television" radio" newspaper" email" regular mail" 7eb site" and the telephone )ry to have the same loo% and feel throughout the company Aon.t send mi$ed or conflicting messages++you will confuse the customer @@

Customer Relationship Management

32L 7al% a mile in your customers. shoes 4etting complaints from customers about how horrific it is to do business with you> 9ut yourself in their shoes by role+playing the typical customer e$perience 3nce you suffer through what you dish out" you.ll be shoc%ed into a more customer+centric mindset 33L Keep your promises Fust li%e relationships with your friends and loved ones" relationships with your customers should be based on trust Reminding customers of promises %ept++and ta%ing responsibility for promises unfulfilled++simply re-uires openness 3$L Clean your data regularly Cour CRM system is only as good as your data" so %eep it clean and avoid duplication 6&ccording to the M 0 Census" about one in seven people change addresses within a year"6 says Aenis 9ombriant" managing principal of 8eagle Research 4roup )hat.s why" he adds" 6=aving old data is li%e having no data 6 3AL 8ig names don.t mean big money 7hile big clients may loo% impressive on a customer list" they may be costing your organi'ation more money than they bring in )hese clients may have special needs" such as customi'ed pac%aging" special distribution needs" more hand+holding" which ta%e e$tra time and e$penses Eoo% at overall customer profitability" not 2ust sales" and send unprofitable clients to the competition 3DL Consider life stages &ccording to the M 0 Census 8ureau" there are roughly <? million baby boomers (born between 19;@ and 19@;)" more than ;9 million gen Wers (born between 19@? and 19<@)" more than <1 million gen Cers (born between 19<< and 199;)" and ;0 million millennial (born between 199? and now) 3FL Know thy customer Aon.t assume that an ethnic cohort comprises one monolithic group of consumers 0ome consumers are more tied to their culture than others 7ithin each culture e$ists subcultures that include a wide range of people who are fully assimilated to those who don.t spea% 5nglish 7hat.s more" country of origin may also play a significant role in buying behavior @<

Customer Relationship Management

3HL Mass mar%eting or one+to+one> &ctually" it should be a mi$ that mostly meets somewhere in the middle Cour most valuable customers re-uire one+to+one communication Fust below this re-uires a one+to+some model" in which your mar%eting messages are somewhat customi'ed and sent to the bul% of your customer base )he bottom level is your lowest 10 percent" which re-uires little customi'ation 3!L 5$periment with mar%eting Mar%eting is 2ust as much of an art as it is a science Recent technological developments are enabling mar%eters to challenge their segmented mar%eting campaigns with 2ust a few %eystro%es Consider different data sets li%e attitudinal" demographic" and behavioral data when reevaluating your mar%eting campaigns $"L 0ell what.s priceless )he affluent are no longer as interested in material things as they were leading up to the !nternet boom !nstead" they.d rather purchase products and service that enhance their e$periences )a%e heed from Citiban%.s 6Eive Richly6 and MasterCards 69riceless6 campaigns $1L Choose your customers #ind some commonality among your best customers in your database and cross reference that with prospects from e$ternal databases to pic% the most profitable customers $2L 6Aon.t reinvent your relationships"6 says Foshua Custer" C53 of 8ranch!) Corp Relationship management software from companies li%e 8ranch!)" 0po%e 0oftware" and Eeverage 0oftware can search digital records of customers and potential customers who have pree$isting relationships with other members of your team $3L Reward team players !n the big picture a happy customer is more important than one salesperson.s commission 9rovide bonuses or team player rewards for referring customers to the right internal sales agent or business partner who.s closer to the customer and can add more value $$L )hin%" partners Z customers 6)reat XpartnersY li%e customers"6 says Catherine 0mith" C33 of !I4 M 0 #inancial 0ervices 9artners" li%e customers" want @*

Customer Relationship Management what they want when and how they want it 0o 2ust li%e you do with customers" identify your partners. needs and wants" and implement processes that %eep them smiling $AL 8undle up )o really reward those loyal customers who turn to you for multiple products and services" cut them some slac% with a discounted pricing plan to show your appreciation Cou may not pull in as much in the short term" but you.ll score lifelong customers++and long+term profits $DL ) not lost" 2ust misplaced &lmost every business goes through rough periods" either individually or when the economy sags" and so lose customers as a result 7hen business pic%s up again" be sure to attempt to restart your relationships with lapsed easier to sell to than brand+new ones $FL &utomate contract renewals 7hen focusing on customer ac-uisition efforts" don.t let e$isting customers slip away Eoo% to contract renewal applications that will remind sales professionals when clients. contracts are nearing e$piration and can also automate contract renewal efforts with customers $HL 0treamline your chec%out process Cou wouldn.t give your family (e$cept maybe your in+laws) a roundabout route to get to your home if there was an easier set of directions )he same idea applies to your online chec%out process Ma%e it less of a ma'e and more of an e$press lane #or e$ample" 3verstoc% com condensed its chec%out procedure from seven pages to three" and retooled its product pages to ma%e it easier to complete the chec%out process" bolstering conversion rates and reducing online+chec%out customer calls $!L 4et personal Customers hate to feel li%e the sales agent is reading to them from a script Eearn your customers. personal needs and profiles and target your service to each individual !t will ma%e them feel important and that you value the relationship A"L 4et co'y 7hen people come to your retail store" financial institution" or garage" ma%e them feel comfortable Many %inds of companies provide coffee and ca%e in the mornings for customers who must come in before wor% 3thers provide free !nternet @9

Customer Relationship Management access to people while they wait Retail stores increasingly are adding in+store cafes to %eep hungry shoppers around longer

11.3 *i6 7enefits 9f Moving (ricing Into 2our CRM pplication

)here are si$ %ey benefits to moving your pricing functions to the front office, 10 Reduces sales c'cles and improves cash flo: Moving pricing to the front office reduces sales cycles and improves cash flow by giving sales agents the information they need to -uic%ly and accurately -uote an order from a single" consistent source 7hen customers are ready to buy" the sales agent needs to have the tools to -uic%ly provide an accurate -uote for valid products to be delivered by a reliable promise date 0ales agents spend too much time on administrative tas%s li%e reviewing catalogs" consulting with sales support" searching spreadsheets" and duplicating order entry )his time could be better spent on getting the product to the customer faster" or selling the product to more customers 20 (rovides sales agents :ith the abilit' to configure and @uote an order in real% time via a single CRM application/ :hich enables a :hole ne: set of capabilities. Customer+focused product configuration rules can be enforced and dynamic pricing can be applied" shipping charges and ta$es can be calculated" and a specific promise date can be confirmed and guaranteed( all this without having to travel bac% to the office or re-uiring dual entry (6swivel+chair6 integration) to other systems 0ales agents that spend time handling comple$ orders using multiple systems have less time to spend on new orders and generating new business & single system gives them more time for these activities" as well as other customer service+related activities li%e order management and issue resolution )his reduces the amount of time between when an order is placed and when it is delivered" thus improving cash flow 30Improves margins #ront+office pricing improves margins by enabling dynamic pricing based on various CRM components" including customer profiles" product attributes" and mar%et segments


Customer Relationship Management 0imply %nowing who your best and most profitable customers are does not guarantee a successful CRM strategy Companies should implement programs and policies that target highly desirable customers and provide incentives for them to increase their sales volumes #or e$ample" account profile information li%e membership in a buying club" being a competitor.s top customer" or belonging to a target industry may trigger discounts or promotional benefits that encourage a prospect to become a long+lasting customer 3n the other hand" belonging to a low+volume" high+cost customer segment group may trigger price premiums that encourage the customer to either purchase more high+margin products or migrate to a competitor 5stablishing pricing rules dependent upon product attributes may also help raise margins #or e$ample" if sales of a product in the color red are outpacing sales of the same product in blue" price premiums may be added for the red product while price discounts could be added for the blue product )his would ensure that the optimal price is charged for each to balance margin targets with inventory goals Knowing your customer.s previous purchasing history or comparing a purchaser.s profile to similar customers allows you to use upsell and cross+sell techni-ues that steer them toward products with higher margins and those that encourage a more long+term buying pattern $0 ,o:ers administration costs Msing one system to deliver consistent pricing across all channels (!nternet" field sales" telesales/call center" and channel sales partners) lowers administration costs Msing multiple pricing and order management systems for each selling channel increases implementation" administrative" maintenance" and upgrade costs 8y distributing pricing logic through one repository" these costs can be significantly reduced while ensuring that your prices are applied consistently throughout your organi'ation =owever" this approach doesn.t 2ust reduce costs and ensure consistency 8y deploying a single pricing engine" changes only need to be made once )his allows an organi'ation to adapt -uic%ly to changing mar%et conditions by ma%ing them more fle$ible and nimble A0 Reduces accounts receivables <1

Customer Relationship Management 9ricing in the front office reduces accounts receivables problems upfront by enforcing pricing rules during order entry" which reduces invoicing errors and disputes Customers are demanding more product options to allow them to customi'e purchases to their e$act re-uirements )his has led to more comple$ product offerings that re-uire sophisticated product configuration and pricing models 7ithout the appropriate tools sales agents may promise products with options that cannot be delivered" provide inaccurate -uotes" or configure a product that doesn.t meet the customer.s e$pectations )his can result in cancelled orders or significant order reconfiguration Aelays due to missed deadlines" reorders caused by incomplete sales forms" or lost sales because of cancellations are costly and can damage a once+solid customer relationship Resolving product configuration and pricing abnormalities at the time the -uote is provided improves order entry compliance and reduces the li%elihood of invalid orders reaching the order fulfillment system D0 Reduces integration costs Moving pricing to the front office reduces integration costs between a firm.s CRM and bac%+office systems 8y 2oining mar%eting" customer" and product information together with product configuration and pricing rules" a company can reduce the number of its cross+application integration points 3ther pricing components that are tied into the bac% office can be integrated with the CRM pricing engine )hese include those systems that calculate delivery charges and ta$es" and provide credit card authori'ation Moving pricing processes from the bac% office into a CRM system also decreases the fre-uency of round+trips data must ta%e to fulfill an order" since less bac%+and+forth communication is re-uired among the various systems before the order is approved CRM isn.t 2ust about sales force automation" customer loyalty" or :@0+degree customer views !t.s also about the processes that support those ideas 9ricing is a fre-uently overloo%ed and underappreciated component of CRM strategies =owever" pricing provides the framewor% to build and sustain healthy and satisfying customer relationships by enabling smooth" consistent" and effective business transactions that are mutually beneficial Foining CRM and pricing can positively affect your bottom line by improving cash flow" increasing margins" lowering administrative and integration costs" and reducing aged receivables <1

Customer Relationship Management

Chapter # 12. Reasons for CRM -ailure 12.1 &he &op 1" Reasons CRM (roMects -ail
Aepending on which survey you read" you will see comments and statistics such as Oover ?0L of CRM (Customer Relationship Management) pro2ects fail P 3n the other hand" you will also see published results that show double+digit percentage growth in revenue" improved productivity" and increased customer satisfaction from new CRM pro2ects 7hat drives companies to have such different results from the same initiatives> 8efore we loo% at reasons" lets define the scope of CRM CRM has been one of the most confusing terms established in e8usiness !n many cases" it has been defined" as what the user of the term is promoting !n the conte$t of this article" we want to loo% at CRM as the following !# is a strategic approach that combines the business processes, technology, employees, and information across an enterprise to attract and retain profitable customers. CRM pro2ects are launched to reali'e the plans and achieve the ob2ectives defined in the CRM strategic plan Eets loo% at why many CRM pro2ects fail and many others achieve great success =ere is C4!s top+ten list of reasons CRM pro2ects fail 1. CRM initiatives launched :ithout a strateg'. 0imply stating O7ere going to do CRM this yearP is not a strategy & CRM strategy needs to clearly define how you will be viewed by and manage all touch points with your customers !t should also define how you plan achieve this result 2. &he CRM strateg' is not integral to the business strateg'. CRM cannot be viewed as a pro2ect or solution separate from your overall business plan =ow you develop and grow customer relationships is the lifeblood of your company Customers must be a core part of your overall business strategy


Customer Relationship Management

3. &he CRM toolset is based on someone else#s success. )here are many CRM tool offerings in the mar%et place )ypically" these started around a particular process and product offering that was very effective )his offering has since been e$panded to offer broader functions through ac-uisition or system development 8e sure to evaluate tools against your business re-uirements to get the best product for your highest priority needs Iot everyone serves customers the same way" has the same business processes" or has the same priorities as your business $. CRM is launched :ith no regard for enterprise or customer interfaces. Can you afford to invest in ma%ing one part of the customer e$perience e$cellent only to destroy it at another step in the lifecycle> Ma%e sure every touch point you have with the customer provides consistent" %nowledgeable" and high+-uality service A. CRM is launched :ithout customer input. !t is so easy to get caught up in the rush to implement CRM solutions that you forget those people on the outside of your business )al% with your customers #ind out how they want to be serviced =ow can you better meet their needs> =ow can you collaborate for a true win/win initiative> 7hat are other suppliers doing for them that they li%e> D. CRM is considered an I& proMect N not business initiatives leveraging technolog'. Customers interact with your company through people" processes" electronic media" transactions and indirect relationships )hey typically will not %now what language your tools are written in or what platform they run on )he capability" -uality" function and reliability of the systems are critical 8ut design them to support the best customer processes you can provide )he greatest success will come from the coordinated efforts of business users and technologists in the company F. CRM is launched :ithout defined metrics and obMectives. &n important part of any rollout of new processes is the e$pectation of improvement !f you dont e$pect performance to improve" dont measure it" or manage it Conse-uently" you wont see improvement 5ven if you achieve it 0et e$pectations <;

Customer Relationship Management Measure performance improvement 9rovide feedbac% Reinforce successes Eoo% for ways to continue the improving trends

H. CRM is considered a one%time event. 3nce your initiative is launched" youre 2ust getting started Eoo% at it as an evolutionary development of your organi'ation that will re-uire multiple iterations to implement Cou will have some employees who resist the change )here will be bumps in the road 0olicit feedbac% Eearn from the new data at your disposal Refine your strategy 0et new goals Aevelop plans to achieve these new goals !. ssume 'ou have a customer%centric culture because 'ou have customers. )he global economy has bro%en down consumer barriers" reducing geographic constraints and revealing little difference between the products and prices of one competitor to the ne$t &s a result" -uality and service have become driving forces behind brand preference" loyalty and bottom line results 8e sure to loo% at your company as your customers do Consider how they want to do business with you Aevelop your strategy" design processes" and ma%e decisions loo%ing from the outside in Measure" analy'e and trac% customer service performance 0olicit input and feedbac% from your customers 8enchmar% with other organi'ations Arive this Ocustomer firstP culture throughout the organi'ation Reinforce it with every employee 1". Bo top do:n leadership and emplo'ee bu'%in for CRM. 5very employee will be affected by fundamental changes in CRM &ppoint an e$ecutive sponsor Communicate vertically and hori'ontally through the organi'ation 4et employees on board 4et them e$cited about doing a better 2ob for your customers and ma%ing your company more successful Create momentum toward a competitive customer focus 9rovide training so employees %now their role and the rationale for change 11. ltering the CRM solution to accommodate current business process and



Customer Relationship Management 8enefits will accrue from the adoption of new processes that leverage the information" speed" integration" lower operating costs and improved service resulting from new CRM tools 8e sure to ta%e advantage of these revenue" service and productivity enhancements 12. CRM is regarded :ithout urgenc'. Cour customers e$pectations are increasing Maybe not from your direct competitors but from other service providers 7ill your competitors announce a -uantum leap tomorrow> !f they do" what will it ta%e to get customers bac% after you have lost them> =ow much is it worth to pre+empt your competitors and loc% in new customers> 13. &r' to implement Oever'thing CRMP at one time. 7hat about the sense of urgency you as%> !t is difficult to change the entire organi'ation overnight and %eep it running 3rgani'ations have personalities and need to learn new and adaptive behaviors 4o after your highest leverage" or highest priority areas first 0how successes to bring the rest of the organi'ation along Move forward in manageable steps


Customer Relationship Management

Chapter # 13. Case stud' 13.1 Case *tud'8 &ravelocit'.com

,eading the =a' in E%Commerce to 9ptimi?e Customer Relationships Eets loo% at what online travel agency )ravelocity recently did with integrated analytics and mar%eting automation on an enterprise data warehouse & ma2or airline offered a special fare from Eos &ngeles to 0an Fuan" 9uerto Rico &t * a m 50)" the airline sent this offer out to all travel agencies" including )ravelocity )ravelocitys mar%eting department created a customer campaign with the right value propositions and then started boo%ing tic%ets !t was e$ecuted within hours" not days" leveraging an integrated enterprise data warehouse (5A7) environment 8y mid+afternoon" )ravelocity had analy'ed the browsing behavior of its :0 million registered users" pulled the email addresses for :0"000 people living in the Eos &ngeles area who had browsed but not bought tic%ets to the Caribbean" crafted value propositions in the form of email messages" and sent them out )he ta%e rate> 3ver the following month" a whopping 1? percent of the recipients of that value proposition had boo%ed tic%ets )his illustrates the %ind of speed" intelligence" and integration re-uired to create and deliver effective value propositions (measured by the ta%e rate) as well as highly efficient ones (measured by the R3! from the profit of those e$tra tic%ets" compared to )ravelocitys cost for developing and launching the communication campaign) =owever" the power of analytical CRM on an enterprise data warehouse can e$tend well beyond mar%eting( the greater opportunity is in improving customer management processes across the business" so that insights and intelligence created by and for mar%eting can be leveraged in all departments 4artner recogni'es this with a forward+loo%ing view of what CRM is really about,


Customer Relationship Management ustomer relationship management refers to the concept of moving ownership of the customer up to the enterprise level and away from individual departments and channels. "hese departments are responsible for customer interactions, but the enterprise is responsible for the customer. Q 4artner Research Iote" #errara and Ielson 5ven the best business minds often assume that customer management is the concern of the mar%eting department" however" the customer+centric enterprise of tomorrow %nows better Customer conversations ta%e place across the whole organi'ation" not 2ust in mar%eting Conversations with customers occur in the service department" the financial department" fulfillment" shipping" and other functional areas !t is critical to ma%e sure that every customers ongoing conversation with your company is consistent N wherever they touch your company &n analytical solution that truly drives a higher -uality of intelligence must also provide communications capabilities that support relevant" consistent conversations with individual customers N anywhere" anytime &nd then trac%ing and managing detail data on each customer over time N measured in years" not merely days or months Companies wont often share the details of their own intelligence+ generating tools with the world =owever" we %now that those that have focused their resources on creating more effective customer communications are getting great results

(ea+ Returns b' Integration/ *'nchroni?ation/ and Customer Relationship 9ptimi?ation )hese firms have e$perienced a transition to an analytical information infrastructure that focuses on customers" resources" and abilities to drive new decisions every day )his is the real+time approach to meeting business needs 5ach of them has implemented a form of optimi'ation for meeting these business needs I&8" in fact" was one of the inventors of relationship optimi'ation and of integrating it with mar%eting and services CR3 begins with the integration of analytical CRM and mar%eting communication tools to give mar%eters multiple views from which to discover" plan" communicate" and optimi'e ever+changing relationships )his must be formed from a data warehouse that synchroni'es for -uic% access and leverages of all


Customer Relationship Management data when and where needed Mar%eters will create comple$ analytic wor%loads to develop new intelligence from this holistic view of your customers and drive dynamic communication across all channels for highly profitable returns CR3 will utili'e customer profiles that are automatically refreshed in real+time in the data warehouse )his ensures that customer analyses are always fresh for more accurate intelligence and more refined value propositions 5vent triggers are used to monitor customer behaviors and interests in real+time 3ptimi'ation tools ensure right+time( right+channel offers and messages are delivered in ways that ma%e sense for the customer as well as the business )he result is an optimi'ed multichannel" multistep" event+based customer+driven dialogue and relationship Moving -rom >ision to Realit'8 *tart Getting &he Most -rom 2our CRM and I& Investments )o ma%e all of this a reality" companies must align technology tools and customer processes to interact with individual customers in meaningful and relevant ways #irms must become masters of the customer conversation N and instinctively learn how to appeal to customers 0pecifically" mar%eters can get this alignment underway by developing their %nowledge base" s%ill sets" and technology tools to leverage the power of advanced CRM analytics and mar%eting automation tools Mar%eters also need to focus on being innovative in their application of customer intelligence through ma%ing the science and practice of CRM a total learning environment Eearning is a critical part of the CRM process" as pointed out in the forthcoming boo% "he .alue (actor by Mar% =urd and Ears Iyberg )hese e$ecutives %now that, A company needs to understand its customers better, not only so it can market to them more effectively, but also so it can learn from the information in an iterative feedback process. &y closing the loop on understanding their customers, companies can design products and services that anticipate customers/ needs, enhance contact, and predict the ne0t best interaction. &he Be: &op (riorit'8 Improve Customer Conversations and Relationships


Customer Relationship Management )o move from where your company is today" you need to consider tactics that allow you to better understand the value and interests of your customers =ere are a few practical suggestions, B *ee and segment 'our customers b' business value. Ie$t" model them to predict their migration into a spectrum of value segments )hen" simulate and predict customer buying behavior based on the potential effectiveness of different potential value propositions you devise B (erform a mar+eting%influencers anal'sis to identif' :hich customers can be influenced in their value migration. )hen communicate to them with value propositions that will have the effect of moving them in the right direction B B Ma+e accurate assessments of each customers affinity to a value proposition ,earn to optimi?e channels and fre@uenc' of customer contact. Eearn and and its timing Eearn from the customers positive and negative responses relearn which channel you should use for specific messages as times and offers change and decide how often to contact each customer B (erform detailed customer value anal'sis" including mar%et bas%et analysis" product affinity analysis" cross+product correlation analysis" multiple campaign response models" customer growth models" churn and attrition models" and customer lifetime value models to spot opportunities to more effectively communicate your value propositions

7hen a company can continually identify those opportunities that hold the greatest long+term value potential" finite resources can be directed at e$ploiting these opportunities and ma$imi'ing profits )his means establishing an environment where a company can continuously assess and act upon value+generating or value+retaining opportunities as they occur 7ith a complete" integrated view of the customer in an environment designed for optimi'ed dynamic customer interactions" customer processes across the business will consistently create and deliver messages that customers find compelling and the positive and profitable results will follow

13.2 Case *tud'8 =estpacEs *trateg' -or CRM *uccess


Customer Relationship Management & )eradata platform for data management and analytics is %ey to the company.s winning ways More than two years into a five+year CRM program" #ernando Ricardo has good reason to feel happy 7estpac 8an%ing Corporation.s 9rogram Reach" of which Ricardo is director" is ahead of schedule" ahead on anticipated benefits and right on budget !n fact" Ricardo believes the program has e$ceeded e$pectations" which he attributes to state+of+the+art technology" personnel e$perienced in CRM and" most importantly perhaps" the right corporate culture and buy+in across the organi'ation 6!t.s been a very good first two years 7e don.t have any particular issues 5verything that we have done to date is wor%ing fine ! can.t see any scenario where things could have gone better"6 he reflects #ounded in 1*1< as the 8an% of Iew 0outh 7ales" 7estpac is &ustralia.s oldest ban% !t provides ban%ing and financial services for nearly * million personal" business and institutional customers in &ustralia" Iew [ealand and the 9acific region !t operates more than 1"000 branches and agencies" has offices in %ey financial centers around the world and employs more than 1@"<00 people Eaunched in 1001" 9rogram Reach.s principal business driver was to provide 7estpac.s staff with better information about customers 0uch information would allow staff to proactively approach customers as well as reactively satisfy their needs &s Ricardo puts it" 7estpac wanted 6to provide the right tools for our staff to better service customers and have relevant conversations with them 6 )he program gives ban%ers concrete information about what customers need" enabling them to offer to customers the right %inds of products and services rather than blindly suggesting something 6Cou don.t want to be offering credit cards to young teenagers or to someone who already has two or three of your credit cards"6 Ricardo e$plains 68ut if you have a home loan with us and you don.t have insurance" it ma%es sense to tal% to you about insurance 6 )he ability to %now the difference is a %ey advantage in a highly competitive industry 60ystems in ban%s worldwide are still very much product+centric Most ban%s don.t have a single view of the customer and cannot determine and act upon what needs (their customers) may have"6 Ricardo says


Customer Relationship Management Ricardo gained oversight of 9rogram Reach in 0eptember 1001" bringing nine years e$perience in analytics and strategic mar%eting for Iational &ustralia 8an%" which used )eradata !n Aecember 1001" after e$tensive investigation" 7estpac selected )eradata CRM technology for its 7estpac Eeads engineQwhich is the heart of its cross+channel" integrated customer management and event+based customer contact system

7uilding a s'stem )hrough its data warehouse" 7estpac Eeads draws data from 7estpac.s source systems &t the front+end" or presentation layer" are Relationship 8uilder (0iebel < ?) and the Reach Aashboard (0iebel &nalytics) Modeling is performed using 0&0 5nterprise Miner Relationship 8uilder provides a fast" browser+based" holistic view of customers" enabling a continuous conversation with customers through multiple channels !t is a powerful sales management tool that records referrals" service re-uests and opportunities" and it allows ban%ers to manage this information )he Reach Aashboard provides sales management information about activities spanning from the call center to the e$ecutive level )hrough real+time visual reporting" a manager can monitor the sales pipeline and focus on coaching or other sales activities as indicated by the Aashboard 0ales leads" referred to as 7estpac Eeads because they are generated in that system" are delivered from )eradata CRM to Relationship 8uilder as opportunities for ban%ers to ma%e proactive customer contact 9rofile information and future opportunities recorded in Relationship 8uilder can be used to trigger a future 7estpac Eead #or e$ample" an outbound caller employed by 7estpac who is targeting potential customers via Relationship 8uilder is sent a 7estpac Eead regarding a specific campaign and a specific customer )his can trigger discussion about other future needs Auring the conversation" the caller might discover that the customer has a term deposit with another institution that will e$pire in four months 7hen the ban%er records this as part of the customer.s profile" a 7estpac Eead will be triggered in time for the ban%er to contact the customer with an appropriate 7estpac offer Ricardo says that prior to )eradata and 9rogram Reach" 7estpac could not deliver consistent or 6ne$t best6 offers" which enable a relevant" timely lead to be attached to *1

Customer Relationship Management the customer.s record within Relationship 8uilder 7ithout that information" ban%ers had a hard time targeting customers. needs with appropriate product or service offers Iow" in addition to outbound callers being sent leads" customer service staff can see relevant sales or service offers against a customer.s record 7ith the scripting capabilities of Relationship 8uilder" any ban%er can easily introduce a relevant offer to the customer" and than%s to 7estpac Eeads. modeling capabilities" the li%elihood of the offer being accepted is high &he right offer at the right time 7hile there are a number of platforms available on which to do data management and analytics" Ricardo believes )eradata is one of the most potent !t is also the only platform optimi'ed to run a campaign+management system on top of it 3ne of the biggest benefits 7estpac reaps from )eradata is the ability to analy'e billions of rows of data in a very short period and gain -uic% access to the most recent information in order to leverage it across millions of customers 6!n terms of performance and speed of data analytics" )eradata has no real competition !t has the ability to trawl through billions of rows in a table very -uic%ly and do it thousands of times in a few seconds"6 Ricardo says 7estpac has successfully deployed 9rogram Reach to its small and medium enterprise (0M5) customer base &round ?"000 staff members use 9rogram Reach in 7estpac.s business call centers and branch networ% &ccording to Ricardo" the feedbac% and impact on customer and staff satisfaction have been e$tremely positive 7estpac has made significant gains in 0M5 mar%et share over the last few years" although Ricardo does not attribute this solely to 9rogram Reach )he ban% is progressively rolling out the solution to its consumer and wealth management customer segments #ive full+time )eradata 9rofessional 0ervices associates will remain on+site as the deployment continues &fter that phase" 7estpac plans to integrate the system with &)Ms" the !nternet" short message service (0M0) and interactive voice response (!JR) systems 7hile 9rogram Reach.s aim is to deliver the right offer to the right customer via the right channel at the right time" every time" Ricardo admits such things do not happen in two years =owever" if progress continues" irrelevant offers should be a thing of the past by the program.s fifth year


Customer Relationship Management *martl' planned moves &ccording to Ricardo" the principal challenge in the pro2ect has been to avoid the mista%es that others have made with CRM 6CRM is a bit li%e chess )he players who win are those who e$ecute better by ma%ing fewer mista%es Iormally in chess it is not the great moves that win games( it.s the bad moves that lose games"6 he says =e has sought to ma%e careful and thoughtful moves along the way #or e$ample" Ricardo believes most CRM pro2ects fail because the organi'ations did not spend enough time on people issues !n 9rogram Reach" however" 10L to :0L of the total program effort has been focused on training staff" which he thin%s is uni-ue in &ustralia 6)en years ago" all of my peers were spending 1L to 1L on people( the rest was on technology 5verybody thought that the technology was the silver bullet (that) would fi$ everything and is so easy to use & decade on" we all %now that the most important piece in the pu''le is not the technology !t.s what people feel about the technology and how they use it"6 he says &nother potential barrier for other organi'ations is lac% of senior support for the pro2ect 9rogram Reach has been well sponsored" initially by 7estpac.s group e$ecutive for business and technology because the first 11 months or so essentially involved technology and building the necessary infrastructure Iow that the 0M5 pilot is up and running" the sponsor is the group e$ecutive of the retail ban% for 7estpac in &ustralia &nother reason Ricardo thin%s !)+related pro2ects fail is that they are overly ambitious 7estpac.s approach" however" has been to underta%e small pieces of the program at a time" starting with defining and addressing the ban%.s top 10 types of customer interactions & large proportion of e$ecutives around the world believe that CRM doesn.t wor% because they are not made an integral part of the process Ricardo advocates clear communication about what is ta%ing place" when it will happen" what value CRM will add in terms of profitability and customer and staff satisfaction" and when there will be a visible return 6! spend a lot of time articulating to the frontline staff" the mar%eting staff" the technology staff and the e$ecutives e$actly what we are doing" so there are never any surprises for anybody"6 he says *;

Customer Relationship Management

&he =estpac :a' Ricardo believes three -ualities differentiate 7estpac.s CRM strategy and focus from that of its competitors #irst" he says the ban% is deploying current technology that is much more mature than it was 10 or 1? years ago Ricardo thin%s that many of the companies that first attempted CRM in the early 1990s found themselves dealing with highly customi'ed applications and are now struggling to upgrade to browser+based applications =e also believes that these days there is much less need to customi'e CRM solutions and conse-uently loc% oneself out of an upgrade path 67e are deploying e$isting browser+based technology and setting up an infrastructure that will survive the ne$t decade or so because it.s geared up for the future while ! thin% a lot of our competitors in &ustralia will incur significant e$penditure in migrating to e$isting and future technologies"6 he says )he second differentiator is that 7estpac.s sales and corporate culture is unrivaled in &ustralia" according to Ricardo )he ban% has been recogni'ed with global and national awards for social responsibility and customer focus =aving this environment as well as a balance between the interests of shareholders" staff and customers puts 7estpac in a uni-ue position 6)hat cultural fabric of the company provides a fertile ground for these things to wor%"6 Ricardo e$plains 6)he lac% of cultural alignment between the various sta%eholders has been one of the causes of the many failures of CRM pro2ects 6 =e continues" 6)his is also a place where the focus on the customer e$ists as a natural part of the company.s fiber not using technology to help our staff to focus on customers( they are already focused on customers )his is really not as hard as it would have been in other companies where customer service" customer satisfaction and doing the right thing for the customer are not core business (directives) li%e they are here 6 #inally" Ricardo and others on the pro2ect have been able to bring their prior e$perience with CRM to bear so that 7estpac will not have to start from scratch )his accelerates the speed of e$ecution and the -uality of the outcome while reducing the number of failures in technology" training and process reengineering


Customer Relationship Management 6Combined" these three things provide us with a uni-ue opportunity to do well ! thin% the big difference for 7estpac is that 7estpac is going straight to the nuggets without spending a lot of time mining in areas where there is no gold"6 Ricardo says

Chapter # 1$. Conclusion

!n the past" CRM was mostly about the technology" not about the customer )here is a change in the way the organi'ations do business &t a technology level" CRM is increasingly about con2oined best+of+breed applications delivered via portal technologies &t a business level" it is beginning to invade traditional territories occupied by brand management or customer support 9eel shows companies how to ma%e the shift to the new paradigm )he CRM vendors loo% li%e they have got their act together in terms of coupling their wares to the needs of the business )he mar%et now distinguishes between CRM and eCRM 3ne would be forgiven for thin%ing that this differentiation was contrived to allow the vendors to retreat bac% to pre ecommerce CRM 8ut the opposite is true eCRM is the new game and the vendors are being bullish about it !t may well be worth creating a CRM vendor inde$" as ! thin% that it will be a good indicator of confidence in business in general and technology in particular


Customer Relationship Management

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Reference 7oo+s
o CRM, Redefining Customer Relationship Management o 7hy CRM Aoesnt 7or%> o CRM, 4etting !t Right