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Back to the Future of CRM - Part 1 of 4
By Enabliser Howard
People are often asking us about the benefits of a CRM system and how they should approach their implementation, as this is what we are experts in. The businesses we speak to are keen to strengthen their customer relationships and provide good value to their customers. It has a good effect on revenue too.
Over the years, I have read many articles about CRM, but one of the best, which still rings true, is an article some years ago in the Harvard Business Review. It discussed successful CRM implementations, and what experiences we can learn from them. The lessons are the same today, as in 2004 when the article was written.
The features and functionality of CRM solutions continue to be improved, however to ensure success, the approach to take when implementing a CRM solution needs to be planned. It doesn’t happen by good luck.
In a series of blogs, we will discuss this paper, which gives a valuable perspective on harnessing the incredible power of CRM.
Millions of dollars have been spent by companies worldwide to track and strengthen customer relationships. The expected benefits were not apparent for many of them, so enthusiasm waned. Research shows CRM spending has been growing again. Why the change? A variety of companies with successful implementations were studied, to discover what common elements they did right. They can be summarised as:
• Pragmatic and
• Narrowly focused.
Start small and focused
Rather than trying to transform the business, the companies studied solved problems in their customer relationship cycle which were clearly defined. The customer relationship cycle begins from market segmentation, ending with the sale, and wooing customers back for more. The companies showed a healthy scepticism, discounting overblown claims that the real benefit of CRM is a "real-time enterprise." Understanding that highly accurate and timely data are not required everywhere in their businesses, they tailored their CRM to those parts of their relationships that truly depended on "perfect" information. After succeeding with a smaller project, this was often used as a springboard for resolving other problems.
The research suggests four questions to ask when launching CRM initiatives:
• Is it strategic?
• Where does it hurt?
• Do we need perfect data?
• Where do we go from here?
Many companies' CRM has been less effective due to the absence of organisational structures to support them, making them mistrustful of CRM generally. Perhaps they expected it to just happen by magic. Just as you nurture a garden, so it is with new projects like CRM too. To clarify which CRM projects are likely to show the most value, the companies studied included an aircraft parts distributor, equipment manufacturer, office equipment distributor and a manufacturer of electronic connectors. As CRM solution providers, these insights into how to do CRM right are supported by Enabling.
This discussion on Back to the Future of CRM will be continued.