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With Permission from Sir Richard Heygate
"Improving the Return on Investment from CRM".
"I have borrowed the heading for this weeks newsletter from Jack Rech, Director of E-Commerce at National Gypsum Company, who sent me a very interesting email. National Gypsum focused their CRM efforts on service instead of sales force automation. To quote Jack "We began by looking at ourselves from the customers view point. If you actually interact with some customers, they will quickly and honestly give you some insight where your opportunities are for improvement of the relationship. Our strategy was simple - find out what the customers need - provide it."
Peter Li sent me a summary of his Masters Thesis that was carried out across Canada in 2001. Entitled "The Critical Success Factors of CRM Technology Initiatives", his main conclusion was that "possessing knowledge management capabilities is the single most important Critical Success Factor in CRM initiatives". By knowledge management capabilities he means "the ability of an organisation to capture, manage, and deliver real time customers, products, and services knowledge in order to improve customer response and decision making processes. Such capabilities foster effective and efficient management of customer relationships".
Both these views struck a real chord with me. I have long believed that there are three basic sources of value from CRM. Firstly, the more traditional option of using better understanding of the customers propensity, in order to target sales communications more effectively through automated campaigning. Secondly, supporting these campaigns with further automation of the sales/service process to improve efficiency. In addition to these two more familiar sources of value, a third is emerging, based on the sort of thinking developed in the two e- mails I have quoted. This third opportunity derives value from translating insight into the way customers like to be treated, in very short order into new ways of providing products and services. Executed effectively, it provides a continuous process of brand and customer loyalty enhancement, based on real customer experience.
David Redfern, another e-mail correspondent, takes a different tack again. His email is headed "CRM the biggest con contrived by IT consultants ever", and is centred around the inability of standardised solutions to bring competitive benefit. He writes "the blame for all this hype and, frankly, scam lies with the big five. How can a company expect a single, enterprise wide product to address all the issues of a corporation in exactly the same way as their competition, who installed the latest very expensive version of an application? It is not possible, every company is different, otherwise there would be no competition; yet all the big five are "partners" of Seibel systems or some other overblown SFA product. How can this be good for their client? How can the clients be blind enough to fall for it?"