The spirit of CRM

By: Kostis Panayotakis
Submitted: 2007-01-17 12:15:04
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CRM is an approach which diversifies the customer facing processes, according to Customer groups of different value to the Enterprise. CRM is about tuning the consumption of Enterprise resources, in order to provide increased value to the valuable Customers.

‘Tuning the consumption of Enterprise resources’ means trying to identify optimal approaches in investing existing budget to handle the Customer relationship. Optimal approaches would entail the direct & flexible linking between Customer value to the Enterprise and service level or pricing offered.

Enabler of this approach is Customer insight: the knowledge of the Customer by the Enterprise, the Customer’s value to the Enterprise and the Customer’s preferences in the relationship with the Enterprise. If this information is unavailable, the Enterprise is unable to apply any of the above mentioned practices. CRM is about developing Organisational processes & competences, which shall allow the Enterprise to better learn from the Customer and adopt to the Customer’s needs, thus positioning itself to better serve the latter.

CRM is about transformation of an Entreprise, from product-centric to customer-centric & solution-focused. CRM is about viewing ‘one face of the Customer’: the ability to consolidate records related to a single Customer, in order to produce a holistic view (or 360 degree view) of that Customer.

CRM is about having ‘one face to the Customer’. All Customer Touch points (e.g. sales personnel, service personnel, call centers, invoices etc) should have the same level of consistent & timely information on a Customer, and act in coordination (cross channel alignment). CRM is about enabling the measurement of marketing efficiency and aiming at reducing marketing campaign cycle times, increasing ROI on marketing programs, increasing customer satisfaction & loyalty.

CRM is about automation & standardization of customer facing processes.

CRM is about innovation: the ability of an Enterprise to identify new ways to handle the relationship with specific Customer groups, ways that are valued by the latter (e.g. offering similar service content on the web channel, to that of the conventional channels).

CRM is a simple concept, which can be quite difficult to implement in the context of a complex Enterprise which markets numerous products via many Customer touch points (CTPs) to thousands or millions of Customers (e.g. banking or telecom industry).

Barriers to a successful CRM

Barriers to a successful CRM can be any of the following:
• Internal resistance to change – lack of process management funding
• difficulty in identifying the Customer (data related to the customer are unlinked or stored in silos)
• problems in capturing Customer data (i.e. web registration forms may discourage the visit to a web page)
• difficulty to organize internally in order to implement the diversified customer facing processes (selling, order handling, problem management, billing, customer retention) required (e.g. implementing complex service levels or invoicing).
• difficulty to measure customer value or CLV
• Many retailers do not capture any customer data unless they promote a loyalty program

CRM information systems

In a complex Enterprise, the necessity to implement an information system to support these customer facing processes and capture, store & exploit customer profile & behavior info efficiently, is obvious. This CRM information system has to be linked to many (if not all) other operational systems, which are serving non customer facing processes (e.g. order fulfillment or billing processes).

Moreover it has to be linked to an analytical infrastructure (a Data Warehouse or a CRM Datamart), in order to retrieve derived facts like Customer value rankings or lists of Customers to be contacted.

However, the information system is only a tool supporting the CRM strategy, value proposition & relevant process. If this strategy is not designed or implemented efficiently, the information system can’t help much.

Relevant material can be found at http://www.pleroforea.com.

Article source: Expert Articles