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The last five years in business have been a wild ride. The market placed a high premium on cutting-edge ideas, as emphasis shifted away from the less glamorous fundamentals of business strategy and effective execution.
In the process, many start-up companies with brilliant concepts learned a lesson—the hard way—about the importance of sound business strategies and delivering on promises. Meanwhile, companies with clear vision, core strategies and strong business fundamentals are surviving the mayhem and continuing to capitalize on marketplace opportunities.
Clear-cut performance matters now more than ever. And delivering that performance depends on having the right strategy and the ability to execute properly. Programs that can't deliver measurable results will be the first to go as organizations experiencing limited resources and heightened shareholder demands tighten their belts.
Your existing customer base is one of your most valuable assets and should be guarded, protected and nourished to generate revenue growth for your company through retention, referrals and sales of new or additional products.
In the current economy, most companies are pressured for growth. As marketers, you can't afford to give competitors a chance to grow through acquisition of new customers. Managing and growing relationships with your most valuable customers is more critical now than ever. And as corporate resources become more limited, marketing campaigns aimed at new customers must become more targeted and cost-effective.
There's no cookie-cutter solution to ensure great results. Specific customer relationship management (CRM) tactics must be situational to be successful—that is, they must be the right solution, for the right challenge, at the right time. There are, however, several universal tenets of successful CRM that are particularly relevant in a slowing economy.
Tenet #1: A Knowledge-Based CRM Strategy Is Critical.
An effective CRM strategy has at its core the understanding that you can't successfully be all things to all customers. It's critical to develop a CRM strategy for your organization that's based on intimate knowledge of your customers—who your most valuable customers are; their demonstrated and anticipated needs and preferences; what drives their satisfaction; and what impacts their purchasing decisions. This strategy can be leveraged as the foundation for developing cost-effective programs and tactics, ensuring your efforts are focused and your return on investment maximized.
Tenet #2: Proper Execution Is Key.
A solid CRM strategy is critical, but it doesn't matter how wonderful your ideas are if you can't execute them effectively. All tactics and programs hit roadblocks and snags. Your ability to anticipate issues, identify them as they occur, manage them effectively and/or leverage contingency plans will be what ultimately determines your level of success.
There are several important components to effective execution of CRM tactics and programs:
• Enroll the right players with the right skills.
• Plan effectively.
• Accurately project costs and benefits.
• Communicate status, issues and progress frequently.
• Implement processes to quickly identify and address issues.
• Understand critical dependencies.
• Develop contingency plans.
• Recognize and reward progress/success.
• Establish key measures.
• Gather and leverage feedback.
Tenet #3: Concentrate on Strategy and Requirements First, Then Technology.
In recent years, most technology spending was focused on automating the sales and service processes through front-end CRM applications. It's likely we'll see this spending pattern begin to shift toward data management and decision support applications as companies struggle to make sense of the huge volumes of customer and transactional data collected through multiple distribution channels.
Technology will continue to be a critical component of most companies' CRM strategies. It can provide significant advantages through cost reduction, improved employee efficiency, better business decisions, and enhanced ability to meet customers' needs and requirements.
But, many technology initiatives fail to deliver anticipated results. For example, a study by the Gartner Group indicates that in 32 percent of sales technology projects, little or no use was made of the technology 12 months after deployment. Signs of a technology project failure include low or ineffective use of the technology by employees and/or customers, and inability to measure improvements or gains from the technology solution.
Tenet #4 : Learn From Mistakes and Successes to Improve Performance.
Some of your CRM tactics and programs will succeed; others will fail. Your long-term success will be dependent on your ability to learn from your mistakes and successes, and use that knowledge to optimize performance. Creating a learning organization requires several areas of focus:
• a clear definition of business requirements for data gathering;
• access to and use of the data;
• development and population of a database that meets business requirements;
• decision support applications that get the right information in the hands of the right people at the right time;
• development of employee knowledge management and decision-making skills.
Tenet #5: Make Employees Your Greatest Allies.
An effective change-management strategy will help your CRM program succeed. And in a difficult economy, employee enrollment in a cause such as CRM can provide the added benefit of improving staff morale and sense of purpose. Your change-management effort should include:
• an employee communication plan;
• processes to gather employee feedback on the CRM initiative;
• training on hard and soft skills required to support desired behaviors;
• performance measures;
• executive enrollment and sponsorship of the endeavor;
• alignment of employee rewards and incentives; and
• organizational alignment.
Customer relationships are your greatest assets. You must continue to invest intelligently in those relationships even in a slowing economy. A company with a clear, customer-focused strategy and culture can sustain itself and prosper through turbulent times. This strategy provides a consistent sense of direction, a customer-centric sounding board against which tactics and programs can be evaluated and prioritized, and basic values that your employees and customers can hold onto.
Bottom line: Commitment to a sound CRM strategy ensures that existing relationships and customer knowledge can be leveraged to drive enhanced profitability and growth.
Carol Eberhardt is senior consultant, lead business strategist, for D7 Consulting. You can reach her by phone at (312) 553-5575, or via e-mail at carol.eberhardt@d7c.com.
Five Insights for CRM Success
By Bob Thompson
Think of customer relationship management (CRM) as a never-ending journey, with satisfied customers as guideposts along the way. No matter how successful you've been, you're never really done with CRM. As customer expectations continue to rise, what was exceptional service yesterday becomes the status quo today—and will be a going-out-of-business strategy tomorrow.
Following are some insights to keep in mind:
1. Deliver value first. Your customers don't care about your management problems. Make sure their experience will motivate them to return again and again, and to make positive referrals. If you decide to skip this step, you might as well skip the rest, because they won't matter.
2. It's still about people. Technology is great, but without executive leadership, employee and partner buy-in, and genuine emotional bonds with your customers, a CRM project won't succeed. Make sure people are enabled by technology, not the other way around.
3. Pick CRM technology partners, not vendors. Find software and service firms that are as committed to you as you are to your customers. In other words, pick CRM technology partners that practice good CRM. If they don't, keep looking.
4. "Ready, fire, aim" doesn't work. Resist the temptation to make it up as you go along. CRM is complex. Use process analysis and planning methodologies to avoid costly and time-consuming rework. Installing software fast means nothing. Or, it might be even worse than nothing—ever hear the term: "Garbage in, garbage out?"
5. Treat partners like customers. You can't do it alone. Get some help! To win the battle for mind share with indirect sales channels, invest in tools that enable partners to do business more effectively and efficiently.
Rising expectations mean that continual innovation and improvement is a competitive necessity. As Will Rogers once said: "Being on the right track is not enough; you can still get run over by the train."
Bob Thompson is founder and president of Front Line Solutions, an independent consulting and research firm specializing in Partner Relationship Management. You can reach him via e-mail: bob@frontlinehq.com. Reprinted with permission from Front Line Solutions' Web site, CRMGuru.com.
Tech Talk
Real-Time Data Mining
IBM's new DB2 Intelligent Miner Scoring integrates data-mining capabilities directly into a DB2 database for faster analysis of customer transactions. The system enables, for example, simplified real-time data mining while a customer is still on the phone, according to IBM. Bank of Montreal, a beta test site for the system, is using it to build a full life cycle model management program for its customers. Visit: www.software.ibm.com/data.
Automatic Privacy
Unica Corp. added privacy enabling capabilities to its Affinium Suite, a cross-channel marketing solution. The new automated features help companies limit access to and visibility of customer information, implement e-mail best practices, and honor customer preferences throughout the marketing process, say Unica officials. For example, in Affinium Campaign, consumer credit information can be attached to anonymous IDs instead of real names. Visit: www.unicacorp.com.
Analytical CRM
Teradata, a division of NCR Corp., unveiled version 4.0 of its CRM solution. The software presents marketers with analysis, action, evaluation and learning from within one tool, noted officials, thus enabling marketers to engage in personalized and timely dialogues with customers across all channels. The software also provides a means to manage communication delivery and response information between Teradata CRM and front-office operational systems. Visit: ncr.com/teradata.
Interactive Customer Service
Fulfillment Plus, a provider of back-end infrastructure service solutions, unveiled an interactive customer service and fulfillment solution for telecommunications companies. The technology-based solution provides marketing, distribution services and product fulfillment. Visit: www.fulfillmentplus.com
Hosted CRM
Harte-Hanks recently released Allink Xpert, an open-architecture software solution that encompasses Xchange's cross-channel campaign management, customer analytics and response management software. Delivered as an application service provider, or hosted CRM solution, it's designed to help marketers understand the value and potential of their customer and prospect databases and to facilitate customer-focused strategies and campaigns, say Harte-Hanks officials. Visit: www.harte-hanks.com.
Gather, Analyze Data
Delano Discovery Marketing, a new analytical e-marketing management solution from Delano Technology Corp., enables marketers to better understand their customers and improve online marketing initiatives. The technology enables marketers to collect and analyze customer data from multiple touchpoints in their enterprises. The data can then be used to drive intelligent customer interactions using Delano's Velocity Marketing solution, an event-triggered, one-to-one, e-mail marketing application, interactive surveys and personalized newsletters, note Delano officials. For more info: www.delanotech.com.
CRM Challenges
Of those companies that have implemented CRM solutions, only 35 percent say their results met or exceeded expectations, according to a survey of 500 readers of InfoWorld magazine, a trade publication for information technology professionals. Other findings of the February survey include the following:
• While 78 percent of respondents consider CRM critical to success, only 35 percent have actually implemented a CRM system. Most cite budgetary constraints. InfoWorld's editors offer a tip: Divide a CRM project into more manageable and less expensive subprojects.
• 49 percent of respondents say getting widespread cooperation from all levels of management is problematic. Mario Apicella of the InfoWorld Test Center writes: "The truth is that each department has a precise but partial image of your customers, and the difficult task of combining those segmented views into a coherent, company-wide picture is crucial for a successful CRM implementation."
• Almost 30 percent of respondents say an unsupportive cultural climate inside their companies could be a serious handicap to successful CRM initiatives.
• 46 percent of IT leaders surveyed say integration with existing applications is a major impediment to successful CRM implementations; and 40 percent blame a lack of skilled IT professionals.
• 73 percent of respondents cite the availability of a complete solution from a vendor as a very important or critical factor in their CRM technology choices.
In the process, many start-up companies with brilliant concepts learned a lesson—the hard way—about the importance of sound business strategies and delivering on promises. Meanwhile, companies with clear vision, core strategies and strong business fundamentals are surviving the mayhem and continuing to capitalize on marketplace opportunities.
Clear-cut performance matters now more than ever. And delivering that performance depends on having the right strategy and the ability to execute properly. Programs that can't deliver measurable results will be the first to go as organizations experiencing limited resources and heightened shareholder demands tighten their belts.
Your existing customer base is one of your most valuable assets and should be guarded, protected and nourished to generate revenue growth for your company through retention, referrals and sales of new or additional products.
In the current economy, most companies are pressured for growth. As marketers, you can't afford to give competitors a chance to grow through acquisition of new customers. Managing and growing relationships with your most valuable customers is more critical now than ever. And as corporate resources become more limited, marketing campaigns aimed at new customers must become more targeted and cost-effective.
There's no cookie-cutter solution to ensure great results. Specific customer relationship management (CRM) tactics must be situational to be successful—that is, they must be the right solution, for the right challenge, at the right time. There are, however, several universal tenets of successful CRM that are particularly relevant in a slowing economy.
Tenet #1: A Knowledge-Based CRM Strategy Is Critical.
An effective CRM strategy has at its core the understanding that you can't successfully be all things to all customers. It's critical to develop a CRM strategy for your organization that's based on intimate knowledge of your customers—who your most valuable customers are; their demonstrated and anticipated needs and preferences; what drives their satisfaction; and what impacts their purchasing decisions. This strategy can be leveraged as the foundation for developing cost-effective programs and tactics, ensuring your efforts are focused and your return on investment maximized.
Tenet #2: Proper Execution Is Key.
A solid CRM strategy is critical, but it doesn't matter how wonderful your ideas are if you can't execute them effectively. All tactics and programs hit roadblocks and snags. Your ability to anticipate issues, identify them as they occur, manage them effectively and/or leverage contingency plans will be what ultimately determines your level of success.
There are several important components to effective execution of CRM tactics and programs:
• Enroll the right players with the right skills.
• Plan effectively.
• Accurately project costs and benefits.
• Communicate status, issues and progress frequently.
• Implement processes to quickly identify and address issues.
• Understand critical dependencies.
• Develop contingency plans.
• Recognize and reward progress/success.
• Establish key measures.
• Gather and leverage feedback.
Tenet #3: Concentrate on Strategy and Requirements First, Then Technology.
In recent years, most technology spending was focused on automating the sales and service processes through front-end CRM applications. It's likely we'll see this spending pattern begin to shift toward data management and decision support applications as companies struggle to make sense of the huge volumes of customer and transactional data collected through multiple distribution channels.
Technology will continue to be a critical component of most companies' CRM strategies. It can provide significant advantages through cost reduction, improved employee efficiency, better business decisions, and enhanced ability to meet customers' needs and requirements.
But, many technology initiatives fail to deliver anticipated results. For example, a study by the Gartner Group indicates that in 32 percent of sales technology projects, little or no use was made of the technology 12 months after deployment. Signs of a technology project failure include low or ineffective use of the technology by employees and/or customers, and inability to measure improvements or gains from the technology solution.
Tenet #4 : Learn From Mistakes and Successes to Improve Performance.
Some of your CRM tactics and programs will succeed; others will fail. Your long-term success will be dependent on your ability to learn from your mistakes and successes, and use that knowledge to optimize performance. Creating a learning organization requires several areas of focus:
• a clear definition of business requirements for data gathering;
• access to and use of the data;
• development and population of a database that meets business requirements;
• decision support applications that get the right information in the hands of the right people at the right time;
• development of employee knowledge management and decision-making skills.
Tenet #5: Make Employees Your Greatest Allies.
An effective change-management strategy will help your CRM program succeed. And in a difficult economy, employee enrollment in a cause such as CRM can provide the added benefit of improving staff morale and sense of purpose. Your change-management effort should include:
• an employee communication plan;
• processes to gather employee feedback on the CRM initiative;
• training on hard and soft skills required to support desired behaviors;
• performance measures;
• executive enrollment and sponsorship of the endeavor;
• alignment of employee rewards and incentives; and
• organizational alignment.
Customer relationships are your greatest assets. You must continue to invest intelligently in those relationships even in a slowing economy. A company with a clear, customer-focused strategy and culture can sustain itself and prosper through turbulent times. This strategy provides a consistent sense of direction, a customer-centric sounding board against which tactics and programs can be evaluated and prioritized, and basic values that your employees and customers can hold onto.
Bottom line: Commitment to a sound CRM strategy ensures that existing relationships and customer knowledge can be leveraged to drive enhanced profitability and growth.
Carol Eberhardt is senior consultant, lead business strategist, for D7 Consulting. You can reach her by phone at (312) 553-5575, or via e-mail at carol.eberhardt@d7c.com.
Five Insights for CRM Success
By Bob Thompson
Think of customer relationship management (CRM) as a never-ending journey, with satisfied customers as guideposts along the way. No matter how successful you've been, you're never really done with CRM. As customer expectations continue to rise, what was exceptional service yesterday becomes the status quo today—and will be a going-out-of-business strategy tomorrow.
Following are some insights to keep in mind:
1. Deliver value first. Your customers don't care about your management problems. Make sure their experience will motivate them to return again and again, and to make positive referrals. If you decide to skip this step, you might as well skip the rest, because they won't matter.
2. It's still about people. Technology is great, but without executive leadership, employee and partner buy-in, and genuine emotional bonds with your customers, a CRM project won't succeed. Make sure people are enabled by technology, not the other way around.
3. Pick CRM technology partners, not vendors. Find software and service firms that are as committed to you as you are to your customers. In other words, pick CRM technology partners that practice good CRM. If they don't, keep looking.
4. "Ready, fire, aim" doesn't work. Resist the temptation to make it up as you go along. CRM is complex. Use process analysis and planning methodologies to avoid costly and time-consuming rework. Installing software fast means nothing. Or, it might be even worse than nothing—ever hear the term: "Garbage in, garbage out?"
5. Treat partners like customers. You can't do it alone. Get some help! To win the battle for mind share with indirect sales channels, invest in tools that enable partners to do business more effectively and efficiently.
Rising expectations mean that continual innovation and improvement is a competitive necessity. As Will Rogers once said: "Being on the right track is not enough; you can still get run over by the train."
Bob Thompson is founder and president of Front Line Solutions, an independent consulting and research firm specializing in Partner Relationship Management. You can reach him via e-mail: bob@frontlinehq.com. Reprinted with permission from Front Line Solutions' Web site, CRMGuru.com.
Tech Talk
Real-Time Data Mining
IBM's new DB2 Intelligent Miner Scoring integrates data-mining capabilities directly into a DB2 database for faster analysis of customer transactions. The system enables, for example, simplified real-time data mining while a customer is still on the phone, according to IBM. Bank of Montreal, a beta test site for the system, is using it to build a full life cycle model management program for its customers. Visit: www.software.ibm.com/data.
Automatic Privacy
Unica Corp. added privacy enabling capabilities to its Affinium Suite, a cross-channel marketing solution. The new automated features help companies limit access to and visibility of customer information, implement e-mail best practices, and honor customer preferences throughout the marketing process, say Unica officials. For example, in Affinium Campaign, consumer credit information can be attached to anonymous IDs instead of real names. Visit: www.unicacorp.com.
Analytical CRM
Teradata, a division of NCR Corp., unveiled version 4.0 of its CRM solution. The software presents marketers with analysis, action, evaluation and learning from within one tool, noted officials, thus enabling marketers to engage in personalized and timely dialogues with customers across all channels. The software also provides a means to manage communication delivery and response information between Teradata CRM and front-office operational systems. Visit: ncr.com/teradata.
Interactive Customer Service
Fulfillment Plus, a provider of back-end infrastructure service solutions, unveiled an interactive customer service and fulfillment solution for telecommunications companies. The technology-based solution provides marketing, distribution services and product fulfillment. Visit: www.fulfillmentplus.com
Hosted CRM
Harte-Hanks recently released Allink Xpert, an open-architecture software solution that encompasses Xchange's cross-channel campaign management, customer analytics and response management software. Delivered as an application service provider, or hosted CRM solution, it's designed to help marketers understand the value and potential of their customer and prospect databases and to facilitate customer-focused strategies and campaigns, say Harte-Hanks officials. Visit: www.harte-hanks.com.
Gather, Analyze Data
Delano Discovery Marketing, a new analytical e-marketing management solution from Delano Technology Corp., enables marketers to better understand their customers and improve online marketing initiatives. The technology enables marketers to collect and analyze customer data from multiple touchpoints in their enterprises. The data can then be used to drive intelligent customer interactions using Delano's Velocity Marketing solution, an event-triggered, one-to-one, e-mail marketing application, interactive surveys and personalized newsletters, note Delano officials. For more info: www.delanotech.com.
CRM Challenges
Of those companies that have implemented CRM solutions, only 35 percent say their results met or exceeded expectations, according to a survey of 500 readers of InfoWorld magazine, a trade publication for information technology professionals. Other findings of the February survey include the following:
• While 78 percent of respondents consider CRM critical to success, only 35 percent have actually implemented a CRM system. Most cite budgetary constraints. InfoWorld's editors offer a tip: Divide a CRM project into more manageable and less expensive subprojects.
• 49 percent of respondents say getting widespread cooperation from all levels of management is problematic. Mario Apicella of the InfoWorld Test Center writes: "The truth is that each department has a precise but partial image of your customers, and the difficult task of combining those segmented views into a coherent, company-wide picture is crucial for a successful CRM implementation."
• Almost 30 percent of respondents say an unsupportive cultural climate inside their companies could be a serious handicap to successful CRM initiatives.
• 46 percent of IT leaders surveyed say integration with existing applications is a major impediment to successful CRM implementations; and 40 percent blame a lack of skilled IT professionals.
• 73 percent of respondents cite the availability of a complete solution from a vendor as a very important or critical factor in their CRM technology choices.
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