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How to Implement a CRM Strategy

How to Implement a CRM Strategy

Client Relationship Management (CRM) is a business discipline that has been around for a relatively long period of time. Surprisingly, therefore, it is still possible to find organisations that have a comparatively poor understanding of it and little or no overarching CRM strategy.

By contrast, if you would like a quick overview, you may find the following to be of some use by way of introduction.

Understanding the Principles of CRM

In theory, the relationship between an organisation and its customers couldn’t be simpler.

The customer decides if they wish to purchase some of your products or services, places an order and pays. In practice though, things inevitably become far more complicated.

For an organization to be able to deliver the most effective customer service experience, it needs to show that it understands those customers and the totality of the way that they interact with the business.

An often-cited example is the bank in the 1980s that is rumoured to have brusquely turned down a personal loan request for a relatively small sum on the basis that it was not a line of business they wished to be involved in.

What they had not understood, because the information technology systems didn’t provide them with the information, was that the person concerned also had over £65 million of corporate funds on deposit with their business banking arm.

That is not the sort of mistake that organisations can afford to make.

Therefore, the ultimate objective of any CRM strategy is to implement systems and processes that allow you to know your customer in the broadest possible sense.

The Purposes of CRM

In practice, CRM exists to service a number of potential requirements and not simply to avoid howling errors in the way an individual client engagement is handled.

Just a sample of some of its objectives might include to:

  • support effective decision making when investigating a customer’s requirements
  • understand the company’s total exposure to an individual customer and the total transaction history with them over time – i.e. customer segmentation and profitability analysis plus credit scoring
  • identify opportunities for analysing their purchasing and behaviour patterns, with a view to delivering to them more appropriate target-specific and relevant propositions for future sales – i.e. marketing
  • see at a glance the complex inter-relationships between what might appear to be different customers – i.e. understanding that two customers are in fact married or sharing the same household

These objectives may seem basic and hardly revolutionary but there are a number of reasons why, historically, commercial systems and processes have made the achievement of these are rather more difficult than you might imagine.

Inhibitors to CRM

There are a number of reasons why some of the above things might be difficult to achieve including:

  • historic vertical silo mentality leading to the development of departmental fiefdoms and a belief that the customer belongs to them rather than to the wider organisation
  • arising from the above, a reluctance to share information about individual customers horizontally across the organisation
  • information technology systems that may have been built and installed over 30 or 40 years, which were largely designed and aligned on the same basis as the departmental vertical silos. The end result of this might be a multiplicity of customer files and databases all of which have different data structures
  • duplication – this syndrome arises due to the fact that processes and systems sometimes did not recall that (e.g.) a woman may be purchasing products and services using either her married or unmarried name after marriage though she was the same individual.

Other examples might be new customer records opened up when someone purchased from a new address even though they were the same individual that had previously traded with the organisation or one person registered on two different departmental systems but using different data;

For all these and many other reasons, getting a horizontal view of the total customer engagement across an organisation is sometimes far from straightforward.

Implementing a CRM strategy

There are a few initial simple steps that need to be adopted by an organisation as part of moving forward towards a full-blown CRM strategy:

  1. set down firm corporate standards that customers and customer data are collectively owned and are not the property of an individual department – though in some industry sectors some caution may be necessary in terms of legislation and required information barriers
  2. design the new organisational structures and processes that will be required to firstly consolidate and then exploit the new central customer view
  3. specifically identify the purposes that CRM will be applied to in the organisation
  4. identify the various data sources that will need to be cleansed and consolidated to form a single integrated customer view
  5. appoint a suitably authorised and empowered individual plus the team that will be charged with responsibility for delivering an integrated CRM strategy and its supporting systems
  6. educate and obtain the support of existing vertical organisational silo and process owners in changing established views and practices as part of the migration towards new models. Note that in larger organisations this is typically a significant challenge and inevitably some surreptitious obstructing and blocking may be anticipated. This is why the individual and team charged with delivery must be given sufficient organisational authority or failure is predictable
  7. define measures of success

Specialist help

There is a very significant range of issues that will need to be dealt with as part of the design of a detailed CRM strategy and eventually the implementation of a project to achieve it.

It is important to guard against the sometimes dangerously misleading view that CRM can be achieved by the installation of a software package alone. It cannot and requires fundamental cultural and organisational change as well as appropriate software.

CRM consultants

Two examples of companies that might be able to assist:

CRM UK, Manchester – Microsoft certified CRM consultants;

PPD Computing, Halifax – full consultancy offered in all areas of CRM.

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