2. MAKING CUSTOMER RELATIONSHIP MANAGEMENT
WORK
THREE DETERMINING FACTORS
As with all major change programmes there are the classical issues of
business process, organisational culture and information systems to get right.
Process
Before an organisation can starting designing and piloting new CRM
processes it must first of all develop a customer strategy. The strategy needs
to address critical questions about the customer such as what sort of
customer does the company want and how they be recruited, how will
customer service be provided, how will it make the portfolio management
approach work and what will be done with ‘Below Zero’ customers?
To successfully implement CRM, customer management processes need to
be integrated into the organisation and from a holistic viewpoint. This means
that the processes for identification, attraction, retention and development of
customers must be customer orientated. It also means that in many cases
significant organisational changes need to be put in place. A process view
necessarily means that existing departmental, product or geographic
structures are no longer valid or effective.
Changes of this scale are difficult to implement and manage overnight so
many organisations are moving in this direction and getting short term
benefits by putting a process ‘overlay’ on to the existing departmental
structures. This overlay is designed to increase the communication between
departments and enable a broader understanding of customer needs, while
the broader process design and implementation phase is developed
separately.
Culture change and competency development
The skills and competencies of employees need to be enhanced as CRM is
implemented. Team members must be skilled in problem solving, interacting
with customers, be able to understand and work with new technology and
successfully work with new processes. In addition the organisation’s culture
and mind set needs to be changed when it comes to building customer
relationships, particularly when it comes to effectiveness and flexibility in
dealing with customers.
Many companies have implemented call centres in recent years to improve
customer service and this is a good example of the challenges and the
difficult and time-consuming process an organisation might face when
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3. introducing new customer management skills and mind sets. Many
companies experience high turnover in call centre staff and when it takes 6-9
months for a call centre team member to become proficient in dealing with
customers the time for the organisation to become competent in customer
relationships is obviously lengthy. This ‘time to competency’ (as Andersen
Consulting refer to it) will be a critical factor in determining how successful an
organisation will ultimately be in managing customer relationships.
If we use the call centre example again, another dimension of the challenge
facing companies in moving their organisation to this level of competence is
how do the companies support their employees during this development and
learning phase. Most people learn 20% of their skills in a classroom
environment and the remaining 80% on the job. Therefore many team
members are learning the skills of customer management with real
customers, a risk to customer satisfaction and retention. In addition, having
the right number and level of skilled resources available to support the team
members in this learning phase will also be a challenge.
A final point on culture and how it affects customer relationships is the
importance of the link between employee satisfaction and customer
satisfaction. Since the work which BA (and others) did in the late 1980’s, it
has been clear that there is a direct link between the level of customer
satisfaction and employee satisfaction. Empowering the front line customer
facing team members is only one aspect of employee satisfaction. It is also
essential that these team members have a strong identity and belief in the
products and services which they are providing to their customers.
Systems and technology
Just as it is important to have a customer strategy when embarking on
implementing CRM, it is equally important to have a systems strategy in place
as well. This needs to specify how any short term and pilot systems will be
provided to support new processes or CRM initiatives and how these new
systems will be integrated with the existing systems in the long term.
New technologies are emerging all the time and it is new technologies such
as the Internet and e-commerce, call centres, self service kiosks and smart
cards which are enabling new customer relationship management
capabilities. Therefore for many companies it is now possible to offer and
manage a number of different channels to the customer. In this situation it is
essential that all channels can manage the knowledge about a customer,
have this customer knowledge at the point of customer interaction to improve
the customer relationship and be able to extend knowledge about the
customer. However, getting to this single combined view of the customer and
providing this information to the necessary points in the organisation is a
challenge, not least because of the transactional nature of many of the legacy
systems in today’s organisations. However, with the appropriate systems
strategy and implementation programme in place there is an opportunity for
the first time to have a single and fully integrated holistic view of the customer
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4. across the sales, marketing, customer service, finance, and support and
maintenance functions.
The importance of the Internet and electronic commerce as a channel can
also not be understated. These technologies have created a whole new
vehicle for communicating with customers. This has moved from a one-way
‘push’ broadcast mechanism into an interactive channel for 1:1 dialogue with
customers. Companies that do not have this capability will appear to be
unresponsive to customers.
Again, just as in the case for starting CRM initiatives, systems which are used
to support CRM should be piloted, developed in a step by step approach and
should be justified on an ongoing basis.
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