CRM



CRM IntroductionEstablishing and maintaining good relationships with customers provided few problems in the past when businesses were small and customers were identifiable by sight rather than by an ID number or code. The Manager of the small business knew each of his customers, understood their value to him in terms of how much they spent and how often, remembered their idiosyncrasies and their preferences. Customer relationship management was a term unknown but a practice adhered to if business was to be successful.Definitions of CRMIt is clear from the previous pages that Customer Relationship Management, CRM, involves far more than technology.? It involves technology, process and people.So, a very simple definition of CRM might be:CRM is a business and marketing strategy that integrates technology, process and all business activities around the customer.CRM technology enablesinformation about the customer to be stored in databasesbusinesses to analyse that data, pull out customer preferences and make clear their behavioureasy access to that data across departments that may be widely geographically dispersedeasy access for customers in terms of online transactionsspeedy personalized communications that enable the customer to feel valued and special even though in reality they may be just one of hundreds of thousands of customersThe three parts to CRM – technology, processes and peopleIn a sense, the?technology?part of CRM – the database - largely equates to the information that was previously stored 'in the heads' of Managers of small businesses. But good customer relationships are about far more than that.Processes,?or key steps, have to be put into place to make sure that such data is used effectively. In fact it is the processes that hold the whole thing together.And the?people?involved in any way with the customer have to be aware of those processes and preferably believe in those processes so that a seamless service can be delivered to the customer.Process Map sectionBy definition – a business is only as successful as its processes Each company will have a number of discrete activities that occur from the initial customer inquiry, through to completion of the sale, customer support and after sales service. These are the processes.It is unlikely that any two businesses will sell in exactly the same way, using the same number of steps and the same procedures. In other words, different businesses will have different processes in place.Since processes are so critical to the success of any operation or business, the need to document them carefully is critical (see section on process mapping).The peopleIn the same way that it would be important for the Manager of the small business to train his staff so that they understood his customers in the way that he did and understood the benefits to the business in treating them in a certain way, so it is equally important for people in large organizations to be suitably trained in the processes and technology used.No CRM implementation will be completely effective without the commitment or buy in from the people involved. Without commitment, processes may be inefficiently implemented, by-passed or break down completely.Indeed, it is usually the people (or cultural factors) that define success or failure of the CRM systems, not the technology itself.The components of CRMLet’s look now at the components of a CRM system and how it might work in practice.?CRM, or Customer Relationship Management, is a company-wide business strategy designed to reduce costs and increase profitability by solidifying customer satisfaction, loyalty, and advocacy. True CRM brings together information from all data sources within an organization (and where appropriate, from outside the organization) to give one, holistic view of each customer in real time. This allows customer facing employees in such areas as sales, customer support, and marketing to make quick yet informed decisions on everything from cross-selling and upselling opportunities to target marketing strategies to competitive positioning tactics.CRM, or Customer Relationship Management, is a company-wide business strategy designed to reduce costs and increase profitability by solidifying customer loyalty. True CRM brings together information from all data sources within an organization (and where appropriate, from outside the organization) to give one, holistic view of each customer in real time. This allows customer facing employees in such areas as sales, customer support, and marketing to make quick yet informed decisions on everything from cross-selling and upselling opportunities to target marketing strategies to competitive positioning tactics.Once thought of as a type of software, CRM has evolved into a customer-centric philosophy that must permeate an entire organization. There are three key elements to a successful CRM initiative: people, process, and technology. The people throughout a company-from the CEO to each and every customer service rep-need to buy in to and support CRM. A company's business processes must be reengineered to bolster its CRM initiative, often from the view of, How can this process better serve the customer? Firms must select the right technology to drive these improved processes, provide the best data to the employees, and be easy enough to operate that users won't balk. If one of these three foundations is not sound, the entire CRM structure will crumble.It's a strategy used to learn more about customers' needs and behaviors in order to develop stronger relationships with them. After all, good customer relationships are at the heart of business success. There are many technological components to CRM, but thinking about CRM in primarily technological terms is a mistake. The more useful way to think about CRM is as a process that will help bring together lots of pieces of information about customers, sales, marketing effectiveness, responsiveness and market trends.If customer relationships are the heart of business success, then CRM is the valve the pumps a company's life blood. As such, CRM is best suited to help businesses use people, processes, and technology to gain insight into the behavior and value of customers. This insight allows for improved customer service, increased call center efficiency, added cross-sell and upsell opportunities, improved close rates, streamlined sales and marketing processes, improved customer profiling and targeting, reduced costs, and increased share of customer and overall profitability.This sounds like a panacea, but CRM is not without its challenges. For CRM to be truly effective, an organization must convince its staff that change is good and that CRM will benefit them. Then it must analyze its business processes to decide which need to be reengineered and how best to go about it. Next is to decide what kind of customer information is relevant and how it will be used. Finally, a team of carefully selected executives must choose the right technology to automate what it is that needs to be automated. This process, depending upon the size of the company and the breadth of data, can take anywhere from a few weeks to a year or more. And although some firms are using Web-based CRM technologies for only hundreds of dollars per month per user, large companies may spends millions to purchase, install, and customize the technology required to support its CRM initiative.Setting a Clear Customer Experience StrategyTo establish a good strategy certain key practices are required:Understand the overall organisational vision and missionDefine the organisation's customer service direction, slogan and valuesEnsure customer service is defined as a key responsibility for the business/departmentShare the customer experience strategy via a comprehensive communications programEnsure that this strategy does not conflict with other business strategies. As consultants, it is amazing how often we hear organisations say, "Improving Customer Service is a priority, and we are also introducing stringent cost-cutting measures." This can present a tough dichotomy.Selecting The Correct PeopleIt's really hard to teach an elephant to dance!When recruiting employees to provide customer service, the process often tends to concentrate more on functional expertise, technical competence and knowledge rather than interpersonal skills. However, lack of the right attitude can drastically impact client satisfaction levels. Research has in fact shown that attitude is the most important requirement: skills and functional expertise can be taught.Therefore in selecting the right people:Define the critical job requirementsDevelop scenario-based interviews/assessment centres to screen and select candidatesInvolve multiple team members in the hiring processEnsure evaluation is based on objective, not the subjective "Be Like Me" criteriaIn part two of this article, we will look at the remaining four key principles of making the transition from a customer service culture to customer relationship management. ................
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