Customer are changing – so must CRM
Over the years, CRM has emerged as a key strategic initiative that companies are working to master. As economic pressures increase and customers in both commercial and consumer sectors demand immediacy, mobility, and omni-channel reach, many businesses have been forced to undergo a major shift surrounding customer experience and engagement. One of my customers said these initiatives attempt to re-engineer the ways we manage our customer relationships "end-to-end and side-to-side."
The challenge is that there are no clear definitions of what CRM initiatives should entail. They may refer to anything from technology roadmaps to a vague set of communication standards or anything in between. Despite that, it is clear that refining customer processes and systems is critical. For CRM to be effective, there must be an understanding of the business levers of change as they relate to organizations and their constituents.
The following catalysts are shared across organizations:
Rapidly increasing interactivity. Specifically, engagement between organizational constituents – customers, partners, and employees -must change. The product or solution-centric paradigm in the enterprise is being replaced by a focus on customer engagement and process. A good example from the retail sector is the shift from a product inventory mentality to the development of consumer loyalty through appropriate responsiveness to buying behaviour.
Economic pressures. Economic uncertainties force stringent budgets, aimed to decrease operational costs and increase returns across marketing, sales, and service. Organizations look to automate marketing revenue management, streamline the lead-to-order process, and push customer service toward self-service and social channels.
Revenue needs. More and more organizations are turning to existing customers with the intention of maximizing revenue potential. They do so by finding opportunities to upsell and cross-sell their products and services. This requires bridging process and data silos to deliver insightful information about the customers to employees.
As companies ramp up their CRM initiatives to meet the needs of the rapidly changing marketplace, it is important that their unified CRM strategies address not only near-term challenges, but also carry forward momentum into the future. The following essentials will help minimize the pitfalls along the way:
Sponsorship. The larger the organization, the more isolated the functions and processes within the organizational fabric. There is rarely one eye on the life cycle of the customer across functional and process boundaries. Bringing together leaders across operational and functional areas will gain buy-in throughout the organization and help manage organizational resistance to change.
Customer engagement. Consumer engagement and experience now drive the evolution of business. Customers want providers to listen and respond through the channels by which they are already engaged. Furthermore, customers desire control of the process and the rich supply of information available to them. Finding ways for customers to engage within communities and collaborate with each other and the business can yield a more personal user experience. Developing an omnichannel, behaviour-driven communication strategy can elevate the overall effectiveness of marketing and sales messages as well as their reach.
Customer segmentation. Not all customers are created equal. By assessing potential profitability along with demographic, behavioral, and attitudinal characteristics, marketing tactics can be designed to better engage customers and prospects. Although most organizations have customer segmentation methods in place, assessing how they play into a company's overall strategy ensures that the evolution of CRM enables optimal revenue potential.
Data management. Information stewardship is essential in order to leverage your data effectively. A common misconception is that data is exclusively a technology problem. To own your data, you need to understand and follow the "flow" of data through people, processes, and systems. This flow will help your organization develop an understanding of how data is used and who owns it. As a result, a baseline for the creation of an effective data management platform will appear.
Analytics. Measuring and valuing customer relationships is critical to implementing a CRM strategy. To this day, many organizations are unable to produce key operational metrics to drive day-to-day business decisions. As part of a CRM strategy, metrics across the lines of business must be defined and evaluated in terms of the goals.
Technology. Technology is not the universal remedy to business problems associated with managing customer interactions. However, many organizations are facing high infrastructure maintenance costs, long development cycles, and limited application mobility and performance. As part of a CRM strategy, it is important to understand the limiting technology factors so that you can define a roadmap, both short-term and long.
Agility. Often CRM initiatives either get stalled or fail to achieve their goals. In the time it takes to bring a large-scale initiative to fruition, the goals of the initiative may no longer meet the needs of the business or the customer. Avoid this by embracing change as the underlying current of the environment, continuously re-evaluating the needs of your constituents and breaking efforts into smaller chunks. A good strategy is a nimble strategy.
Dmitri Novomeiski is the leader of CRM solutions at Hisoft Technologies. He has held internal and consulting roles in the CRM industry over the past 14 years.