Selecting And Buying CRM
Software
BY JACK MCAVOY, PEGASYSTEMS
Customer relationship management is the key to creating
a successful business. CRM, however, requires a comprehensive strategy,
carefully designed business practices and integration with existing applications
and contact channels.
Managing and enhancing customer relationships is increasingly
important as a market differentiator. In recent years, CIOs and business
unit managers have been asked to select solutions that increase productivity
and enhance the quality of customer interactions. But today�s competitive
landscape is changing, and they are now being asked to take that challenge
to the next level. Customer relationship management is critical to achieving
success in today�s businesses. Selecting the right CRM software has moved
from a tactical departmental solution to an enterprisewide strategy. The
software that is selected will be the foundation of the company�s customer
service strategy and the means by which they can take that service to
the next level. The stakes have never been higher. You have many choices
and alternatives, so it is crucial to think seriously before buying.
According to industry studies, the most successful organizations
will be those with a strategy that automates � and makes consistent �
their sales, service and marketing business processes throughout the entire
enterprise. Developing a strategy is not a simple departmental task. An
effective CRM strategy may require a dramatic shift in organizational
focus, from a departmental- or product-centered view to one that places
the customer at the center. Development of this strategy requires participation
and buy-in at all levels, especially senior management. AMR Research stated
the following:
CRM must come from the top. CRM is an all-encompassing
strategy, and no one department, call center or information technology
(IT) manager can drive the cross-functional process changes required.
Bottom-up implementations may optimize local needs, but optimizing efforts
to benefit customers means that some parts of the business will not be
as efficient as they were while others do better. Such choices are made
in the boardroom. A recent study showed CEOs were directly involved in
successful CRM initiatives more than 40 percent of the time.1
While you may not choose to implement a wide-ranging strategy
all at once, you should recognize the necessity of thinking broadly. Concentrating
on a strategy within the call center and over the Web, integrating back-office
processing with front-office delivery functions and using solutions that
are flexible and scalable constitute a good beginning. But to achieve
enterprisewide benefits from CRM, organizations must link customer and
prospect information with disparate business-unit databases. Better information
� and timely, consistent delivery of that information � benefits the customer
and increases customer loyalty and retention. In turn, increased customer
retention increases profitability. Enterprises that purchase CRM solutions
that are not flexible, scalable, extensible and that do not integrate
their operations will ultimately be unable to respond to competitive pressure
and will fail.
What Constitutes A Successful CRM Implementation?
According to GartnerGroup, a successful implementation enables an
enterprise to use customer data to match enterprise resources to customer
needs in an optimal manner. This requires that customer data � such as
descriptive data (e.g., who, where, how old and how rich), transactional
data (e.g., purchases, costs and channels) and interactional data (e.g.,
service requests and sales offers) � be collected throughout the enterprise
and analyzed to turn it into meaningful information. Following that effort,
a customer relationship strategy is developed to support high-quality
interactions across several channels.2
As you begin to develop your strategy, you must incorporate the following
concepts and requirements.
The strategy must extend across all channels. While one particular
channel may be your first priority, ultimately all channels must be involved
(call center, Web, kiosk, sales and service departments, partners, and
more).
Service delivery must be consistent across all channels. Service-level
quality and timeliness standards that differ from the Web to the contact
center to the individual sales office let your customer know that you
are not serious about providing them with flexible options.
Your solution should result in a holistic view of the customer.
At the same time, it should provide contact personnel all the information
they need to handle each customer interaction. This includes service information
as well as customer and account data.
Your solution must improve the level of service by performing real
work rather than merely tracking and routing service requests.
It must provide the highest degree of accuracy and reliability. Effective
self-service options must be included.
It must seamlessly integrate the front office with back-office systems.
It must accommodate unique and ever-changing business requirements.
It must grow with you.
To summarize, your CRM strategic objectives should be to maximize the
effectiveness and productivity of all channels, deliver stellar service,
increase selling time with each customer, enable better communication
and information sharing between sales, service and marketing, decrease
sales cycles and achieve higher call-to-sale ratios.
Once you are comfortable that you have a well-planned strategic vision,
you must next translate that vision into evaluation criteria that can
be applied to your search for appropriate CRM software solutions. Consider
the following:
Extending your solution across all channels. A robust CRM solution
must integrate customer service representatives, sales associates, voice
response units, Web self-service, branch platform and back-office personnel,
and even support ATMs and kiosks. Customers demand consistent service.
Stay away from CRM vendors who look at only the call center, or only at
the Web. Integration � and using best and consistent processes across
all channels � is the key.
Delivering consistent service across channels. Look for an integrated
solution that enables you to share business rules and processes across
the organization wherever appropriate. But be careful: You don�t want
to dictate rules to business units where they don�t make sense. Flexibility
to adapt the rules to individual area needs is crucial.
Creating a holistic customer view. CRM solutions must bring together
all of a customer�s transactions into a single view so that the context
of his or her activities is always visible to whomever is dealing with
any aspect of that customer relationship. CRM solutions must also capture,
analyze and help you understand the behavior of that customer and target
products or offers that will be of genuine interest. This requires a strong
data management philosophy and smooth workflow that allows actions to
be based upon customer events. Don�t overlook existing resources and systems.
You probably have valuable information in existing data warehouses and
historical transaction databases that should be incorporated into your
customer view.
Improving the level of service by performing real work. Workflow
is integral to CRM applications. Look for robustness. And beware of vendors
who exclusively equate workflow with routing. Today�s systems can be far
better. Again, be sure to select a system in which rules define and drive
the business processes. Remember that rules allow you to add new functionality
quickly and easily, creating competitive advantage without the costs associated
with de novo development or package integration. A CRM solution that incorporates
workflow, supports product and service delivery at each touchpoint, allowing
critical tasks to not only be initiated, but actually performed, eliminates
the error-prone handoffs and costs associated with executing these routine
yet critical activities. Sales and service tasks are performed consistently,
accurately and efficiently � redefining the customer interaction �moment
of truth� from error avoidance to value-added needs anticipation and an
understanding of the customer�s financial objectives. Sales and service
personnel can perform functions ranging from basic service to prospect
profiling, suitability analysis and account opening through stop-payment
entry, beneficiary change, fund redemption and trade entry, as appropriate
to their business function and skill levels.
Providing the highest degree of accuracy and reliability. Delivering
a superior level of service means that your sales and service personnel
must have access to real-time updates, complete information, appropriate
customer and transaction history and audit trails that explain each step
in the service process.
Including effective self-service options. Self-service is a �win-win�
concept for both you and your customers. You win by lowering the cost
of providing service, they win by gaining a new level of convenience and
autonomy. Therefore, be sure to include plans for a comprehensive self-service
option that includes both IVR (interactive voice response) and Web self-service
options. To be successful, this option must truly support an acceptable
level of service activity and options. Customers should be able to have
the same comprehensive view of their data that your internal staff can
access. Not only should your solution provide integrated Web capabilities
to provide a self-service channel to customers, but it should also incorporate
automated workflow so that customers can truly perform work rather than
merely log their service requests and wait for a response. Your customers
should be able to execute the same business processes as your call center
representatives.
Seamlessly integrating the front and back office. Today�s organizations
are large and complex. They typically incorporate many different business
units, departments and service areas. Each business unit may have its
own complex set of systems, applications and hardware platforms. You cannot
provide a superior level of service if your customer is forced to wait
while your service agents navigate this complex maze. Connectivity and
seamless integration are more important than before.
Accommodating unique and ever-changing business requirements.
Every customer is different and every business is different. Therefore,
every CRM solution must also be different. For that reason, it�s impossible
for a CRM solution to be used �out of the box.� Customization will always
be required, and as the solutions get bigger and more complex, the amount
of customization will grow. The trick is to have a solution with the architecture
and tools that enable customization. Since products change and competitive
conditions fluctuate, your solution must be flexible and changeable. Be
sure that your CRM solution embodies an easy-to-use rules set, enabling
you to change all aspects of the system, from how an individual customer
is managed, to how, when and from where back-office information is gathered.
A CRM solution relies on information, so it must retrieve it from, and
send it to, virtually any data source. The workflow solution encapsulates
system interfaces and normalizes host data to create a 360 degree view
of the customer. Also, be sure that your CRM solution is based on an XML
architecture that normalizes and standardizes the data before presentation
to the call center agent or customer, or in a self-service environment.
Growing with you. To survive, your business must grow. Customers,
staff, interactions and requests increase each year. Mergers and acquisitions
will bring new customers, systems, networks and data repositories. When
selecting a CRM system, determine if its architecture will support this
growth. Inquire about production usage, concurrent users, n-tier approach.
Be sure that it can grow, extend to and accommodate thousands of simultaneous
users, sharing information and work queues across multiple contact centers.
Make sure that its connectivity options are flexible and easy to extend
to rapidly assimilate merged companies.
To summarize, don�t limit your solution to your immediate business objectives.
This may result in some short-term benefits, but eventually it can interfere
with your ultimate success. Start with a well-planned customer service
strategy that is driven from the top. Be sure that your strategy is comprehensive,
wide-ranging and well-defined. Once that strategy has been defined, use
it to define your software evaluation criteria.
Make sure that the software you select supports the entire strategy,
and be clear about how you will shift your focus to a customer-centric
approach. Then you will be well-positioned to quickly implement the solution
in areas where you can achieve immediate benefits, and gradually extend
the solution across the enterprise.
Jack McAvoy is vice president of communications for Pegasystems.
1 Surviving in
an E-Business World. AMR Research, Inc. 1999.
2 Strategic Analysis Report. GartnerGroup, September 27,
1999, W. Close and C. Claps.
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