Customer Think’s Bob Thompson has said that CRM, “the successful kind, anyway, is a misnomer.” Thompson’s research shows that “successful companies don’t manage customer relationships any more than you manage the relationship with your spouse.”

This didn’t stop business executives from rushing out and buying CRM software as a “shortcut” to getting more revenue and profits. Thompson defines CRM as ”the management of the value exchange between the enterprise and its customers, including partners and intermediaries, such all parties benefit, leading to long-term loyal behavior along the value chain.

” Not a bad definition — and note the fact that the word “technology” isn’t used. This reporter once met up with Thompson in San Francisco. He met me at my hotel and we went for dinner, and on the drive he asked what I thought of CRM, how it was doing and what was going on. After I talked for a couple minutes, he said “You’re just talking about technology.” And he was right.

That said, you need the correct technology to implement your customerfriendly, loyalty-inducing policies and practices. Sending Alex Rodriguez or Manny Ramirez up to the plate does your team no good if you don’t give him a bat. Without the correct technology, having the best hitter in baseball does your team no good at all.

________________________Sending Alex Rodriguez or Manny Ramirez up to the plate does your team no good if you don't give him a bat. Without the correct technology, having the best hitter in baseball does your team no good at all.
_____________________Customer Relationship Management is anything you do or use to help your company understand, relate to, and market to your customers. First you decide how you want to do that — and then you go out and find a tool to help you do it. Otherwise you’re sending ARod up to the plate with a pool cue and Tiger Woods to the putting green with a tennis racket.

Right now the hot technology among all companies — big, large and small and a guy in his garage — is ondemand. This is where you basically pay a monthly user’s fee to rent someone else’s applications and data storage. It works if you want to be up and running quickly and don’t want the hassle of dealing with installation and maintenance. On the other hand, going on-demand costs more, in the long run, than staying on-premise, andsome companies still aren’t comfortable with their data residing on someone else’s server.

The basic tasks CRM focuses on were broken down a couple years ago and have stayed pretty consistent since. Analytical CRM is where you take everything you know about your customers and target markets and tease out actionable information: “If we send out follow-up reminders one day after purchase we have low success, but if we contact them a week after purchase response rates are a lot higher,” or “If we put the diapers next to the beer we end up selling a lot more beer.” Here are all the zippy products for predicting customer behavior, planning and executing marketing campaigns, and analyzing reactions to price increases and whatever.

Operational CRM is collecting information from customer interactions and making it available to anyone: If Ed Jones contacts your Denver office and is dealt with, a company rep in Miami will have the information from that interaction when Ed calls her next week. Obviously this is where your call center technology is used.

Self-service CRM is sometimes euphemized “collaborative” CRM (a bad term). These are the tools for your customers to serve themselves — interactive voice response (phone menus) and automated e-mails are the main features here. The focus is on cost savings and getting operational efficiencies out of your Web site and other customer self-service points, and doing it well enough so you don’t offend or alienate customers.

And the differences between the technologies used for each of these functions are as significant as the differences between tennis rackets, golf clubs and baseball bats. The technology vendors listed alphabetically on the following page offer a nice selection of CRM bats, rackets and clubs. Get what you need — and good luck in the game!

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