Deception Point @ CRM

Dears,


This article is more of an introspection of the CRM program execution that prevails over a decade and an attempt to identify some vital deception points in CRM initiatives.
When companies started to realize that they might have been just a little misled about the costs and benefits of CRM, one of the witty professional renamed it as 'Clever Repackaging Mechanism - CRM'. This was because he believed that CRM was just a combination of some very simple classic business disciplines, such as customer database marketing, key account management, people management, quality, supply chain management, change management, risk management, customer service and latterly e-business, combined to create a rather complex but often not very well articulated, planned or managed business change programme.

When the first CRM disasters began to occur, the same witty professional referred to 'Client Rip-off Menu' – CRM, because in retrospect many more System Integrators and Product Vendors than clients seemed to have made money out of CRM! One way System Integrators and Product Vendors achieved this was through a sustained campaign of hype, consisting of a combination of almost 'self-evident' requirements, such as 'a single customer view', justified by different 'burning platforms' such as, for example, severe customer attrition, escalating costs of customer recruitment, the need to reduce the costs of customer management radically and quickly, and of course that all-purpose justifier, competitive advantage and so forth.

Over a decade, most CRM programmes are barely worth the name, particularly when a vision of CRM has been foisted on the client by a high-powered consultancy or firm of analysts. Before we explore the perniciousness of this, let us explain why so many companies were (and still are) vulnerable. It is because the quality of what we call 'business discourse' has plumbed depths usually only plumbed by poor CRM evangelist and Business Consultants. One reason for this is PowerPoint culture, which makes managers decreasingly able to produce connected arguments.

This low quality discourse occurs in a less detectable and possibly more pernicious form within CRM. This version of the disease is called 'personification'. For grammarians, personification means treating something (anything from a car or a company to a country) as if it were a single person. This is harmless in daily life, but potentially catastrophic in management. Why? Well, consider the phrase, 'Company X does Y, or believes Y'. While a small company might be so in control of its actions or thoughts to achieve this degree of consistency, the large companies who constitute the suppliers and clients in the world of CRM are rarely in this situation. Take the suppliers of CRM systems. They can be divided into suppliers of CRM software and services (including implementation and outsourcing), with many companies straddling the two.

While suppliers of single software packages might be capable of maintaining a relatively simple vision of what CRM is and how information technology supports it (indeed, this vision may be their prime differentiator), the implementers - particularly those who serve very large clients - are in a very different situation. The largest implementers are giant companies, usually global in scale. They are typically involved in helping giant clients, themselves often global in scale, change the way they manage their customers. Neither supplier nor client can in these situations ever be personified as described above. Our experience is that successful suppliers succeed because they work closely with their clients, whose view of where they want to go in CRM is often fragmented. For example, a big insurance company may in each country in which it operates have different visions of where it wants to go in CRM in its direct division, its life and pensions division, its broker division, and so on. Many such companies have tried to bring their different visions together, and failed. Some have turned to consultancies that have produced simple templates representing visions and implementation plans, and tried to use these templates to impose change upon the organization - and failed. This is because of big differences in the skills and capabilities possessed by the different divisions, and of course differences on the buy side - different competitive pressures, channels of distribution, and of course customer needs.

The lesson - the bigger the company, the less relevant and the more foolish the idea that a single vision is needed. In many cases a portfolio approach could be more relevant. The idea that a very large supplier should or even could have a single vision is similarly stupid - many large suppliers succeed by having the skills and flexibility to work with different business partners (eg software suppliers) to develop and deliver very different visions of CRM to their clients. This is, by the way, true in nearly all areas of systems. Of course, there are massive economies of scale to be gained by standardizing on systems, but as our research has shown again and again, brilliant systems are neither a necessary nor a sufficient condition for success in CRM. That is why the more discerning clients do not want a vision, but pragmatic advice and results, taking into account the variety and possible inconsistency that exists in their own situation

The moral of the story is simple every organization has its own vision formulated and diversified in terms of what they want to achieve in a different portfolio of their business , CRM should become the enabler of this vision accommodating the diversified needs of business group rather than to superimpose the CRM Product vision on the Client ‘s Vision. This exercise of resisting to CRM deception points is not simple as it may sound and requires intelligent introspection from top executives of the company to lay down their CRM plan before it gets baptized by third party arguments and still hold on to the true CRM vision of the company.



Loving P&C


DC*