Customer relationship management has historically been seen in an all-too-literal sense, as dealing only with the relationship between the customer and the contact – usually a salesperson. It’s a way of keeping track of the contacts made with the customer or prospect and the progress in handling their needs in sales and after-sales and taking the opportunity to cross-sell and upsell. Traditional CRM may have provided information on the success of a promotional campaign, but that’s about as far as it went back into the analysis of the company’s business. It has often become a silo, with the consequence that its front-line users, the salespeople, saw little benefit from it to compensate for the extra workload entailed in entering data into an often unfriendly system.
Now the picture is different; the CRM package and what is usually called “business intelligence” are closely linked, indeed almost the same thing. The output of CRM is used to maintain the pace of the business, ensuring the right stock is on-hand and the right people available to handle the customer’s needs. It even plays a role in planning for staffing levels. And the benefit of that aggregate data can be accessed by the customer-facing staff.
A Forrester survey of North American companies established that most of them saw improving the customer experience and retaining customer loyalty as critical priorities. These are key capabilities of CRM, yet the organisations surveyed are dissatisfied with the capabilities of current CRM systems. Particular concern was felt at poor integration with other applications and data sources, unsatisfactory vendor support and a long lead time before any value was derived from the CRM software.
While we like to think the enterprise leads the way in all forms of technology, it’s not always the case. There are lessons to be learned from small-to-medium-sized businesses - they’re light, they’re agile and frequently looking for the latest technology to give them the competitive edge that worries the large incumbents less.
A thinking CRM
Providence Marketing of Auckland is set on exploiting this advantage, though only a recent convert to full-scale CRM. The company provides the sales, marketing and after-sales service front-end to whiteware and brownware importer TIAG. With about three months’ use of Oracle’s hosted service CRM OnDemand, it is already seeing the broader benefits to the business, says director Henry Cassin. “We have better control over the parts that get sent out with a servicing call and can set up the call much more quickly” – matching the customer’s explanation of the problem with a diagnostic database of faults, particularly the most common ones, assigning a serviceperson and ensuring the right parts are sent out, virtually in real-time.
Transferring the data into the necessary systems used to take 10 to 15 minutes, with processes based on Excel spreadsheets, says Cassin.
Providence also wanted a system to monitor the performance of the service personnel it contracts to do the maintenance and repair jobs and the differing prices contractors charge for a similar job. The company also uses CRM data to build up the database of common faults with certain pieces of equipment, recording “scenarios from history”, as Cassin puts it. Such functions might in the past have been considered the domain of business intelligence.
“We wanted a system that would think for itself,” he says, one that would have a repertoire of default options automatically coming into play, unless the situation is out of the ordinary.
Providence only has seven staff, but is turning over $15 million a year, handling imports from China, South Korea and Italy and dealing with large-scale retailers such as Mitre10 and Bond & Bond.
Providence chose the hosted (Software as a Service) CRM because as a new company it didn’t want to commit to purchase of a package with huge functionality, not all of which would immediately be relevant. “We wanted something that we could add to in an orderly way as we developed.”
Eventual integration with the company’s financial and other appropriate ICT functions was one of the key criteria for choosing the Oracle offering, says Cassin. Though only using it for reporting at this stage, the company plans to integrate CRM with its financial systems to be based on MYOB.
“The most critical benefit as I look on it is time management,” Cassin says.
Better control of staff time will help them become more productive and give the company an insight into staff levels needed for growth.
Cassin has a sales role himself in the top half of the North Island and has trained on the system. It takes as little as two or three hours to become reasonably proficient, he says.
Master data management
It’s pretty clear a growing number of organisations will choose hosted ‘Software as a Service’ for their applications, with CRM a front-runner in this respect, says Will Bosma, Oracle’s Asia-Pacific vice-president for CRM. This trend has very much started in small-to-medium businesses who are sufficiently resource constrained to look for an offsite solution, he says.
CRM is an indispensable ingredient of call-centre customer servicing operations, he notes and these are also increasingly outsourced. A logical move for this combination in the future is towards customer self-service and CRM will have to evolve to support this trend. Typical applications for self-service are electronic bill presenting and payment and customer examination of account details online. “We are starting to see analytics built in to hosted self-service,” he says, and this makes it easier to identify a customer who might be susceptible to a cross-selling or upselling pitch. Statistics indicate that ‘self-servers’ are more open to such approaches, says Bosma.
Appropriate analytics as part of CRM can deliver something of value both to the customer and the sales or support person, he says. It is no longer simply an application for management to follow the big picture.
“It’s early days, but I think we’re seeing use of real-time analytics” that will recognise what context the customer inquiry or customer-sales staff interaction is in as it progresses and provide appropriate information, deriving, perhaps, from accumulated experience of previous customers with a similar problem. Providence’s identification of fault symptoms is an example of this.
Bosma also sees more integration of CRM with other business processes. “Applications will be pulled together to provide end-to-end business management.” Having some applications operating in hosted mode and some in-house should not be a barrier to this, he says.
Master data management is the ultimate form of such integration, where there is a central database on which CRM, back-office applications and the company website all draw from.
There is still some resistance to CRM systems among sales and marketing people, Bosma agrees, and users and vendors need to understand what they’re saying. “We need to make the application easier to use and accessible wherever they are, and it needs to provide them with some insight [that they would not have normally]. That’s where the benefit comes from.”
The CRM market has “matured significantly”, adds Bosma, in that it’s not the features and functions of the product that inspire a user to choose it; the extent of the support and help provided by the supplier is as important, if not more so.
Scott Hirst, CRM solutions architect with SAP, also says ease of use is crucial and this is not just a matter of a straightforward user interface. “The trick is to deliver visible benefits [to the customer-facing user] and not to generate noise”.
One powerful approach to this is to recognise frequently encountered scenarios and establish pre-packaged sequences of tasks to handle the situation. And that is where the link to business intelligence plays a role, he says. “If we aggregate and summarise all the information we have, bringing in, for example, third-party demographic information”, these patterns can be more easily recognised and prompt an appropriate response. Alerts should be triggered signalling changed behaviour by a customer, without the user having to perform their own analysis to discover it. Characteristics such as the danger of a customer “churning” to another supplier are vital information. It can best be deduced against a background of accumulated information on the whole customer base.
Different information is, naturally, appropriate to users playing different roles in the company, says Hirst.
Interfacing with financials
Procurement company GSB Supplycorp has a different CRM experience, having been using Sales Logix CRM since 2004 and making it the centre of its contact management and financial system. Data flows between CRM and the financial applications, the organisation’s web portal and a data warehouse, says Jamie McNabb, general manager of business intelligence.
Sales Logix functionality and pricing influenced GSB Supplycorp to adopt the separate CRM application, crosslinking it to the company’s Exanet financial system, rather than buying a complete integrated suite.
GSB Supplycorp provides procurement services to government agencies and businesses, using the power of aggregated demand to improve prices. A sister company Conexa develops procurement technology.
At first GBS staff had a negative reaction that has been common among those first experiencing CRM. “When we first put it in, a lot of people asked ‘Why do we have to use this?’” McNabb says. Part of that reaction was a normal aversion to change, he says, but an element of “control and visibility” also came into it. People had their own systems in place and disliked having what they did visible to everyone and under centralised control.
This changed, however, as users realised the advantages gained by the information available on the history of transactions, as well as the advantage of being able to exchange information smoothly for a co-ordinated procurement exercise involving staff in different geographical centres.
Typical of the early phase, he says was “a salesperson who came to me looking for information [on past transactions] I said; ‘look in Sales Logix’ and I showed him how; it had always been there.
“Now when the application goes down people start yelling ‘where’s my Sales Logix?’ They can’t do without it.”
Interfacing with the financials was quite straightforward. “I’m lucky enough to have people who know SQL very well and if you have that knowledge it’s very simple. We planned [the links] just with a big whiteboard session, saying ‘these are the variables; this is where they are set and this is where we want to see them’.”
A change of customer address, for example, is set in the CRM application and propagates through to the financial and other systems.
The system is based on two servers, in Auckland and Wellington. Salespeople on the road, at a customer’s premises or working from home, can keep a copy of the entire database on their laptop, which is reconciled with the central copies the next time they link to the company’s virtual private network.
“Personally, I’m not enthusiastic about taking a laptop to a meeting with a customer,” McNabb says; “it can be a barrier. But some people like to work that way.”
The data warehouse, built from data input through CRM, can be used to explore in-depth dealings with one particular client, but is also used for typical business intelligence surveys of the whole pattern of the company’s business. Recently, for example, GSB has been doing a projection of the shape its business might be in four or five years from now, based on growth trends for the various sectors. “That’s been quite easy to do,” he says.
With additional reporting from Patrick Gray, MIS Australia.
CIO New Zealand Business Software Guide 2007
© Fairfax Business Media
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