Lend Me Your Ear

[From iSource Business, May 2001] Let's play what if. What if you knew your final customer so well that every contact with him or her resulted in an order? What if you served him so well that you never had anything returned? What if one, simple event an order did all this: generated a warehouse packing slip, a shipping label, an invoice and the start date for the warranty. It would also create an alert to the sales department to follow up with and thank the customer for the order, and it would tell the service department to schedule an appointment for installation. It would send an e-mail to the customer confirming the specifics of the order and asking if the scheduled delivery date is acceptable. Then, three months later, about the time a reorder would be expected, another e-mail goes out thanking the very valued customer for his past business and offering a discount for a new order.

And, even better, what if your call center agents could see all that information, along with the very valued customer's credit standing, any discounts he's entitled to and the status of his orders? What if that very first online order meant that no one else in your company had to type in the customer's name, address and phone number ever again? And, wonder of wonders, what if customers could check all of this information for themselves?

Such a real-life example of this happened at State Street Corp., a Boston-based financial services company managing more than $6 trillion in assets. Customers can access their account information, which allowed the company to reduce the number of employees in its call centers and eliminate its reputation on Wall Street as being meeting central.

Now, just a few more what ifs. What if decisions relating to new product development, marketing campaigns and supplier contracts started by asking, How will this help our customers? What if everyone who works for your company had the authority to solve a customer complaint on the spot? The luxury car manufacturer, Lexus, tried this and moved from a question mark to an industry benchmark in 10 years, making them the best-selling luxury car manufacturer in the country.

What would transforming your customer management process mean to your company and your supply chain? 

Their Interest Just Keeps Growing

These are the kinds of questions refocused customer-centric organizations are beginning to raise as they evaluate the ramped-up efficiencies of today's customer relationship management (CRM) technology. A $19 billion industry, CRM technology wags a judgmental finger at the efficiency buzz of the 1990s that cut off contact between the supplier and the customer, the most critical stakeholder in the supply chain. A recent study from business analysts Gartner Dataquest revealed that companies individually budgeted more than $1 million for CRM initiatives in 2000, a figure that is expected to double by the end of this year.

As a strategy to attract and retain customers, the CRM technology pay-off can potentially offer enormous benefits in increased sales, lower marketing and advertising costs, higher customer retention, better use of staff, and more efficiency in processes as employees share information. Still, one Gartner study reveals that only 3 percent of companies have implemented CRM, calling it a fantasy in most organizations.

Most companies don't get the full benefits of CRM primarily because they don't understand or won't accept that it's not a piece of technology that you unpack, plug in and run. And it's not something that comes from sales, marketing or even the information technology (IT) department. To work, acceptance of CRM has to start at the executive level and then drive down to every business unit of the company. Firms fail [at CRM] because they think it's something they buy and simply plug in, says Gartner Group vice president and research director Scott Nelson. At its core, CRM is about people. It's strategy, tactic, processes, people and technology.

That usually means change, and lots of it.

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