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6 Steps to Effective CRM Implementations

Article By Ari Buchwald & Jamie Botdorf September, 2002

You’ve read the articles. You’ve attended the trade shows. You’ve done your homework. Your company needs to implement Customer Relationship Management, or CRM tools and techniques, in order to gain or maintain the competitive edge. Now what?

If the idea of launching a CRM implementation seems rather daunting, take heart -- it can, and has been done successfully. But make no mistake; it can be a substantial undertaking. Many projects have floundered under the sheer magnitude of it all (as many as 40%, according to some sources). However, this doesn’t have to be your experience.

Following are six key practices that characterize successful CRM implementations. With these steps to guide you through the maze, you will be well on your way to implementing an effective CRM project.

Step 1: Identify internal champions

The first key is the creation of a team that is committed to the vision and readily grasps why the initiative is important. No one can implement CRM alone. To ensure the effectiveness of the team, assemble champions from every corner or the organization. Recruit members from upper management as well as each department or business unit.

Usually Operations, Sales, Customer Service, Internet Support, and IT are involved; but don’t forget others like Accounting, Legal and Human Resources.

These members become the project advocates to and for their respective areas. They carry the message to those who will be impacted by the project. Their main message is that this is not just the latest crazy idea or management fad. It is an organization-wide effort and a new way of doing business.

Step 2: Gather consensus on the definition of CRM

The next step is to develop an internal consensus on what CRM means. This may seem obvious, but it’s not quite as easy as it might first appear. What does CRM mean to you, management and your customers? How broad or narrow should the definition be?

If you were to ask four CRM vendors for their definition of CRM, you would most likely receive five different answers! Why all the confusion? Because defining CRM is like the old adage about the three blind men trying to describe the elephant.

Internal consensus will be necessary to gain buy-in for future phases and drive acceptance of paradigm changes, such as alterations to operational procedures and adoption of best practices.

The definition should address broad business practices, outlining a customer-centric philosophy rather than a detailed plan of attack. For instance, “Customer Relationship Management is the maximization of the value of the company to the customer and the customer to the company.”

Step 3: Develop the Vision

Once the team has formed their definition of CRM, the next step is to determine what CRM means specifically to the organization. Why implement a CRM project? What shape will CRM practices take for each customer touch-point within the organization?

Create a vision statement that incorporates the particular business goals and objectives of the company. Gather input from those on the front lines as well as upper management. When completed, the documented vision will serve to guide the activities and decisions throughout the rest of the implementation process.

There are two critical issues to keep in mind:

A: Business goals come before technology solutions Define the business goals before selecting technology. Too often, companies are under pressure from management or a vendor to begin a CRM project without identifying what the real goals are.

Business rules should define the system. Take the time to list specific goals relative to the definition developed in Step 2. And do this before researching technology solutions. Review what is happening today, how it has been tweaked or optimized for specific situations, and what the ideal processing should be. This is the area in which buy-in can be most critical. Process owners may perform tasks in specific ways and may be reluctant to let go of their ideas or past work.

This crucial step represents the most common point where projects begin to go off course. This is the time to evaluate everything thoroughly and determine where changes or improvements are necessary. Once a firm understanding is developed, then technology solutions that match the requirements can be considered. Not the other way around.

B: Customers, not business goals, measure success Defining business goals is a necessary step to ensuring selection of the appropriate tools and the development of efficient customer-centric procedures. These goals are not, however, the same criteria by which to gauge the success of the CRM project. It’s important to always keep the customer foremost in the process and approach success from the customers’ perspective.

Internal goals are often along the lines of “sell 10 more widgets” or “lower operating costs by 3%.” But these are the results from focusing on customer interaction, the ends – not the means. They are the measures of doing the right things.

By focusing on the process, the desired result will come. Trying to force results will invariably result in wasted time. You should define success by how enjoyable it is for customers to do business with each forward facing (Sales, Customer Service, Accounting) aspect of the organization. Failing to focus on the customer heightens the risk of not meeting any of the original business goals.

Step 4: Share the vision

With a clear vision in hand, the next step is to generate curiosity in order to build company wide awareness. Develop a catchy slogan or a project name. The goal is to keep the importance of this initiative in the forefront of everyone’s minds.

Establish communication channels for sharing success stories, answering questions, and addressing concerns. This internal CRM initiative can be accomplished with newsletters, emails or even via an Intranet site.

To help people get on board with the project, boil the vision down to one or two sentences or use word pictures. For example, develop names for customer profiles. “Karen – the Soccer Mom” might represent your average customer. Demonstrate how each aspect will enhance Karen’s relationship with the company. Share the vision in terms of how the CRM project will impact Karen.

Step 5: Manage expectations

Is there internal consensus on how quickly the company should see an ROI from the CRM project? How much time has been allowed to implement new procedures and software? How high are the expectations that CRM will deliver significant cost savings or increased income? What is the pace of change within the organization?

While roles and responsibilities can be well defined and easily redefined, people tend to be uncomfortable and resistant to paradigm changes. They may be committed for a short period, but if they sense failure, additional work without reward, or mixed political pressures, they will return to old, familiar practices.

Establish quick-win milestones and easily achievable goals to keep the workforce on track. Set realistic expectations and don’t lose heart halfway through the process. As one Marketing professor was fond of saying, “Great marketing will only hasten the demise of a poor product.” So it is with CRM systems. Understand what this CRM implementation can and cannot do. Realistic goals within CRM projects never fail to meet reasonable expectations.

Step 6: Continually refine efforts

Once the tools are in place for delivering on the vision, don’t assume the project is done. One benefit of CRM is the ability to “sense and respond” to customer needs. Make sure this also applies to the entire enterprise and that the organization does not rely on technology as the sole business solution.

Constantly refine the process. Revisit the vision, documentation and training regularly to see if it still applies. Establish and maintain clear internal and external feedback channels. Identify where the information goes and who has the authority to act on it. Success must be measured from the customer’s perspective, so use metrics such as types, number, and frequency of issues as well as time to resolution.

Solicit ideas from those who regularly interact with customers. And don’t be afraid to interview customers, both the happy and the not so happy, to gain feedback on the feedback process itself.

Set up systems to acknowledge, reward, and empower everyone in the organization to provide great customer interactions. Encourage those who are already taking steps to improve customer relationships. Keep the cycle going – make it harder for your customer to want to do business anywhere else. This is, after all, the competitive differentiator and the reason you began the process in the first place.

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