Through the Eyes of the Customer

Five Steps to a Positive Return on Your CRM Investment

To some people, particularly those who were alive during the 90's and the dot.com days, CRM is a three-letter-word that means the opposite of ROI.  Sources reported a higher  than 50% CRM failure rate.  Back in those days, a lot of ships were sunk.  

The good news is that many expensive lessons were learned, and CRM is enjoying a higher success rate than ever.  CRM success needn't be rocket science, if some sound practices are followed:  

1. Establish clear executive sponsorship.
There must be a high-level executive with a clear presence, supporting the project; someone with authority.  And this can't be simply a Vice President who says a few words, or sends and email of endoresement, and then disappears.  The executive sponsor must be actively and visibly involved with the project.  If CRM is a priority for the executive sponsor, it will become a priority throughout the organization.  With no executive sponsorship, there's no priority.  And if there's no priority, there will be no results that matter.

2. Motivate the end user community.
This is highly-contingent on #1, and is enhanced by tying rewards to proper CRM utilization, with a "What's in it for the end-user" approach.  Telling people they have to use it won't get the job done.  Instead, show the end users how the system will make their jobs and lives easier, more productive, and more beneficial.  Taking a "What's in it for me?" approach is the most successful (with "me" being the end user; the person you're relying up to enter data, information and call notes into the system on a regular basis.  The success of CRM is highly dependent on the commitment of the end-users.

3. Clearly define your business outcomes (aka goals!)
Steven Covey said, "Begin with the end in mind."  In other words, define your outcome at the start.
For example, "We want to increase our lead generation by 50%, and reduce our cost per lead by 30%."  ROI means that you're receiving new business value, that exceeds the cost of the CRM solution.  In order  to determine "how much" return you're getting, you must first know what that return is.   Increased revenue from closing more opportunities?  Reduced costs through more efficient lead generation?  Know exactly what business value you expect to generate, before you begin.

4. Draw a clear roadmap, connecting the business goals with the system functionality/utilization.
Yogi Berra said it best: "If you don't know where you're going, you probably won't get there."  The sagacious hall-of-famer knew what he was talking about.  With CRM, if you expect the system to deliver results, you better know exactly how it's going to do that.  In other words, be able to trace your business goals all  the way back to specific functionalities in the CRM system.  For example:

Q: "What do we need to do in/with CRM in order to increase our lead generation, and reduce cost per lead?"

A: "We need to connect each new lead to its source campaign in the CRM system, so that we can precisely measure campaign effectiveness. Then we will re-allocate our marketing dollars to those campaigns which are most effective. This will increase the number of leads, and reduce the cost of each lead."

5. Continually measure your results, and refine your processes.
Peter Drucker said, "If you can't measure it, you can't manage it."  Now, Drucker was no Yogi Berra, but he held some credibility in business management circles.  Remember those business outcomes that we defined in step 3?  Well, make sure you know exactly how you'll measure your progress.  Have reports defined, and run them on a regular basis.  If you're not on track to hit your goals, drill down into the process to figure out the root cause of the shortfall.  Then adjust the factors to put you back on track.  Measure and adjust until you find yourself on track to achieve the goals.

Customer Relationship Management  projects can be highly risky.  But they can also be highly successful, if you approach them methodically, by following the five steps outlined here.  Now, there are other ways, and other approaches that can bring about a positive ROI.  If you have other ideas, please share them in the comments section.

 
 A clear captain, committed crew, a well-plotted course,  frequent wind measurements and well-trimmed sails leads to a high ROI on any Sea R M.
 

What Can Customer Service Learn from the Atlanta Test Score Scandal?

There's an important lesson  that any success-based organization can learn from the Atlanta Test Score Scandal.

Sometimes, so much emphasis is placed on metrics, that the metrics become more important than the mission. 

At the risk of simplifying our educational system, I’ll say that its primary purpose is to educate children; and to prepare them well for their next stage of education.

When metrics are tied too tightly to the rewards of the people who are responsible for fulfilling the mission, those  same people may go to extremes to optimize the metrics, at the expense of the mission.

Just as the success of an educational system should be measured on how well students become progressively better educated from one year to the next, the success of a customer service organization should be based on the satisfaction and loyalty level of customers from one year to the next.

If we place too much emphasis on metrics like Daily Call Volume, or Average Call Closure Time, agents become more focused on getting the customer off the phone, than solving problems and delivering a satisfying experience to the customer.

Metrics are important; metrics are the milestones along the path that guide us in the direction of our mission.  We just need to make sure that we don’t get so focused on the metrics, that we lose sight of our true mission.

 

Don't become so focused on the marker, that you lose sight of the reason for the trip.