Has the pursuit of ROI become out of fashion in CRM?
It seems that way. Back in 2002 when we were all up to our eyeballs in alligators due to the recession it appeared that every customer wanted to talk about conducting a return on investment analysis or build a business case to justify their CRM budget. Now the companies I talk with indicate that it is “just a given” that they have to make the investment. My how times have changed.
However, I am not fooled into thinking that we can afford to take our eye off of the proverbial ROI ball. The benefits of having a good business case for CRM program investment go beyond strictly convincing the board to approve program funding. Back in 2002 the programs with a strong business case also had some of the most clearly defined CRM strategies as well.
Why is having a CRM strategy so important? The simple answer is that the more clearly defined the strategy, the greater the likelihood of success. There is both evidence and logic to support this statement. Evidence can be found within the plethora of analyst reports coming from companies like Gartner that show strong correlations between program strategy and program success. A significant number of the reports I have seen put strategy at the top of the list for predicting success or failure. The logic behind this is pretty straight forward. If you put in time to define what you want to achieve with a CRM program, it increases the likelihood that you will actually identify the correct tactics to get there as well. And further, if it is clear where you want to be, you have a better chance of knowing when you are not getting there, and therefore you know that you have to take corrective measures to achieve your endpoint.
The great thing about developing a business case is that it forces you to think about the end state or Outcomes of your program. I believe that having a clear sense of the Outcomes is the key to successful planning. The more you understand your Outcomes, the better the chance of consensus on your end state, the greater the likelihood of setting correct expectations, the better the chances of setting and monitoring metrics, and the better the likelihood of knowing what capabilities and tactics are needed for the program to be successful.
Ultimately, if you do a good job of targeting your CRM Program Outcomes you will know what business benefits to expect from your investment. From there you can build a hard or a soft business case, depending on what you need for budget approval. Either way, Outcomes never go out of fashion.