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December 18, 2009

Clouds on the Horizon

Grand Shower

If 2009 was the year of social media, I predict 2010 will be the year of cloud computing. To be honest, I will welcome the change. There were just too many newsletters and webinars on how to use facebook for lead generation. I am happy to change subjects. Of course, social media is not going away. If you don’t have this included in your CRM strategy, it is time to rethink that position. However, you are also going to be forced via the tech press to get your head in the cloud.

So, I am not planning on making this entry a treatise on computing in the cloud – you have lots of other places to go for an education. Instead, I think it would be useful to understand some of the ramifications around CRM technology, especially for those who are on the verge of making decisions regarding the investment of a new platform. The nature of the cloud is something to take into consideration.

Some of you out there are teetering back and forth on whether to go on premise or SaaS. Every day there are more reasons to go the path of software rental and it is all because of the cloud getting more and more populated with applications. Because so many software vendors are building their applications to be accessed via the web, the likelihood of finding a solution that snugly fits your business requirements is getting higher with every release.

Even if you do choose to buy licenses for an on premise CRM solution, there is a good chance you will be connecting SaaS applications to it because of this exact phenomenon. Somewhere out there is an app that fits what you need.

Perhaps more important is the selection to be made between SaaS CRM platform vendors. While all of these folks are up in the cloud, some are more connected to the cloud than others. Top tier CRM packages are like planets with gravitational pull. They attract moons into their orbit. However, these are not all created equally – some have more gravity and attract more moons, becoming more like a big solar system. This is to your advantage. The more vendors that write code to fit up nicely with a CRM platform, the greater the likelihood you will find one that fits your requirements with precision. You get a composite application that fits together seamlessly, reducing your implementation costs and driving up your adoption. This translates into higher success rates for CRM programs.

I prefer not to name names here, but with a little bit of research you will see for yourself which vendors have generated the most gravity. Back in the 90’s we used to talk a lot about having to make the choice between single vendor platforms versus best-of-breed approach. Well, that whole debate now goes away because you can get a best-of-breed galaxy and have it act like single platform. You just need to decide which vendor has the best options in their orbit to suit your needs.

If the transition from the atmospheric metaphor to the astronomical lost you, the connection is this. Vendors who write their software to be accessed via the web are operating in the cloud. This computing paradigm enables what can be seamless combinations of applications that are tailored to fit your business. In the universe of CRM some of these platforms have attracted many vendors to build their applications to play nicely together. If you are in the position of having to choose, I suggest that you consider the platforms with the most gravitational pull. Not only do they have the best chance of satisfying you now, they will likely attract more and more new apps – things are being built right now to satisfy needs you don’t even know you have yet.

Watch out for those asteroids!

December 11, 2009

For Mature Audiences Only

I remember when the motion picture industry first came out with its movie rating system. At the time I was just a kid and it was the first time I encountered the word “mature”. So, one night while at the cinema I required my mother to explain to me the meaning. Rather than just tell me that some movies were for kids and some were for grownups, she attempted to explain to me the more elaborate definition (she was a career-long school teacher and every long car ride involved a lesson of one kind or another). What was strange about it all to me was that one would be required to reach a certain level of maturity in order to watch a movie. It did not help my full comprehension that my parents often let me accompany them to more adult-oriented movies, even as a pre-teen.

Thanks to my mother this lesson really stuck and, believe it or not, I think this whole maturity thing plays a critical role in managing CRM strategy and program planning. For example, a very common request that I typically field from a new client will be to help answer the question, “what should be next for our CRM program?” Naturally, as a consultant my answer is always the same – “it depends!” But I am not acting flippant with this response; it truly does depend on the maturity of the different elements within their program. The best things to focus on are commonly those that are less mature and most likely holding back the effectiveness of the whole program.

So, you are probably wondering, does this mean some CRM programs are PG13 while some are rated R, and then are there serious programs out there, which get the infamous X rating? Well, no, that is not exactly the right way to think about it. I prefer to think about maturity on a five point scale. At the low end of the continuum (I prefer not to use the term “immature”) are program elements that we might view as just getting initiated such as a first attempt at creating a customer segmentation model. On the other end of the continuum would be what we might view as world class capability – you do it as well as the best companies on the planet.

The next thing you are probably asking is what exactly is it that we are rating on this 5 point scale? Naturally, that gets another, “it depends”. Some of our clients want us to look at their whole CRM program to determine what is needed. Then, there are those companies that have a very focused need, they may want us to focus just on campaign management – where are they on that five-point scale and what do they need to do to advance just that one CRM element to the next stage of maturity? We can work at either end of that range, and everything in between.

When we focus on the whole CRM program we take a look at the full spectrum of CRM domains:
- Technical CRM,
- Functional CRM and
- Enterprise CRM.
Technical CRM is what many people think of when they consider CRM. It is the software that defines the industry. But there is more to it than just configuring your CRM package. You also need to consider the data, which may be in many places. Then you also need to include the integration and middleware that brings those disparate data elements together into something useful. And then supporting all of this is the infrastructure in place to make it wall work – servers, networks, portals, handhelds, all kinds of stuff that make up the backbone of our CRM technology.

Functional CRM is all about the customer touchpoints. How do you make your company known to prospective customers? How do you convince them to become customers? How do you keep them happy customers once they are through the door? These are the business functions that touch the customer. CRM is all about how those customer interaction processes work and how to make them as effective as possible. For example, are your pipeline management processes well developed? Do they need to become more mature? And don’t forget about your partners who sell and service for you? The channels you have established to reach and support your customers are also one of these functional components. Don’t leave them out of the maturity assessment.

Enterprise CRM includes all the other parts that can be overlooked. What is your customer strategy and how well is it aligned and executed across the customer facing functions? What measurements do you have in place to know how well you are doing relative to customer-facing objectives? And then there is your company culture – is it customer friendly? Finally, achieving higher levels of CRM maturity requires the ability to define and implement initiatives. How well do you manage programs – process improvement initiatives, technology deployments and the management of these organizational changes? Yes, this is all a part of the CRM capability.

If you are really focused on CRM software as the center of our program, there is a good chance some of the other elements are not as well developed. Often customers will ask us about what tools they should add as the next step in their CRM program. If all of the focus has been on the technology, our answer will probably be to focus on something other than a tool as the next step. Here is the reason. The least mature element of your CRM program may be the least common denominator to your success. If you have good software but weak processes or poor alignment with your strategy, adding more software is not going to make you more successful. You have to address the less mature items first. If you want to run faster, but you have a strong leg and a weak leg, don’t exercise the strong leg more – the weak leg is what is holding you back.

Weak Link

Improving your CRM capability can be managed at multiple levels. You can assess your maturity with the big picture as the focus or you can get up close and personal with targeted capabilities that you know need attention. If you are not sure where to begin, start at the broad level. If you are confident that you know your weak links in the chain, examine them in more detail. Improving those links then will make the entire CRM chain stronger.

Good luck with your maturity rating analysis, and don’t forget the popcorn.

December 04, 2009

Time Out

It is basketball season again here in the states. Having come from Indiana, the home of Hoosier Hysteria – the epicenter of basketball madness come tournament time, the return of hoops always gets my attention. There is an amazing drama in a closely matched game. I have never seen so many people with their hearts in their throats when there is the potential for a buzzer beater to change the outcome. When I played bball as a kid in school I got butterflies before every game. It never happened to me on the football field nor did it happen on the baseball diamond. Something about basketball.

Today the sport is big business. University coaches make as much as top CEOs. High school stars hold press conferences to announce their choice of colleges. Each game is played starting long before the first jump ball. Coaches spend hours viewing scouting tapes. Offenses create new plays to surprise the opponents who have been watching those same tapes. And every game includes a defensive plan as well – how to handle the big guy, how to handle the hot shooter, who to double team. The game plan is comprehensive – both sides of the court are covered in order to maximize success.

The best teams make the best plans and execute best on those plans.

Hoop Dream

Time out - so, this is why I don’t get why so many of the organizations that I work with don’t want to include customer service in their game plan. Too often when I am asked to help build a CRM strategy or facilitate the development of a CRM program plan, the services end of the court gets left out of the picture. You can’t win a basketball game just on making baskets. Likewise you can’t get the most of your CRM approach focused only on business development. You must include the service element in the game plan to maximize the w’s in the win/loss column.

More often than not, the rationale I get is that the customer service folks have their own CRM system, so, they don’t need to participate in the commercial group’s program. This is like attempting basketball with three players on offense and two on defense, but not letting them help each other or have any interaction on or off the court. You can’t win that way – you will always be outnumbered. Everybody needs to be in the game on the same team and with the same plan.

There is nothing worse than a sales rep showing up at the client and finding out that there has just been a big service disaster, which they knew nothing about, and just when they were planning to have a conversation about a price increase. If there were a better mechanism in place for communication about account activities, these embarrassing client interactions would not happen with the frequency that they occur. And the communication flow needs to flow both ways. The services folks need to know the strategy for the account from the sales and marketing side of game plan. This helps them align services correctly and assure that top accounts get the right attention.

In the healthcare industries on which I focus a similar dynamic occurs with the field medical liaison team. They get left out of the CRM discussions all the time. Just because they don’t sell does not mean their customer contact is unimportant. CRM is meant to focus on all customer-facing activity and maximize the effectiveness of those activities to maximize the effectiveness of business outcomes.

So, the next time you get into a pick-up game, remember that you have to play both sides of the court. Then, let that be a reminder to you that you need your CRM plan to include both sides of the court as well.

Time in.