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MEA CULPA
(Confessions of a CRM Consultant)
Let’s start with a fundamental truth: Most of what you’ve been told about Customer Relationship Management is wrong. Nobody was lying. It just seems that an astounding number of experts had inflated expectations. And no one, including us, was immune.
After five years of plunging down the path to the promised land, we think it’s high time we all stopped, took a deep breath, and examined the lessons of the past few years.
This book is our attempt to do just that. What has emerged, we hope, is a useful collection of common sense when it comes to CRM. We don’t claim to have The Truth, but we think this book is a decidedly positive step toward finding it.
– The Consultants of Deloitte
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MOTHER KNOWS BEST
Pull out your project org chart. Is Mom on your project team?
At one time or another, everyone involved with CRM gets infatuated with technology’s bells and whistles. How could you not with all the efficient, wonderful, and truly amazing things it can do?
But technology is cold and logical, and if that infatuation becomes the centerpiece of your initiative, you’re in for a rough ride. You’ll miss the human touch. And so will your customers.
So before you ever, ever think about introducing technology into your customer relationships, make sure you’ve got the basics of customer service right.
Remember the lessons you learned from Mom.
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HOW MAN BECOMES APE
Has anybody noticed how many truly awful customer relationships are being produced in the name of CRM?
While the big chiefs wax eloquent about customer centricity, bizarre things are happening when their companies attempt to achieve it.
Annoying phone calls at dinner from telemarketing agents? CRM run amok.
Hyper-aggressive Customer Service Reps who try harder to up-sell you than to solve your problem? CRM poorly translated.
Infuriating 14-level voice response systems that absolutely refuse to let you talk to a human? CRM on bad steroids.
Why is this happening? Why are so many customers getting harassed rather than helped?
More often than not, it’s because the people handed the CRM mandate are put under enormous pressure to quickly demonstrate bottom-line impact. So the lofty vision of customer centricity quickly devolves into short-term sales efforts and cost reduction initiatives.
And it works. For a while. Until short-term sales techniques and dehumanizing technologies turn once-happy customers into hacked-off customers.
Increasing revenue and aligning costs are imperative. But do so in ways that don’t monkey with your customers.
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THE VALUE POWER ALLEY
It’s not inevitable, but companies who try to be everything to everybody, everywhere, every-time, tend to fail. They don’t create enough value for their enterprise. And while their customers may well have loved them, their shareholders are now wallpapering their studies with worthless “New Economy Company” stock certificates.
Oligopolies go to the other extreme. No matter how bad it gets, their customers have no choice but to take their lumps. They’re too focused on themselves to notice those pesky customers.
Is there a happy medium?
Yes, and it lies in the Value Power Alley. Where you’ll find great companies who magnificently balance great financial returns with truly happy customers. You know them – Charles Schwab, WalMart, eBay. Ever had a bad experience with them? Not likely. Own their stock? Quite likely.
If you are one of the lucky few already there, make sure your CRM initiative maintains the balance and keeps you in the Alley.
If your company has historically forsaken profits for customers, make sure your CRM initiative disproportionately creates value for your shareholders. Likewise, if you recognize your customers only by their billing number, it’s time to get to know them. Your CRM efforts should create value for your customers.
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WOBBLES, WAGGLES, AND CRM
“Astronomers have long known that the Earth wobbles as it spins. Several irregularities in rotation – small oscillations superimposed upon larger wobbles atop even larger waggles – cause the location of the true North Pole… to meander across the Arctic landscape.”1
Too many CRM projects suffer from oscillations and end up meandering across the corporate landscape. They all start with the best intentions. But, a surprising number eventually start to wobble and waggle and lose their focus. Don’t take your eye off the customer. But keep your other one on the True North of all CRM projects – greater shareholder value.
Use the map on the opposing page and repeat these two steps often:
1. Start at the top. Working your way down, ask yourself “How will it get done?” at each step.
This will ensure that your tactics directly support your objectives.
2. Go to the bottom.
Working your way up, ask your-self “Why are we doing it?” at each step.
This will ensure that all your CRM activities lead to True North.
1) Science News Online, August 12, 2001
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LOOK BEFORE YOU LEAP
Where to start?
Too many companies focus on the things they’re already good at. Because that’s the part of their business they know best. Before you take the CRM leap, look for the right place to land.
Because improving your customer strategy won’t help if you can’t implement it. And new technologies are no good if your
people aren’t prepared to use them.
So, take a moment to ponder these key areas, and start by fixing your weakest link.
Only honest answers will be accepted.
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WHEN TOUCH TURNS TO TORCH
Be careful.
When you’re mesmerized by the act of pulling together The Big Solution to The Big Business Problem, it’s easy to miss those little flames dancing around your toes.
Most CRM projects have a Customer Experience Design Team. And they are usually hard at work, plotting out charts of the customer experience, defining the much-anticipated end-state, and preparing an enterprise-wide transition plan to get there.
Big team? Check. Big problem? Check. Big solution? Check.
It’s a big mandate. Who wouldn’t want to make the biggest difference for the largest number of customers by attacking that big bulge of average experiences?
You, that’s who. Don’t do it. At least not yet.
Start by looking for smoke. Do some mystery shopping. Call your call center. Interact with your receptionist. Speak to your service center. Sit through a sales call. Find those torch points and form a hit squad to extinguish them. Do it now, and do it fast. Then, keep them in place until all the embers have died out.
In the short-term, quickly fixing your torch points is almost always the biggest impact move you can make. Once you’ve done that, you can figure out how to make the most out of that big team.
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MIND YOUR GIVES AND GETS
One morning on your CRM journey, you may wake up and ask yourself, “How come nobody’s following my lead?”
Consider this…
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MIND YOUR GIVES AND GETS
… Making CRM work is a matter of effectively managing political capital.
To get your stakeholders to play the game, you need a lot from them (gives). So in return, you should be prepared to offer them something of value that you can deliver every 100 days (gets).
Once you’ve made the promises, be sure to mind your gives and your gets. Deposits must keep up with withdrawals. Because if your political balance drops to zero, you’re out of business.
And no matter how you look at it, bankruptcy is an ugly word.
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ESCAPING THE TYRANNY OF AVERAGES
(Why setting CRM budgets is more complex than you’ve been led to believe)
The quickest way to watch a CRM project go down the drain is to watch its costs go through the roof. Things go a lot better when initial estimates are accurate. But, the trouble is, the two most common approaches are flawed:
Approach 1: Per Seat Costs (number of users multiplied by an average cost per seat)
Approach 2: Software Multiple (total software costs multiplied by an average all-inclusive factor)
In reality, there is no such thing as average, because project costs are hugely influenced by project complexity. So both approaches give you bad numbers – usually way too low.
Use the chart on the opposing page to see if your budget is in the ballpark. Nothing revolutionary here. Just some hard-earned knowledge scraped off the scar tissue of our consultants, provided to help prevent you from getting your own budget whipping.
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WHEN IT COMES TO CRM, MURPHY’S LAW IS POSITIVELY OPTIMISTIC
If you haven’t been there already, you’re about to discover the bewildering array of things that can go wrong with CRM.
Challenges, set-backs, and changes in direction. Some of these will be harder to survive than others.
Keep this list with you at all times, and consult it during all major decisions.
Because you can count on a few visits from Mr. Murphy. But if you plan ahead, you’ll be ready for him.
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THE MACHIAVELLI METHOD
Most large-scale initiatives follow an age-old standard methodology. You know the one; it goes some-thing like this: Define Vision, Design, Build, Implement, and Roll Out. If you’re patient and wait till the end, you’ll get your just desserts.
How would you like a more practical approach? One that doesn’t offer some far-away pay-off that will be irrelevant by the time you get there?
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THE MACHIAVELLI METHOD
The 100-Day Solution (. The Machiavelli Method) does exactly that. It aligns your deliverables by end date, so that every 100 days, you’ve finished a number of major milestones and have news to report to your organization.
This isn’t just about a few gratuitous quick wins. It’s about building momentum. And being flexible enough to shift your plan when the business climate requires it.
It’s about staggering your wins and delivering meaningful results every 100 days.
So, just how do you eat the CRM elephant?
Break it up into little bite-sized pieces. Chew thoroughly (for about a hundred days). Swallow and repeat.
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