Customer relationship management is more than a technology. It's a strategy that requires tools, technology, and a clear sense of the problems your customers encounter.
From: Inc.com By: Kate Carroll de Gutes, Technology Reporter
According to Gartner, the world's leading provider of research and analysis about the technology industry, "CRM (Customer Relationship Management) is not a technology or a software package -- it is a strategy. To implement the strategy, organizations use tools and technologies, usually offered by vendors in the form of CRM software packages ... using the tools and technologies offered by the vendors to solve specific business problems related to interactions with customers."
Too often, CRM deployments help businesses manage the sales cycle more effectively, but the software isn't utilized throughout the organization, so you're only getting a partial value from the software and you're not maximizing the customer's experience with your organization. For instance, when a customer calls a service center, an agent may only have the customer's sales history and information on shipping issues but not have access to customer questions submitted via e-mail. This means your customer must explain her problem or question -- again -- to the live agent. True customer relationship management goes far beyond sales, marketing, and support management. But many small and medium businesses tend to view CRM solutions as technology for technology's sake, even though CRM experts caution small and medium businesses, as well as the enterprise organizations, against this attitude.
In fact, according to the December 2005 DestinationCRM article, "11 Ways to Ensure CRM Success," "If executives learned anything from the Y2K tech wreck, it should be that technology is not a good driver of a CRM strategy, but reorganizing business process efficiencies and bolstering revenue are. Find out how your company's customer touch points can maximize those ideas, then give customers applications that work with them."
In other words, set your strategy first -- yours might be something such as "How can my company improve customer commitment and loyalty (leading to greater profitability)?" Then use your technology as a means to an end.
With the right technology -- both hardware and software -- you can consolidate, access, and store customer data, and even segment it into categories that make sense for your company. For example, say a certain group of customers purchases the same or similar products and services. You can utilize your CRM system to make this information available to the marketing department, which in turn can create a marketing strategy or sales promotion geared to that specific group of customers. Segmenting your customers this way can enhance your company's revenue in the long run.
By putting customer-centric capabilities and technologies in place, you gain a significant competitive advantage because you can provide both customers and business partners a better relationship experience, including better service and more timely information. In addition, Gartner also reports that CRM software for small and medium businesses drives better bottom-line and top-line financial results through reduced sales and service costs, greater sales productivity, and improved levels of customer satisfaction and increased customer retention.
After you've developed your strategy for a customer-centric environment, consider the following points as you look for a CRM system to meet your unique business needs:
But most importantly, remember that CRM is a strategy, not a technology. Figure out where you can get greatest return by improving customer-facing processes, then find the CRM solution that best supports your goals and best fits your organization and budget. Then when you look back at your CRM solution in a year, you'll be thinking not about the technology but of the rewards in terms of new business, more revenue, and greater customer loyalty.