Customer Relationship Management

CRM Implementations are the most thought of and talked about as well , owing to its direct impact on the customers and thereby revenues and corporate brand image. The conventional package evaluation exercise along with fitment analysis and later stages are definitely necessary but not sufficient in themselves for a successful CRM Implementation.

 

A successful CRM Implementation is NOT the one where there are no defects or usage hiccups ( as this is almost a hygiene factor these days than a customer delight parameter ) but the success of an implementation is gauged by the measurable business benefits yielded.

 

It is a combined responsibility of the Client, the Implementation Consultant and the Product vendor to chalk out a clear RoI framework and plan towards a phased accomplishment of the RoI metrics.

 

A few sequential steps for this critical activity would be to

1. Identify Key Customer Touch Points
   
2. Prioritize the areas where an impact can be immediately felt from business and customer standpoint
   
3. Identify key pain points and areas where there is a revenue leakage /cost overrun
   
4. Re-engineer and Improve the business process to include industry best practices (could be prior to or  a part of the CRM Implementation exercise )
   
5. Measure As-Is value of the metric
   
6. Breakdown the functionality of the product/CRM Package that can address the pain points
   
7. Measure post CRM Implementation value of the metric in steady state
   
8. Associate a dollar value to the benefit accrued or cost saved
   
9. Calculate the RoI using established models  taking into account the Rate of Return , Breakeven period and Cost structure.
   

 

 

An analysis to identify areas that require improvements is key for RoI estimation . These could be metrics like Resolution Time, number of calls where first time resolution is provided , Number of Customer service agents using and updating Knowledge Repository etc for the Customer Service Operations. Ability to route calls and service requests based on skills of the customer service agents has clearly been a time-saver and a cost –cutter in many organizations. Measuring this would also lead to utilizing the agents’ time in other productive tasks aimed at increasing revenues in addition to customer satisfaction owing to quicker resolution based on skill-based routing. Apart from the clear value-add to the organization, these modules , as my colleague Badri states, do empower the frontline to do render better customer service.  

 

In case of Sales function , metrics like Sales Closure Lead time, Win-Loss Analysis , Deal Conversion rate and margins would act as key performance indicators. Mobile Sales and Sales Online are features that have enabled Sales force to quickly access the price list and create quotes on the fly right at the customer site  . These have cut short time spent by the Sales personnel in the office and enables them to be where they are most productive – the Field !   The sales force performance can be enhanced by innovative models to provide incentives for achievers.  RoI is not elusive in Marketing activities despite many believing so . Intelligent segmentation and targeted marketing efforts would reduce marketing  costs , thereby increasing Return on Marketing Investment (RoMI) . If 20% of customers contribute to 80% of the business , it is  prudent to invest in focused marketing than a mass –scale campaign with lukewarm response which may not always translate to sizeable financial returns. The CRM packages enable assigning RoI targets and track budgets (costs) and sales figures (revenue) as an outcome of a campaign. These tightly link the campaign’s outcomes as leads and tracks them till the order booked stage traversing opportunity and quote creation phases. An interesting blog on RoMI by my colleague Indivar is worth reference here.

 

For organizations that execute  CRM Activities in association with the resellers or partners , Partner Relationship Management modules help gauge performance of collaborative Sales and Marketing activities .The PRM Modules enables resellers performance measurement  and to rollout plans for rebates or rewards.   Pricing and Promotion decisions in independent and collaborative Sales and Marketing activities can be effectively done using pre-integrated  framework between Partner Relationship Management and Trade Management Modules [Oracle E-Business Suite ]. The decision makers  can easily identify  the offers that were most profitable in the past and plan for new offers based on marketing strategy and business goals (revenues)

 

Self Service Modules to purchase products (like Oracle iStore) and avail services / information online  ( like Oracle iSupport and Knowledge Management  ) are aimed at reducing the expenses in human resources and brick and mortar setups . A good way to gauge RoI for these would be to compare the investment and maintenance costs for the implemented CRM Suites and compare it with the revenues generated or costs cut using the modules. The intangible benefits would also be increased customer satisfaction that can be captured using surveys . A delighted customer who gets his concerns resolved immediately is likely to be more loyal and thereby cutting down massive acquisition costs for the organization . As a bonus, you also have an engaged customer who would spread positive Word of Mouth and bring in referrals.

 

In essence , the idea is to consciously identify areas of impact and quantify the benefits /cost saved to measure the financial success of your CRM Implementation .Performing a thorough scientific RoI Analysis thereby goes a long way in building a stronger business case for IT spends in large organizations and provides the much-needed relief for the CIO. Afterall , anything that cannot be measured cannot be improved !