Wednesday, September 13, 2006

InformationWeek: IT embraces customers, not CRM

InformationWeek's September 11 issue published its list of Top 250 Innovators, with detailed profiles of the top five. What first struck me was that four of the top five firms focused on improving customer experiences: whether by better marketing (Principal Financial Group), mass customization (Automatic Data Processing), or improved customer-facing operational processes (American Power Conversion and Global Crossing). It seems that companies, and InformationWeek, are really taking seriously the soft-headed notion that customers really matter.

But on reflection, what’s even more interesting is that not one of the customer-oriented projects was a conventional Customer Relationship Management system. What apparently impressed InformationWeek was projects that radically altered business operations in ways that provided real customer benefits.

The American Power Conversion profile in particular described how “In 2004, APC launched a CRM program that included identifying touch points customers have with the company, capturing information on failed interactions, and determining what was needed to fix customer satisfaction at those points. APC set up a measurement system that assesses how the company is doing on each point.” Even though InformationWeek calls it a “CRM program”, this sounds more like what we at ClientXClient talk about with our Customer Experience Matrix: a comprehensive view of all customer interactions.

The article continues by describing how “APC’s Customer Loyalty Framework guides process improvements and sets a road map for system implementations....APC focused on automation points that connect different systems, including the company’s credit management system, Siebel apps and analytics, solutions configurator, and Oracle databases. ” In other words, it was integrating all the different systems that really counted. The Siebel CRM system was just one of several participants.

In an environment where some analysts are reporting that traditional CRM is back in fashion, it’s good to see evidence to the contrary. Smart companies are recognizing what matters is the entire customer experience, not just using CRM to build a better call center.

- David Raab

2 comments:

Lloyd Merriam (lmerriam@deltalytics.com) said...

Dave, I agree with your point that customer relationship management ideally addresses (nearly) all customer touch points, and that the typical CRM application (like Siebel) is only one component in the constellation of "systems" that govern or impact the customer relationship. And, of course, these systems should be coordinated in order to provide a comprehensive view of the customer relationship and facilitate guided feedback and analysis of each interaction. The confusion, as I see, lies in that slippery term "CRM." What you're describing is customer relationship management (aka CRM) whether or not the applications that typically go by that name are short-sighted or not.

Maybe you should refer to what you're doing some other way rather than criticizing the conventional, and I think appropriate, use of the term CRM itself. Perhaps, to make the distinction -- and to coin your own term or variant -- why not call what you're doing something like Total Customer Relationship Management (TCRM). Just a thought....

David Raab said...

Hi LLoyd,

I guess I was trying to make a distinction between CRM software, which does the traditional sales/service/marketing functions, and the CRM concept, which certainly includes a complete view of all customer activities. My point was, there are business processes and systems that greatly affect the customer experience but are outside the scope of conventional CRM software, and it's good to see people recognize that you have to look at those processes to really improve how you treat your customers.