I have for the last 20 years been involved in some of biggest projects in the UK. Many of these have redefined relationships with customers and led to organisational change. Good organisations understand the need for change to respond to customer changes in the way they want to do business with you, the Internet being a good example of the changes in customer demand and expectation over the last 20 years. Customers expectations are now instant and you need to recognise that quickly.
An example being the National Rail Enquiry Service given the fact that it was appalling bad before the transformation, driven by the need to meet new regulated targets the mainly phone based service is now an award winning web and application based service none of us could imagine, 20 years ago.
In those 20 years I have logged lessons and opportunities that introducing a strategic change on how organisations do business with their customers have evolved and key lessons on each occasion so that I can learn from each implementation.
For the purposes of this paper I have classed a life cycle change in the customer interaction as a Customer Relationship Management programme, defined as CRM.
There has often been a misunderstanding within programmes of change that define CRM as purely a technical solution and technology can provide a “silver bullet” Many CEO rushing off to buy some “shiny” technical software application that will solve all their customer problems.
This approach often missing the point that customer service failure is nearly always:
· A lack of understanding of the needs and wants for the customer often driven by decision making not built on evidence and data.
· A failure to understand that the processes, supply chains which make the customer journey are often at fault.
· That improvement to customer experience, this greater satisfaction and a combination of lower cost comes from process improvement linked to the enablers of technology and people, the latter two being responsible for the change.
Customer Relationship Management is a whole life cycle business approach that integrates people, process and technology to maximize relationships with all customers, through the seamless coordination between all customer-facing functions.
Having been an interim consultant for 20 years I have a little black book of lessons learnt from Customer Service change programmes and it is those I share with you today with a few tips on how to stop them happening in your projects.
The common pitfalls of a CRM programme could include:
1. The change is viewed as a technical, not a business problem and not evidence driven.
2. Driven from the top down and lacks user involvement,
3. Lack of senior management involvement often driven from “silo” mentality.
4. Not targeting the areas of highest adoption.
5. Driven by the IT organization vs. business leaders.
6. Trying to do too much at once.
7. Lack of Organizational Readiness and capability to deliver the change.
Let us look at these areas in more detail with some tips on how to avoid these pitfalls
1. CRM viewed as a Technical Not a Business Problem, failing to address lack of customer data and people and process issues.
One of the most common reasons why CRM projects fail is that the technology was allowed to dictate how customer relationships would be managed instead of the technology being the enabler, as are people. Therefore the strategy would be:
Strategy #1: Analyse all customer interactions, map all customer interactions and each customer journey, measure current processes using six sigma, define your customer relationship and interaction processes, and implement them. Once these are defined consider the appropriate systems solution and people issues associated.
2. CRM Driven From the Top Down
In most cases there is a danger that CRM programs are driven from the top down. The need for management information and understanding of customer interactions is a management function. Typically, when users are asked to put more into a system than the benefits, the results are a low adoption rate. Sure, you will get data entered into the system. However, over time you will discover that the integrity isn’t there as your team continues to follow their “tried and true” ways of developing and closing business. Human nature will prevail, and you will find your users doing the minimal required, to show their “attempts at using a less than adequate system.”
Strategy #2: It is vital in the initial phases of CRM Change initiative to ensure that you “consider” the requirements of senior management, and meet the requirements of your front-line personnel. Management reporting will come, but only after your customer-facing personnel are receiving value from the system. It has been said that users need to obtain 3 units of benefit from a system, for 1 unit of work that they put in to a system. If you don’t acknowledge this, your CRM initiative will struggle getting off the ground.
3. Lack of Senior & Middle Management Involvement across the organisation
While CRM initiatives shouldn’t be driven “just” from the top down, as discussed above, senior management across all parts of the organization involvement is absolutely critical. Without senior management involvement, accountability for ROI (return on investment) will be non-existent, and the programme will experience scope creep as “everyone” tries to get his or her requirements in. Scope creep brings with it cost overruns and implementation delays. Both of these can be avoided.
Strategy #3: Ensure senior & middle management across the organisation is involved in the program, to include all partners and stakeholders. Appoint a "change" champion, flag waver, drum banger and respected agent of change in every department within your business and use them as your "senate" for design.
There is only one way to engage in the change process and that is to include everyone in the process of change. Middle Management are always the last to come on board with change as they feel most threatened as traditionally these “NCOs” of the organisation have clearly defined roles and responsibilities and could see these roles disappearing within a programme that attempts to reduce process failure and perhaps replace people with process change and technology. Less people mean less leaders.
So your strategy needs to identify these key players earlier, senior management need to become “participative” managers and bring managers on board, one way of doing this which worked successfully in a client of mine was to make the managers the agents of change. Retrain them in project managers and allow then the opportunity to lead the change.
However let us not beat around the bush organisational survival often depends upon on this change and whilst a consultative approach to change is always the starting point it is important that managers make hard decisions when the time is right.
4. Not Targeting the Area of Highest Adoption
The programme attempts to improve customer experience, which in turn will drive a reduced cost per transaction, but also establish a raft of interactions, and data collection will allow more targeted marketing and customer centric offerings to potential customers.
A CRM programme tends to target: Sales, Marketing, Service and production outputs. Traditionally CRM initiatives “tend” to address these functions in the order listed.
However, consider the “characteristics” of each group:
1. Sales people are typically not process oriented. They are relationship builders
They tend to demand much flexibility in the way they work, which includes the systems they use.
2. Marketing teams tend to be “more” process oriented, while at the same time they need to be creative and flexible in terms of approaches to develop the business proposition to the market place.
3. Service personnel are highly process oriented and their management structure is typically focused on measures to continually improve "operational effectiveness" reduce cost and follow process and procedures. There is an ops manual somewhere I am sure!
Strategy #4: Target your service functions first, then marketing, then sales. The momentum and value created, in the system, helps to ensure a successful adoption rate by your Sales professionals. In targeting service functions first, the CRM initiative provides for the highest adoption rates. Once a service team has converted to the system there is immediate payback in operational efficiencies, and increases in customer satisfaction soon follows. And, by virtue of managing the service function from the system, customer information is being accumulated. Information is now available to the organisations across broad spectrum of customer interactions.
5. Driven by the IT Organization vs. Business Leaders
It is important that across the organization that the CRM programme is seen a change process that derives change in people, process and technology, though the IT organisation is a critical aspect to the successful delivery of the programme. Therefore it is imperative that it is not perceived that the IT organisation is leading the overall initiative, but that you placed accountability where it belongs at the heart of the University, in a centrally driven programme office.
Strategy #5: CRM projects must be owned and driven by the senior business managers responsible for delivering the customer proposition not by the IT or come to think of it HR.
6. Trying To Do Too Much At Once
CRM is a big initiative. And, a key element underlying all customer change initiatives is the need to integrate access to all customer information. Many implementations have failed simply because the project was too aggressive.
Rest assured the transfer of calls from old calls centres to the new providers answering calls on behalf of the new National Rail Enquiry Service took 18 months as we piece by piece chunked up the country by telephone book area and transferred a tranche at a time. it would have been crazy to have delivered the change in one go, so be sensible in delivery timescales and realistic on what you can achieve.
Strategy #6: Identify the 3-5 highest priority areas to target and implement them. Once implemented, let them “bed-in” to the environment. In parallel with the bed -in period, begin work on the next 3-5 highest priority areas. Continue this cycle.
7. Lack of Organizational Readiness & capability
Business change requires the proper balance of people, process, and technology. CRM initiatives are often technology driven, with plenty of focus on the systems and even the processes to support them. However, one of the most important aspects of successful CRM implementation is Organisational Readiness and capability.
By its nature, CRM projects are usually a cross-functional, organisation-wide initiative aimed at creating a single face to the customer. To present this single face, the multiple groups within the organization must agree on what that face should look like.
Strategy #7: Develop and communicate that the programme should be considered an Organisational -wide initiative, and no one group should have the ability to derail such a broad endeavor. For CRM projects to be successful, the organization must be prepared to compromise, and must always remember that the organisation is more important than any one group.
There is of course one thing missing from my review of CRM projects, which should be obvious, the clear need for one single leader driving and championing the change programme is vital. In essence a programme leader with amazing stakeholder skills, broad shoulders and an endearing personality as it will be a tough journey ahead. Don't be scared to get in expert resources without the likely hood is you will fail.
Nigel Gooding MCMI is managing partner at Fifth Consultancy and a leading business transformation professional who lists the National Rail Enquiry Service, the new MPs Expenses Scheme amongst his impressive CV.