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CRM Software vs. Microsoft Excel

Sep 2

Gepostet von David Duncan in CRM, Customer Relations, Marketing | Keine Kommentare

 

In a discussion today with a major PC systems integrator, I was told that the company worked quite happily with Microsoft Excel and Word  for CRM purposes and had no plans to make any changes. This was bad news for someone offering CRM consultancy, so I followed up with some questions.

The sales and marketing organizations are producing good results. Sales activities are largely not documented, but a well organized ERP application provides reliable information on goods and services purchased. A simple ticketing system provides a record of service activities. The company has a stable customer base. Sales processes are simple and are supported by the ERP-System.

In this particular situation, there really would be little gained by introducing a CRM system. There is no need for sales persons to produce offers or take orders while on the road. News letters and customer correspondence can be produced and sent with Microsoft Office products. A Sharepoint depository holds all customer records.

The situation would change however, if the owner/manager were not coordinating and guiding operation himself, thus ensuring a high quality of customer service. If further management levels were introduces this would also change the scenario as would a period of rapid growth. In this case the strategy of the company is to maintain and protects its customer base and to grow only through the sale of more services to a slowly growing number of customers.

So what am I trying to say? Basically that CRM sales persons should be aware that CRM systems are not per se essential for a successful operation. This will depend on the size and processes of the organization. Particularly in the case of an owner managed company, the owner will (normally) be the first to notice when the operation is not running efficiently.

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Mind the gap: ERP meets CRM

Aug 26

Gepostet von David Duncan in CRM, CRM Projects, CRM Software | Keine Kommentare

Travelers on the London Underground are used to taking a big step when the train carriage stops at a curved platform. A similar mismatch exists when ERP and CRM systems need to be interfaced, but the solution is not so simple.

Most solutions for CRM Users involve either the import of data to CRM from ERP or direct access to the ERP systems, but this is not what CRM users really want. CRM users need:

• indicators, when things go wrong or not according to plan and

• aggregated figures or KPIs with the ability to drill down when needed.

ERP manufacturers have tried to create their own integrated CRM applications, for example SAP or SAGE, only to find that CRM apps must be considerably more flexible than ERP systems and that a tight integration makes the CRM System inflexible. More on this in a later post. The solutions of these companies now supplied are in fact not tightly integrated at all, they only appear to be.

Of course, this can be done by importing large volumes of ERP data, but this redundancy is not beneficial to performance or flexibility. A better solution is to insert a middle layer of multi-dimensional data so that CRM Users can use simple dashboards for their data access.

Typically products such as SAP Netweaver or BW are in a position to supply suitable data, but BW projects tend to be long and complex and make it difficult to keep up with sales people who change their requirements often dependent on market and sales conditions.

The most economical and practical solution is to introduce a middle layer and to use products such as QlikView or Dundas Dashboard to present and manipulate data. There are more products available, but it happens that I have recently been involved in evaluating these two.

It is surprising that CRM integrators often ignore this middle step. Controllers would never think of going directly to raw data during the financial planning process.

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Why CRM Software has not developed over the years

Jul 29

Gepostet von David Duncan in CRM Projects, CRM Software, Customer Relations | Keine Kommentare

The last two posts have been pointing to the limitations of CRM software. It is true that software functionality has not changed much since the first CRM solutions were offered, but usability and flexibility has shown a massive improvement.

Why do the applications not develop? Basically the tools customer oriented users require are not that complex and are limited in number and type. The tools are available and have been for some time. A tool alone will not help you however, just as little as owning a hammer will drive a nail into a wall. There is nothing wrong with the hammer, but you need to know what to do with it. The same applies to CRM Products. As stated in a previous post, there are solutions available for almost any CRM requirements, but first you must know your requirements.

These are the steps you need:

  1. Define your business aims with regard to your growth plans and planned customer base. Then define your strategy for reaching these aims from the point of view of the customer.
  2. Define your business processes in relation to your business aims. Business processes in sales and support are not in any way complex, but they do need attention to detail and need to interface to back office functions. Sales processes must remain flexible. Back Office processes tend to be more strict.
  3. Translate your processes to software requirements that support your information flow and work processes. Do not let your IT-Department talk you into making a check-list of functions and certainly not into a technology oriented selection process. Your processes are important.
  4. After all this, go ahead with the software selection process. Let suppliers show you how their software can support your process. In the short list stage it may be worthwhile investing in the development of a module from all short listed companies.

Many CRM projects start with having an IT-oriented employee research information on existing solutions and the development of a list of requirements based on the functions offered by products favored by that person (or team). This is the wrong track. Start a step 1, not at step 4!

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CRM as it could be

Jul 22

Gepostet von David Duncan in CRM Projects, CRM Software, Customer Relations | Keine Kommentare

Contrary to popular practice, CRM consulting is about putting the customer at the center of your business, not about internal efficiency. In most of the cases I have been recently involved in, customers have been primarily concerned with the improvement of existing internal processes. This makes life easy for the consultant or software sales person, but will probably neither lead to reduced costs nor to increased sales.

Finding and retaining customers is becoming increasingly difficult as loyalty is no longer to be expected and competition increases at all levels. To be successful, it is essential to look at your company from the customers point of view. Is your company behaving the way in which your customers expect? Are you supplying sales and support services which your customers expect? Or is your company more concerned with internal efficiency than with customer needs? You do not need a CRM product to increase sales efficiency – most sales people require little more than a good contact management tool, CRM becomes effective when you prospects and customers notice an improvement.

CRM is not software and in fact most available solutions can support your operation. CRM is about knowing your customer’s requirements and putting a strategy in place to find, develop an keep them. Are you looking at your CRM Software with regard to this aim?

Generally, software suppliers will suggest a workshop to define your requirements. That is generally correct, but whether before or after the sale, these workshops will always be conducted with regard to the limitations of the software offered. Sales people know that your budget is limited and will avoid suggesting improvements which, due to software limitations, will be too costly

You must define your aims and requirements without reference to a product. If you are unable to do this with internal resources, find a consultant who is not tied to a product. However, you are still the only person who can define your business aims.

There is no need to fear that you will then not find a suitable CRM product to meet your needs. There are enough excellent solutions on the market.

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Why has CRM not developed in 15 years?

Jul 16

Gepostet von David Duncan in CRM Projects, CRM Software | Keine Kommentare

Sales Partners of CRM Software suppliers are by definition more interested in selling you software than in helping you develop a CRM solution. Most of them only work with one or two products, so to them, your problem always look the same.

This characteristic is unfortunately actively encouraged by buyers who look for functions and technical requirements but are not aware of the real business aims involved. There are probably no functions which can be requested which existing CRM solutions do not offer, so using lists of functions will not produce valid results. The quality and the usability of those functions in your environment is another question.

CRM suppliers and resellers can be exptected to have good expertise with regard to their products and good sales people who can show you their solution the way you like to see it. However, even though it is often thought that customer care and sales are the same everywhere, this is definitely not the case. Sales and support processes are always unique. Selecting CRM Software which has the largest number of ticks against your requirements list will not get you the best solution. You will hear talk of best practices from your CRM Rep, but there are no best practices which fit all companies.

If you are looking for more than simple contact management, CRM Software will always need to be modified, so you need to look for suppliers who can understand your business and convince you that the software they are offering can be modified to your requirements.

The sales person who points out these traps will bring you a better solution than the person who tells you the software will do it all for you.

The advice is as old as the hills, but is as true as ever: Don’t let software drive your business, define your requirements and then look for software which fulfills your business needs.

More follows.

What sales people really need from CRM

Jul 12

Gepostet von David Duncan in CRM Projects | Keine Kommentare

Let’s start with a list of things sales people do not like doing:

  • Writing monthly/quarterly reports
  • Looking for marketing collateral, product descriptions
  • Entering data
  • Processing documents

This is evidently not an exclusive list but one which relates to CRM systems.  When new CRM Systems are put in place, too little attention is paid to the real requirements of sales people. They are regarded as a source of information and are often left with little more than an automated address book with contact history and opportunity management. Even the opportunity management is more often oriented towards management information requiremens and not to the need of sales people.

The remedy is not tricky. When a new sales support system is to be introduced, ensure that exisiting information is imported for each sales person, provide interfaces to back end systems with sales and product data and ensure that reports and forms exist to relieve the sales force of routine tasks.

Is CRM moving back to SFA?

Jun 28

Gepostet von David Duncan in CRM Software, Customer Relations, Marketing | Keine Kommentare

Looking back to the beginnings of software for sales and marketing, we have seen “Computer Aided Selling”, “Sales Force Automation”, “1to1Marketing” and now “Customer Relationship Management”. Although suppliers and experts speak about the need to communicate with customers and offer 360 degree customer views, the majority of the RFPs I see tend to center arount the improvement of sales efficiency.

This can probably be explained by the increasing cost of sales and decreasing sales margins but does ignore the advantages which could be gained by looking at sales processes from the cutomers point of view. Aiming at decreasing costs usually involves simplifying current processes and not on reviewing the processes in total. It also has the side effect that products promising simple and quick implementation tend to be preferred.

Increasing efficiency and reducing costs are certainly valid aims when introducint a new CRM system, but the real advantages of a new system should include processes which would not be possible without the use of software. Sales, Marketing and Service functions can be integrated  to improve the total service level to the customer not only be reducing administrative loads, but also by offering new services.

How to define B2B customer value

Jun 15

Gepostet von David Duncan in CRM, Customer Relations, Marketing | Keine Kommentare

In most cases, in Germany at least, customers are categorized as A, B or C customers based on the volume of business. At first, this appears logical but at a closer look more factors should be regarded:

  • business volume in relation to the customers total budget
  • the customers growth plan
  • marketing prestige

Just looking at achieved business volume is a very one sided view of a customer. More important is the size of the customers budget, assuming that there is no reason why you should not expand your share. Some customers will clearly grow rapidly and these need to be handled with particular care since this is a chance to establish contacts and loyalties which will keep competitors out when the company grows and more people are involved in purchase and development decisions. Some companies have a lighthouse function in their industry which makes them a generator for new business if they can be referenced.

Basically, there is nothing wrong with an ABC analysis, but the process for the classification needs to be well and clearly defined and classifications should be reviewed at least annually.

The main argument against the ABC classification, is that C customers tend to be ignored. This would lead to problems, since the rule that 20% of customers create 80% of revenue will always apply. Cutting away the C customers will only reduce revenue – it will not change the 20:80 relation!

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The importance of call scheduling for CRM

Jun 11

Gepostet von David Duncan in CRM, Customer Relations | Keine Kommentare

The importance of information gathered during a customer call cannot be exaggerated. This means that calls to customers should be carefully planned and the results recorded in way which allows later analysis of the information gained.

Good sales persons will know how often they should visit their customers and have a good knowledge of customers attitudes and requirements. However even the best sales person will sometimes forget a call and information not stored online is not available for analysis. A well designed CRM system will provide means for suggesting calls to be made on the basis of the date of the last visit and the potential of the customer. Going into more detail, a CRM-System can support sales people by offering a customer-specific check-list of important points and will make the job of entering call data simple.

This is basically a very simple process and is often, exactly for this reason, overlooked during application design. Some of the most succesful companies guide the frequency and content of customer visits very closely – CRM in practice!

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What can CRM learn from the 2010 FIFA World Cup South Africa?

Jun 10

Gepostet von David Duncan in CRM, Customer Relations, Social CRM | Keine Kommentare

The World Cup is here again, cars and houses are once more flagged and the streets are empty during games. The key word here is loyalty. Why are people loyal to the team they support? At a time when companies are looking for ways to promote loyalty, people are turning to sports and social media. There is a lesson to be learned from this. People can only be loyal where emotions are involved, and emotions are built around people. There is a strong need to identify with a group of people with similar attitudes and opinions.

Companies which attempt to reach customers by offering the lowest prices or the newest technology may have success so long as they are the cheapest or the best, but they will not keep their customers when conditions changed. This may be one recipe for success, but companies able to generate an identity to which people can relate will do better. Evidently, creating and maintaining the identity is a case for the entire staff of a company, but a good CRM concept should provide the organizational basis by supplying the right information at the right time.

Loyalty is more important than the promotion of special offers and technical gimmicks.

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