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Archiv der Kategorie CRM Projects

Web 2.0 Analysis Tools

Dez 2

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

“Buyer beware” is beginning to have a new meaning. A new CRM-Add-In was offered to me today. The tool, when integrated into a CRM-Application, measures the extent to which the person is networked in Facebook, XING, Twitter etc. and gives a score according to the size of the network. The idea is of course, that people with a large network need to be more carefully handled than others.

From the point of view of the customer, this would mean that it is necessary to invest time in maintaining a network in order to get good service. That does not sound too good.

Maybe the saying “we are what we eat” should be changed to “we are what we buy”. Something to think about the next time you buy something on the internet.

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360 Degree Customer View?

Nov 25

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

In theory all sales, marketing and support functions can be found in one gigantic application. This does have the advantage that customer relevant data can be gathered in one place, but think of what happened to programms like Open Access or Lotus 1-2-3: they were replaced by single programms such as those making up Microsoft Office.

There is much to be said for using separate applications for these three functions, just as Front and Back Office are separated. True, many ERP-Vendors offer a CRM component, but in most cases this only demonstrates that no-one can do everything. SAP may appear to combine these functions, but looking carefully one sees two products with a single marketing blanket.

The market seems to be moving away from fully integrated solutions. Companies today are looking for tools to improve sales efficiency without involving support and help desk groups – the more complex the support operation, the more is this apparent.

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Should CRM Software be used for sales forecasting?

Nov 11

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

Frequently I am asked to show how a CRM System can be used to compare achieved sales with sales targets. The subject sounds simple enough but in fact has considerable implications.

Even assuming that a sales planning process is defined or in place, which is often not the case, it is important to consider how and why a CRM system is required. A comparison of actuals and targets is only of importance for controlling the performance of a sales force or possibly for production or purchase planning. For production and purchasing purposes, much better information can be gained from back office systems, so the only real reason for wanting this functionality is for controlling sales performance.

The aim of CRM however is to increase sales success by helping all those with customer contact to provide a higher level of service to customers and prospects. It may be necessary to set targets so as to provide direction, but neither the targets, nor controlling will

  • help to gain more leads
  • improve the lead conversion rate
  • improve service levels
  • increase customer satisfaction
  • increase customer loyalty
  • improve sales and service efficiency

Since these are the main aims of a CRM application, it is apparent that functionality for sales controlling must take a subordinate role. For this reason, it is better not to place too much focus on quotas and achievement. These functions can be more easily incorporated in a back office system where most of the information originates and where the data input can be carried out by people used to working with financial controls.

Measuring Customer Value

Sep 24

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

At a recent BI-congress I listened to a presentation of a solution for the measurement of customer value. In this case, the visually attractive graphical representation  showed the “value” of each customer in four quadrants and the suggestion was, that customers shown to be unprofitable should be phased out. That sounded reasonable, but on more careful examination a number of questions were raised.

A more careful look at the basic data showed many weaknesses which could lead to damaging decisions. The calculation was made on the basis of invoiced goods and services minus costs. OK, but how are costs measured and applied? It appeared that in this case many of the costs were estimated, cost of sales for example, or support costs on the basis of a calculated cost per hour.

This raises two questions:

  1. How should calculated sales, marketing and support costs be applied to individual customers?
  2. Can customer value be defined purely on the basis of profitability?

The first point is a question for controlling and relates to processes and practices in the company. The second point is more interesting from the CRM point of view.

What is customer value? Is lifetime value the criterium or the value over a specific period? Which factors should make up value?

From the CRM point of view, the pure financial situation over a given period is only one aspect. The following aspects should be considered in any analysis:

  • Does the customer have more potential?
  • Is the customer important as a reference?
  • Does the customer provide leads or other marketing value?
  • Is the customer networked with other customers or potential customers?
  • Is market share important for the acquisition of new leads?

These aspects may not be easy to handle with the BI Tools currently available, but are of critical importance to sales and marketing. An analysis without reference to these factors will produce misleading results and a frustrated sales force.

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Facts and KPI for sales organisations

Sep 9

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

Sales DashboardSales people need data when visiting existing customers (see “ERP meets CRM”), the level of detail depending on the products concerned. A sales person selling for example to retailers or wholesalers will be more interested in purchase patterns than a person selling CRM software. All sales people will be interested in certain factors such as share of budget and order frequency and size.

In well organized companies there will be a sales plan per customer, so what the sales person really needs to know, is whether or not the sales are above or below plan. In this case it is only necessary to know if sales are on plan or not. Detailed information is only required when there are deviation from plan or when new requirements arise. A display as shown above will tell the sales person at a glance if all is OK or if there is need to examine things in more detail.

During the planning phase of a new CRM installation, I would strongly recommend an analysis of sales data required and close attention to the presentation of the data. In many cases a simple red-yellow-green indicator could be informative and time saving.

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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.

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