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.
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.
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!
Tags: B2B, Customer Value
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!
Tags: call scheduling, crm
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.
Tags: crm, Loyalität, World Cup
Selecting ten vendors out of the 140+ vendors in the (German) market is not a task for beginners. The tendency is to go for the big names, but this does not necessarily get you the best solution for your requirements. Many of the lesser known suppliers have excellent products and may match your needs better than a product purchased on the basis “the product has so much functionality, we will find what we need in their somewhere” (this is a quote from a recent prospect). Firstly, this may not be the case and secondly, disposing of unwanted functionality can be an expensive business.
These are the steps you need to take:
- Define your infrastructure requirements
- Name the required interfaces to groupware, ERP or other essential software
- Decide if you wish to be a small customer of a large vendor or an important customer of a smaller vendor or if this is a factor at all
- Name the major modules you require such as sales, marketing and support and the most important processes required
- Work with an experienced consultant or use online services to make a list of 20 vendors
- Reduce the number to 10 and off goes your RFP
Use the responses to the RFP to form your opinion about the product and the quality of the reaction to your request. Qualified vendors or partners will suggest that they need to know more about your application before sending you a reply. This is in fact correct and a sign of competence, but you cannot spend time with up to 20 suppliers. The RFP, as explained in a previous post, must allow suppliers to show their strengths and not just be a list of check boxes.
On the basis of the reactions you may want to invite around 5 suppliers to a presentation. It is better to have these people demonstrate one or two processed in detail than to give a general tour of their product. Any skilled sales person can make a good impression if he just shows the chocolate side of his product. Invite users to attend the presentations.
This process will enable you to select a maximum of 3 suppliers to run a preliminary workshop with you, the aim of which is to give you deeper knowledge of the product and the implementation partner and for the partner to be able to estimate the project costs and effort.
Tags: crm, CRM Investment, CRM Software
Here we need a distinction between the well known consultancy organizations such as Accenture, Bearing Point or Deloitte and freelance consultants or small specialized companies.
Large companies will tend to talk to large organization, so let’s start there. Accenture and similar organizations will tend to give the impression that due to their size, they have specialists for everything. To a certain extent this is true, but it is generally surprising how few specialists for each topic there are and it is also true that there will be virtually no people with in depth knowledge of several products, so be sure to look carefully at the qualifications of the staffing proposed. Of the three main project phases
- requirements definition
- product selection
- implementation
these organizations are well suited to assist in phases 1 (maybe) and 3 (recommended), but should not be involved in phase 2. Large organizations are interested in selling large numbers of consulting days and this is more likely with a product such as SAP than of say Pivotal CRM, so it is not difficult to guess which product will be recommended.
Freelancers and small partnerships may well be involved in phase 2. Do not expect these consultants to know all the CRM Products in detail. They will know however, which suppliers have a good track record in your line of business and will be able to assist you in the selection process. The selection and the responsibility for the selection remains with the buyer. These smaller organizations may will be involved in phase 1 if the number of potential users is not too high.
Tags: Accenture, crm, Deloitte
Once again I have met with a person charged with creating an RFP for a CRM System for a medium sized company. This person, straight from university, has a very difficult task and is unlikely to come up with the best document for the company having received no input on the real needs of his employee. This happens surprisingly often. I would not delegate the purchase of a new car for myself to a person who does not know my needs and preferences!
What is the solution? I am now repeating myself but try this:
- Develop the business case
- Define the processes to be implemented or improved to meet the business goals
- Define the hard facts which may limit the choice of product (required interfaces, infrastructure for example)
- Transfer the process requirements to the RFP, not lists of functions
- Speak to the implementation partners before requesting an offer. An offer from an unknown source is worthless to you and to the supplier
- Ask your preferred implementation partner to show you how your processes will be implemented with their product. This will produce some surprises
- Make a short list
The rest is more difficult. I will go on with that later.
Knowing what you need is the key to making the best selection, but how do you go about defining your requirements? Frequently an unhappy employee is charged with checking the functions of the products on the market in order to come up with a set of ideas. This is just not the way to go and will lead to a choice of a product with the most functions but not necessarily the best fit.
Start with the business case and clear business aims which may be anything from reducing sales and marketing costs to increasing customer satisfaction. Évidently, this is a management task, so management must be involved.With these aims in mind, look for the processes which may be installed or improved in relation to your goals. In a few days I will add a document to this blog with ideas on how to find the processes and listing a selection of the most important items. There is too much information for a post.
Sometimes this process will show that no complex solutions are required, a solution based on address and contact management may be adequate. Alternatively you may find that your requirements are not available in any standard products, meaning that customizing becomes a major issue. Whichever way it goes, it should be possible to relate each process to the business aims and subsequently to select the most suitable solution.
It can offer help to look at your company from the customer point of view. Even if the business aims are limited to increasing increasing sales efficiency customers should register an improvenmt in sales service.
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Tags: CRM Applications
In the past few weeks, I have been concerned with a number of companies starting a new CRM project. In a surprising number of cases the process has been something like this:
- Check the internet for possible suppliers
- Download product descriptions and request informations from suppliers
- Watch online demonstrations
- Attempt to read the mass of information gathered
- Give up, prepare a list of requirements and start over
This is evidently not the right way to go about it. Not only is it time consuming and unproductive but it can also lead to false results. It is absolutely essential to determine requirements before looking at any products at all. Products are around to improve and optimize business processes, not to define them.
The process could look like this:
- Define the requirements
- Build a business case
- Prepare a document describing the required processes (NOT functions)
- Select a number of potential suppliers on the basis of product reputation and market positioning
- Ask these suppliers to show how the processes could be implemented with their products
If you have no resources for defining the requirements, then go to a qualified consultant (preferably not a potential supplier). This may be appear costly, but time saved will more than compensate this. Even reading this blog may help!
Tags: crm, RFP, Sales, Vertrieb
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