Businesses everywhere are discovering the secret to longevity is something they have had in their arsenal for a long time. However, CRM is only now being employed as both a strategy and a product - the best way to store customer details and retain customer service. Byron Kaye investigates the latest software applications that are taking advantage of the re-emergence of CRMCustomer relationship management (CRM) is nothing new. Good businesses were doing it long before the first IT industry three-letter acronym was invented.
And longer still before this new focus, there was software specifically designed to assist its cause.
So why all the hype around CRM now? If all good businesses - those that manage to attract and retain customers consistently - have been hell-bent on managing their customer relationships since day dot, why all the excitement in the last six months? Can it really have taken this long for software vendors to realise once and for all that, yes, the customer is actually important?According to Neil McMurchy, analyst Gartner's research director specialising in enterprise applications, it hasn't.
In fact, in McMurchy's opinion, everyone's always known about the importance of customer relationship management; it's just that only now, resellers and vendors are realising they've used up all other competitive advantages. There's simply no other weapon to fight with.
In a business climate where competition is literally enforceable by law, says McMurchy, the age-old concept of aggressively low pricing as chief differentiator has, in recent times, seen too many companies flying too close to that dreaded number zero, or worse. Besides, we are in this to make some money, aren't we?Quality, too, is out, McMurchy says. While quality-of-product seemed to make all the difference 10 or more years ago in consumers' minds, so many competitors have caught onto its benefits that quality as a differentiating, competitive factor is barely even noticeable anymore. Sadly or fortunately, whichever way you look at it, lack of quality stands out these days even more than quality itself.
The same again for features and functionality. How can a business-to-business (B2B) e-commerce company for instance, claim to be offering something wildly different from its competitors, when those competitors are offering products with all the same features, delivered via the same software architecture, possibly even integrated by the same one of five "big" consultancy companies? If it looks the same then it must be the same is a thought that crosses many shoppers' minds, however erroneously.
And so we have CRM - three letters slapped seemingly willy-nilly on any new technology product targeted at customer-centric businesses. The new cure-all? Maybe. This is likely if the meaning of the acronym is understood - which itself is no mean feat. After all, we have one-size-fits-all, out-of-the-box e-commerce applications branded as CRM. We have new and improved highly customisable database and server software branded as CRM. We have front-end call centre applications. And back end applications. And front-to-back end-to-end, integration products. All pitched as CRM. So which is it?None, says McMurchy. Well, none and all. "Fundamentally," McMurchy said, "CRM is a business strategy. It's very important for businesses to understand this." Any technology involved should simply be a strategy "enabler".
The definition of a CRM strategy he explains as: ". . . The customer is actually a part of the business. It is all about engaging effectively with the people who you perceive to be your customers, and providing the most effective channel and product set to attract and retain them."This is advice agreed with by Stephanie Rider, regional manager of e-business relationship management at integrator Eclipse Computing.
"With customer relationship management, you're not only looking at the product," says Rider. "The product is the tool that helps you obtain the information."Patricia O'Keefe, national CRM manager for integrator Data#3, adds : " [CRM] is not just an application. It's a philosophy. You need an app, but that's only one part [of it].""The aim of [CRM] is to give each employee in the organisation a 360-degree view of a customer," she continued. "It doesn't matter who you are; whether you're on the sales force, the MD, or sitting at the helpdesk."For organisations with large workforces and even larger customer bases such as telecommunications carriers, banks and financial services institutions, even some government agencies, CRM technology can be a time- and cost-saving aid in the process of quickly understanding individual customer needs and histories.
However, McMurchy makes no concessions for the advice he often gives that it should be entirely possible to deploy a CRM strategy "without or in spite of technology".
For this reason, McMurchy stressed that a business' active involvement throughout and after the CRM software implementation is crucial. And especially so, considering that, as Rider said, a good integrator will, in most sizable CRM implementations, need to exercise a certain degree of creativity for the project to achieve its aims. Can any business afford to take a back seat when outside help is making decisions affecting how the company is run?According to Eclipse's Rider, there is no certainty from the outset over how a particular implementation will be carried out.
"We will actually go in there and do an analysis of what they [the customer] currently does and then, based on that, make a recommendation of the products they should use and how they should go ahead and actually do the implementation," she said.
Details such as which software will have the right functionality for the business scenario(s), and which integration strategy will be employed, are figured out on site. Even from this early planning stage, the business is encouraged to get involved.
As O'Keefe added: "The CRM software comes as the last step."Colin McKenna, country manager for integrator Avnet Computer, has a more pragmatic approach to CRM implementation. Although he agrees a CRM integrator "should bring experience and knowledge" to a project, McKenna is quick to point out that integrators "have to work against pre-defined outcomes.""There's not a lot of magic to it," he said.
Nevertheless, McKenna believes the very first step of a CRM implementation is for the business to pinpoint in detail the objectives of the project.
If CRM is a solution, what's the problem?According to McMurchy, the most looming technology issue for customer-oriented businesses is where and how to store existing customer information. Except for startups, most customer-oriented organisations, even in the absence of a CRM suite, already have reams of stored customer information, and often on more than one database. Is it feasible to simply rekey all of a company's customer data into a new database?Sometimes, suggested McMurchy. If that is all that is required.
Both Rider and O'Keefe see the importation of all customer data into one universally accessible (within the company) database as the typical first technological hurdle to jump.
According to Rider, a common Eclipse strategy for dumping the company's customer data into one centralised storage location involves importing the data from existing separate databases into an SQL-based Pivotal system, either directly or, if necessary, via middleware agent Brio.
Where possible, a business' customer data "probably needs a separate server, because what you're trying to do is get as much information about your customer as possible," she explained.
However, importing data in this way may not always be a viable option. As McMurchy points out, some telcos or large financial institutions with "hundreds of thousands, if not millions" of customers, will have up to 10 separate databases of frequently used and vital customer information.
Companies like these might even require an entire database for each separate product line.
In some cases, therefore, and as is often recommended by suppliers of front-office software, a viable solution is to keep the data where it is, and to simply add an integrated front-end application. In this case, O'Keefe said, the challenge for integrators then becomes the seamless drawing of existing customer information systems together, but only at the front end.
This is no small task. The best businesses - those that have kept busy accumulating customer data long before software came along to assist in the process - have never felt the need to update the sometimes wildly idiosyncratic legacy systems built originally for the job unit now. Or, as McMurchy suggests, these businesses might have actively chosen to cling to their generation-old legacy systems simply because these provide one more piece of evidence that that company's service is unique. Lengthy and painstaking processes, such as one described by integrator Logical's e-business director Michael Panosh as "screen-scraping", can sometimes prove the only method of deciphering code written in-house by an untrained, uncontactable amateur more than two decades ago.
McMurchy agrees that this last stage drawing together of customer data can often be the most immediately available method of overcoming storage/access issues. However, and perhaps cynically, he feels that CRM vendors' insistence on this being the best solution is merely evidence that the vendors, themselves, are stumped.
Leaving as many as 10 databases' worth of customer info to expand, perhaps towards or beyond capacity, hardly seems like a long-term solution. Besides, as McMurchy says, the cocktail of multiple legacy systems mixed with these new CRM solutions can prove, if not deadly, then at least terribly messy.
Can a business simply keep its existing customer info where it is and add all new customer data to a newly acquired CRM database?Some companies are jumping at this approach, McMurchy said. Once again, though, this is a Band-Aid solution that will eventually encounter the same inter-operability issues before too long.
McMurchy does not believe any customer data-storage solution is entirely problem-free. The best solution, should it be prepackaged or purchased one piece at a time, depends entirely on the situation. Broadly speaking, larger companies with more specific needs will benefit from individually sold, highly customisable software. Smaller companies, or ones where only basic customer data (name, number, address) are required, would do better with an out-of-the-box solution, where all necessary functions are there and ready.
Whichever way, McMurchy is never dismissive of the "huge job" faced by integrators when it comes to CRM. Perhaps this explains in part why the Australian systems integration workforce is ballooning at an estimated annual rate of between 400 and 500 per cent.
Considering the potential size and uncertainty of the integrator's task, it isn't hard to imagine the kind of disaster that could ensue if the assumed objective the integrator is working towards is actually different to what the company needs. Perhaps the CEO, COO or GM doesn't have time to sit down and discuss the nitty-gritties of the entire implementation. Perhaps it just isn't that interesting. However, if the CEO, COO or GM wastes $500,000+ of company money on the nationwide installation of some glamorous but entirely unnecessary new system, he'll have all the time in the world.
Forget me not
McMurchy highlights a tendency for businesses to presume that once a CRM system has been installed, all of the company's customer data/technology issues have been resolved once and for all.
O'Keefe, too, said companies too often believe the initial CRM implementation will suffice long-term. "A lot of clients are still uneducated," she said.
McMurchy warns: "What happens over time with any business application, if businesses don't get actively involved, is that their CRM system starts to move away from where the real business requirements are."On the upside, constant and careful attention given to a business' CRM system will see a shift towards greater cost savings and efficiency of customer service, McMurchy said. If maintained continuously, he believes a CRM application will develop "organically", as will the business itself.
Ironically, this organic development of the software does mean leaving it alone to follow its own course.
"There's got to be a conscious, ongoing effort to maintain the relevance of the application to the business," McMurchy said. "The one certainty is that business requirements will change and indeed, should change very rapidly."This active, ongoing involvement is important with the development of all company systems, McMurchy believes, but especially so in the case of CRM, given the rapid rate of change occurring in the external business environment - communication with which is the real objective of CRM in the first place.
No one ever dismissed the direct correlation between good business and the quick, seamless, productive customer experience. It's always been there; it always will, hopefully. The only difference now is that all other weapons - pricing, quality, product features - have been stripped away, with only the CRM strategy left standing. Your weapon has been chosen for you, whether you like it or not. Take interest. Fight.
WHAT'S NEW FROM . .
Clarify's eFrontOffice suite is pitched as an integration and "consolidation" solution, covering all points of contact between customer and business such as telephone, fax, Internet, or face-to-face.
By installing eFrontOffice, a business will enable its customers to order, configure and gain live support, all-in-one online sitting. eFrontOffice-equipped businesses can also orchestrate and manage personalised marketing campaigns.
Businesses with an online presence can establish their own customised portals based on the vendor's eBusiness Framework infrastructure. Web-based support using eBusiness Framework is live, yet does not require a second phone line or internet connection.
With eBusiness Framework, a Web shopper needing assistance can simply click a "CallMe" button, which immediately routes them to the first available, and best qualified, call centre agent. Because eBusiness Framework supports click-stream monitoring, the agent can see exactly where the customer is in the buying process.
Clarify's eBusiness applications - Clarify eOrder, eConfigurator, eMarketing, eMerchandising, eSupport and eResponse Manager - can be run from eBusiness Framework using any standard Web browser, including Microsoft Internet Explorer and Netscape Navigator. eBusiness Framework is built on Clarify Business Objects Architecture, which supports COM+/ActiveX for NT users and CORBA/JavaBeans for Unix users.
Purchasers of Clarify eFrontOffice are able to buy only the modules their business requires. Costs of individual modules vary, according to how many users are affixed to the network.
Clarify: (02) 9923 0111http://www.clarify.comSAPIn 1999 SAP began its foray into CRM with the gradual integration of 16 customisable business solutions into its mySAP.com online enterprise application suite.
The mySAP.com CRM offerings are based on a growing list of what the vendor describes as "typical business scenarios", all 16 of which are expected to be available for integration into the suite by the end of 2000.
Basic e-commerce customer relationship scenarios, such as Internet Sales and Internet Customer Self Service are already included in the suite, with more advanced scenarios, such as Internet Marketing, Marketing Analysis, and Product & Brand Management scheduled for inclusion in mid-2000. Retention Management, Customer Development and Tiered Servicing are likely to be included by the end of the year.
The mySAP.com CRM offerings cover all customer touchpoints, including face-to-face, Internet, fax or phone collaboration between employees, business partners or consumers.
The mySAP.com suite allows remote access to internal and external applications, hosted services and business content via a single Web portal.
Long-term savings inherent to CRM are furthered by the mySAP's open, architected platform, which allows for cost-effective flexibility and expansion.
Pricing available on request.
SAP: (02) 9935 4905http://www.sap.com/australia/index.htmOracleApplications InterConnect from Oracle is an interface-based platform for integrating a company's enterprise applications and enables full integration between Oracle CRM products and company back-office applications - whether those back office products are Oracle ERP products, legacy applications or otherwise.
The platform, which is based on Oracle database and server technologies, operates various messaging systems, and is pitched to include a centralised management system for distributed deployments.
Due to InterConnect's asynchronous messaging model, any operational problems or failure with one CRM application will not affect the other applications connected via the platform.
For an additional cost, Oracle can also provide CRM Pack, an "out-of-the-box solution" for integrating a company's enterprise systems into the centralised InterConnect platform, saving both time and integration costs.
InterConnect also includes iStudio, Oracle's wizard-based integration customisation tool, allowing e-businesses to tailor functionality to their own requirements.
Prices for Oracle CRM products are available on request.
Oracle: (02) 9935 4905http://www.oracle.com/com/au/index/htmlGreat PlainsIn 1999 Great Plains and Siebel joined forces for the release of Great Plains Siebel Front Office. Pitched as a fully integrated front office/back office solution, Front Office is targeted at small-to-medium businesses, although the suite can be upscaled with ease.
According to Great Plains and Siebel, Front Office allows for communication with customers via all channels, including telephone, Web and fax. However, the suite is also equipped with functions for efficiency of sale, such as customer account and contact management. Front Office also offers a Web-based customer self-help service.
The suite comes complete with a number of advanced customer service functionalities including: contract management functionality, whereby the business is able to measure their fulfilment of a contract against the original specified terms; quality of service trend measurement tools, whereby a company can graphically represent any broad shifts in quality of customer service; and what is described by Great Plains as global "integrated problem resolution technologies". Front Office is able to classify and prioritise customer requests in terms of severity and problem source.
The suite is easily integratable with other Great Plains and Siebel products, as well as Microsoft Outlook, Microsoft Word and Novell GroupWise.
Available now, pricing for Great Plains Siebel Front Office is approximately $2500 per user.
Great Plains: (02) 9409 9200http://www.greatplains.com/company/contact/australia/