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The first thing you find when looking into the world of Customer
Relationship Management is the number of different definitions in
use today.
Here is the one I have chosen:
"CRM is the business strategy that aims to understand, anticipate,
manage and personalize the needs of an organization's current and
potential customers" -- PWC Consulting
From this we can learn that CRM is more than just a piece of
software; CRM is a business strategy, one that puts the customer at
the heart of the business.
“That’s nothing new” I hear you say, and you would be right. Good
business people have always understood the relationship between
happy customers that come back again and again and creating long
term, sustainable profitability.
You just have to think of the local shop owner who knew everyone of
his customer’s names, birthdays and particular ailments to prove
that point. What is new is that there now exists the technology to
enable this customer-centricity on a much larger scale.
It is said that a successful CRM implementation will allow your
Customer Service, Sales and Marketing people (and anyone else in
your organization) to have a holistic view of each and everyone of
your customers. In theory this will enable them to make quick,
informed decisions, create cross selling and up selling
opportunities, measure marketing effectiveness and deliver
personalized Customer Care.
The History of CRM
Following on from Enterprise Resource Planning or ERP (the business
strategy that promised to automate the “back-office”), the term CRM
was first coined in the mid-1990s. CRM in those days referred to the
software used to help businesses manage their customer
relationships. From sales force automation software (SFA) that
focused on customer contact management to integrated knowledge
management solutions, these were the early foundations of CRM.
The last couple of years have seen the term broaden to encompass a
more strategic approach and the investment of billions of dollars
worldwide into CRM solutions and services has followed.
First Things First
Successful CRM always starts with a business strategy, which drives
change in the organization and work processes, enabled by
technology. The reverse rarely works.
The key here is to create a truly Customer-Centric philosophy that
touches every point and more importantly every person in the
company. From CSR to CEO everyone must live and breathe customer
focus for all of this to work.
At the same time you should look at your which processes could be
re-engineered to make them more effective for your customers. Until
you have done this, put away your chequebook.
The Right Technology
It is estimated that the global market for CRM services and
solutions is currently worth $148 billion. That means a lot of
choice when selecting your technology - from web-based solutions
aimed at small businesses with less than 10 employees to solutions
suitable for multi-national enterprises with millions of customers.
The Future
CRM has already made a big impact in the world of Customer Service
and will continue to do so. As more and more companies become
customer-centric those that fail to do so will lose competitive
advantage.
As technology increases to develop at a startling rate the key
emphasis will be how we can fully utilise it within our business.
However let's not lose sight of the fact that Customer Relationship
Management is about people first and technology second. That’s where
the real value of CRM lies, harnessing the potential of people to
create a greater customer experience, using the technology of CRM as
the enabler.
CRM may or may not prove to be the answer to providing excellent
customer care, but the philosophy of putting customers at the heart
of our business is definitely a step in the right direction.
Copyright CSM Magazine 2006. All Rights Reserved.
About the author: Ian Miller is Founder & Editor of CSM, the website
for customer service professionals. Visit
CustomerServiceManager.com for more
articles and a free newsletter.
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