Switching On To C R M

The perception lingers that CRM is an exclusive arena only open to large or rich organisations. This is partly because some of the higher end vendors surround CRM with mystery in order to justify the high cost of product, services and consulting. The main change in the industry is realisation that to guarantee its own growth, vendors must cut through the hyperbole and convey the message that CRM is not just for big players, but is affordable and acceptable to all.
Thanks to the Internet and cheaper off-the-shelf CRM solutions, this picture is changing. Demand for CRM continues to grow rapidly. More than 75 percent of all customer interactions with companies in New Zealand are now channelled through call centre, according to the latest industry benchmarking study.
Bill Lyons, COO callcentres.net says, “This industry is still roaring along at an expected growth rate of 15 percent for the year 2001, as measured by the expected number of new call centre seats. We also expect that better technology will provide enhanced productivity from agents and that the volume of transactions will continue to climb reinforcing the position of the industry as very substantial pillar of New Zealand’s economic growth.”
This sounds healthy enough but CRM vendors never tire of reminding us that CRM means far more than just contact management for call centre. Good CRM is not just about technology but is business issue; technology is merely one component of its solution. “When I think of CRM, it reminds me of what my hairdresser said about being blonde – it’s not hair colour, it’s an attitude,” as one vendor put it.
One of the trends in New Zealand over this past year has been the continuing realisation by customers that CRM is more of starting point than an end-all solution. Too often companies install CRM software and to their disappointment discover relationship violations, where one rule applies on the web and another through the call centre. The software itself won’t solve these issues. “To solve this is more about making staff understand company’s goal and how they should deal with customers. It is about sniffing out these disconnects and deciding how to resolve them. The challenge for CRM vendors is to provide the tools to assist this, but the vision should be driven from the company,” says John Devine, MD of Auckland-based Sales Technologies.
As the CRM market matures companies must focus more on the customer. “We are seeing shift from an e-commerce focus to customer centric e-business. What this means is companies must look at empowering their customer by giving them tools to access people and information themselves,” says Devine.
Paul Roussell, MD of The Integrators, echoes this point. “Our role is not to bring CRM to an organisation, but is more to provide technology and anecdotal experience to assist customers in their adoption of the CRM ?attitude’. True CRM involves treating all customers with individual care and attention, recording their likes and dislikes, noting and resolving all issues, managing sales and after-sales support.”
New Zealand has had high degree of leadership over Australia in CRM implementations until recently when our Tasman neighbours have caught on. The products best suited to the New Zealand and Australian markets are what would be termed mid-market in the USA. “Our largest site has just under 300 users scattered around the world in about 38 countries,” says Roussell. “Those users run their own database copies, but these are synchronised with each other using the Internet.”
The advances in the CRM software market over the past year have had significant impact on the shipping industry in New Zealand. “Today’s software enables us to link with our international corporate offices, which has improved our accuracy, timeliness, efficiency and security,” says Brian Stocking, general manager at Hapag-Lloyd Container Line (NZ).
“Recent software tools are advantageous to both our export and import customers, for their optimising logistics planning, goods flow, controlling and reducing stock, cost effective processing and optimising purchasing.”
Stocking notes that there has been tendency within the shipping industry to make excuses and blame poor performances on external factors. Success in shipping nowadays partly relies on “hiring few staff from outside the industry with an ability to make the most of technology. Senior management also need to update their own skills in CRM.”
The shipping industry here is set to change over the next decade, believes Stocking. “There are currently too many major ports in New Zealand and too many shipping companies creating unnecessary competition. It would not be surprise to see major change with consortiums and small shipping lines folding. Technology and CRM tools will play part in the commercial aspect with cost cutting and tracking data. We must face up to tomorrow by constantly being proactive in technology development, market force changes and keep one step ahead of competitors.”
These competitive pressures also help to reduce margins and raise customer expectations for personalised service. Knowing what customer wants and how valuable the customer is, is daily prerequisite for business decision-making.
Brent Ellison, at SAP NZ, believes that “CRM is not luxury, but necessity. As result, both mid-range and large companies are starting to reconsider CRM solutions and understand that only tightly integrated solutions that span the entire customer lifecycle will deliver significant benefit.”
CRM is still in its infancy in New Zealand. Organisations are tentatively piloting, testing and implementing limited solutions often without supporting CRM strategy lead from the top. It is common scenario for large organisation to buy myriad of point solutions for each department, which in fact increases costs and fragments the most valuable company asset – customer information.
“Only an integrated CRM strategy led by the CEO will deliver strategic advantage to companies,” says Ellison. “The good news is that the technology is mature and ahead of the current thinking within business. The problem is now business problem and not technology one!”
Nevertheless, there are still significant pitfalls in CRM technology. Most CRM vendors candidly agree there are so many pitfalls that it is hard to choose which ones to highlight.
Many enterprise customer relationship management (ECRM) projects fail to deliver the expected returns. Here are some of the reasons why. Some of the projects are too ambitious, some have tactical instead of strategic focus, and others have insufficient investment, are poorly defined and have lack of attention to data migration and quality.
The rate of failure of CRM systems is still very high. Martyn Riddle, at FrontRange Solutions in Sydney (formerly known as GoldMine Software Corporation), explains why. “This is partly because if an organisation has bad business practices to start with, the introduction of CRM technology without reviewing business plan can actually speed up the demise!” The solution, he suggests, is to start with small “proof of concept” pilot rollout during which any issues and problems can be ironed out. “The pilot should take less than three months and should start in the area of business that has the most pain, be it sales, marketing, service, support or administration.” From this it is easier to produce larger business plan with definitive return on investment figures rather than wasting huge amount of money and resources on scheme that is unsuitable.
One of the ways to reduce mistakes and ensure that organisations use their CRM systems properly is to provide ongoing training and support. “A lot of mistakes are made by companies focusing on the technical use of product. Whilst this is of course important, it is also imperative that training is provided on customer-centric processes. How to speak with