Implementation of
CRM Systems
Learning Objectives
• To understand the implementation process of CRM
This chapter focuses on!
• Factors influencing success and failure in CRM
• How to implement CRM and how to form a customer-centric
organisation using a stepby-step approach, based on project
managemen
• The phased build-up of CRM competencies
CRM Failure?
• CRM is about strategy, organisation, marketing and IT
• CRM touches on so many facets of an organisation that it requires
comprehensive changes which have far-reaching consequences and
high investments.
1. Causes for Disappointing Results
• A study conducted by Gentle revealed the causes of the disappointing results
obtained with CRM:
• Lack of CRM strategy: Committed employees are not in the driving seat
• Lack of a business case with clear objectives.
• The organisation was not ready for CRM.
• Poor data quality.
• The scope of the project was too broad.
• The lack of active sponsorship from top management
• The project was IT-driven and the focus on technology was too strong.
• Insufficient attention for change management. Relationship is ongoing
Causes for Disappointing Results (Cont.)
• Customers and others involved in relationships with the company do
not react positively to the system.
• The misconception that CRM may be contracted out to system
integrators.
• An international approach to CRM that results in additional
complexity.
• A bureaucratic approach to project management.
• Resistance from the IT department.
2. An Initial Exploration with CRM and How
Companies Handle This
• CRM is a container concept which everyone may interpret in the manner which
best suits their situation.
• Giving CRM a clear meaning is an initial action that will determine its success.
• Various ‘scans’ have been developed to help organisations get a first impression of
how they may design CRM.
• Using the scan developed by ICSB companies can score their performance on the
various components of CRM. A total score is calculated for each component, which
may then be displayed in a spider diagram.
Figure 18.1 CRM assessment
• Figure 18.1 illustrates the summary results from an assessment of an
organisation which is in the process of adopting and developing a
CRM strategy.
Figure 18.1 CRM assessment
• The scores shown are averages calculated using the scores from
individual answers to numerous questions asked during the assessment.
Figure 18.1 CRM assessment
• The organisation’s score of 8 out of a maximum of 10 points shows that
it has formulated a clear CRM strategy
• The organisation has a low score on customer value experience (score 5
out of 10)
• There is a low degree of customisation of the offering (score 6)
• Insights relating to customer value (both actual and potential) or
customer interests are not used to formulate a relationship policy
• There is no real on-going dialogue across the different communication
channels (score 5).
• This organisation show negative CRM performance metrics.
Figure 19.1 CRM Quick Scan Plot
Elements like
Elements like data
workflow
storage, retrieval, an
automation, task
d analysis
management, and
reporting
Ensuring consistent Elements like
and seamless personalization, lo
experiences across yalty
all channels.
programs, and
customer service.
3. The CRM Road Map
• The range of CRM
• CRM can have an extremely large range.
• In order to transform a product-oriented organisation into a customer-
oriented one, many subprojects are necessary.
• The transition from a product- to a customer-oriented organisation with a
customer intimacy strategy can be plagued by difficulties. In the
transitional phase, the influx of new customers can decrease from the
moment the communication style changes.
• In Figure 18.2 the domain of the projects is illustrated(next slide)
• The CRM vision
• Formulating and disseminating a vision of CRM is crucial to avoiding
getting lost in this expansive field.
They are projects contributing to the transformation of a product
oriented towards a more customer-centric organisation.
The CRM Road Map (Cont.)
• A vision reflects the final situation that the organisation strives to achieve
and to which it is committed, due in part to its pattern of values and norms.
• CRM strategy
• The realisation of a CRM vision requires a strategy that provides an
indication of the concrete goals and how these are going to be realised.
• Operational excellence goal: An organization customer strategy will also
demonstrate more characteristics of transactional than relationship
marketing. Self-service solution is planned.
• The careful specification of objectives can contribute fowards the success of
a CRM project.
The CRM Road Map (Cont.)
• A compulsion arises to search for possibilities which allow benefits to be
derived from CRM during the interaction with prospects and customers.
• Figure 18.3 depicts the effect of the choice of an operational excellence strategy in
global terms for the different CRM sub-topics and the results to be achieved by
them(Next slide). Shading of areas are important activities.
• Start at the beginning: First Phase
• Making the strategy work implies translating it to the operations, the
processes.
• Please note that not all building blocks need to be perfected all at once in the first phase
• Focus the projects on those processes involved in acquisition, delivery and
after-sales service which are important to the organisation.
• The scope of the projects should not become too large as this can result in a
riskier situation.
The CRM Road Map (Cont.)
• In budgeting, it is important to review all of the costs: those involved
in the network, the application software and the data.
• Customer data may be used in approaching prospects in a more
targeted way with offers, and cross-sell initiatives may also be geared
towards customers’.
If an initial project on customer knowledge is geared towards achieving the end
position, without the relationship strategy, proposition and communication
channels to capitalise on the knowledge investment, the advantages will not
outweigh the cost and return on investment will not be achieved.
The CRM Road Map (Cont.)
• Research into organisations that are successful in CRM has shown that their starting
point is often an area of ‘pain’, where they experience trouble.
• The business case will have to demonstrate that the CRM project involved in this
process will lead to positive results within a predetermined period of time
• It should be clear how the project will achieve ROI and not in any manner, but in a way
fitting the CRM strategy.
• Phased expansion
• For the short, the medium and the long term, the objectives to be
achieved may be defined for the different areas of CRM.
• The market is no longer divided up into products but into market
segments and ultimately even customer groups.
• The balanced scorecard was introduced as a useful tool to keep track of the
integrated performance of CRM.
The CRM Road Map (Cont.)
• Embedding in the organisation
• Achieving the relevant objectives is dependent upon the proper embedding
of CRM in the organisation.
• Horizontal connections between departments and business units are
created in order to arrive at a customer-oriented organisation.
• In CRM on the part of senior management concerns the entire process and
not only the individual projects.
• Within the steering committee, individual members may take responsibility
for the specific areas within CRM.
• Core teams professionals with authorisation operate from the top; they have
responsibility for developing the organisation’s CRM competency.
4. CRM Project Management
• A good project description is desirable, one which includes the assignment and
the objectives to be realised.
• The objectives should also preferably be SMART (specific, measurable,
actionable, realistic, timely). Next Slide
• The project result is dependent on the degree to which the company is capable
of defining processes from the customer’s standpoint which are supported and
improved by the use of information communication technology and which bring
the realisation of the strategy one step closer.
• Insights regarding the objectives may change along the way, but the ideas on
the project feasibility may also change as well as those regarding the quantity of
work involved in the project.
CRM Project Management (Cont.)
• Characteristic of many CRM projects is that people from more than one
discipline must act in concert with one another.
• The project must have the sponsor at the upper level of management who is
convinced of the importance of the project and is responsible for the final
result.
• Financial means will also have to be made available in order to feed the
system with data. Budget
• It is also recommended that a pilot is organised in which the project can be
tested out in a live environment over a period of several months by a
selected group of users.
• Proper preparation for ‘going live’ with the project is crucial. The users must
be trained and the data migration must be arranged.
• The project will have to be evaluated and lessons will have to be learned from it for the future.
Manifesto for Agile Software Development
1. people and interactions rather than processes and tools;
2. software that works intuitively and correctly, rather than hefty
manuals to explain or troubleshoot;
3. collaboration with customers who use the software, rather than
contract negotiations;
4. dealing with change, rather than sticking to a plan.
Scrum: Agile development and implementation
• A special method of Agile development and implementation is Scrum.
• It is a metaphor for teamwork, communication, resourcefulness and
direction.
• The origins of Scrum can be found in a 1986 article in the Harvard Business
Review, outlining the benefits of multifunctional teams in innovation
processes ( Takeuchi and Nonaka, 1986 ).
1. increase team effectiveness;
2. guard the team’s progress;
3. resolve barriers and blockages;
4. safeguard project progress;
5. map and manage risks.
Agile development, and in particular the Scrum method, are becoming increasingly popular methods of working in CRM
6. International or Cross-division Projects
• Expectations versus reality
• In large organisations with activities in different countries and divisions,
the head office will ‘adopt’ CRM and pursue a standardised approach.
• The national organisations and separate divisions perception is that
their local reality is being neglected.
• Their company division differs significantly from the others and thus
deserves a different approach.
• Coordinating all of the activities appears to be more difficult than was
expected and is accompanied by the requisite travel.
International or Cross-division Projects (Cont.)
• Mistakes are more likely to be hidden or camouflaged than with local
projects because the failure of even a part of a prestigious project
presents major difficulties.
• Even if the central approach leads to a satisfactory solution, the negative
consequences for flexibility will have to be recognised.
• When should a standardised approach be taken?
• In overseeing the risks of the standardised approach, the question arises
whether it is even useful in certain company and market situations.
• An integral system is desired on a transactional level and a standardised
approach to CRM can be legitimate.
International or Cross-division Projects (Cont.)
• It is a considerable advantage for everyone to report in the same manner
on his or her financial results, customer satisfaction, processes and
innovations.
• Comparisons between divisions and national organisations become
possible.
• The choice for a uniform approach will have to be dependent upon a
consideration of the pros and cons on a transactional/operational level.
• Areas of particular interest in managing these types of projects
• The successful management of the international and/or cross-division
CRM projects requires attention to the relationship between head office
and the local units.
International or Cross-division Projects (Cont.)
• Users deserve to be able to participate and have a say, and must be
involved in all stages of the standardised project and not only during
implementation.
• The final team will have to consist of members who have international
experience and who are capable of assessing the situation in different
countries.
• A sensitive issue in the relationship between head office and the units
involves access to local data.
• The success of these comprehensive projects is furthermore
dependent to a great extent on the restriction of their complexity.
International or Cross-division Projects (Cont.)
• Knowledge of the specific situation is required to evaluate
whether a central, mixed or decentralised architecture is
preferred.
• actual implementation and use of the CRM system will have to
be adapted to the local circumstances.
Prepare a List of KPI
Your CRM Should cost:
Your CRM Could do:
Your CRM Must do:
Great Adoption = Great Results
CRM Implementation: Development of Customization
Time length varies from 6 to 10 weeks
Depends upon number of factors, like;
The size of the project
Complexity of system: interfaces, workflow and the function
Employees/users availability to work with team
Midstream changes in the rules and workflow for customization
Legal bindings related to implementation
The project manager is responsible for a project plan.
Alpha & Beta Testing
A sensitive part of CRM Implementation
Alpha = Internal to the company
Alpha Test is the first phase of product testing
Includes Component testing, and System Testing (Ex. Simulation Platform)
Involves employees and machineries
Alpha & Beta Testing
Beta = External to the company
This is where the actual customers get involved (Preferably experienced
customers/users)
Also known as User Acceptance Testing (UAT)
Involves;
Create a testing environment at the customer’s site (2 to 5 days)
Ensures the close working relationship between ‘Development team, Internal
team and IT staff.’
Beginning of knowledge/data transfer with customer IT staff performing beta
implementation
Key Considerations During Beta Test
Customer development during information gathering
Learning about the features (beneficial) and bugs present
Differentiate between the customer and the user
Most of your actual customers will never be the beta testers
Training Phase
The training process involves;
Basic Training – Normally, run by vendor for the users training
Either the company can send its users at the developer’s place OR could
also have a trainer come to the company.
Customization Training – Training of engaged employees to ensure their
familiarity with the system
Usually done by the internal project team
Roll Out & System Hand Off
Final phase of CRM implantation
Normally it takes one or two days and normally takes place on a weekend so that there is
a minimal destruction of actual work week.
Handing over the customized CRM to the client
CRM: Step By Step
Capabilities
Questions?
