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by Alice Thomas

Top 10 CRM Best Practices

Jun 24, 20047 mins
CSO and CISOData and Information Security

Knowing your customers intimately and using that knowledge to deliver better products and services, improve customer service and increase sales opportunities is the concept behind customer relationship management (CRM). Just a few years ago, CRM was all the rage as companies began to focus their attention on forging tighter connections with customers to stay competitive in an increasingly buyer-driven economy. Companies invested heavily in CRM systems, attempting to learn more about their customers and offer more personalized products and services.

For many companies though, CRM did not live up to its promises. Project failure rates ranged from a low of 50 percent to a high of 80 percent, according to research surveys. The high risk and cost of CRM initiatives, combined with an economic downturn, caused the CRM software market to hit rock bottom in 2002.

The story doesn’t end there, however. Despite its early growing pains, CRM has survived the hype, evolving from a business fad into a business necessity as companies face ongoing pressure to attract and retain more customers. CRM provides the tools required to get closer to customers and cater to their individual wants and needs. Much like quality, it is an aspect of business that cannot be ignored. Although the CRM market plunged in 2002, the Gartner Group expects it to grow slowly and steadily throughout 2004.

So why has CRM been so tough to implement? Neither the business concept nor the technologies are to blame. Rather, the fault primarily lies with poor project execution. Many companies have made the mistake of rushing headlong into CRM without a well-thought-out strategic plan, failing to meet their objectives in the end.

CRM works: there’s no question about it. However, it requires the right approach coupled with careful planning and execution to succeed. Here are 10 top CRM best practices that can help to ensure the success of any CRM project.

1. Clearly define the business problem, desired benefits and metrics

Identify a business owner who can clearly articulate the business problem your company needs to resolve. Work with the business owner to identify the desired benefits and map each benefit to the various stages of the project. Make sure benefits are generated at every stage. Your company should not have to wait until year five of the project to see a return on investment (ROI). Clearly define performance metrics up front to ensure a ROI upon the completion of each project phase.

2. Find an executive sponsor and form a governance team

Because CRM has such a major impact on the way a company does business, a CRM strategy needs to be adopted, promoted and executed from the top down. Choose an executive sponsor to the lead the charge. This executive sponsor must be able to make the hard decisions and bring together the various divisions and departments impacted by CRM to ensure everyone clearly understands and cooperates with what the company is trying to do. In addition, form a governance team made up of both the business owners and the technical implementation team. This team’s role would be to ensure that all roadblocks are removed and adequate support is available, as well as to closely monitor project deliverables.

3. Always keep the big picture in mind

Have a clear picture and understanding of what the CRM solution will ultimately achieve. Be able to demonstrate what it will look like up front through the development of a prototype. Create scenarios depicting how the business is run now and how it will operate once the solution is implemented. Once you understand the big picture, you can then break the project down into smaller, tactical plans, making sure to identify all of the points at which the solution will integrate with other front- and back-end systems, as well as with suppliers and partners.

4. Focus more on business processes than technology

To succeed with CRM, companies need to understand, first and foremost, that it is not about technology, but about business. The idea behind CRM is to change a company’s internal and external business processes to make it more customer-centric. Technology exists to support the new processes and nothing more. Focus on making business processes more streamlined, efficient and executable. Add technology only when necessary and feasible.

5. Implement change management measures

Implementing a CRM system fundamentally impacts every aspect of a business-from the front office to the back office. Old ways of doing business are replaced with new ways and getting employees to accept the changes can be a challenge. A champion needs to be appointed to drive acceptance of new business processes and workflows. This champion must be able to effectively communicate with management and staff and get them excited about improving how they do their jobs, reaching more customers and making the company more successful.

6. Put together an “A team”

All the best practices in the world will not lead to CRM success unless there is a highly skilled and experienced team involved. CRM initiatives are complex and you need a team that not only has in-depth CRM expertise and business knowledge, but the commitment, drive and creativity to meet the demands and expectations of the project. Team building is also vitally important. Performance incentives should be offered and successes should be celebrated to motivate and reward team members.

7. Choose the right CRM partner

Finding the right CRM partner in a market crowded with vendors can be a daunting task. The viability of a prospect’s CRM practice, including its financial strength, market leadership and market size, should be considered to narrow down the field. In addition, weight should be given to the prospect’s domain and industry expertise, its partnerships and alliances with other vendors, and its client references.

8. Choose the right methodology

Whether to outsource the development work or do it in house must be decided, as well as how and when the development work will be carried out. Will you use the classic waterfall methodology for software development, for example, or the more modern agile methodology, which allows for iterative design and checkpoints? Overall, the methodology for implementation should be comprehensive, yet simple, addressing every stage of the project lifecycle-from strategic planning to systems design and implementation to end user training.

9. Design a user interface with the end user in mind

This critical practice often receives inadequate attention or is entirely overlooked. User acceptance is the single most important success factor for a CRM system. As a result, user input should be solicited throughout the design process. To ensure user adoption, the user interface must be self-explanatory and easy to use. Terminology that the end user will understand should be used, taking into account language preferences.

10. Invest in training

As with a properly designed user interface, training is essential to ensuring user acceptance. A “train the trainer” approach is recommended. Identify business champions whom you can train and have that group train the end users. This enables the ultimate recipients of the new CRM tool to have full accountability and ownership for the change. Classroom and computer-based training are both effective training methods.

Moving forward

While a lot of companies have failed at CRM, many others are succeeding and gaining an edge over the competition. Success isn’t arbitrary: companies that have succeeded have wisely invested in planning, processes and people before even considering launching a CRM project.

By following these top 10 best practices, which have been tested and proven in the real world, you can keep your CRM project on track and reduce the risk of project failure. A key point to remember is that CRM is not solely a technology initiative, but one that encompasses business process engineering, change management and ultimately an improved customer experience.

Alice Thomas, Vice-President of Consulting Services, is responsible for providing consulting services within the telecommunications sector for CGI. She has more than 20 years of experience in delivering business-centric solutions in a wide range of industries, including telecommunications, oil and gas and government. Over the last 10 years, Alice has focused exclusively on e-business and CRM solutions. For more information on CGI’s CRM expertise, visit