Two-thirds of all Customer Relationship Management (CRM) initiatives fail, according to a recent study by Gartner Inc. Proper implementation and direction may be one problem.
But many businesses overlook the fact that the CRM information they store and manage is inaccurate, outdated, or redundant. Here are 10 tips to help you maximize the effectiveness of your CRM system from Frank Dravis, vice president of information quality, Firstlogic Inc., a data quality software company.
- Identify what CRM means to your organization. Identify and develop your business objectives. Your Customer Relationship Management solution should be built around the way you interact with your customers. The processes you use to sell, service, and support your customers must integrate with your CRM solution to leverage your investment. Make sure the solution you choose isn't just good—but good for your company.
- Secure executive sponsorship. Without involvement at the highest levels of your organization, a CRM project is doomed for failure. Period.
- Involve the right people. During the development process identify significant resources from your company's information technology and business departments. Do an internal evaluation to determine if you need outside resources or if you can handle the project in-house.
- It's all about the data. Bad data leads to bad business decisions. The quality of your CRM system's information affects every aspect of your business. From routine daily transactions to long-term planning, smart and informed decisions depend on accurate and complete information.
- Pick a pilot. Don't attempt to bite off more than you can chew. Identify a pilot project and set attainable goals. Quick successes lead to quick returns, which lead to wider project scope and corporate-wide support of your CRM project.
- Assess the data. Failure to assess and address data quality issues is a common flaw in CRM projects. At least 50 percent of enterprises undertaking a CRM strategy are unaware of data quality problems in their environment, according to Gartner. Continually measure and report on data quality metrics. You can't fix a problem if you don't know it exists.
- Cleanse the data before it enters the CRM system. You can do this in different ways. For some areas of your operation, you need to cleanse data on a transactional basis. Other types of data, such as existing databases or prospect marketing lists, are most effectively cleansed or processed all at once as a batch. Another key place to implement data quality is within the CRM package itself—whether it be a packaged or proprietary application.
- Consolidate the data. Combining databases or data sources can cause problems because they may have been created independently and on different platforms. While the basic information contained in each database is essentially the same, the format of each may differ. With a data quality solution, you can normalize and correct customer and business information before it is loaded into the CRM system—whether you collect or store customer name and address data, email addresses, point-of-sale data, or any other type of business data.
- Build in maintenance of the CRM system. CRM is a continuous process, not a one-time fix. Information becomes dated, people move, businesses relocate and acquire new customers, postal codes change. You must continually improve and fine tune business rules as you learn more about your company and your customers.
- Create a single customer view. One main principle behind Customer Relationship Management is that there is only one record for each client. Unfortunately, even the most sophisticated CRM system is incapable of maintaining a single record per client without accurate, cleansed data. A single customer view means that everyone can surely access and use the same information, allowing for a more in-depth understanding of your customers and your business.
By Deborah Catalano Ruriani, inboundlogistics.com.
