Don’t Be Afraid of Discipline

Companies contemplating CRM typically perform return-on-investment analyses to determine the impact on financials, but when it comes to the customer experience, most companies fail to identify and prioritize the CRM capabilities that are likely to have the greatest impact.

We’ve developed a disciplined approach for those who’d like to bring a degree of rigor to the process of determining which CRM investments and capabilities are most likely to improve the customer experience. The key is to adopt the customer’s orientation. First, define the phases of the customer lifecycle (e.g., Learn, Buy, Install, Pay, Operate, Enhance). Next, define the key customer touch points for each phase of that lifecycle (e.g., attending a marketing event within the Learn phase; receiving an invoice within the Pay phase). Each phase should have six to 12 such interaction points.

The touch points are the moments of truth, the instances when the company delivers experiences that disappoint, meet, or exceed the customer’s expectations. If the experience falls short of what the customer expects to receive, then the transaction is a failed customer interaction.
The challenge is not so much in defining the lifecycle and identifying the touch points as it is in prioritizing those touch points in terms of their importance to the overall customer experience, and then assessing the company’s performance relative to customer expectations.

To make these assessments, a repository of leading practices can help, but a workshop with informed managers and employees can do the job. The goal is not to produce a precise ranking of areas for improvement. It’s to identify and target the touch points that, if reliably improved, will most likely improve the customer experience. The collective judgment of those who deal with customers on a regular basis can be a reliable guide.

Much of the value from this approach is the shift in mindset that it fosters among those who assess what the customer experience currently is and what the experience ought to be -- presumably front-line leaders within the company, people who can lead fellow employees to appreciate the CRM initiative’s goals. In other words, they can be the energized, enthusiastic change agents that every successful CRM transformation program needs.

That said, the value of analyzing the customer experience in a disciplined manner comes mainly from identifying specific capabilities that can be designed, developed, and deployed in the company’s CRM system. These capabilities typically target reducing defect rates and cycle times in the transactions most important to the customer.

Improvements of this type can be achieved by developing alerts, workflows, reports, and dashboards -- often more concentrated in the domains for service and support than for marketing and sales. The company can even measure the number of failed interactions as a percentage of total interactions. All of these targeted capabilities can serve as functional requirements for the CRM system, thereby helping to prevent the analysis of the customer experience from becoming merely another PowerPoint presentation delivered to executive management.

As a final value driver, shifting focus toward preventing and redressing failed customer interactions often reveals systemic shortcomings in the processes that manage customer issues. In most companies, these processes depend upon the customer for submitting and escalating an issue. In a customer-focused company, however, CRM is designed to identify customer issues automatically and reliably, triggering remediation processes that can even make a failed customer interaction an occasion for a positive overall customer experience, once the company has followed up and made good with a meaningful remedy.

For measuring the financial impact that CRM might have on an organization, ROI analysis is by now a well-established approach. For assessing the impact that CRM might have on the customer experience, no comparable approach exists. But the assessment can be done in a disciplined manner, reliably identifying the customer experiences that need to be improved and the CRM capabilities that need to be deployed. The analysis need not be elaborate in order to be effective: Combined with an ROI analysis, the effort will establish the basis for a CRM program that can genuinely transform a company.

J. David Lashar (dlashar@us.ibm.com) is an associate partner in the CRM practice of IBM Global Business Services and the leader of the IBM SaaS Center of Excellence.
 

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