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Part Six: Putting it All Together
This final installment in the six-part CRM Strategy series deals with execution of a CRM strategy.
Posted Sep 21, 2001
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(I. Barry Goldberg, principal consulting partner of Matterhorn International, completes his six-part series on integrating customers into strategy to achieve a truly customer-focused company. Click here to read last month's article.)

The first five articles in this series have dealt with sweeping concepts in an attempt to explain the strategic components of establishing and leading a business that is truly customer centered. This final installment deals with execution of a CRM strategy.

Keeping a Hedgehog Focus

I was privileged to have lunch recently with Jim Collins, author of Built to Last. Jim was kind enough to share some of the key findings of his new research. He says that choosing key competitive strategies and adopting them with the single-minded approach of a hedgehog is the key differentiator between good and great companies. (More on this is in the October issue of Fast Company magazine). If you choose to compete on the strength of product excellence, your focus on R&D and product management must take precedence over other priorities. While this may be blasphemy to those who preach the customer centric gospel, it is actually good news to practitioners. If, as a company executive and leader, you choose to compete on the strength of customer loyalty, then your hedgehog focus requires that you make customer initiatives, including CRM, mission critical priorities.

This is a defining concept for one simple reason. Most CRM failures are projects that were not classified by the company leaders as mission critical. All the necessary criteria cited by consultants--senior management sponsorship, sufficient resources and integrated execution-come as part of the package when the project is considered mission-critical.

Trying is Not Succeeding

In the second star Wars film, there is a poignant moment shared between Luke Skywalker and his mentor, Yoda. Yoda has encouraged his student to stretch his newly learned capabilities by performing a very difficult task. Luke shrugs and blithely responds, "All right... I'll try." The master scolds him, "No! Do or do not. There is no try!"

As a sponsor or leader, you cannot push an initiative forward through force of will. If you adopt the rhetoric, but not the discipline, you risk compromising your credibility, your business outcomes and possibly your customer base. If your hedgehog focus is not on customers, then spend what is needed on tactical CRM projects to ensure basic service levels and manage channel costs. If you choose to compete on customer loyalty--then you must be clear and dedicated in your actions. This is not a strategy to be "tried." When you begin to take your enterprise to a more customer-centered model, you will change foundational elements. To be successful, your organizational model will change, your investment priorities will be reordered and the criteria by which you make decisions and the metrics by which you manage the business will change. "Trying" will prove expensive and painful. "Doing" is hard enough with full commitment.

stay Focused on Business Outcomes

With all this attention on strategy it is ironic that the single most important guideline for a company leader is articulated through an old business saw, "Don't get so busy killing alligators that you forget you were here to drain the swamp." Managing outcomes, rather than activities is probably the most important thing that a sponsoring executive can do. The more, as a sponsor, you can remain focused on the overarching business outcome you are trying to create, the better your personal success will be at sponsorship.

I remember working with a large brokerage firm engaged in the re-automation of its entire retail operation. When I interviewed the executive vice president who ran the retail division, it was clear that he was desperate to deploy the new system. His primary statement was, "We need this yesterday." When I asked him what he hoped to accomplish and how he would measure it, he looked at me like I was from another planet. It was not until two meetings later that he figured out that successful installation of the technology would not accomplish his business goals without the reordering of key processes and reorganization to eliminate conflict.

If your goals are to improve loyalty, reduce turnover, improve household penetration or improve customer profitability, you will have to bring to bear much more than a CRM technology project. Remember to keep your eyes on the bigger prize. If you, as the leader and sponsor, charter and participate as if adoption of the technology is the project, you are in trouble from day one.

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