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CRM Vendors Target the Public Sector
The need for public sector bodies to develop their relationships with customers is nothing new, but the fact that they are seen as the next big target for CRM vendors is more surprising.
Posted Jul 14, 2000
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Pat House, co-founder of CRM (customer relationship management) market leader Siebel Systems, caught some by surprise in May 2000 when he announced at a US press conference that the largest vertical for the vendor over the next few years was expected to be public sector.

Public sector bodies have long been some of the worst performers in their relationships with their customers. Are they ready to look to relationship-hungry and cash-rich sectors like telecoms and financial services for answers? Bill Gates, for one, appears to think so, and the Microsoft chairman hosted a conference in Seattle in early April to try to stimulate some thoughts and sell some boxes.

But while what the UK likes to refer to as joined-up government is clearly focused on improving communications between public servants and those they serve, some are looking further into the need to better manage their relationships.

There is still a need for education. A recent survey of 104 Members of Parliament by the World Internet Forum, conducted by Mori, found that less than half thought having all government services online would be popular with the electorate. The founder of the World Internet Forum, Derek Wyatt, Member of Parliament, commenting on the findings, said "governments are lagging behind industry in their understanding and adoption of the Internet. They need to work together to develop citizen-centric technologies."

Joined-up government itself requires an element of CRM. Seamless progression through the great government bureaucracy closely parallels the database integration which lies at the heart of many CRM projects in the private sector, but on a much greater scale. It is in a context of understanding the customer that Siebel and others are starting to talk about citizen relationship management.

"Citizen-centric government is clearly something that is coming to the fore in the public sector," says Phil Robinson, vice-president of marketing at Siebel. "In Europe and the US, there's a change in the way public sector organisations are being perceived and they need to demonstrate value."

City Council CRM
Siebel set up a special unit with its own direct salesforce to target the public sector. It also partners with ICL and other integrators, where one of its early wins was at Leeds City Council, hailed as a standard of customer care.

Leeds began an extensive customer care programme in 1996, which initially focused on delivery of customer services. Only recently has the project been extended to CRM. Initially, Leeds set up a one-stop centre in the city's Great George st., where citizens could go for a number of problems instead of being shunted around between different departments. The Council then set up an intranet, aiming to make back-office data more easily accessible and enable better management planning.

ICL has now set up a three-year plan for Leeds, and one of the first elements of this was the establishment of a 50-strong call centre in March 2000, to take some of the load off the one-stop centres. The system will cascade information down to existing systems, so staff only have to enter data once.

The call centre is piloting Siebel, and Andy Taylor, director of community planning and regeneration at Leeds, clearly has high hopes for the system: "The CRM system will help us to produce an evolving community plan for each area of the city," he states.

The ICL spokesman insists that few changes will have to be made to the packaged CRM system, even though it was originally designed for profit-minded businesses. "It's a different set on information in the core system, but they are both trying to manage the relationship."

Selling to the public sector also carries unique challenges, since their procurement practices are so tightly monitored. Robinson says that this can work to your advantage. "At least in dealing with the government the rules are written down. In the private sector you might only discover them after the deal has gone elsewhere."

At a certain level, public sector bodies have two sets of customers--they must also sell themselves to the other departments that fund them. Certainly, at this level, service is better regulated and controlled. Siebel customer DERA, for example, the Government's Defence and Research Agency, carries out research for a number of government organisations, and has a very strict handle on what it is doing for each.

At the citizen level, there is still a great deal of room for improvement. But the moves of early adopters are starting to make an impact.

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