Is it possible to strike a balance between optimizing productivity and providing top-notch service and profit from it? Yes.
For the rest of the August 2003 issue of CRM magazine please click here
Service or efficiency? In many cases the two are mutually exclusive. More and more technology floods the market promising increases in the number of sales proposals drafted, the number of calls handled, the number of marketing campaigns completed. Too often, however, these productivity enhancements are achieved by cutting away at the personal side of the business relationship.
Is it possible to strike a balance between optimizing productivity and providing top-notch service? Yes. In fact, organizations like the ASPCA, Cox Communications, and Dreisilker Electric Motors (DEM) have done so within their sales, marketing, and service departments, and are profiting from it. Any company can follow the lead of these businesses.
"It's most important to focus on strategy, not technology," says John Bardwell, a senior analyst at ROI consulting firm Alinean. "Too much focus on automation and you run the risk of losing a lot of that personal touch that can set you apart from your competition; simply focusing on cost reductions and productivity can be dangerous."
Bardwell says that regardless of the business process--sales, marketing, or call center--companies must always create goals that maximize customer relationships before eyeing profit-boosting initiatives. "Satisfaction equals more wealth than cost cuts, since it costs eight times more to attract new customers than retain current ones, and clients are 95 percent more likely to tell their associates about bad service than good service," he says.
So, what are the best ways to increase sales, marketing, and service productivity, while remaining customer-centric? The answers are as diverse as the number of companies attempting to do so. Following are several successful productivity optimization strategies and how they have been put into practice at various companies.
Sales force automation (SFA) applications are one of the main drivers of CRM technologies, and can help increase the amount of leads sales reps contact, while allowing reps to better manage those leads as they become customers. But using technology to retain the human touch is what's most important in this area, says Claudio Marcus, a research director at Gartner. "Applications and technology in general can drastically improve efficiency," he says. "But how much can technology really improve how effective a salesperson can become?"
As the economy turns into recovery, the winners are likely to be those who have not only stabilized their customer service and sales costs, but those who are improving the effectiveness of customer retention and loyalty programs. Improved customer segmentation, customer satisfaction, and service strategies should be tailored in downturns and expanded in upswings, but need to remain long-term goals of any successful CRM program.
Robb Eklund, vice president of CRM product marketing at Oracle, agrees: "The best solutions make sales representatives more effective by reducing the paperwork and enabling the reps to have more time in front of the customer. Take sales proposals, for example. What can be a labor-intensive, time-consuming task can be automated to give sales reps more time in the field." Automating proposals also can make them easier to check for pricing accuracy and to track until a sale is complete and a new customer is entered into the system.
This philosophy of "less paperwork equals more face time" has worked well for DEM, according to Melissa Donahue, information systems coordinator at the company. After implementing and tweaking its SalesLogix CRM software, the company has been able to improve the human-touch aspect of its sales approach, and sales among its top customers have grown by about 20 percent.
Another firm that has benefited from boosting sales force productivity while optimizing customer relationships is Pictage, an online service that caters to professional photographers. After implementing a combined sales and service solution from Salesnet and Qualte, the company saw a 50 percent increase in new clients in the first month alone, according to Scott Brogi, vice president of development at Pictage.
"The Salesnet SFA application helped us automate lead management, getting the right leads to the right people, and the support capabilities from Qualte helped us to cut down on the amount of time servicing customers, since we put together some self-service features that accounted for a majority of the questions people were asking support staff," Brogi says.
If the definition of sales force productivity is transforming leads to sales, then it follows that productivity in the marketing department is to generate those leads. But generating leads isn't about blasting out direct mail, hoping to catch the eye of potential customers. It's about running campaigns that deliver ROI.
"Marketing really needs to be about generating revenue, not leads," Oracle's Eklund says. "The marketing team needs to be held more accountable for increasing revenue, not for pumping out reams of direct mail."
One way to build revenue from marketing is to increase revenue from existing customers. "Campaigns should be event triggered--for example, sending emails to decision-makers at a company reminding them that their service contract is about to expire," Alinean's Bardwell explains.
By cross-marketing to its constituency groups (e.g., activists and donors), the ASPCA raised more than $430,000 online in just under a year, and grew its online Advocacy Brigade membership by 247 percent in seven months. It also converted 24 percent of online activists to donors.
Bardwell says that companies can use analytics to gain better insight into their customers' behavior, and market to them accordingly. He cites as an example that a car company could send personalized email to car owners based on their service records with dealerships. Once an owner takes her car in for scheduled 100,000-mile service, it may be time to market a new vehicle to that obviously loyal customer, he says.
Also, focusing on the right customers is important in creating a more productive marketing strategy, says Jonathan Copulsky, lead partner for CRM strategy at Deloitte Consulting. "Companies may discover that about a dozen customers account for about 85 percent of sales," he says. "They could then go and effectively market to those customers that really matter."
Copulsky also says that exhausting all the ways of getting revenue out of existing customers is often preferable to blindly marketing to cold leads, since the profit made from existing customers is usually more than that made from new customers, after accounting for the marketing costs.
Beyond Service With a Smile
Sales and marketing efforts may bring in the revenue, but it takes great service to keep customers coming back. And while productivity in the contact center often means keeping per-call talk time to a minimum, rushing customers off the phone is certainly not a relationship-enhancing strategy.
For this reason productivity enhancements on the service side are primarily coming in the form of workforce optimization solutions. "Optimizing the right level of agents at the right time so that you are not over- or understaffing is a key to driving productivity while also cutting unnecessary costs," says Karen Hardy, director of product marketing at Aspect Communications.
One way to optimize support center staffing and increase customer satisfaction is to reduce wait time. Aspect customer Cox Communications, for example, offers a scheduled callback option to customers calling its support center, and Cox has seen improvements in staffing since implementing the system, says Joel McGinley, director of customer care technology at Cox. "If the customer does not reach a live agent within two minutes, they can opt to schedule a callback time when an agent will call them to discuss the problem," McGinley says. Forty percent to 60 percent of those presented with the callback option chose to receive one.
The solution has created staffing efficiencies for Cox, because it can track the busiest time frames based on how many callbacks are scheduled. Customers are happier, too. "The result has been extremely positive: Customers are satisfied, because they feel empowered being able to schedule a callback time that works for them," McGinley says.
There are bonus benefits as well. Because customers are on hold for much less time, the company is seeing line-usage savings that will result in bottom-line increases.
Another company seeing workforce productivity enhancements in the support center is Pyxis, a division of Cardinal Health that markets and supports automated medication and supply distribution systems. The company uses PeopleSoft support and field service modules to send automatic notifications for service calls to field reps assigned to "critical accounts," according to Dave Groves, operations manager for the Worldwide Service Center at Pyxis. Groves also says Pyxis uses PeopleSoft Solution Advisor for decisions on whether a service rep needs to be sent out to fix a problem, or if a rep can talk a customer through a resolution.
Groves says the solution itself has increased productivity in the support center simply by being easier to use. "The PeopleSoft solution stores all contact information, so we only have to plug it in once," Groves says. "Now, when a customer calls in need of service, all the service invoice fields are automatically populated. This helps build customer relationships, since the customer does not have to supply loads of information every time they call."
No longer do service and efficiency need to be mutually exclusive. Whether in sales, marketing, or customer service, productivity enhancements are delivering benefits that build customer relationships and translate to bottom-line improvements.
5 Productivity Builders
Getting more out of your CRM initiative is no easy task. John Bardwell, a senior analyst at ROI consulting firm Alinean, says the following five steps can help build a more productive, yet service-oriented, CRM strategy:
1. Aim to optimize the customer experience, not cut costs. CRM strategies based primarily on reducing costs rarely meet their goals.
2. Set measurable ROI goals based on productivity improvements, cost avoidance, and profit improvements. These goals should include both tangible and intangible measures. Quantifying the value of intangibles like improved satisfaction demonstrates how a company delivers value, as long as the goals are clearly linked to its larger business objectives.
3. Be conservative, plan for risk, and adjust ROI projections accordingly. A CRM implementation may have a risk factor of 20 to 50 percent; the key is to identify an acceptable level. What-if scenarios are particularly helpful to assess risk impact and create a discounted cash flow analysis.
4. Benchmark internally to track projections and goals against achievements. Quantifying success and shortcomings will help ensure that management approves future proposals and will help identify areas for continued progress.
5. Benchmark externally to identify how peers are investing in IT, and who is deriving the greatest value. A company that is lagging can use this hard-dollar competitive analysis to strengthen budget requests, once the ROI is both clear and credible. Expand your benchmarking to companies of similar size and revenue in other industries. Best practices and standard-setting ROI behaviors can cross sectors.
Contact News Editor Martin Schneider at mschneider@destinationCRM.com
|Learn more about the companies mentioned in this article in the destinationCRM Buyer's Guide:
Sponsored By: Marketo and Real Magnet
Sponsored By: Jacada, Avaya, Confirmit, inMoment and BoldChat
Sponsored By: Genesys, Avaya, Verint, and Aspect
Sponsored By: Informatica
Sponsored By: Freshsales
Sponsored By: Microsoft
Transform business process automation and people productivity with Microsoft Dynamics 365 and the Microsoft Cloud
New Gartner Report from Microsoft
Sponsored By: Microsoft
Sponsored By: Microsoft