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Is IT's Reign at an End?
CRM forces information technology departments to reevaluate their place in the organization.
For the rest of the May 2000 issue of CRM magazine please click here
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Previously unimaginable acts such as IT executives riding with sales reps to make customer calls and wearing headsets at call centers became routine.

The further customer interaction shifted toward the Internet, extranets and newer digital communication channels, the closer IT needed to be to customers.

Once upon a time, there existed the autonomous principality of IT. Surrounded by high fortress walls, encircled by a moat filled with voracious creatures, only the king dared enter--and even the king was forced to go blindfolded. Such was the power of this principality, which stemmed from its control of all information systems throughout the kingdom.

Others in need of favors from IT were forced to write down their requests, wrap their proposed work orders around stones and hurl them over IT's mighty walls. While IT deigned to honor some requests, most were held captive and ultimately tossed into a reputed "black hole" at the center of its castle. Such was the independence of IT, which stemmed from the others' fears of being denied future requests.

While nominally reporting to the king, IT was really accountable to itself, and only itself. IT often showed little respect for others in the kingdom--and was especially disdainful of those in sales and marketing, who had never figured out how to build better-than-flimsy walls around their consequently less-protected turf.

End of an Era
But the day came when a mysterious, seemingly invisible force crept into the kingdom. No one could see it or define it, but its effects were unmistakable. Alarming changes began taking place, many of which upset the natural order of things. Sales, long considered an unwashed and unwanted caste of fisherman and golfers, suddenly demanded better treatment from all subjects, especially IT. This "force" breathed new life into oft-vanquished sales and made it too formidable for even IT to ignore. To wit, sales began demanding information management tools of its own, at which IT at first sneered. But sales fought with the ferocity reserved for fights over commissions, and was granted money to buy and make these tools. And IT, would you believe it, was ordered to assist sales.

Marketing, too, did a turnabout. Long viewed as dilettantes without significant power and influence--although it was afforded huge sums of money to spend, much of which it squandered--marketing took on a more serious demeanor. Not all of marketing, mind you, because many remained with their heads in the clouds, but those marketers who could feel "the force" and swore allegiance to it. These marketers split away from the larger group and, strange as this seemed to all, formed an alliance with their long-time adversary, sales. Marketing, too, had traditionally looked down upon sales, calling it "marketers without MBAs." Sales, better warriors than leaders, responded by seeking the help of those now designing and deliberate marketers in plotting out just how to respond to the wishes of "the force." And to make their partnership yet more powerful, sales and marketing reached out and freed service, which had long languished in chains that bound service to accounting and manufacturing, as well as IT's cumbersome information systems. Together, sales, marketing and service formed a powerful "front office" triumvirate.

And yet stranger events were in the wind. While sales, marketing and service grew empowered, tablets bearing the letters "CRM" began appearing all over--and not just here, but in many other kingdoms as well. No one knew exactly what "CRM" meant, but few doubted that it was truly something special--something planted by the "invisible" invader. Great value was immediately attached to "CRM," which precipitated the arrival of hordes of merchants swarming into this and other kingdoms to sell "CRM" as if it could be put into a bottle--or a package. Many bought. But they were sorely disappointed. Either this was not real "CRM" they were buying, or CRM was little more than a tangle of technology not even IT could understand, or debug. But because IT people saw technology coming into the kingdom from merchants foreign to them, they naturally sought to capture and grok it.

Lightning in a Bottle
But IT found capturing CRM no easier than getting lightning in a bottle, or a shrink-wrapped package. And despite all the CRM disappointments, excitement about it continued to rise. Even the usually far-removed king became intrigued. "What is this 'CRM'?" Whatever it was, one thing was for certain. Whatever had possessed sales, marketing and service was behind it.

Even before anyone unraveled the riddle of "CRM," a dispute broke out over ownership. The new "front office" partnership of sales, marketing and service claimed it as their own. And at face value, CRM certainly appeared to have mostly to do with front office functions. But IT saw CRM as a new technology. And that, by definition, made it their responsibility. Then the dispute turned into a technology tug-of-war. What a sight.

The front office side, finding strength in numbers, surprisingly managed to hold its ground. IT, although frustrated by its inability to win with the first tug, was immutable. So it turned into a standoff--until the next mysterious event occurred. Almost imperceptibly at first, something took hold of the front office end of the rope and began pulling. The pull became stronger and stronger. Although desperately trying to hold its ground, IT began losing its footing and sliding and skidding toward the front office line. And then the rope was jerked from IT's hands with such power that even the trio of sales, marketing and service was pulled off its turf and landed in some highly undignified positions. Everyone realized a yank so powerful had to be the work of "the force." After all, these were bright people.

And then came the strangest, most magical moment of all. Perhaps unnerved by the violence of their uprooting from familiar turf, all the combatants suddenly experienced a rare brush with reality. Almost in unison, they turned their eyes--normally riveted on a giant thermometer just outside the king's palace that measured progress against their financial goals--outward toward the rest of the world. And when they looked out, they came face to face with "the force"--which turned out to be their customers. The customers had risen up and taken the power they believed was rightfully theirs--and in so doing, had become the final arbiter of issues within the kingdom. CRM was, in fact, theirs. The purpose of CRM was to serve them. Riddle solved. And all felt foolish for not figuring this out sooner.

What happened next is still the subject of much dispute, but this much we know.

Customers took charge. Before long, impatient customers started bossing everybody around. Some of their demands were outrageous and difficult to grant. They wanted salespeople armed with information and decision-making power, not puffery; marketing that addressed them individually, not as one lump; customer service that knew them and their relationship with the company; and many wanted to do business over the Internet without further delay.

IT clapped upon hearing that customers wanted to do business over the Internet because the Net was technology, and IT still believed they controlled all technology--at least all technology other than CRM.

Customers Rule
But these customers yielded to no one, not even IT. They made it plain that they would determine what happened over the Internet. They had their own agenda, and were not shy about expressing it. They wanted information at their fingertips--and not just product details. They wanted product availability and production schedules and other "internal" information previously off-limits to them, which IT and executive management protested they had no right to have. But might makes right. Customers also wanted routine order placement that did not involve salespeople. They wanted their choice of customer service over the Internet or human service, depending on their needs. They wanted fast navigation to where they wanted to go, without being forced to wade through what marketing wanted them to see. No one was spared.

And while they were ordering people around, customers also had a few more words for unrepentant marketers. "Get rid of all that annoying advertising. The Internet's not a television channel." And "Send us unsolicited e-mail, and we'll never do business with you. Our e-mail boxes are ours, not yours." And most emphatically, "Pass our name out and we'll pass laws so you can't do that ever again." This was a blow to IT as well as marketing, for it placed a cloud over development of powerful and intrusive customer databases that IT had relished the thought of building.

This was powerful stuff. These were the true goals of CRM, although "non-believers" persisted in twisting these goals so they could label "CRM" as what they wanted to do to instead of for customers. Disguising the old paradigm treatment of customers as "targets" to fit under the CRM umbrella had already become quite commonplace.

IT split into two camps. After losing the tug of war, IT found itself at a crossroads. It could either take the road back to Fortress IT--or accept direction from a new boss, the customer. The two other options, going on strike or asking for a rematch, were obvious dead ends. Some argued that the road back was also an obvious dead end, but many ignored them and decided to turn a deaf ear to these customers and retreat. Back behind the walls, IT would continue to control its technology. IT kept on insisting this was a technology-driven economy--not a customer-driven economy--while all outside its walls were constantly reminded otherwise. And that's how this sizeable segment of what had been powerful and autonomous IT came to be increasingly marginalized. It would become relegated to building and maintaining information systems that others dictated. Even with all the complexities of the Internet that might otherwise have satisfied its cravings for technology challenges, IT felt unsatisfied because technology was not determining the direction things would take. That was a sad ending to what it had assumed would be a coronation of IT, and it became most bitter about this denouement.

But the other segment of IT, to the surprise of many, actually took advantage of CRM and the emerging power of customers. It used this as leverage to gain even more importance--and to become stronger leaders than ever before. In fact, the understanding that CRM was first and foremost about taking better care of customers--not about taking better care of internal matters--presented CRM adopters with several challenges that such forward-thinking IT shamans were uniquely equipped to meet. No one had ever suspected IT could be so adaptable.

CRM provided new opportunities for IT. One big hurdle facing CRM adopters was the difficulty of changing to organizing around customers instead of around specific functional responsibilities, which had been the mode for as long as anyone could remember. Having met the information management needs of each functional area, although not always without some wrangling and disputatious discourse, IT had acquired an overview of what went on throughout the whole enterprise. True, that overview was focused on information management. But as it happens, work processes ride on top of information flow. And that gave IT insight into how to develop new "cross-functional" work processes that inevitably accompany CRM.

A second opportunity CRM presented to this forward-thinking IT segment was introducing more disciplined work habits to sales and marketing--who had long resisted such attempts to structure their work. Some termed this endeavor "herding rabbits." Others preferred "herding squirrels."

However, as everyone soon learned, implementing CRM requires adopting a very structured workflow--without which those with initial customer contact wouldn't gather customer information, transaction data and other customer-related information. This data then wouldn't flow back to any others with consequent customer contact and marketing wouldn't know what to do, customers wouldn't have consistent experiences with the company and inefficient operations would create increased costs that customers wouldn't bear. But sales had very little process development and management experience; marketing had less than none. And even service was accustomed to working with very narrowly prescribed processes applicable to service only. Where was the requisite process management experience to come from? IT was the natural source--which drove IT's stock even higher, at least for those in IT who realized its role transcended technology.

Yet another opportunity CRM presented to IT was dismantling the front office/back office wall that traditionally separated those who faced outward, sales and marketing, from those who faced inward and ran things. Previously, IT had used this wall as its perimeter defense, keeping out those who had no business meddling in truly important matters. But responding effectively to new customer demands required close collaboration among the front-office functions and back-office functions, and especially IT. This forced cooperation among functions unaccustomed to getting along, never mind working together.

The forward-thinking IT contingent saw this as an opportunity to get beyond its traditional boundaries. The others who remained locked in the past were yet further threatened. But before long, "nouveau" IT was routinely consulted on sales and marketing matters. That may sound unnatural, but both sales and marketing had become increasingly dependent on management of customer information. Their roles had tilted more and more toward preserving and improving customer relationships and away from casting out huge nets in search of new customers. And in a remarkable break from past practices, IT-initiated contact with customers became almost commonplace.

Previously unimaginable acts such as IT executives riding with sales reps to make customer calls and wearing headsets at call centers became routine. And the further customer interaction shifted toward the Internet, extranets and newer digital communication channels, the closer IT needed to be to customers in order to appreciate their experiences first hand--rather than receiving oft-filtered feedback from sales, marketing and service.

A great melding of systems occurred. When CRM first arrived, it was held apart from all other information management systems--partly because IT was afraid CRM would infect or corrupt the others. But also because no one was yet sure how or whether to integrate CRM-supported functions with the likes of more "serious" functions such as accounting, manufacturing, purchasing and logistics. But after much experimenting, many reached a surprising conclusion: A number of functions traditionally performed by back-office staff, who typically were blind to customers, could be better performed by those in contact with customers. These functions ranged from product configuration to order entry, from maintaining "official" customer records to analyzing customer information, from establishing production priorities to determining product design.

Moving these functions out to the front office caused much consternation. It also caused a radical reordering of functional responsibilities within the information infrastructure. CRM systems started performing functions that previously resided on ERP, as more and more work was done closer and closer to customers. Some in IT, even among the forward thinkers, fought mightily against this change. But others saw it as the wave of the future--and saw this, too, as an opportunity to grow further in importance and influence in the new, customer-centric environment. After all, who else could navigate the necessary technology changes?

Alas, some IT preferences had to yield. The shift in focus toward customers and those interacting with customers challenged "standard operating procedures" for many--but for none more than IT. These were hard changes to accept in the light of traditional training and conventional wisdom: Customer data management as a closed loop, starting and ending with laptop and desktop clients and their servers.

Front-office systems creating and exporting data necessary for accounting functions to traditional "legacy" systems, which now played a much more limited role.

CRM system componentry influencing the design and development of traditional "enterprise" systems--instead of the other way around--radically changing selection criteria for everything from databases to e-mail to operating systems.

The growing need to distribute data to functional application systems in real time--rather than making data "available" from a central repository--Web-based architecture giving way to the distributed data model.

And a good time was (not) had by all. Ironically, the profession seemingly most threatened by CRM--IT--became its biggest beneficiary. At least that's true for those in IT who recognized early on that business was becoming customer-centric, not information-centric. Admittedly, that was a hard recognition, one that many marketers have yet to make.

Happily Ever After?
And it's very fortunate for CRM that so many in IT adopted the customer-centric perspective. Without IT's adapting to a very different environment and mindset, CRM would have remained either mired in technology, limited in function to front office matters, or still a product sold by software merchants--a sad fate for something with such potential and with so much power to satisfy customers. But lest we forget, the advent of CRM and the customer-centric movement behind it also created many casualties. A significant segment of IT that did not grow beyond technology lost its upward mobility--and even experienced diminished roles. And that lumbering IT division was joined by marketers who chose traditional information-driven approaches over customer-driven ones, salespeople who couldn't change course and thus created a whole new generation of "Willy Lomans," accounting and other back-office operatives who threw their bodies across the tracks of change, only to have their careers (and their bodies) truncated.

But hey, that's change for you. It puts us at a crossroads and lets us decide which direction to take. And there always seems to be a safe-looking, well-worn path, a riskier-looking climb and a couple of seeming shortcuts. Funny how the risky-looking route usually turns out to be the safest, the safe road the riskiest and the shortcuts dead-ends.

Who says change isn't predictable?
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To contact the editors, please email editor@destinationCRM.com
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