Future Electronics doesn't need a crystal ball to know that CRM will give the company the edge it needs to gain a competitive advantage.
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Future Electronics knew that providing both internal sales staff and manufacturer contacts with better visibility into its design registration pipeline would give the international electronics distributor an edge on its competition. But the firm had first overcome a huge obstacle.
"We would be the first to be able to deliver this information, which was seen as a competitive advantage for us," says Martin Bates, strategic MIS manager for Future Electronics in Europe.
With operations in nearly three dozen countries, Future Electronics' business model is not just about bidding and supplying chips and capacitors on demand. Its sales consultants and engineers work with electronics manufacturers to ensure that components Future Electronics represents are built into new boards and electronics that are just entering the design stage. This is a lengthy process with several important steps, including registering the presales efforts with the component manufacturers for proper credit, and offering choice pricing. And global shifts in manufacturing were not helping.
Going back a few years the market was very territorial, and there wasn't a lot of crossover--companies designed, built, manufactured, and sold [components] in their market," Bates says. The result was a mess of siloed data. "I had nineteen different databases running design registration."
The situation was untenable. But closing the loop on such an intricate sales cycle has become increasingly tricky in the digital age, so the company realized its need for a CRM solution that integrated the best in Web and mobile technology. The process began in March 2000 and evolved into a two-platform approach: PDAs for field sales and full-featured CRM for the enterprise.
Sales reps needed more and better information at the point of contact with the potential customer, so a mobile product selection guide was a critical early step. "In the past, if a customer started asking you questions that were quite technical, or they wanted specific information on a part, nine times out of ten that salesperson might have the catalog in the [trunk] of his car, or would have to inquire with the office and get a specialist involved," Bates says.
Future Electronics had rejected a full-bore laptop deployment, because the bulk of the sales force had never been equipped with notebooks, and cost and portability were key concerns. PDAs had been working their way into the workflow as a matter of individual choice, so the company decided to capitalize on the momentum and standardized on Palm OS--based Handspring units. The system, which relies on AvantGo synchronization server technology, considerably improved the visibility of critical product information. "Because we have this product selection guide on a PDA, we can give [customers] some options straight away, and get them samples or a data sheet if it's something they are interested in. It was a quick win," Bates says.
Future Electronics, AvantGo, and Citria, a now-defunct technology partner, worked together extensively to ensure that the PDA could deliver and retrieve enough information in eight megabytes of RAM and a small screen. The prize for all the hard work is a better, faster flow to get to design
Recognizing the limitations on gathering and delivering data on a small device, Future Electronics also wanted a full-featured CRM software package, and selected Firstwave in September 2000 to upgrade the enterprise's view into customer and sales activity. "[Future Electronics' European operations] were originally using a Lotus Notes application to share data, but it couldn't be shared anywhere else in the organization," says Russell Loarridge, vice president of U.K. operations for Firstwave. "The idea [for Future Electronics] was, How do we create a system that would enable us to be more flexible, and make it more sales-oriented?"
"It wasn't conducive to encourage the salespeople to always update information as they should," Bates says. "We wanted a user-friendly system that without being unkind to the users, was simplistic, and no burden on their time."
To ensure the application met everyone's needs, Future Electronics spent three months conducting internal workshops and studies, with Firstwave looking on--but not leading--the sessions. "We didn't talk about CRM or design registration," Bates says. "We asked, 'What do you think is missing, and how can your function be enhanced? What tools do you need? What information do you need?'" The sessions included at least one representative from every facet of Future Electronics' European operations, and one week-long session ran through an executive-designed series of business case scenarios to ensure that the application could help users find solutions to everyday challenges.
The business-based testing was critical, because failure was not an attractive option. "[Future Electronics] had already attempted to do this twice in Canada, spent millions of dollars, three or four years elapsed trying, and it failed," Loarridge says. That did not mean the entire Future Electronics organization had given up on finding a better way to manage the sales cycle. "The Europeans turned around and said, 'It can't be that complex,' and we turned up with 250 man-days of effort to get to first base."
The proof-of-concept of the full CRM system began in mid-2001, and the subsequent rollout of Firstwave by September 2001 marked the introduction of the first Web-only application within the Future Electronics organization. The Web-based approach fit best with the company's existing MIS structure, which made heavy use of mainframe and "host-centric" operations, rather than client/server architecture, Loarridge says.
Although the PDA project (code named Harry) and the CRM software (dubbed Sally) were originally conceived of separately, Future Electronics encouraged Firstwave and AvantGo to design data connectors to link the product catalog and enterprise customer data. Yes, this led to an obvious pun, but more important, Future benefits from improved visibility and value on the PDA. Some 350 staffers now make regular use of the mobile application, and the Web-based Firstwave CRM interface can be deployed at any Future Electronics' office location.
Despite Future Electronics' formidable investment, the company has not yet taken full stock of the results. "We still have to get them to agree to [an ROI measure]," Loarridge says. Field reports indicate that the PDA sales catalog can cut more than two hours from meeting preparation time, but there has not yet been a formal productivity study. "Now, what [salespeople] do with those three hours...if they go on another meeting, great, you have an ROI. If they go play golf, it's rather more debatable," he says.
The single biggest tangible benefit for Future Electronics' European operations as a whole is that all 19 countries now use a common data format, making it easier to communicate with North American and Asian units and partners. Whether Future Electronics as a global organization will take full advantage of the system remains to be seen, however. "The business needs to take a view on whether we want to expand this server and roll this out worldwide," Bates says.
But Bates proudly notes that the company's efforts thus far went from concerted design to operation in less than a year, and he expresses confidence that the hard work will be validated on the bottom line. "The speed of getting information through the organization is [a] big benefit," Bates says. "Because of that we have a greater chance of turning an opportunity into a sale."