CRM Supports Internal Customers, Too

What started as a solution to Pegasus Airwave's billing problem has evolved into a growing slew of improvements in sales and service. The company, which distributes specially designed mattresses and other products for patients with severe skin conditions like burns, was suffering from a case of bad data. The essence of the problem, according to Linda Masterson, Pegasus Airwave's director of operations for field administration, was that the quality of information in the company's billing system was unreliable. "We were trying to address a data integrity problem," Masterson says. "Our salespeople were complaining that the information was never right when it was billed." The complaints arose because salespeople didn't earn their commissions until a given deal was complete and paid for--and incorrect bills were being justifiably returned or disputed before they could be settled. Put simply, Masterson says, "If the billing wasn't correct, [salespeople] didn't get paid." To rectify the flawed bills the salespeople were spending a disproportionate amount of time communicating and correcting billing information--time that they should have spent selling. In addition, the company often had to write off losses due to adjustments in revenue caused by the flawed billing. So, after an RFP to replace the billing system produced little more than frustration, the company contracted with Technology Applied with Strategic Knowledge--a consultancy and systems integrator that goes by its acronym, TASK--to select and install a CRM system that could address Pegasus' needs. After evaluation, SalesLogix got the nod. Having committed $250,000 to the project, including costs for new laptops, servers, and custom programming--still a considerable sum by Pegasus' standards, Masterson says--Pegasus wanted results fast. "We went into it looking for ROI within a year," she says, and she wasn't disappointed. Masterson says the major payback came from reductions in write-offs and an increase in revenues collected without the use of an outside agency. Pegasus measures the efficacy of its sales process by the volume of sales (either in dollars or orders); the time that it takes to process each order; "and the cash that we're able to bring in without using our collections staff," Masterson says. The depressed medical-products market has dragged down overall volume, but the SalesLogix application has helped compensate by buoying the other metrics. But that was just the beginning. The company now has control over its order process, and soon will be able to get rid of its legacy billing system entirely. "It's not as if we don't need the billing group anymore," she says. "We just do a better job with fewer people." As a bonus, she says, service levels have improved at the same time. The software has reduced not just the processing time for each order, but also the delivery time. Today the company can measure turnaround time at each stage of the process. "We can benchmark--and improve," Masterson says. "We know our average delivery time is 3.75 hours. None of our competitors has the ability to do that." As the system matures Pegasus is expanding its functionality. Masterson says the company revisits the setup annually, either to add a new feature or to tweak an existing one. This past year, for example, the company added an inventory-tracking module and is about to add one to handle depreciation. Before the inventory-tracking module was installed Pegasus executives had to request monthly field reports, which were outdated by the time they were received. "Now we know where the products are," Masterson says. "We will never do away with hand-counted inventory, but hand-counting now verifies our reporting instead of being our only source of reporting." Masterson says one pleasant surprise was "the ability to report positively on our customer service or our order management. Before, there was a lot of finger-pointing about who did what." A date-and-time stamping function added to the order process fixed that. The added information showed that "no one group was at fault," she says. Instead, the hitch turned out to be that "the inability to communicate true, live information made it impossible to know where the problem was. "No one really disputes or blames anyone anymore," Masterson says. "It's obvious where [an] order is in the process, which has removed a lot of animosity between the billing and sales groups--and the service group as well." In essence, she says, "it's more information than we ever thought we'd have. "There's a really big difference between where we were and where we are now," Masterson says. For one thing, speed is no longer the main goal. "I don't think we can do what we're doing any faster," she says. "Improvement will come from a higher level of accuracy, which will result in a higher level of receipts." An accurate bill--known as a clean claim--obviously gets better results. "The more clean claims you can get out the door, the more likely you are to get the money than having to resubmit the claim," she says. Still, Masterson knows that Pegasus isn't maximizing the potential benefits of SalesLogix: "We bought a six-bedroom house and we're only using two of the bedrooms [so far]....There's a ton more stuff we could do."