• June 19, 2008
  • By Marshall Lager, founder and managing principal, Third Idea Consulting; contributor, CRM magazine

CRM Versus CEM

Businesses are just expensive hobbies if they don't have customers, so doing whatever's necessary to satisfy those customers is an important concern of executives. But Ventana Research's "Customer Experience Benchmark," released Tuesday, suggests that few organizations have a mature focus on ensuring the optimal customer experience.  

Can a business answer its customer relationship needs by looking inward, or must the focus solely be outward? "The desire to influence relationships with customers led to the development of customer relationship management (CRM), which was supposed to produce better relationships and therefore more business," writes Richard Snow, Ventana's vice president of research and author of the report. "But CRM mostly managed internal marketing, sales, and customer service functions and didn't address the company's actual interactions with customers. Customer experience management (CEM) targets those interactions and focuses on influencing customer behavior."

Respondents to the survey tend to get the concept. Fifty-six percent said the purpose of CEM is to improve customer-related processes at every touch point, and 27 percent went one step further to say that it's about influencing customer behavior at those touch points to increase loyalty and the volume of new purchases. Despite these encouraging figures, most companies don't seem to have put any effective processes into place yet. ""CEM is one of the hottest topics people are talking about; it's why we carried out the research" Snow says in a follow-up interview. "Responses tell us there's a higher understanding of the concept than we expected, but they aren't putting that understanding into practice"—in fact, Ventana's report provides a fairly comprehensive analysis of the various customer touch points and their shortcomings. 

One common trouble spot is the contact center agent's tools. "The agent's desktop is a primary source of frustration for both agents and customers," Snow writes. "Agents don't like these systems because typically they are hard to use, don't provide all the right information needed to resolve customers' issues, and don't follow the flow of interactions." Customers aren't privy to what happens on the agent's screen, but still feel the effects "because agents cannot focus fully on them, ask them to repeat information, and often don't resolve their issues." Roughly two-thirds of respondents said their agents had no access to a screen with relevant information on the caller's profile and circumstances. Yet only about one-third planned to upgrade agent desktops in the next year. (Tellingly, half of those intending to upgrade said they planned to keep the programming in-house.)

Results are also dismal in the area of analytics and feedback management. The most popular method of contact center quality monitoring is still "having a supervisor listen to sample call recordings"; Ventana reported little interest in voice analytics, which would process, in an automated fashion, a higher number of sample calls (or possibly even all calls). According to the report, the next most popular methods of surveying were, in order:

  • emailed;
  • delivered via outbound calls; and
  • administered on the Web.

"Unfortunately, the majority (57 percent) send out surveys no more often than once a month; coupled with the small number of surveys that recipients normally complete, this means that most companies are basing their opinion of customer satisfaction on a very small volume of untimely data," the report states.  

Blame is also laid at the feet of poorly implemented Web self-service and e-commerce, but the chief culprit in businesses' failure to achieve a 360-degree view of the customer is the spreadsheet. "Spreadsheets require a lot of manual effort to enter, update, and analyze data, and [they can't] integrate all the sources and types of data normally found in a contact center," Snow writes. Hamstrung by their reliance on spreadsheets, most companies are desperate for better analytics. More than a quarter of respondents have tried building the functionality themselves with a business intelligence tool. "An even more cost-effective approach would be to use one of the specialized contact center analysis products now on the market, but only one in five (20 percent) has done so," Snow writes.

Through all the responses, the common thread is that businesses don't know what they're missing. "The main factor was lack of perceived need of CEM tools," Snow says.  "Not far behind was lack of budget. But we have a case here where there's a lack of knowledge that the technological capabilities are even there."

In summary, it seems that the same problems continue to plague business, no matter what acronym is used for the proposed solution. "As CRM vendors once did, CEM promoters now promise that it can produce better relationships with customers so [those customers] remain loyal and buy more," Snow writes. "The goal of CEM should be to improve every interaction each customer or prospect has with the company, so each goes away happy, having found the information he or she wanted, having had the issue resolved, or having made the planned purchase—and perhaps going on to recommend the company to others. Ventana Research believes that if companies don't consider carefully and fully what it means to manage the customer's experience, it is likely that CEM will disappoint them in the same way that CRM did and leave them no better equipped to prosper in today's intensely competitive global market."

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