Even SaaS Requires the Right Approach

In the world of CRM, success can be elusive. In response, many companies have adopted software-as-a-service (SaaS) to accelerate implementations, reduce costs, and control risks. For smaller companies, SaaS can substantially bolster the probabilities for success. But in larger companies, SaaS by itself is unlikely to bring about the desired CRM benefits. For these companies, it remains imperative to do CRM right.

In 2004, IBM’s CRM Done Right study identified key success drivers for CRM initiatives. Produced with the research arm of The Economist, the study remains a must-read for CRM leaders on both the business side and the technology side. Based on a survey of 373 companies worldwide, the study found six disciplines that, when done right, increased the probability of CRM success by almost 80 percent.

Value Case: The value case is the foundation on which all CRM programs should be erected. It should be prepared in a formal manner, even when the CRM business need seems obvious or intuitive. And it should be articulated in a document that is referenced and updated as part of ongoing activities and communication. Typically offering a quantitative ROI analysis, the value case should include qualitative benefits such as improvements in the customer experience and employee satisfaction.

Value Propositions: The value case speaks to the executive suite, but it does not speak to other CRM stakeholders such as sales reps and contact center agents. For each such stakeholder group, the CRM program must offer a value proposition. If it fails to do so, key groups will be at risk of not adhering to new CRM processes or not adopting new CRM applications. The value propositions should be developed early in the CRM program, so that they can inform the development of requirements and the finalization of scope for the system. And they must be developed for stakeholder groups that fall outside the company as well, such as customers and distribution partners.

Blueprint: The blueprint conveys the end-state vision for the CRM program. In addition, it engages the build-versus-buy question for the range of competencies and capabilities needed to deliver that end-state vision. The blueprint does not need to include the actual selection of partners and vendors, but it does need to specify the areas in which the selection process will have to be undertaken.

Roadmap: The roadmap is the multigeneration plan by which the organization will realize the CRM blueprint. The roadmap sets the how-to direction for delivering CRM capabilities at reasonable increments. The roadmap turns the blueprint into a prioritized sequence of time-fixed workstreams (i.e., programs) that are implemented at a rate that the organization can handle and manage successfully. A “crawl, walk, run” approach is often required to achieve the CRM vision and reach full CRM maturity for the organization.

Governance: The governance team is responsible for executing the roadmap and achieving the benefits codified in the value case. The governance structure typically consists of multiple tiers, and it should be defined early in the CRM program with clear roles and responsibilities. At the top levels of the governance structure, the executives and directors provide budget, direction, and empowerment. They serve as champions of organizational transformation. At the lower levels, managers oversee and coordinate programs, identifying issues and risks and escalating them up the governance hierarchy for resolution. At those lower levels, managers and their teams serve as the transformation agents. An effective governance structure can overcome almost any challenge; an ineffective one can become stymied by even a routine problem.

Change Management: Change management is the process by which stakeholders such as employees, customers, and partners adopt new ways of doing things. For each stakeholder group, it identifies the attitudes, skills, and behaviors that will need to change. And it typically draws upon the value propositions to articulate the “carrots” that will facilitate the change process, without which stakeholder adoption will not occur, and the value case will not be realized.

Adherence to these six disciplines of CRM Done Right will enhance the probabilities of CRM success, regardless of company size or technology platform. Better yet, they affect CRM costs only marginally. To learn more, please feel free to contact me for a copy of CRM Done Right, our 2004 study that continues to resonate.

J. David Lashar (dlashar@us.ibm.com) is an associate partner in the CRM practice of IBM Global Business Services and the leader of the IBM CRM Center of Excellence for SaaS.

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