The Future of CRM Is Outcome-Driven

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I have been thinking a lot about continuing to support CRM.

Don't get me wrong. Most organizations are nowhere close to having decent or good CRM implementations; virtually all are moving along their path of enlightenment and iteration toward it. An astonishing amount of value can be derived from having a CRM initiative in-house (not an implementation; that is too technology-focused) that evolves over time as the company and customer do.

However, is there a need for a stand-alone solution for CRM? Has CRM as a stand-alone packaged solution lost its value? Is there something that can replace it?

Let's do the analysis.

The death of CRM has been greatly exaggerated over the years. CRM has not died--nor will it. Here's why. There are three groups of people an organization deals with: internal stakeholders, the public, and external stakeholders. Each requires at least one system to master effectively (let's not use the word manage, to avoid controversy). CRM is the system that pertains to mastering interactions with the public. As such, it is not going anywhere.

The better question is what CRM should look like in the future. We have tried many things: operational CRM (focus on transactions and collecting data), analytical CRM (focus on analysis of the data), and social CRM (focus on relationships and "engagement"). None have been successful. They all moved the needle in terms of adoption, but none set a long-term example of what CRM should be.

CRM is about collecting data, analyzing it, focusing on the needs and desires of the people--and lots more. The problem has not been identifying what CRM should do, but how.

The focus of CRM until now has been to improve and excel at three functions: sales, marketing, and customer service. Regardless of the channel and data used, the focus has been very company-centric (customers don't think of dividing an interaction with a company into sales, marketing, or customer service) and not very useful for customers.

If we were to turn things around a little and not focus on the function to be performed, or the company-centric view of operations by departments, we could do better. The answer, to be fair, is also not going "whole hog" and indiscriminately doing everything the customer wants. Somewhere in the middle is the answer: cost-effective, outcome-driven CRM that fulfills the needs of the organization as well as the customer in the process of delivering effective interactions.

There are three possible outcomes (and a need for more research and thinking before saying there are no more, but the past five years has focused me on these): optimization, personalization, and automation.

Optimization. This is about improving the experiences (for all concerned stakeholders, not just customers) and delivering interactions that are better, faster, simpler, easier, cheaper, etc. The focus is on improving manual or complex stages in a process by leveraging tools, analytics, and technologies to eliminate bottlenecks. This results in better operations for the organizations and faster and more focused answers for customers.

Personalization. My friend Ray Wang has been talking lately about personalization at massive scales, and this is what we are looking for. One of the visions for CRM was to have each interaction personalized for each customer based on history and predictive analytics. We are closer to realizing that as one of the outcomes for CRM: a personalized, ultimate experience each and every time.

Automation. This is my favorite outcome, and also the one that suffered the most during the social CRM debacle of the early 2010s. This is the one that most organizations would like to believe customers don't want, but that customers themselves have expressed no qualms about. The advent of the new generations into the marketplace and workplace highlight a resurgence in automating interactions to the point that having no human interactions is very much acceptable.

What do you think? Is outcome-driven CRM the future for CRM? Contact me at www.estebankolsky.com and share your thoughts.

Esteban Kolsky is the principal and founder of ThinkJar, an advisory and research think tank focused on customer strategies. He has more than 25 years of experience in customer service and CRM consulting, research, and advisory services. He spent eight years at Gartner, and has assisted Fortune 500 and Global 2000 organizations in all aspects of their CRM deployments.

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