CRM Strategy and Methodologies for the 21st Century

Clearly Web 2.0 -- in the form of wikis, blogs, and other means of social networking -- is transforming the Internet into a truly interactive medium. What's unclear is how Web 2.0 -- with its ability to empower consumers to collaborate among themselves, and with Corporate America -- will impact CRM as we know it. Will these technologies pave the way to what is being called "CRM 2.0"? The answer is "Yes," but getting there will be evolutionary.

At its most basic level, Web 2.0 is the transition from centralized control of information technology and Web interactions to decentralized control. With wikis, blogs, and the like, users are able to determine how their virtual experience will transpire. And clearly social networks are playing an increasingly key role in product selection and market acceptance, communications and content consumption. As a result, the corporation will have less influence over customer minds and wallets.

What does this mean for CRM? First and foremost, basic CRM functions will remain critical, if not more so. At the core, companies will still need to provide the following:

• a good customer experience;
  
• cross-channel integration;
  
• efficient/effective sales force management/automation;
  
• robust contact center operations;
  
• results-driven marketing and campaign management; and
  
• efficient customer process management.

As consumers become more sophisticated and have greater access to information -- especially negative information -- the responsiveness and effectiveness of CRM applications will become ever more critical. Problems with Web-site usability or technical support will quickly be broadcast across the connected community. And with the perpetual decline in switching costs, small CRM glitches may be magnified many times over, resulting in untold business losses.

Other CRM functions will be impacted as well. Cross-channel integration, for example, will be crucial. Each user will expect to seamlessly connect from a cellphone to a Web site to speak live with a customer service rep. Customers who have grown up with their cellphones in hand will expect flawless service/support. Companies will not only need to keep their contact center applications in synch with the Web, but will need to tie in mobile applications, cellphones, iPods, etc.

On the bright side, social networks may eventually mature and become trustworthy enough to help customers to help themselves rather than having to turn to a corporate Web site or customer service rep. Lists of frequently asked questions (FAQs) will be supplanted in some part by blogs and wikis that provide support and updates. However, the onus will then turn to marketing and sales to ensure that proper information is communicated. This could eventually put those two departments in the difficult position of having to challenge misinformation promulgated by individuals on social networks.

Marketing functions will probably be most affected. Some companies are already taking advantage of the Web for advertising new-product launches and for collecting and disseminating feedback to product management groups. Marketing, therefore, will have to incorporate Web 2.0 techniques into campaign initiatives, embracing social networks, blogs, and so on.

Moreover, 24-hour availability and global access to CRM systems will also be increasingly important. As new generations of consumers across the globe become accustomed to conducting business over the Web at all hours, from anywhere they happen to be, customer support will have to follow.

Arguably the greatest challenge will be in CRM technology, which is relatively transparent to the customer. While enterprise platforms will likely remain in use, a vast array of new applications -- and demands to integrate them -- will emerge. CRM 2.0 platforms will need to incorporate the new social networking experience and data generated by Web 2.0 technologies. These platforms will be based on services-oriented architecture and hosted services, and will need to co-exist with enterprise, on-premise applications. There will be new peripheral applications to integrate and support with new methods for interacting with the Web and with mobile devices. Enterprise application integration tools will be more robust and allow more-seamless integration of disparate components. To the extent that this "connectedness" is being addressed in the Web itself, some of the integration and data management issues may be simplified. But for large companies, a great deal of integration work will lie ahead.

So, will CRM 2.0 be radically different than today's CRM? Probably not. But it will have a whole set of new permutations and complexities. And companies will still have to deliver on the promise, and the growing expectation, of solid CRM capabilities.

The bottom line: Companies that want to cross this tricky chasm will need to protect and strengthen their core CRM functions and build out at the periphery to support Web 2.0 capabilities, integrating key functions and data sources as needed.

About the Author
Peter Grambs is Vice President of the Customer Solutions Practice at Cognizant Technology Solutions, a $2 billion IT services and business process outsourcing firm in Teaneck, N.J.