Turning the CRM Promise into Reality

If there ever were a time when running a sales and marketing organization was easy, now is not it. Dealing daily with issues like continuing economic uncertainty, increasing global competition, collapsing product life cycles, expanding product complexity, increased customer expectations, decreased customer loyalty, never-ending profitability pressure from Wall Street, etc., results in a flood of Maalox moments for all senior management team members, especially sales and marketing executives. Businesses across all industries are recognizing that to deal with the pressures of the marketplace today, they need to make fundamental changes in the way they market to, sell to, and service customers. To be successful going forward we must better understand our customers, live process instead of talking about it, optimize our sell cycle to more closely support our customers' buy cycles, maximize the success of our channels, integrate our workflow across the enterprise, and provide real customer value to regain loyalty. And, we need to do all this quickly if we are going to meet our revenue and profitability goals. Working harder will not be enough to accomplish these objectives. We need to give our people the tools necessary to function at a whole new level of performance. In that regard CRM technology will have to play a pivotal role in optimizing the effectiveness of our sales, marketing, and service organizations. The mission is clear, but how to do it is not. During conversations with hundreds of executives in 2002 as background for The Sales & Marketing Excellence Challenge, a book I'm coauthoring with Barry Trailer, many of them still voiced concerns regarding how to turn the CRM promise into a reality. Starting with this month's "Viewpoint," and then continuing monthly through 2003, Barry and I will be sharing with you real-world experiences we compiled regarding how your peers are developing strategies and tactics to successfully address these challenges at their companies. This month I will share some insights into one of the cornerstones for making CRM work. When we started doing interviews one of the first people we contacted was Sheryl Kingstone, program manager of the Yankee Group's CRM Strategies Planning Service. Her first words reflect exactly what sets the stage for CRM success or failure: "I find it interesting how many people still think that customer relationship management is this switch that you can simply buy, turn on, and say, 'Voila, now everything is perfect.' That is not how it works. CRM is not a turnkey answer to things, because CRM is not a system--it is a process. Until you understand that it doesn't matter how much money you spend; you are not going to solve your sales, service, and marketing problems." Having benchmarked more than 2,900 sales excellence projects over the past 10 years, I couldn't agree more. The key critical success factor for CRM is viewing what you do as a process, and then determining what role CRM can play in optimizing that process. When we say that to executives they nod their heads and agree, and then they ask, "But how do we get our arms around the process?" Three individuals we talked to offered insights into dealing with this task. Ask Your People John Williams shared with us the experience he had in championing the CRM initiative at StorageTek. "When I took over the position of executive vice president of worldwide field operations, I was actually coming back to StorageTek. I had worked as a sales executive for the company in the 1980s, before leaving to start a PC hardware company. While I had some previous knowledge on how things worked, and in fact had kept in touch with people in the company over the years, upon my return it occurred to me that it would be a mistake to let any of that influence my decision process on where to take things from here. I decided that I needed to do my own due-diligence analysis of the company as it existed today. I needed to get a current perspective on how operations were currently managed. So I personally visited every major sales office and analyzed how we did business." John reflected that by getting out into the field and talking to the troops he gained a wealth of insights into the good, the bad, and the ugly regarding how StorageTek did business at that time. How important was this to starting the project down the right path? John told us that, "over a four-year period we took sales from $700 million to $2.2 billion, and we did this all through productivity gains--we did not add any additional salespeople during that time. In retrospect I think the main foundation of our success was that we concentrated on three things: metrics, process, and tools." Ask Your Channel Roger Koenig, CEO and founder of Carrier Access, a communications equipment manufacturer, shared with us the second step necessary in process analysis, which is to understand what your channel does. Roger said, "When you are selling through a channel, you need to understand that your 'sales in' is a result of your channel's 'sales out.' If you want the channel to sell, you have to go beyond providing them a great product and value proposition; you also have to make it easy for them to sell these values." Roger championed a CRM initiative to help build tools to make it easier for channel partners to sell Carrier Access products. "To accomplish this," Roger told us, "we first started looking at the complexities of the detailed business discussions taking place between the service provider salesperson and their prospect. To do this we actually sat down with our customers and jointly walked through the process. What we came up with is a very streamlined process that is based on fourteen questions at most, in plain English, that the salesperson needs to get answers to cover all of the cases that could come up. Behind these questions is a sophisticated model that understands all the implications, corequisites, and prerequisites for dealing with the prospect's communications environment. "Today, our system completes that process automatically. When channel salespeople use the system, it creates the proposal verbiage, network diagrams, and the implementation plan for a given customer's situation. Since this information is based on the knowledge elements in the centralized sales expert system, the consistency and accuracy of these documents is significantly improved as compared to the past one-off proposal approach." Ask Your Customers A final insight we obtained was from Bob Knebel. Bob shared with us the experiences he gathered as vice president of domestic sales for the Citation division of Cessna Aircraft Company. Bob's opinion was that looking at the process from the point of view of sales is a good starting point, but your work should not end there. In that regard Bob observed that "in our industry we have come to realize that it is not nearly as important that our customers understand our strategies as it is for us to understand theirs. Our customers will be the ones that define what competitive advantage really means, whether overtly or not, and will somehow indicate that to us. To succeed, we better be ready to listen and respond." "Fundamentally, customer relationship management as a process is about understanding our opportunities, listening to and responding to the customer, and then building a quality relationship with the customer. Those are simple concepts, but you need to make sure that every employee, customer-facing or not, understands those and the need to treat all customers as true business partners." "We are spending a lot of time making sure we are listening to and understanding the voice of the customer. In fact, when we find customers who have something truly meaningful or profound to say, especially if the message is process-related, we videotape them so we can share their views across our company." The key concept common to the experience of all three of these executives is the need to get out and talk to people: your people, your channel partners, and your customers. These are the people who live and breath process every day. They will share it with you if you only ask. Take the time to do that, and making CRM work will become a lot easier. Copyright Insight Technology Group About the Author Jim Dickie is managing partner of Insight Technology Group.