CRM - it's not about the customer...

I get to read a fair number of articles written by CRM software vendors. Generally you can tell how new to the organisation, or how close to the front-line the author is, through the number of references they make to customers. If there’s lots of reference to ‘knowing your customers better’ etc it’s a reasonably sure sign the author knows little about the real world application of their technology.

While on the surface the term CRM technology would suggest it’s all about improving customer management – it’s in the name after all - in reality I’d suggest CRM technology is principally about process improvement, and ultimately, and perhaps counter intuitively, the benefits of process improvement may have little to do with the end customer.

I work on around a dozen CRM projects at any one time. If I pick a fairly random selection of core business processes I’m currently implementing, these include:

Management of pre-sales resources
Sales process management
Order process management
Order fulfilment management
Lead logging and tracking
Marketing campaign management
Anti-social behaviour management (local authority)
Complaint handling
Contact management
Account management and planning
Contract renewal management

It’s not that these processes don’t touch the end customer, and in many cases may improve the customer experience, but the reality, rightly or wrongly, is that most organisations purchase CRM technology because it helps them manage their business processes more effectively to generate operational efficiencies. Improving the customer experience is often a desirable side effect, but is not the main objective. Organisations can often significantly increase profitability through the use of CRM technology without moving the needle significantly in terms of what the customer experiences.

Take lead management for example. In many organisations there is no systematic approach to handling sales leads. Often if the opportunity is not short term the lead gets forgotten about and the opportunity is missed. Effective lead handling systems and processes ensure that a higher proportion of leads are converted, increasing sales and profitability. Yes, the customer should have a better experience of working with the company – they didn’t get forgotten about after all - but these systems are implemented because companies want more sales.

Anyway, I’m not sure it’s a hugely insightful observation, but it does strike me there’s a huge gap between what people really buy CRM technology to do, and how it’s portrayed in the media, and I suspect that’s part of the reason so many organisations have failed to embrace it effectively.