Implementing a CRM Strategy
By Lisa Burris Arthur
Lisa Burris Arthur is Vice President, E-Business Marketing for Oracle Corporation. She is responsible for global product marketing for Oracle's CRM Applications and Online Services. She has presented at many prestigious events around the world including Direct Focus, Gartner Asia, Frost & Sullivan, Customer Contact World, and Stanford University.

1. Introduction

Now more than ever, the customer is king. In today's competitive business landscape, recognizing this fact is imperative for a company's success.

To help businesses cope with the ever-increasing customer demands, many companies have chosen to implement a Customer Relationship Management (CRM) strategy to manage the customer-facing processes of their business.

Customer Relationship Management is nothing new. In fact, it's been the foundation of business since the first barter ages ago. What is new are the strategies, technologies and applications that enable better management of customers, customer information and the business as a whole.

Even with these latest advances, the basic fundamentals of CRM are constant. Ask any business and you'll hear the same demands:

"We need a 360 degree view of our customer"
"We need to track our marketing leads"
"We need to obtain more customers"
"We need to measure our marketing return on investment"
"We need sales force automation"
"We need to increase our customer satisfaction"
Those are fine, elementary goals to obtain. But it's not enough. Companies need to reduce the complexities within the organization in both processes and communication channels so that the benefits of CRM can be measurable and more concrete.

It incorporates applications in marketing, sales, and service to give the individuals who interact with the customer the ability to access valuable customer information. CRM can also consolidate that customer view across multiple channels including the Web, call centers, field service, sales reps, and partners so that they can better market, sell, and service their customers.

The Goal

The primary CRM focus areas support the requirements of the customer-facing processes of a business:

              Marketing Automation applications give marketers the ability to create, plan and execute their campaigns to a targeted audience.

By using CRM, marketers can also access the necessary business intelligence to better understand which campaigns are working and which customers to target with a specific offer. This type of information reduces wasted time and money on sending out the wrong promotion to the wrong customer.

              Sales Force Automation or SFA helps sales people track leads and opportunities for forecasting and to optimize their sales across all sales channels. SFA also helps reps target whom to call on, what to sell, and to understand how their customers prefer to buy their goods or services.

              Customer Service applications enables reps to resolve service issues throughout multiple channels, whether it be through the Web, a call center, fax or field service rep.

Customer Service applications and Interaction Center applications enable customers to solve their own problems on a self-service model for efficient problem resolution.

CRM provides employees with the business intelligence and processes necessary to better understand customers needs and effectively build relationships between its customer base and its partners.

CRM also links its customers, employees and suppliers over the Web, the phone, fax, in person and through partners. Companies can then improve relationships with customers, add value, reduce costs and improve efficiencies in their business processes.

What does this Mean to Marketers?

An integrated CRM strategy gives the marketer access to intelligent information on customer profiles as well as campaign metrics and analytics.
Marketing intelligence on campaign metrics can help the marketer understand which channels are most effective, which campaigns are generating the most leads, and which lists resulted in better response rates. This enables marketers to measure campaign effectiveness and allocate resources to the most successful tactics.
These conclusions can also be used as a basis for future campaign activities. For example, a marketer planning a campaign to existing customers should have knowledge about past customer sales, service requests, and even customer satisfaction. This helps the marketer tailor promotions to customers who provide the most profits for the organization.
When marketing campaigns are based on comprehensive customer knowledge, tight customer profiling and segmentation, and the ability to tailor offerings based on an individual's preferences and needs, they generate better-qualified leads that can secure a sale and deepen customer loyalty.

2. Sources of Customer Information

Companies must synchronize their marketing, sales and service across all customer interaction channels. They also need to link customer information throughout all back office systems such as accounting, human resources, manufacturing and inventory for a complete view of the customer.

In many companies, customer data exists in separate silos maintained by each department. By not sharing information between silos, companies lose efficiency. Also, information updates (such as contact information or addresses) will not necessarily be transferred to the other departments.

For example:

Marketing has data on markets, prospects, and lists. This is also supported through a third party vendor. But marketing needs to drive generated leads to Sales for follow up. The marketing department also could use feedback from service and sales about what campaigns are working.

Customer Service has excellent customer feedback, but it's not looping back into marketing department. This is the type of data that can act as the foundation for upcoming marketing campaigns. Customer Service can also provide sales reps important product information or specific account issues that would be invaluable for sales to have before they call on an account. Finally, Customer Service can be used for cross sell and up sell opportunities.

The key is to have all your customer information integrated. This provides each department with a 360-degree view of the customer, and ensures that the data is current and complete.

CRM applications must also enable companies to interact with customers throughout multiple channels including the Web, phone, fax, direct mail, e-mail, in person or through partners.

Where else is Your Company Customer Information?

It doesn't end with the integration of marketing, sales and customer service, however. Companies also need to account for other department databases and systems such as manufacturing, accounting and purchasing.
Global companies have an added layer of complexity. Customer files from the United States, Europe and Asia must be integrated.

3. Importance of Integration

Unless you have integration between marketing, sales, order management and accounting, it is impossible for a marketer to understand what revenue a campaign generated - "What's my real ROI?"

Visibility into ROI and which channels are working successfully is critical. Integration delivers a genuine flow of information with meaningful information to marketers.

Also, an integrated CRM system enables companies to drive efficiencies by leveraging the Web, not as a standalone e-business initiative, but integrated into the heart of the business.

Component vs. Package Approach

There are two strategies used to achieve the kind of data integration needed for a successful CRM implementation, the Component and Package approach.

Component Approach: The component approach connects a series of individual department "data silos" into a single system. The underlying data is shared between platforms through software and applications that must access the data from various sources.

Package Approach: A package approach deploys a single technology platform and a single database to handle all of a company's data. Each department would then tie into the same database and the systems would speak the same "language."

On balance, the package approach is recommended because it more easily provides a 360-degree view of the customer. Tying component systems together can be a challenging and expensive task due to differences in programming and database structure.

4. Successful Implementation

A simple way of implementing a CRM strategy is to consider Business Flows. This requires a company to examine the business processes such as planning and executing marketing campaigns, driving leads to sales and ensuring customers are being served quickly at a low cost.

A business flow also addresses how you need to interact with other departments and how information is shared and collaborated among teams to achieve overall objectives. Companies can start by focusing on the key business flow that has the highest priority or causing the greatest pain within the business. Some areas to consider might include:

Are your marketing expenditures too high or not targeted enough?
Do you need to lower the cost of sales?
Do you need to save money on customer transactions over the web?

That way, a company can implement an integrated CRM strategy in stages based on the priorities of the business.

The Blueprint of CRM

A CRM system is only as good as the commitment garnered from the entire organization. Successful CRM requires transformations on four basic levels:


The Meta Group reported that 55%-75% of CRM projects don't meet their objectives (March 2001). Why is there such a high failure rate? The reason is that companies have not affected change in these four fundamental areas:

Structure: Departments will be restructured for maximum business efficiencies that require departments to begin sharing customer information.They will no longer exist as separate entities.

Process: As departments begin to work together, they will discover ways to interact more efficiently.

Culture: Employees need to change their thinking and the way they conduct their work. They must begin to work efficiently with other departments and other divisions around the world. Additionally, many of the daily functions of a company can be shifted to the Web - which requires a change in both procedure and attitude.

Technology: The final, obvious change will be in applying a new technology. Companies will add the latest tools to help everyone get their jobs done, but also to help customers manage their business.

The good news is companies don't have to make these changes overnight. But keep in mind that no solution can take you to a new way of doing business unless these four areas are addressed.

5. Conclusion

CRM strategies offer companies a complete view of their customers across the entire organization.

When implemented properly, a CRM strategy integrates all customer-facing and back office applications with the same data. Companies reap large gains from these efficiencies by offering better service and developing deeper relationships with customers.

In order to achieve those gains, the implementation of the CRM strategy has to create a 360-degree view of the customer. This means merging the information silos maintained by each department into a single data repository accessible by all departments.

Selection of technology is vital to a successful CRM implementation. Selecting a package approach, rather than tying together existing individual components, enables each department to tie into the same database with systems that speak the same "language."

Implementation of a CRM strategy is by no means a project for the IT department alone. Marketers must be directly involved in the process because they will ultimately win or lose based on the quality of the outcome.

If implemented properly, a CRM strategy enables marketers to interact with customers armed with useful information. Additionally, by analyzing existing customer data, marketers have better tools to build future marketing campaigns, increase sales and drive ROI.

2001 Inc