CRM Reality - Think About Your Customer Interaction Model

All too often, companies that adopt Customer Relationship Management (CRM) strategies do not realize their full potential in achieving enduring customer loyalty. One of the reasons they fail to be completely successful is because they are not able to view their customer interactions from the perspective of the
customer. Many organizations apply CRM solutions based purely on the customer’s economic value to the organization. This approach can focus too much emphasis on the outcome the organization desires from the customer, without appropriately considering the outcome the customer expects. Not all interactions with high-value customers present valuable opportunities to affect the customer relationship. A lack of focus on interactions that matter to the customer can have devastating consequences, leading to an ineffective CRM solution being applied to a set of customer interactions. Customer-facing operations need to focus on interactions that matter, since customerfacing operations powerfully impact a customer’s experiences with an organization and thus affect their continued interest in doing business with that organization.

The ideal CRM strategy employs a blending of processes and systems to optimize both efficiency and effectiveness in customer interactions but, in reality, most businesses have neither the resources nor the type of organizational structure that will allow this approach to work successfully. Most companies plan their CRM initiatives to influence customer behavior, but the process or technology enhancements put into place actually focus on internal behaviors. Yet a sound CRM strategy should not mandate process or system improvements unless these improvements can be demonstrated to affect customer behaviors in a manner that is desirable to the business. The intent to influence customer behavior to build and sustain a
profitable relationship with the business is the foremost  differentiator of a sound CRM strategy.

Implementation of CRM solurtion can follow several different paths depending upon whether the desired emphasis during a customer interaction is on efficiency or on effectiveness. When the emphasis is on efficiency,  the idea of operational CRM is employed. This type of CRM focuses on improving operations through the standardization and optimization of business rules and processes that affect the way business is conducted. This type of CRM frequently incorporates tools that manage workflow or improve the speed at which interactions can be executed.

When effectiveness is the goal during a customer interaction, analytical CRM is the general approach, emphasizing careful measurement and analysis of current and historical customer and transactional information. This type of CRM relies on having the appropriate systems in place to collect data that can be fed into a database for later analysis and measurement. The results from these analyses contribute to
better decision-making during future customer interactions.

Another approach to CRM attempts to blend aspects of operational and analytical CRM such that customer-facing processes handle the interaction in both an efficient and effective manner. This CRM approach provides the capability to integrate and analyze data, feeding back the results in “real time,” so that a process can be modified instantaneously to improve the outcome of the interaction. Although this approach appears to be an ideal solution to the broadest range of problems, the organizational effort required to deploy these solutions at an enterprise level involves such a dramatic re-engineering of both systems and processes that the initiative is seldom seen through to fruition. The optimization of enterprise processes usually requires a breaking down of deeply entrenched organizational structures and, therefore,
can be met with considerable internal resistance. Implementation of this CRM approach across organizational boundaries also requires a substantial investment in both capital and resources that often delays the realization of the planned return on the investment.

Choose  the best CRM solution to apply to the particular types of customer interactions you encounter most often, thereby ensuring the highest probability of continually attaining mutually favorable outcomes from these interactions. Take into account that the right solution to a problem is only relevant if it is the right solution to the problem at hand. Focuse on how your customer views the problem and the solution during an interaction with your organization.