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5 Aspects of Your Business That Can Make or Break CRM

5 Aspects of Your Business That Can Make or Break CRM

CRM is often referred to as a foundation on which other things are built, but CRM itself needs to sit on a solid foundation as well. What is that foundation built on? A bunch of things that are, in general, never considered when we talk about CRM, but which can heavily influence CRM's effectiveness for good and for ill, based on how well the business executes on them.

By Christopher J. Bucholtz CRM Buyer ECT News Network
02/23/12 5:00 AM PT

I have a lot of fun writing about CRM -- the ideas, the tools and how they're brought together as a coherent strategy. CRM is a foundation on which to build relationships, layer on additional sales and support tools, and create a customer-centric business.

But this foundation needs a foundation. After all, businesses thrived even before CRM technology was invented, and they flourished long before the acronym was coined. While we in the CRM space like to say that you need a solid CRM foundation in place before you can grow to the next level (which, these days, is most often defined as social CRM), we tend to forget that CRM itself needs to rest on a solid foundation.

What is that foundation built on? A bunch of things that are, in general, never considered when we talk about CRM, but which can heavily influence CRM's effectiveness for good and for ill, based on how well the business executes on them.

There are many foundational things that every business should strive to master even before they have a CRM application in place, but here are five that serve as underpinnings for successful businesses, and thus as underpinnings of successful CRM efforts.

Products and Services

Businesses exist to create customers, wrote Peter Drucker, but customers exist because they have needs. The bottom-line question for your customers is this: Do the things I buy from this business satisfy my needs?

The real issues here are quality and value. If your products are faulty or second-rate compared to the competitors, or if they're priced wrong, it doesn't matter what kind of CRM magic you work -- your sales funnel will be more like a conveyor belt, with prospects proceeding down the pipeline to customers and then, rapidly, to ex-customers. And over time, quality and pricing issues (and their unpleasant cousin, delivery issues) will erode your customer base and create poor word of mouth. Unless you remedy this issue, your business is doomed to failure.

Honesty

Even with a good product or a well-delivered service, issues happen. A smart business understands this and has a plan in place to deal with these exceptions, and to do so in a way that assumes that customers are intelligent and, within reason, understanding.

Excuses that sound phony or inauthentic multiply the negative impact of a problem. Explanations that are sincere and candid, however, can have the exact opposite effect. For example, a very small business run by a friend took a serious delivery and production hit when its one employee was stricken by a nasty stomach flu just as a new product was supposed to ship. Rather than ignore the problem, he dragged himself to email and social media and explained the problem honestly. This brought a few angry customers but many more who sympathized and were understanding -- and, when he was able to return to work, almost no complaints about the delay.

Honesty as an underlying value of a business is not just morally laudable -- it's also key for forging better customer relationships and maintaining employee morale. Which brings us to ...

Employee Attitude

I like to say that a CRM strategy should start with hiring. Employees with a customer-focused attitude are an asset whether or not you've invested in CRM software. Conversely, employees who lack that attitude can take a CRM investment of any amount and effectively reduce its value to zero.

Your management takes the data you collect in CRM and translates it into directives for actions and interactions that mean something to the customers; your employees carry out those directives. Without the proper focus on the customer, management and employees are unlikely to connect the dots between data and dealings with the people who keep your business in business.

Cultural Respect for Process

CRM also helps automate many of the sales, marketing and support tasks that dominate most customer relationships. That allows your business to scale in terms of the number of customers each employee can care for. To do that, however, means that all employees who need to interface with CRM do so. That starts with the sales team and carries through to the rest of the organization; adhering to the process of using CRM is as important as adhering to any other company process.

There is an exception to this, however: When an employee sees an area where process is preventing customer satisfaction, he or she should be able to take action to override or modify the policy. Process and productivity mean nothing to individual customers, and employees need to be empowered to step out of process when necessary.

Commitment to Support

Too many businesses stop paying attention to their customers after the sale closes and only begin paying attention again when it's time to sell again. Smart businesses know that an ongoing relationship is the best route to ongoing sales, and a natural place for contact in that relationship comes in customer support.

Companies that have a commitment to support do a good job of meeting customers' needs regardless of whether they are a one-person shop with a single telephone line or a large corporation with several call centers -- the technology simply lets bigger businesses scale up more effectively. Sadly, when the emphasis is all on sales, support is seen as a cost center and doesn't get the care and feeding it deserves. That's why so many service calls leave customers more agitated at the end of the call than they were at the beginning, even if the problem that triggered the call is resolved.

When a business fails in any of these areas, the customer relationships that were the goal of its CRM investments are ruined -- which raises the question: Why did you invest in CRM if you weren't willing to build a foundation on which it could rest?


CRM Buyer columnist Chris Bucholtz blogs about CRM at the CRM Outsiders. He has been a technology journalist for 17 years and has immersed himself in the world of CRM since 2006. When he's not wearing his business and technology geek hat, he's wearing his airplane geek hat; he's written three books on World War II aviation.


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