One of the best ways to determine which CRM strategies to pursue at your organization is to begin by evaluating your overall business strategy and current customer position. Your CRM strategy must be linked to your overall business strategy. Otherwise, ailment unhealthy defining your CRM strategy will be just an academic exercise that will quickly be abandoned. If you start with key customer-facing metrics (e.g., case customer retention, health customer satisfaction, customer fill rate, order cycle time, etc.) that are being used by executives within your organization today to measure corporate performance, and make influencing these metrics a key goal of your CRM strategy, you’ll be in the best position to achieve measurable business results. Making the CRM strategy objectives measurable in terms of metrics is vital for the success and evolution of your CRM strategy.
Once you have evaluated your overall business strategy and gathered the metrics used by executives in your firm to measure customer success, you’ll need to audit your current customer position (your standing by customer segment). You’ll need to seek input on the current causes of customer pain from multiple external customers and partners and from internal sources like frontline employees working in different business functions. Measure the state of current relationships and the experiences of customers. How satisfied are customers and what level of focus is the organization placing on its customers? Below we outline 10 steps to help your organization develop its CRM strategy.
Ten Steps to Developing Your CRM Strategy
Step 1
Evaluate your current business and marketing strategy. Your CRM strategy must be linked to your over all business strategy.
Step 2
Collate and assess the metrics used in your organization to measure customer-facing departments (e.g., sales, service, and marketing). Example metrics tracked by sales organizations include sales close rate, sales cycle rate, sales price, cost of sales, forecast accuracy, and customer retention. Sample metrics tracked by service and support organizations include on-time delivery, order fill rate, service performance, customer care performance, service accuracy, and agreement effectiveness. Marketing metrics that are typically tracked include market coverage, channel profitability, and market share for example.
Step 3
Seek input (through focus groups, surveys, customer feedback systems, etc.) on the current causes of customer pain from multiple external customers and partners, and from internal sources such as frontline employees in different business functions.
Step 4
Measure the state of current relationships and the experiences of customers. How satisfied are customers and what level of focus is the organization placing on its customers?
Step 5
Find out what matters most to customers in dealing with your organization.
Step 6
Set customer objectives (acquisition, development, and retention) for each customer segment.
Step 7
Outline a strategy to customize products, pricing, communications, and services to create the desired customer experience by segment.
Step 8
Define metrics for monitoring the execution of your strategy and further evolving it.
Step 9
Ensure these metrics map to corporate objectives.
Step 10
Assess the organization’s capabilities to deliver on its CRM strategy. This will include reviewing the state of customer data, mapping customer-facing processes, and accessing an organization’s readiness to adopt CRM technologies. If you find your organization has not done much in terms of defining its CRM strategy, you’re not alone. An independent research firm conducted a survey of 160 midsize businesses (defined as having 100 to 1,000 employees and including midsize divisions of large enterprises) that had purchased and deployed CRM software from 14 different CRM suppliers. It found that 30 percent of those surveyed characterized their organization as in the process of developing CRM strategies versus practicing, optimizing, leading, or having achieved the maximum value theoretically possible. The results of this survey suggest that organizations are investing in CRM technology without having a clearly defined CRM business strategy to leverage their investments. It also suggests that those organizations that clearly develop, document, and execute their CRM strategies will be at a competitive advantage compared to their less mature CRM counterparts.
As a best practice, most successful CRM projects have a clearly defined set of goals that are communicated to the enterprise, along with baselines to measure against, metrics to track them, and an integration plan that integrates these goals with employees’ work plans and compensation.
