CRM Creating Customer Advoacates[1]
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Transcript of CRM Creating Customer Advoacates[1]
Marino Associated, LLC
Customer Relationship ManagementCreating Customer Advocates
Dan Marino, CPIM
Sr. Partner
Marino Associates, LLC
Marino Associated, LLC
MOST COMPANIES NEED TO GROW REVENUE
Best In Class CRM Companies state that profitable growth, rather than growth through aggressive customer, product or business unit acquisition, is the reason to implement a Customer Relationship Management program.
Marino Associated, LLC
CRM REQUIRES A CULTURAL SHIFT
Companies need to align their Processes,
Employees, and Systems towards a customer-centric philosophy.
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CRM IS:A marketing philosophy based on Putting The Customer First.
It’s the collection and analysis of information designed for sales and marketing decisions, to support and understand existing and potential customer needs. It includes:
– Sales and Marketing
– Product Line Managers
– Demand Managers
– Operations
– Service
– Finance
– Systems
Process Alignment
Marino Associated, LLC
Marino Associated, LLC
HOW MANY OF THE COMPANIES IN THE ROOM HAVE?
• Implemented CRM and are achieving benefits
• Started the process of implementing CRM
• Contemplated the implementation of CRM and are not sure how to start
• No plan or strategy for CRM
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KEYS IN ACHIEVING CRM SUCCESS
• Open access of all customer information to all employees that are customer facing
• Link CRM to corporate goals
• Select software that enables the users to apply customer information with speed and accuracy
• Build cross functional buy-in and collaboration
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How is customer intelligence data managed in your company?
• Multiple data bases throughout the company which are difficult to access
• Single data base/accessible and current
• Customer information is not kept in a data base no formal system
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CRM REALITY
• CRM is a management discipline
• CRM blends customer intimacy with economies of scale
• CRM is a data base of needs and preferences and this information is available to anyone in the company
• CRM is absolute customer focus
• CRM is when the strategic thrust of a business is customer focused
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BEST IN CLASS CRM PRACTICES REPORTED GREATER THAN 25% YEAR OVER YEAR
IMPROVEMENT IN:
• Annual revenues
• Customer acquisition
• Customer retention
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HOW IS A CRM INITIATIVE VIEWED IN YOUR COMPANY?
• A strategic goal• Thought of as tactical only• A Sales department goal only• Not considered an important strategic
initiative
Why Implement a Customer Relationship Management Program
• Customer relationship management (CRM) is often a miss understood and not, widely-implemented strategy.
• It involves using technology to organize, automate, and synchronize business processes.
• The overall goals are to find, attract, and win new clients, nurture and retain those the company already has, entice former clients back into the fold, and reduce the costs of driving revenue into the company.
• Customer relationship management denotes a company-wide business strategy that embraces the customer and all interactions with the customer.
• When an implementation is effective, people, processes, and technology work in synergy to increase profitability, and reduce operational costs.
Marino Associated, LLC
Marino Associated, LLC
RECENT ARTICLE IN THE WALL STREET JOURNAL
General Motors audit on what the Company would have to change to be able to make cars to order. The
answer?
“We’ll have to change everything.”
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THE IMPLEMENTATION OF CRM REQUIRES THE ENTIRE COMPANY TO CHANGE THE WAY IT
THINKS ABOUT THE CUSTOMER:
• Who are your customers?• What do they want and expect from your
company?• How can they be better served?
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COMPANIES THAT HAVE SUCCEEDED IN THE IMPLEMENTATION OF CRM HAVE EMBRACED A STRATEGY
THAT HAS RE-ENGINEERED THE COMPANY’S:
- Focus- Training- Education- Technology- Energy- Product Development- Customer Communications
- Personal- E-Mail- Fax- Internet
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REASONS FOR CRM IMPLEMENTATION
• Companies who begin to embrace CRM often have no one single strategy.
• They are pushed into CRM by a compelling business problem or a series of customer relationship issues.
• They may be losing market share even though cost, quality and solutions are equal
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CRITICAL ATTAINMENT FACTORS
• Top management support is a must when implementing CRM.
• Review and value map your business approach before re-engineering.
• Build a strong functional CRM team.
• Outline the information required to affect the appropriate CRM change.
• Integrate CRM tools into your system seamlessly.
• Review your technology requirements and only invest in high tech solutions if required.
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CUSTOMER RELATIONSHIP MANAGEMENT STRATEGY
CRM business strategies must clearly define where the business benefits will come from and how these benefits are distributed and, very importantly, in what priority?
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BEST IN CLASS CRM PRACTICES WILL TYPICALLY:
• Centralize management of customer information at the corporate level
• Utilize both operational and strategic analytics to respond to high value customers
• Take a long term approach to growth by defining customer value according to lifetime value models
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Companies must understand that customers Want and Need contact with
your company. You must be able to provide this contact:
How they want it
When they want it
What they want it for
.
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HOW DOES YOUR COMPANY MANAGE ITS CUSTOMER BASE?
Does not individualize customers
Individualizes service by customer
All customers are treated as equal
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CRM VALUE QUOTIENT
• CRM solutions should focus attention on the right customers. The most valuable customer might not be the biggest spender or the most frequent buyer.
– Big Spender (high maintenance)
– Frequent Buyer (small order quantities, high fulfillment cost)
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CRM VALUE QUOTIENT cont’d• The perfect customer value quotient is difficult to
obtain, but by tracking:
– Discount Rates – Product Profitability – Customer Acquisition cost – Cost of Service – Number of Support Calls – Fulfillment Cost
It can lead you into knowing and individualizing service based on customer value to your company
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CURRENT BUSINESS CONDITION ASSESSMENT
Current Company Process and Business Rules
Has Management communicated throughout the organization a clear CRM STRATEGY ?
Is there a ranking of customers that is used when managing the relationship?
Has Marketing articulated to Management the competitive environment that it is competing in?
Review existing customer databases
Conduct internal interviews with management
Conduct voice of the customer interviews with a cross section of your customer base
Checklist
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BUILD THE BUSINESS PLAN
- Develop a Detail Project Plan that supports transformation to CRM
- Develop a formal CRM Project Team
- Define Project Scope and Timelines
- Prioritize all Key Elements of the Plan concentrating on competency requirements, education, training and capacity
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BUILD THE BUSINESS PLAN cont
- Establish quick wins (homeruns). Things that can be complete in as little as 3 months’ time and will provide:
Financial Impact
Morale Impact
Validate Process
Early Success
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CRM STRATEGY NEEDS TO FOCUS ON:
• Customer Retention – Rank customer based on ABC– Concentrate on retention campaign
• Customer Service – Provide exceptional service in all areas
• New Customer Acquisition – Manage the cost of obtaining a new customer
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DRIVERS FOR CUSTOMER SATISFACTION
– Return on Sales
• Companies that give good service achieve 12% Return on
Sales compared to 1% for companies with poor Customer
Service
– Market Share
• Higher market share
• Perceived as a Quality Company
• Demand premium pricing
– Internal Customer Satisfaction
– Positive Word of Mouth
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KEY BENEFITS OF CRM
- Reduce the cost of customer acquisition- Improve customer retention- Improve the up-selling of additional products
and services- Treat your customer with consistency and
quality- Improve information flow for Sales and
Operations planning- Dynamic information flow for Operations
planning
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ESTABLISH PERFORMANCE MEASUREMENTS
• Increases in annual revenues• Improved customer retention• Improved acquisition rates• Improved accuracy in forecasting customer
requirements• Improved stability in the S&OP process• Improved utilization of inventory and capacity• Improved supplier management
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IMPLEMENTATION STRATEGY
Modular Approach
VS.
Big Bang
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MODULAR APPROACH Function Specific
• Marketing• Sales• Logistics / Fulfillment• Call Centers
– Benefits• Shift of long-term strategy
– Drawback• Cost Ongoing• Customer data silos continue to exist within company• Gradual shift of corporate culture from Product-Centric to
Customer-Centric
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BIG BANG APPROACH Corporation Wide Approach
Benefits– All functional areas cut over to the same system
• No legacy systems interface• Elimination of redundant systems• All areas sharing the same information• Single source for training and support
Drawbacks– Massive Implementation
– Massive amounts of:
• Support• Education• Training
– Legacy Systems are turned off– Culture change required– Cost
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CRM TEAM PROCESS
• Customer Relationship Management Champion
• Executive Sponsor
• I.T. Management
• Management Representative from each department touched :
- Sales
- Marketing
- Customer Service
• External CRM Advisor (consultant)
.
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CUSTOMER RELATIONSHIP MANAGEMENT PITFALLS
• Lack of Top management direction
• Change culture is difficult and change management is not understood
• Poor project management
• The effects of CRM on current business processes
• CRM is not understood
- Lack of a solid strategy
- Lack of clear goals
- Lack of defined objectives
• Lack of training and education
• Existing technology is inadequate
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Customer Relationship Management Creating Advocates
CRM success requires the total committed resolve of a corporation to commit its resources and to change its culture in a Continual campaign that results in the optimization of customer and partner satisfaction, revenue, and business efficiency.
Despite the cost and risk, the uncertainty and the noise, CRM is Valuable, Viable, and Real, and it’s not going back in the box.
THERE ARE TWO WAYS TO GET ON
TOP OF AN OAK TREE
YOU CAN CLIMB IT,
OR
YOU CAN SITON AN ACORN
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Please leave your Business Card and we will send you a White Paper on this talk
and a version of this presentation
Learn more about Marino Associates, LLC at :
www.dmarinoassociates.com