Free Building and Measuring Your CRM Strategy Essay Sample
Customer relationship management (CRM) is an extensively implemented strategy used by organizations for managing their interactions with clients, customers and sales prospects. It encompasses the use of technology to automate, organize, and synchronize business procedures; mainly sales activities, customer service, marketing and technical support. The main goals of a CRM strategy are to attract and retain new customers, lure existing clients and lessen customer service and marketing costs. Customer relationship management depicts an organization-wide business strategy encompassing customer interface department amongst other departments. Some of the noted benefits of a CRM strategy include reduction in overall costs, efficiency and quality, decision support, customer attention, and enterprise agility. Studies have proven that, valuing and measuring customer relationship is significant to implement customer relationship management. This paper focuses on building and measuring CRM strategy.
Building a CRM strategy
An organization requires three significant elements, which are technology, process, and people before it successfully initiates a customer relationship management strategy. Individuals should work in a manner that promotes open communication, collaboration and organization in general. Good business processes acts as a basis in which the adopted systems works around. Better processes ensure better customer care, which results to greater satisfaction of the online business clients. The right technology such as faxes, phones and computers should be put in place and determined sufficient to the requirements of the automated software and strategy which will be implemented. Before building a CRM strategy, organizations should consider how this strategy would fit into account management process, core competencies, customer segmentation and key planning procedures amongst others. According to Martinez, the process of building a CRM strategy takes three steps as explained herein.
Setting the Destination
Organizational managers should examine the diverse definitions of customer relationship management, thus generating their own in order to gain cohesiveness and buy-in from those engaged in the initiative. Furthermore, organizations should establish a vision for customer relationship management which classifies why the company wants the initiative and that which points out the desired outcomes. The organization team in charge of building the CRM strategy should include a sponsor, program/project manager and a facilitator.
Auditing the Present Situation
An assessment of past customer relationship management initiatives should be carried out. The persons involved in the building of the strategy should give their views of what they think requires to be modified. However, the goals and assumptions of the previous projects remain applicable, even though the implementation was as successful as desired. Wide range gathering of information from external sources and weighing client feedback is also recommended in order to ensure success of the process.
Mapping the Journey
This involves the identification of the steps to attain the vision. The organization should classify motivating factors for client loyalty and core value proposition for the clients. Furthermore, the organization should be revalued on the prospect of its client base rather than on present profits or revenues. The company should build systems and processes which can be altered dynamically and rapidly as individual clients move amongst segments (Martinez 6). In addition, the company should establish at least three objectives for the customer relationship management strategy, and these objectives should be efficiently and regularly communicated to executives and sponsors.
It is apparent that a CRM strategy cannot be build in isolation. Such a strategy must be pertinent and related to the general corporate strategy and furthermore, it should be build on subsisting marketing or sales strategies which are already in use. Studies have revealed that organizations that are good at linking strategy and implementation are very successful. Organizations however should have both a good vision and a strategy, and follow the above steps in order to build a successful CRM strategy.
Measuring CRM strategy
To ensure effective management, companies need to measure various aspects such as financial performance and customers. However, traditional measurement tools have proven to be inefficient and they suffer from various limitations such as measuring past activities. The main uses of customer relationship management systems include: to validate or influence decision making, to forecast future states and to guide ongoing tactics or activities.
Studies have proven that, CRM technology solutions play a vital role in measuring CRM strategies, in that they facilitate digital execution of these strategies. Furthermore, technology serves as a mechanism through which client measurement data can quickly be generated. CRM measurements can be used to measure how often and accurately client strategies are reformulated and reviewed.
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CRM Measurement Frameworks
Some of the commonly used CRM measurement frameworks include brand building, customer equity building, customer-facing operations and leading indicator measurements. In this case, we will focus on customer-facing operations which encompass such aspects as sales force operations, website operations, service center operations and customer equity building, which include customer value management and customer behavioural modeling. Organizations use such systems as sales force automation systems in measuring CRM strategies. Sales force operations center on tracking sale leads, measuring individual performance of the sales workers, monitoring the sales performance of the company’s products and cost of sales. In this case, some of the measures used encompass sales quotas, close percentage, customer score, sales expenses and sales totals and number of new clients amongst others.
Organizations currently are using call centers to handle and manage incoming and outbound sales calls. Various measures have been employed by organizations to measure this including average hold time, call counts and duration, abandonment rate, blocked calls, call quality and service level amongst others (Anton pp. 40). With the increased stress on internal metrics linked with call efficacy, organizations have introduced balanced call center which combines effectiveness scores with efficiency scores.
With the initiation of internet, organizations have launched websites for various purposes such as sales, marketing and support. Due to the heavy employment of marketing by organizations in the internet, website operational measures encompass such measures as visitor counter, unique visitor count, page hits, registered users, breakage and click stream. The websites are aimed at offering information to the customers who are connected with the organizations account. Organizations can use various approaches to measure customer value. Some of these approaches include customer value analysis, customer equity management, customer satisfaction and loyalty monitoring.
CRM Information Systems
Customer relationship management software vendors offer tools and relationship management software which assist companies to track data, client history, client-service calls, and payment histories. Marketing automation and sales force automation systems are some of the technological tools provided which assist with online businesses. Sales Force Automation systems which include product knowledge, sales lead tracking, order management, sales tracking, are CRM information systems which computerize sales functions; mechanically recording every stage of the sales procedure of every potential customer. This helps in saving time, thus businesses can be able to serve more customers in less time.
Marketing automation system simplifies marketing by computerizing repetitive duties in a manner that amplifies efficiency and lessens the possibility of human error. Generally, the software programs assist in keeping track of sales information and customer contact typically by tracking customer searches, email and social media to ensure easy accessibility and to allow a business to categorize and target best customers. Customer service and support software which includes web client support portals, and virtual help desks are offered to computerize basic client service duties as they concurrently record client requests which allows an organization real time data which can be used to advance customer service, attract and retain new customers and reduce service costs.
Furthermore, companies can use various social media networks with an aim of giving their online businesses an exposure. The most common social media networks include Facebook, Twitter, Cyworld, MySpace, and LinkedIn among others. These web based CRM strategy networks offers a chance for businesses to offer information to persons who have been connected to the company’s account.
It is apparent that building a CRM strategy is very beneficial for any organization. The main goals of a CRM strategy are to attract and retain new customers, lure existing clients and lessen customer service and marketing costs. Some of the noted benefits of a CRM strategy include reduction in overall costs, efficiency and quality, decision support, customer attention, and enterprise agility. However, before building a CRM strategy, organizations should consider how this strategy would fit into account management process, core competencies, customer segmentation and key planning procedures amongst others. As discussed above, three steps should be followed whilst building a CRM strategy, which includes setting the destination, auditing the present situation and mapping the journey. Furthermore, to ensure efficiency, organizations should ensure that they employ efficient CRM measurement methods.