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CRM: Getting a return on your investment

Despite the development of sophisticated CRM solutions, many implementations have failed to live up to expectations. So what lessons can be learned from well publicised CRM failures and what is best practice in CRM implementation to deliver the required return on investment.

A recent independent survey by PMP Research highlighted that 98% of companies surveyed were planning some investment in CRM this year.

With this level of investment likely, Shaping Business has identified the six key areas for organisations to consider when planning a CRM investment:

1. Understand the business needs

Consider what information and processes your business currently has relating to your customers and how this information is currently used. Now consider what customer information and processes the business needs to effectively manage customer relationships. Examine the information gaps and determine what are the ‘must haves’ and what is a ‘nice to have’. Above all, be realistic on what your organisation can achieve and support. Finally, consider which category of CRM (from mass marketing to one-to-one marketing) fits your business model. This will influence your choice of CRM solution.

2. Ensure a balanced framework

An effective CRM solution needs the right internal balanced framework in the business to support CRM. There must be an optimal balance between the Marketing Strategy, the IT systems and the organisational culture and business processes to create an environment where CRM implementation can succeed. Any shortcoming in these areas needs to be addressed before embarking on a CRM project. Do not expect your CRM solution to solve existing shortcomings in these areas.

3. Investigate solutions

There are many CRM solutions on the market, from simple packaged solutions to the sophisticated solutions of the big vendors in this space. Many other organisations have already embarked on CRM programmes similar to yours. Developing an understanding of their experiences is invaluable - so don't be afraid on insisting on speaking to a selection of the vendor's previous clients. Also be prepared for these opportunities. Structure your questions to ensure you get the information you need and that you are consistent in your discussions with vendors and their customers. Also ensure you have the full input and support of all parts of the business in considering which solution is right for your business. CRM is neither an IT project nor a marketing project.

4. The People Factor

Ensure your CRM project has the right people involved and ensure the project has strong leadership. The project must have the commitment and support of the senior people in the business.

5. Benchmark

How do you define success for your CRM project? Baseline current costs, the current performance of customer relationships and internal processes. Finally, establish realistic targets for business improvements and the return on investment. This is the ultimate mechanism for judging incremental spends.

6. Plan deliverables

Establish a clear and achievable project plan and costing. Include all internal costs. Ensure all project deliverables have a deadline date and all work contributes directly to a defined deliverable. Plan for small steps rather than a big bang.

If you would like an independent review of your CRM systems and processes, or advice on how to deliver a return on investment from your CRM project, please contact our office or email results@shapingbusiness.com.

Acknowledgements:
This article is based on the previous experience and knowledge of Shaping Business and extracts from seminar presentations by:
Dr B Smith - Cranfield School of Management
Mr D Bradshaw - Ovum
Mr S Wood - Catalyst IT Partners Ltd