Every business organisation today operates within highly competitive and dynamic markets; changing customer needs and demands require a new and innovative approach through which to manage the business successfully.
Those organisations that opt to cling to the habitual and sometimes outdated approach to business operations, adhering to the philosophy of “business as usual,” face an inevitable struggle to merely survive. In today’s business environment, change is, in fact, a paramount necessity, not an option.
Amidst this general sense of change, business organisations are increasingly acknowledging the need to align their employees and internal business processes with available technology in order to better understand their customers, address their changing needs, whilst profitably managing their expectations and levels of satisfaction.
The most dramatic business changes today are being driven by changing consumer trends. The internet, through its inherent 24/7 customer service, has induced an ever-growing number of consumers to experience a degree of convenience, reliability, and immediacy that they have now also started to expect from the physical world. At the same time, products and services have become so highly commoditised that low price, coupled with outstanding service, are often the differentiating purchasing factors for the customer.
The notion of customer relationship management (CRM) is increasingly becoming an important focus for every organisation’s corporate strategy. It extends beyond the fundamental concept of database marketing, and aims at creating, developing, and enhancing corporate relationships with customers. In fact the predominant idea is that customer life-time value can be optimised when deeper relationships are formed between carefully targeted customers and the business organisation.
The internet has accelerated the seismic shift toward customer-empowerment, bringing with it a need for real-time execution and immediate response to changing customer requirements. The customisation of products or services to a client’s specific situation and requirements is today a reality and not merely a theoretical concept.
In this respect, the integration of CRM systems with the multiple channels of sale, including the internet and social media, is necessary to better market, sell, and serve customers through a much stronger link between critical business functions and the technical infrastructure that support them.
When implementing a CRM solution, however, it is quite common to discover the degree to which modern business organisations still operate on a foundation of disparate and sometimes incompatible information systems. Such an infrastructure limits business values; rendering any such value difficult, if not impossible, to quantify.
Historically, technology has been implemented within business organisations to address specific short-term processing challenges with little regard to the organisation’s overall long-term business strategy and objectives.
As a result, most business organisations possess outdated, inefficient, legacy systems that provide virtually no insight into customer behaviour, profitability, and preferences. Furthermore, maintaining old file structures and outdated hardware places a huge drain on staff and budgets - resources that are desperately needed to implement a modern-day, customer-focused, strategy. Not surprisingly, obsolete technology is supporting operating procedures that are based on outdated concepts of product portfolio or vertical corporate function lines. To prosper, it is imperative for firms to have information systems in place that provide a ‘holistic’ view of customers and a deeper insight into their respective wants and needs.
With flexible, leading-edge computer systems providing instant access to up-to-date, detailed information – sometimes at the point of sale – cross-selling opportunities and profitability can be maximised. However, this requires much more than implementing the latest, state-of-the-art, technology.
Only through the fundamental realignment of people, processes, and technology can firms gain the capabilities necessary to accurately determine customer profitability, product ownership, and delivery channel preference to succeed.
This is the first of a two-part article on CRM.
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Mr Sammut is business solutions advisor at iMovo Ltd, a local customer relationship management and business intelligence solutions company.