This column is co-authored by Lisa Loftis, vice president of Intelligent Solutions.

When data warehousing began to gain in popularity in the mid-'80s, there was a remarkable influx of technology vendors that suddenly discovered they were data warehouse vendors. They rapidly began to offer "data- marts-in-a-box," virtual data warehouses and "instant" architectures – ad hoc, short-term solutions with limited chance of long-term success. These data warehouses were not sustainable because they lacked openness, integration with each other or with other Corporate Information Factory (CIF) components, customization capabilities to satisfy specific requirements or easy maintainability.

Over the following years, these "instant" offerings lost their appeal as newer data warehouse-specific offerings appeared. The success rate of data warehousing using these targeted products greatly improved due in part to their focused analytical abilities, their interoperability, their customization capabilities and their obvious fit in the CIF architecture.

Fast forward to today. Customer relationship management (CRM) is the buzzphrase du jour, and we see a very similar trend occurring in the vendor community – software products that were previously unheard of in the customer management world rapidly repackaged as CRM tools. Just as before in the initial data warehouse rush, long-term success is unlikely unless IT departments and their enterprises recognize a few key points:

  • Installing expensive CRM technologies is not enough to ensure a CRM organization. Neglecting to adopt new, customer-oriented business practices, processes and measurements will almost certainly assure a less-than- successful result.
  • A CRM initiative without a strategic architecture behind it is crippled. Consider adapting the CIF to fit your specific environment – changing it as needed to accommodate your particular requirements. Then, map the software products to your architecture including the necessary interfaces, data feeds and new processes required.
  • CRM is an enterprise initiative. Vendors must realize that they are selling a process first – not just a product. However, it may be up to you to ensure that any "CRM" products you purchase fit this focus and are not proprietary, difficult to incorporate required changes or impossible to map to your architecture.

It should be as obvious for CRM as it eventually was for data warehousing that CRM applies to both a suite of software products as well as a customer-oriented business strategy. Unfortunately, business executives become dissatisfied with "CRM" because they bought into the marketing hype. They paid a lot for the installation and integration of the purchased products but didn't modify any of their business practices or move them toward the customer orientation required to use the tools effectively.
A very common and natural mistake is to consider CRM from the perspective of only one business function or technology. Organizations that are implementing only call center or sales force automation software packages will probably tell you that they are implementing CRM. The same goes for organizations that are building marketing databases or implementing campaign management facilities. Are either of these groups achieving CRM? Not completely.

Your organization can spend six or seven figures on a CRM technology package and still not arrive at CRM. Why? Because CRM means knowing your customers, understanding their relationships (both with you and with others) and managing all interactions with them accordingly. Here are some suggestions to help accomplish these objectives:

The ABC's of CRM. In order to adopt CRM, you must first understand it. This entails developing a comprehensive strategy and definition that specifies all key components. Executives, technologists and front-line employees alike must accept this definition and, in accepting it, understand the magnitude of the transition portrayed therein.

  • We define CRM as the alignment of business strategy, organization structure and culture, and customer information and technology so that all customer interactions can be conducted to the long-term satisfaction of the customer and to the benefit and profit of the organization.1
  • Your organization should adopt a similar CRM definition.

The CSF's for CRM. Equally important are the critical success factors for CRM. Within each component embodied in the definition of CRM are a number of key issues that must be managed to effectively transition from a product- focused organization to a customer-focused one. Failure to manage the "gotchas" in any one of these areas can negatively impact your organization's ability to reach CRM nirvana.

  • Significant training or education may be needed throughout the enterprise to ensure that the culture is reoriented toward a customer focus.
  • Employee incentives may have to change, again to refocus employee interactions toward the new business strategies.
  • Many times, the organization itself may have to be realigned to support the enterprise CRM strategies. The organization chart may have to change to support centralized functions such as customer management, strategic operations or shared IT systems.

The CIF in CRM. Last, but no less critical, is to embrace a proven technology architecture for your organization. The CIF is just such a technology architecture in that it provides the foundation for building the integrated customer information environment required to support your CRM business initiatives. The CIF will allow you to do the following:

  • Recognize all systems required to support CRM.
  • Classify these systems by use (business intelligence, business operations and business management).
  • Identify points where integration among systems is required.
  • Identify the required tools and management environment for each classification.

Instant CRM is not a silver bullet for curing all of your company's woes. CRM's impact on your business is dependent upon how well grounded your CRM strategy is in a solid business plan and how well you architect your technologies to support your strategy and plan.

1. CRM definition taken from Building the Customer- Centric Enterprise by Claudia Imhoff, Jon Geiger and Lisa Loftis. John Wiley & Sons, February 2001.

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