Is Your Business Doing Customer Relationship Management Right?

Business owners and managers have plowed millions of dollars into information systems meant to track and strengthen customer relationships. Often built around complex software packages, these customer relationship management (CRM) systems promised to allow companies to respond efficiently, and at times instantly, to shifting customer desires, thereby bolstering revenues and retention while reducing marketing costs. But most firms failed to reap the expected benefits, and as executives dramatically reduced IT expenses in subsequent years, CRM sales plummeted. After rising 28% between 1999 and 2000, CRM sales dropped by 5% in 2001, 25% in 2002, and 17% in 2003, according to the technology market research firm Gartner. Many observers came to believe that CRM was destined to join enterprise resource planning (ERP) as another overhyped IT investment whose initial unmet promise nearly killed off the approach.

Today, CRM spending appears to be picking up. Overall CRM sales are predicted to rise another 10% by the end of 2015. So what’s changed? Why has disappointment turned to satisfaction, pessimism to optimism, cutbacks to new spending?

The successful users have also exhibited a healthy skepticism, discounting overblown claims that the ultimate payback from a CRM system is the creation of a “real-time enterprise.” Understanding that highly accurate and timely data are not required everywhere in their businesses, they’ve tailored their real-time CRM initiatives to those parts of their customer relationships that truly do depend on “perfect” information. Once they’ve succeeded with the smaller, more-targeted CRM project, they’ve used their initial investments as springboards for solving additional problems.

Part of the early attraction of CRM systems lay in their ability to deliver real-time information, to give marketers, salespeople, and managers a clear picture of what’s happening in the market at any particular moment. But perfect information comes at a high cost. The systems required to collect and disseminate it are expensive; so are the finely tuned processes needed to react quickly to it. Despite the hype surrounding real-time enterprises, the fact is that few companies need perfect information throughout their customer relationship cycles.

Why pay for real-time information on business processes that customers don’t really value or that managers can’t rapidly adjust? A hotel manager certainly needs real-time data on the availability of rooms but not on the customer’s opinion of the carpets and drapes. A cable company needs real-time figures on service outages that demand immediate repairs but not on the profitability of its pay-per-view programs. Real-time information priorities are driven by real-time business opportunities and must be customized to each individual business. 

Is your business looking for an affordable solution?

SMART Service Desk IT Service Management Software is a great start to creating your very own customer service legends. We know that your satisfied customers will return again and again. Let us help you increase productivity, reduce operations cost and improve customer experience with our ITIL compliant solutions. No matter the size of your business we have your customer retention solutions.

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