While implementing CRM, many organizations lose sight of their customers.
By: Chuck Barker
When I ask most dealers to tell me about their CRM initiative strategy they instantly default to what piece of software they use and that is where it ends.
Funny how we focus almost 100% of our faith and attention on what is deemed as only 10% of the overall CRM initiative to deliver results – the software – which only facilitates good processes and people.
Investments in CRM applications have indeed produced a broad spectrum of results. Some dealerships have experienced dramatic increases in revenue and customer satisfaction along with significant cost savings, while others have experienced limited returns and disappointing results.
The benefits would be greater if more stores took CRM for what it is to the next level by designing their CRM strategy for future aspirations, instead of just implementing software to support current capabilities. The focus on bottom-line costs and departmental goals limits the top-line potential of CRM investments. To gain a competitive advantage and promote sustainable profitable growth, organizations need to take a holistic approach to CRM and develop bold strategies to win, know and keep their customers. It will only occur with professional process training and implementation of a disciplined approach. All else fails or offers only semi-success.
While implementing CRM, many organizations lose sight of their customers. Their attention centers on ratios and efficiency gains. They focus on single channels, ignore back-end integration needs and get only a limited view of the customer, resulting in missed opportunities and a negative customer experience. Organizations often automate existing bad processes instead of redesigning their customer-facing operations based on the new and improved best practices. It is time to refocus on what CRM is really about – the customer – in order to achieve the results CRM has promised to deliver.
No business can exist without customers. No matter how good a product is or how efficient an organization operates, without customers there is neither growth nor profitability. Customers make the purchase decision. They bid the price up or drive it down depending on the value they perceive in a product or service. The customer decides how and when he wants to interact with a dealership and how he wants to explore and ultimately buy whether it is online, over the phone, in a store or through any other channel. It’s the customer’s perception of everything a company does and represents that creates an image of its people, brand and dealership and eventually determines its success or failure as a business. Thus, it is ever so critical for every corner of your store to be radiating these new “relationship building” elements or your store looks just like everyone else and consequently your business will ultimately hinge upon “best price” issues. We have to give customers real reasons to do business with us way beyond the money.
That is why successful companies build their business totally around the customer. They know who their most valuable customers are and they understand their needs and buying habits. They target and tailor their offerings and personalize the interactions with their customers. Successful companies design and continuously improve business processes across their entire ecosystem “including suppliers and channel partners” to respond quickly to changing customer needs. They strive to become fully customer-driven, deliver superior customer value and consistently provide exceptional customer experience across all customer touch points. They make every effort to build long-term relationships with their customers, recognizing that keeping customers is more profitable in the long run than winning new customers over and over again. Essentially this is what CRM without compromise is about.
More than ever, relationship building training is so critical to organizational success. After more than a decade of harnessing cost-savings potential to remain competitive in an increasingly difficult economy, driving growth has replaced cutting costs as the most important goal for most dealerships. Hence it becomes no surprise that CRM is back on the agenda of many top executives. To stimulate new growth, wise dealers are beginning to explore a more disciplined approach to exploit untapped opportunities and make the most of relationships with customers. They seek new ways to increase wallet share, deploy new channels, penetrate underserved segments, reach out to new customers and enter entirely new markets. To ensure sustainable, profitable growth CRM processes must take a leading role in the value chain, enabling organizations to excel not only across, but also beyond customer touch points and rapidly adapt to changing business needs.
When price and efficiency were the driving forces of competition, many companies focused on increasing their competitiveness by improving their internal processes. Continuous, standardized processes were the key to new efficiency potential and to survival in the market. But the spotlight has since shifted to relationships with customers, employees and partners. Internal efficiency alone is not enough to guarantee market differentiation and competitive edge. Success is no longer determined only by price and product, but by well-designed sales channels and well understood relational sales and service processes.
At first, companies focused on CRM for a single department or function. They often turned to niche CRM software vendors to not only support, but also be their CRM effort. However, while sales productivity, call center efficiency or marketing effectiveness may have improved, progression to effectively managed customer relationships was often prevented by an internal focus, deployment of tactical departmental solutions and inadequate integration of front-office and back-office systems. Successful dealerships have realized that integration along the entire process chain is the only way to gain a lasting competitive advantage. But so far, few companies have used this time profitably, redefining their own strategies and reshaping business processes for a truly customer-driven enterprise.
More and more organizations are beginning to realize that overall CRM success depends heavily upon how they treat their employees. Hiring good people, setting high goals and expectations, providing needed resources, training and developing new skills, and holding people accountable for results seem to be critically important ingredients in organizational success. Employees who work in organizations with these qualities often exert more effort toward organizational goals, report higher levels of job satisfaction, and are more likely to stay with their company over the next three years than employees working for organizations that do not possess these qualities.
Although the ingredients for organizational success appear straightforward, few companies appear able to implement them on a consistent and comprehensive basis because many managers believe they do not have time to interview properly potential employees, much less set clear expectations and develop skills. Nor are they much better at holding their employees accountable for results, as many managers do not take the time to conduct weekly one-on-one performance much less annual reviews. If research vibrantly shows us that these leadership activities are related to an organization’s ability to attract and retain key talent and in turn provide us with superior results, and if managers are not doing them, then what other things are they spending their time on that could possibly be more important?
CRM process leadership is the required key in order to grow people, processes and a customer base. It is now a new year and no better time to re-invent yourself, your people and your store. Say goodbye to the status quo and hello to new the CRM relationship principles that will encourage and sustain overall dealership growth.
If you are interested in receiving more enriching ideas that you can employ now, send me an e-mail at cbarker@digitaldealer-magazine.com and I will get them out to you. Also, if you have any questions or success stories, I would love to hear about them.
Chuck Barker’s experience ranges from an executive with a Fortune 200 computer corporation to the automobile business. He has held positions as business development manager, sales manager, acting GM, ADP executive regional manager specializing in CRM and his own current company, Impact Marketing & Consulting Group, LLC, located in Virginia. His firm delivers CRM process strategies, 21st century CRM sales training, CRM e-business deployment and CRM management leadership workshops. More information can be located at his web site: www.impactgroupcrm.com.
