© 2003 Terry James. All rights reserved 1 The CRM Textbook: customer relationship management training Terry James © 2006 Chapter 1: Customer Magic

© 2006 Terry James 2 Welcome! Everyone can can understand CRM since we are all customers at times. CRM is one of the most lucrative areas with billions of dollars spent. A good CRM focus is often the difference between success and failure. You can use many of these ideas to improve your life and increase your work successes. I’ve done it, and I believe in it.

© 2006 Terry James 3 Initial Vocabulary CRM – customer relationship management Let’s jump right in and… deepen your understanding, show some real life complexities, give a you scope and vision

© 2006 Terry James 4 Introduce yourselves Turn around and introduce yourselves to your neighbors behind you Ask them what other words they might use to mean a customer? Ask them the difference between a customer and a client? Can the roles change with customers?

© 2006 Terry James 5 What customer? Is a ‘client’ the same as ‘customer’ ? Different people use different words. Sometimes they mean the same thing, sometimes not. Homonyms and synonyms. Good starting point is collect all the words used for customer and build a common vocabulary. It improves efficiency and understanding when people use the same words to mean the same thing. At a minimum, it will expand your understanding of the customer idea

© 2006 Terry James 6 Internal and External customers Jack sells real estate on Jupiter to a paying customer Bill. Jack needs the company lawyer Susan to check if this is legal or fraud. Jack is Susan’s internal customer, the external customer is Bill. This concept means everyone has customers no matter who or where you are in the organization.

© 2006 Terry James 7 Internal vs External customers This idea means we all care about service to someone who gives us work. Our job should depend on pleasing those who give us work. Ask yourself, what did I do for my customer today? If you are not sure, you are cannon fodder for downsizing.

© 2006 Terry James 8 Understanding customers Once you understand who your customer is, you can define needs. More than half the project that fail do so because of the failure to understand requirements. What does the customer want? Bundled products Add one feature, or remove one Make it simpler?

© 2006 Terry James 9 Everyone knows what a client wants The client wants a better deal, fast service, great service. What’s the mystery? Discuss in a team if this is true? Forget about equal and fair. Every customer is different. Every customer has different needs. Giving everyone the same deal is often not wanted or needed.

© 2006 Terry James 10 The CISCO review Concept of 360 degree review employees do about 5 customer reviews daily Every time someone delivers work, they are given a review. Boss reviewed by workers, workers reviewed by peers.

© 2006 Terry James 11 One order of Complexity to go, please. Is Susan, Jack or Bill the end customer? How do you DEFINE customer? The person who pays? Your boss who can fire you? Is a student a customer? Are your parents the paying customer? You can review the school and help decide if it survives BUT- the school reviews you to decide if you survive Complex relationship of constantly changing roles

© 2006 Terry James 12 One call, one solution. Need a computer? Guy in the green tie tells you to see the bald guy. He tells you to see the woman in the red dress She tells you to see the guy in the green tie. Full circle. No customer wants a runaround. They don’t care what mess your organization is in. They just want a solution. If a client calls you, then you call around until you find the answer. You call the client back. One call = one solution. Everyone who knows you are calling on behalf of a customer should give you priority.

© 2006 Terry James 13 The big picture In large organizations, often the left hand does not know what the right hand is doing. The branch rejects the client loan request. The web accepts the same request. The telephone market campaigner calls to sell a loan to the same client who was just rejected. Gah!!! Be Consistent, or lose clients.

© 2006 Terry James 14 Fire the customer If you understand your customers, you will find some customers have a poor benefit:cost ratio. Fire customers who cost more than they are worth. Get rid of them. Put your resources where they count. But first, does the client have friends, does he have future potential? 80:20 rule. 20% of customers usually provide 80% of profit.

© 2006 Terry James 15 Lifetime value – retention. Go the extra mile in service. The grocery example. One bad apple cost pennies. A long listen to a story about knitting could mean a faithful client for 10 years. One mistake, and you lose the customer. On average an unhappy customer will tell more than 7 friends, who in turn will tell others. Lots of negative advertising from one bad customer.

© 2006 Terry James 16 Summary Customers are survival. Everyone in the company works a customer – internal or external. Roles can change quickly. Client consistency mean you work closely across the company. No silos- teamwork. Fire costly customers. Delight important customers if it means profit. Look at the lifetime value

© 2003 Terry James. All rights reserved 17 “Give me a lever long enough… and single-handed I can move the world”. Peter Senge. The Fifth Discipline. Pg 3.