1. BGS Customer Relationship Management
Chapter 4
Organization and CRM
Thomson Publishing 2007 All Rights Reserved

2. Introduction Multiple Dimensions
Business dimension
Technological dimension
People dimension
Time dimension

3. Introduction McKinsey Study
Ten organizational characteristics fall into three distinct categories: structure, skills, and processes
Structure
Manage trade-offs around critical roles and resource access
Centrally located analytical experts
Cross-function integration
Quick access to multiple customer opportunities

4. Introduction McKinsey Study
Skills
Priority on customer analytics and insights across key decision makers
Carefully balanced core CRM skill sets
Skill gaps identified and filled quickly

5. Introduction McKinsey Study
Processes
Customer-specific metrics and scorecards embedded into performance evaluations, incentives, and financial plans
Decision support automated
IT and business reengineered to ensure responsiveness to customer

6. The Human Factor Leadership Human Resource Capacity Start small
Customer centric
Across whole organization
Human Resource Capacity
CRM enablers
CRM users

7. The Human Factor Communication Cooperation
Solicit feedback before setting strategy
Feedback dimensions include financial, people, technology, value chain, competitive environment, and macroenvironmental forces
Develop “Phase” approach
Cooperation
Internal
External

8. The Human Factor People Knowledge base Skill gaps Role conflict
Customer selection
Maintain momentum

9. Organization Environment Culture
Indicators that may lead to a sub-optimal CRM initiative include:
Reward structure that favors adherence to hard nonflexible standards
Production orientated versus marketing orientated
Leadership from offshore entity
Executive leadership out-of-touch with customer

10. Organization Environment Culture
Indicators that may lead to a sub-optimal CRM initiative include:
Lack of empowerment
Predominately top-down decision making and information flow
Internal competitive work methodology and reward systems not aligned with CRM strategy

11. Organization Environment Size
Size is not a determinant of an organization’s potential CRM success.
Different sizes do create different advantages and disadvantages.
A large organization’s advantage can be a disadvantage for a small organization and its disadvantage an advantage for the smaller organization.

12. Organization Environment Size
Large organization advantages
Financial resources or access to those resources
Economies of scale with respect to technology and human resources
Potentially deeper levels of CRM expertise or easier access to that expertise
Technology and CRM consultative suppliers more ready available

13. Organization Environment Size
Large organization advantages
Large customer base can generate appropriate funding dollars
Large amount of customer and prospect data can enable more in-depth marketing intelligence

14. Organization Environment Size
Large organization disadvantages
Functional structure and silos
Large employee base increases complexity in CRM training and implementation
Customer and prospect data may have proliferated throughout the organization with no thoughts to a single view of the customer
Cost of creating a single accurate view may be prohibitive

15. Organization Environment Structure
Functional or “silo”
Can inhibit quick response
Adds complexity to CRM strategy
Product/Service or brand alignment
Good at collecting customer information relative to specific brand
May inhibit ability to create a holistic view across brands

16. Organization Environment Structure
Geographic structure challenges
Communication of CRM strategies and best practices throughout all customer interaction points
Timely and accurate dissemination of relative customer information from all interaction touch points; ability to process this information quickly with an accurate reverse information flow

17. Organization Environment Structure
Geographic structure challenges
Flexibility in changing CRM strategy to optimize specific geographic opportunities or adjust to geographic nuances, constraints, or opportunities
Integration of value chain members across geographic boundaries
Ability to sustain CRM momentum to decentralized employees

18. Organization Environment Structure
Geographic structure challenges
Adopt input from decentralized employees into best practices for same or different areas
Support organization entities for different time zone customers, including Internet and phone interactions

19. Organization Environment Structure
Account management
Heavy customer interaction
Extensive use of CRM-enabling software
Industry category
Impact on value chain
Matrix
Can be optimal for CRM
Structure around customer
Increase in complexity and cost the more fragmented the customer base

20. Organization Environment Technology
Integration across all areas is desired
Changes in technology solutions over time
Impact on current operations if changes made
Different licenses, leases, or contractual terms for the same or different OEMs
Organizational silo-based decisions

21. Organization Environment Technology
Budget constraints
Strategic and technical understanding and leadership
High skill level employee turnover
Resistance to frequent change of business process caused by rapid technology change
Merger and acquisition activity complicates the issues

22. Organization Environment Process
Hard versus soft standards
Staffing
Outsourcing functions
Cost constraints
Realistic assessment of required depth and breadth of desired customer relationship

23. Value Chain Organization
Business functions provided by different value chain members have increased in number and complexity
Rapid changes in technology create:
Pressure to adopt in effort to remain competitive
Dilemma, as rapid adoption creates challenges of coordination

24. Value Chain Organization
Changes to pull and push strategies need coordination throughout chain
Business function changes need to be coordinated with technology changes across the chain

25. Other Considerations
Knowledge management: The process of transferring captured information into knowledge that can be shared by respective parties within the organization or value chain in an effort to enable CRM efforts
CRM is a long-term strategy that requires a long-term investment strategy

26. Summary Category Stage 1 Stage 2 Stage 3 Stage 4 CRM Planning Limited
budget
Annual
planning within required budget
Planning part of corp. strategy
Value chain inclusion in corp. CRM planning
Market
Research
None
Focus groups, survey
Batch transact-ion analysis
Integrated analysis, including real-time activity

27. Summary Category Stage 1 Stage 2 Stage 3 Stage 4 CRM Orientation
Mass market
Segments
Custom-ization by segments
Custom-ization by individual
CRM Channel MGMT.
None
Basic internal SLA’s tied to CRM strategy
Basic external SLA’s tied to CRM strategy
Integrated CRM strategy tied to end cust. value proposition

28. Summary Category Stage1 Stage 2 Stage 3 Stage 4 Communica-tion
Disparate
Coordin-ated internally
Coordinated internally with external parameters
Channel- integrated dialogue with end customer
MKT
Organization
Sales orientat-ion
Sales and MKT
Org. coordination across all functions
Value chain member integration

29. Summary Category Stage 1 Stage 2 Stage 3 Stage 4
CRM methodology training
None
Sales and MKT
Cross organiza-tional
Value chain coordina-
tion
Employee recognition
None tied to CRM
Informal based on “at-a-boys”
Formal based on predefined metrics
Tied directly to internal and external customer
satisfaction and loyalty

30. Summary Category Stage 1 Stage 2 Stage 3 Stage 4 Customer relationship
None
Efficient complaint handling
Hard standards for customer interaction
Empower-ment with soft standards
Technology
Basic and disparate
Internal customer state-of-the-art
External customer state-of-the-art
Value chain integration