EFFECTIVE CUSTOMER MANAGEMENT: Phase Two: During Project - How to Find the Perfect Relationship Partner

Marketing, June 12, 2003 | Go to article overview
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EFFECTIVE CUSTOMER MANAGEMENT: Phase Two: During Project - How to Find the Perfect Relationship Partner

Finding the right partner for a customer management project requires careful planning and research.

Two years ago Mark Butterfield, sales director of Granada Enterprises, began looking for a partner that could help his company better manage its long-term relationships with its two key customer groups - advertising agencies and suppliers. In total ignorance of the customer management market, he took what might be thought of as the eminently sensible step of going to the CRM Exhibition at Earls Court.

'I was pretty disappointed, to put it mildly,' says Butterfield. 'Ninety eight per cent of the exhibitors were trying to flog me software and showed not the slightest interest in my company or its particular issues.'

One of the two companies that did demonstrate an interest in helping Butterfield achieve his objectives was Round, a customer management strategy development firm. Not surprisingly, it won his business.

Paul Scott, director of Round, says: 'Understanding the capability of the whole business to be customer-centric is a pre-requisite for success.'

The market has moved on over the past two years, and as evidence continues to mount of the spectacular failure of many technology-led CRM solutions, most vendors and consultants at least pay lip service to the need for people, systems and processes to play as big a part in customer management as technology. They also preach the mantra of return on investment.

Proceed with caution

But suppliers and consultants proliferate, many of them bearing propositions designed specifically to rectify some of the problems that they caused in the first place with their heavy technology sell. As a result, any company seeking to improve its customer management needs to proceed with the utmost caution when engaging a partner and managing its relationship with them.

Mike Havard, managing director of CM Insight, a management consultancy specialising in contact centre and customer management, says that most relationships break down because clients don't understand what they need in the first place, and then don't specify the looked-for benefits in the contract.

'Companies typically need to cut costs, improve quality or manage risk, and being quite clear in their own minds about which imperative is driving them helps determine the kind of partner they need to work with,' explains Havard. 'The better the fit between the partner's expertise and the client's need, the greater the chances of success.'

What's more, Havard adds, too many companies rely on 'chemistry' when designing a contract and engagement structure. 'You should be taking a long-term view, and because neither you nor your opposite number in the supplier is likely to be around in four to seven years, you need to formalise the relationship and specify in detail the benefits you want to achieve,' says Havard.

Very large systems implementations are rare these days, as companies approach the customer management task in bite-sized chunks that encompass people and organisational change as well as technology, so there is less need to turn to a large systems supplier, such as Siebel, Oracle or IBM.

Such players still have a role to play - as do the large consultants such as Accenture and EDS - particularly in big organisations that may require fully tailored, highly configured packages along with manpower to get the systems and processes up and running.

However, Merlin Stone, IBM Professor of Business Transformation at the University of Surrey, says: 'While these firms can provide a total customer management solution, they are very expensive and you have to be prepared to railroad them through your business.'

But smaller companies - as well as many large organisations whose basic customer management processes are robust but might benefit from some automation or other tweaking - will find their needs more than met by smaller niche consultants and vendors.

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