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Report: Ditch your five-year CRM plan

CIOs often like to draw a five-year roadmap for CRM success. Yet in its new report "Avoid the CRM planning trap," Boston-based Akibia Consulting is recommending a far more incremental approach. In a conversation with SearchCRM, president Adam Honig told us why going small and seeking tangible results is the best course of action.

Speaking to CRM end user companies, have you noticed companies re-tooling their plans?
Well, not exactly. What we've seen are companies that have spent a lot of money on CRM and reached a point where they want to optimize returns. We've been seeing companies that think they've collected a lot of good sample data and now they want to use that to their advantage around marketing or with customer service and cross selling. Specifically, we're advocating that people get rid of the five-year plan. Even though the world seems like a more stable place in terms of IT spending, companies shouldn't fall into the trap of trying to plan where they're going to be in five years. Things are going to change dramatically in the future, without a doubt. By planning too much with CRM, companies are going to find out down the road that they've lost time. Does this make it harder for CIOs to create a business case that they can pitch to management around CRM?
It does make it harder, but we'll all be better for it. So what would your advice be to a CIO in this role? How do you pitch a plan that makes sense business-wise but affords the kind of flexibility we're talking about?
When we look at any business case around CRM we look at several major elements and boil it down from there. We look at the growth opportunities, the cross selling and the revenue enhancement. We look at the efficiencies; how much time can you free up in your call center staff to handle new tasks? And we look at value from the perspective of customer experience, satisfaction and other ROI (return on investment) that's hard to quantify. The model that we use combines the growth and cost savings factors and uses the value proposition as a multiple of that. There will be many things that change in the day-to-day world, but if you have a plan that is balanced, it will help even out your CRM path. What is the biggest problem in the way companies typically approach their CRM plans?
Almost paradoxically, the important thing is to plan but not plan too much. This is a trap that we see companies falling into and, to be honest, we feel that many consultancies advocate over planning. It's very important to balance CRM planning activities with creating practical wins that are there for the business. That's what people need to watch out for right now. Is this "over planning" part of the market's reaction to failure rates with CRM and based on a perceived lack of appropriate planning in the past?
To be honest, there's been a drought of [CRM] planning, historically speaking. People have followed the Nike philosophy and tried to 'just do it' without significant preparation. I'd say that now is a good time for any firm to take a long hard look at what has worked for them and what hasn't. We've seen a lot more planning occur over the last year than we saw in the three years prior to that. But it's swung to an opposite extreme in some cases. The companies that are best at putting their plans together have been the ones that have demonstrated CRM success, even if in just in a small area. Now that they've gotten some experience and seen for themselves how it all works, it's not so hard for them to see the big picture and move ahead more confidently. Can you give us an example of this kind of planning?
We have a number of customers in the banking space. Instead of looking at big projects, they've looked at very specific cross selling within the customer service center. Provided that this goes well, they'll branch out and start selling other financial products in this manner, like moving customers from checking accounts to NOW accounts.

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On the flip side, as a CEO, how do you accept a plan from your CIO that perhaps isn't completely conclusive? How can these executives read between the lines?
Once again, the idea is to plan small. If you're a CEO and your CIO comes to you with a year-and-a-half program to get returns, you should ask them what they could do in six weeks. And then figure out how to use the experience gained in those six weeks to help put together a three-month plan. The more experience we have with something, the better we become at predicting how things will work out. Go small. Go gradual, and go for very tangible results.

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